Economy

Commentary: Manipulating the yuan debate dangerous game

(Xinhua)
Updated: 2010-06-13 15:56

BEIJING - Some members of the US congress are playing a dangerous game by manipulating the Chinese yuan debate for domestic political gains.

These congressmen, prompted by a need to appease American workers frustrated by the loss of millions of jobs in the global financial crisis, and to woo constituencies in elections to be held later this year, are resorting to their old trick of blaming everything on China.

They claim China's foreign exchange policy is costing America jobs and threaten to impose tough trade sanctions against Chinese imports.

Related readings:  US attacks China's currency stance  China signs 3.5b yuan currency swap agreement with Iceland  China, US reach consensus on currency rate reform  US unlikely to push China hard on currency issue

But they choose to ignore the fact that an appreciating yuan cannot rebalance Sino-US trade or help create jobs for American workers. Both trade imbalance and high unemployment are deep-rooted economic problems that can only be addressed when the United States implements some painful yet necessary structural reforms.

These congressmen claim they are the white knights defending the interest of the American people, but in fact, they are nothing more than a bunch of baby-kissing politicians trying to swing voters by manipulating the yuan debate.

They only served to divert the public attention from the much more serious domestic economic problems, which are caused in part by their incompetence.

It is really dangerous that these irresponsible remarks, played up by some sensational US media outlets, will inevitably mislead the American public, and poison the atmosphere of Sino-US economic cooperation.

The fact is that China now serves as the third-largest export market for American goods and it will probably become the biggest one sooner than expected. A growing Chinese economy has brought substantial benefits to American workers.

When they are manipulating the yuan debate,these American politicians may make some short-term political gains, but they put the long-term Sino-US bilateral relations in jeopardy.

Another dangerous development is that these politicians, in their self-claimed role of staunch defender of American interest, are pressing the US government to take a more radical yet devastating stance on the issue of the yuan's exchange rate, thus greatly narrowing the Obama administration's policy options.

At a recent senate hearing, American Treasury Secretary Timothy Geithner was grilled by a group of politicians, but ironically some of them even didn't bother to remember the name of the Strategic and Economic Dialogue,a high level Sino-US forum on major strategic and economic issues concerning the two nations.

US government leaders have said they respect China's sovereignty when it comes to the foreign exchange policy and they will seek to resolve the issue through dialogue and cooperation.

But some congressmen are clamoring for confrontation with China. It takes real courage and vision to resist their pressure, especially when they claim they are the real protectors of the US interest and seriously believe they stand on a moral high ground.

China and the United States are committed to building a positive, cooperative and comprehensive relationship for the 21st century. The relationship is increasingly of global significance when the two countries cooperate extensively on wide-ranging global issues.

The currency issue is just part of this rich and complex relationship. It is the common responsibility of the two governments to offer the two peoples the real facts and rein in the behavior of those congressmen in case they overplay the dangerous blame-everything-on-China game and derail this generally constructive relationship.