Election observers searching for policy differences on international trade-related issues between President Obama and presumptive Republican nominee Mitt Romney need look no further than currency manipulation by China.
During the Obama presidency, the U.S. Department of the Treasury has declined to identify China as a currency manipulator in its semi-annual report to Congress on international economic and exchange rate policies, despite a finding in the most recent report that China’s exchange rate “exhibited persistent and substantial undervaluation” over the past decade. In addition, Commerce has declined to initiate investigations of currency undervaluation in China CVD investigations, which has precluded U.S. manufacturers from seeking import relief through the imposition of countervailing duties on imports on that basis.
In contrast, Mitt Romney vows to take a tougher stance on China currency issues. For example, Mr. Romney has stated that he will issue an executive order on his first day in office that identifies China as a currency manipulator. Mr. Romney has also stated that, as president, he would permit the application of the countervailing duty law to currency undervaluation by China. Mr. Romney has taken these positions despite opposition by senior Republican officials in Congress, including House Speaker John Boehner.
This policy difference presents an interesting backdrop to the 2012 presidential campaign in both “Red” and “Blue” states that continue to face job losses and plant closures due to the U.S.-China trade relationship.