- - Friday, November 13, 2015

ANALYSIS/OPINION:

For years, China has devalued its currency in order to manipulate both the Chinese economy as well as the global economy.

By devaluing its currency, China has caused its exports to become cheaper for other nations and has enabled itself to undercut its competitors.

China’s actions have also affected the price of imports from other countries, causing them to become more expensive.

These high-priced imports have made it hard for other nations to compete in China, which has ultimately stimulated business for local Chinese companies and negatively impacted countries like the United States of America.

In fact, there has been a dramatic increase in trade imbalance between China and the U.S. for the last 15 years.

In 2001, the U.S. imported approximately $102 billion from China and exported about $19 billion, leaving a trade deficit of about $83 billion, which at the time was extremely alarming when compared to the 1985 deficit of just $6 million.

Unfortunately, the trade deficit rise did not stop there.

In fact, it rose almost every single year since 2001, resulting in a trade deficit of over $343 billion at the end of 2014.

And 2015 has proven to be no better, with about $357 billion in imports from China calculated at the end of September and only $83 billion in exports, leaving an over $273 billion trade deficit with three months remaining in the year.

Furthermore, China’s currency manipulation has had a serious negative impact on the American workforce.

The Economic Policy Institute estimated the cost in American jobs of the Chinese currency devaluation to be 3.2 million between 2001 and 2013.

Others have estimated this number to be even higher.

And with fewer Americans working, the U.S. government generates less income tax revenue and is forced to payout higher amounts to help the unemployed, both of which worsen the already ridiculously high U.S. debt.

It is clear that America has suffered alarming consequences as a result of China’s currency manipulation and will continue to stomach these costs if something is not done to stop China from continuing to devalue its currency.

It’s time for America to wake up and fight back against China to lower the trade deficit and save American jobs and businesses.

Madison Gesiotto is a staff editor for the Ohio State Journal of Criminal Law.

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