Stabenow, Finance Committee Pass Historic Bill Combating Currency Manipulation

Press Release

Bill addresses unfair trade practices that cost Michigan jobs

U.S. Senator Debbie Stabenow (D-MI), along with the other members of the Senate Committee on Finance, today approved the Currency Exchange Rate Oversight Reform Act of 2007. This historic legislation for the first time addresses the unfair trade practice of currency manipulation, practiced by countries like China that artificially lowers prices of goods made in those countries.

"As someone who has been fighting to bring currency legislation to the forefront for some time, I am pleased that this bill finally identifies that there is a currency problem that must be dealt with," said Stabenow. "It finally shows that this Congress is not going to stand by and watch as American businesses are forced into bankruptcy because of unfair trade practices."

The practice of currency manipulation adds up to unfair trade subsidies for foreign businesses. For example, the same good, manufactured with the same materials has a 40% price advantage when produced in China than when produced in Michigan, solely because of currency manipulation.

"Our American businesses can compete with anyone in the world when the playing field is level," said Stabenow. "Companies and workers in Michigan and throughout America are counting on us to hold cheating countries accountable. Today, we make an important step in that direction."

The legislation increases administration disclosure and provides guidelines for determining currency misalignment. The bill removes the need to prove "intent" as a requirement for currency manipulation, requiring the Department of Treasury to consider specific factors for determining currency misalignment and to share more information about their process in determining currency misalignment.

The Currency Exchange Rate Oversight Reform Act of 2007 will now go to the Senate for a full vote. Earlier this year, Sen. Stabenow introduced the Fair Currency Act of 2007 that would provide U.S. manufacturers with the legal means to fight back against those companies whose governments manipulate their currency.

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