CHINA'S CURRENC??Y MANIPULATION: A Policy Debate

In the year 2001, under the banner of a policy of engagement dating back to the Nixon era, China joined the World Trade Organization with the strong support of a Democratic president and a Republican-controlled Congress. Before the ink was dry on this free-trade agreement, Beijing began flooding American markets with illegally subsidized exports while the big multinational companies that had lobbied heavily for the agreement rapidly accelerated the off-shoring of American factories and jobs to China. Today, the US owes more than three trillion dollars to the world's largest communist nation; more than fifty thousand American factories have disappeared. Still a third major weapon of job destruction wielded by China's largely state-owned enterprises is that of blatant counterfeiting and piracy. As economist Ian Fletcher explains, it's not just about pirating Hollywood movies anymore: What's more important is the theft of the blueprints for high technologies. Rounding out China's mercantilist advantages are some of the laxest environmental and worker health and safety standards in the world.