Chinese currency - not the bargain we're looking for (Sen. Debbie Stabenow)

For 109 years, people in Muskegon, Michigan have been making paper – until last year. The Sappi Fine Paper North America mill shut down in 2009 and 190 workers lost their jobs. Mark Evans, a Sappi employee, said "The [Asian companies] can sell the paper cheaper than we can make it. This is foreign competition killing the American worker again".

Mark was half-right. It's not competition that is killing the American worker – it's cheating.

Some people argue that it really is just fair competition. If only Americans would accept lower wages, dangerous working conditions, and non-existent environmental standards, maybe Mark's plant could have stayed open. But I don’t call giving massive industrial subsidies, stealing American companies' intellectual property, and manipulating your currency a "comparative advantage". I call it what it is – cheating.

American workers can compete with anyone when the rules are enforced and the playing field is level. But when the other side cheats, American workers don't even have a chance.

The Chinese government knows this. That's why they've hired some very clever economists to implement a strategy of currency manipulation to keep their prices low and drive Americans out of business. It works like this: they buy American dollars and dump their currency on the market to keep the price down. Experts estimate that China's currency is valued at 40% less than it should be.

That means when you see a bargain at the store for a product made in China the price is artificially 40% lower than what it should be. It also means that someone like Mark probably lost his job so you could save 40% on your purchase.

Why do we let them get away with it?  Because some people are afraid that China will sell off their American debt to punish us. But if China sold off American debt they would cause massive upheaval and devastation in their own economy. Now is our chance to level the playing field and protect American jobs.

The Treasury Department is required by law to report twice a year on countries that manipulate their currencies. During his confirmation hearings Treasury Secretary Timothy Geithner said, "President Obama – backed by the conclusions of a broad range of economists – believes that China is manipulating its currency." But so far Treasury has not listed China as a currency manipulator. They will have another chance to do the right thing on April 15.

But American workers can't keep waiting. Senator Chuck Schumer and I both had bills addressing this issue, but from different angles. We merged our bills and yesterday announced the Currency Exchange Rate Oversight Reform Act of 2010. The bill has strong bipartisan support. We are ready to move forward and call out the Chinese government on its unfair currency manipulation.

Our new bill requires real action in two ways. First, it requires Treasury to act when it sees that a currency is being undervalued as a result of clear government policies that interfere with the currency market. Also, it requires Commerce to act when an American company complains that Chinese products get a subsidy or because manipulated currency results in prices that are artificially low.

China's unfair currency manipulation might keep prices down, but it's costing American workers their jobs and slowing down our ability to get out of this recession. For our workers, businesses, and the future of our economy it’s time to make China play by the rules.