Pressure on China

Rep. Tim Ryan (D-Ohio) and other members of Congress are pressing the administration to take a firmer stand with China on its currency policies.

Ryan said he was disappointed with the recent determination by the Treasury Department that China is not manipulating its currency. This is the second time Obama’s Treasury has made the finding.

“It was a ridiculous analysis when Bush did it and it’s even more ridiculous now,” Ryan said in an interview. He’s circulating a letter to other members of Congress reflecting their disappointment.

Ryan’s legislation punishing China for devaluing its currency has gained little momentum in this Congress, even though criticism of China’s currency policy has increased in recent weeks.

China pegs the value of its currency to the dollar, meaning both have lost value during the dollar’s drop over the past several months.

This has led to new charges that China’s policy is undermining the world economy. Ryan worries about cheap imports from China, driven down by the value of China’s currency.

Steel companies have asked Obama administration officials to raise the issue during Cabinet-level trade and commerce talks with China that begin Wednesday in Hangzhou.

And in a move that Ryan believes will bolster the cause, Nobel Prize-winning economist Paul Krugman criticized Treasury’s recent report.

Krugman wrote in his New York Times column that China was stealing jobs from other countries and that its policy was particularly indefensible as its economy grows amid a worldwide recession.

Lobbyists backing Ryan’s bill say they haven’t undertaken a hard push for it given the crowded congressional agenda. In that environment, the Fair Currency Coalition decided “it didn’t make sense to push hard,” said Charlie Blum, the group’s executive director.

Ryan said the healthcare debate has made it difficult to move forward, but he expects more attention to be paid to the issue as soon as healthcare is finished.

He also thinks it will be easier to move the legislation forward as the economy shows signs of improving. The Commerce Department on Thursday is expected to report that the economy grew in the third quarter.