Categorized | Currency, Politics

Hatch Seeks Currency Provisions In TPP, Future Trade Deals To Guard Against Manipulation

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Hatch Seeks Currency Provisions In TPP, Future Trade Deals To Guard Against Manipulation

World Trade Online  |   February 6, 2012

Senate Finance Committee Ranking Member Orrin Hatch (R-UT) has asked the Obama administration for its views on including a provision guarding against misaligned currencies in the Trans-Pacific Partnership (TPP) and future trade agreements.

“Addressing currency manipulation in the TPP becomes particularly important as the Administration considers the possibility of new TPP participants, such as Japan, who have demonstrated a pattern of currency interventions,” Hatch said in a Jan. 18 letter to Treasury Secretary Timothy Geithner and U.S. Trade Representative Ron Kirk.

Hatch noted that “many stakeholders” consider currency manipulation a key policy issue impacting trade and U.S. competitiveness in the global economy. He said these stakeholders believe the issue must be addressed in trade negotiations, particularly the TPP, which is designed to address “21st century” international trade issues.

The letter mentioned the TPP currency provision as the third of three key issues on which Hatch is demanding a response from the administration.

The first is obtaining a clear administration position on S. 1619, a currency bill the Senate passed in October 2011. Hatch pointed out that he offered an amendment to that bill that would have directed the administration to work within the World Trade Organization and the International Monetary Fund to develop “effective rules and remedies” to mitigate the adverse trade and economic effects of fundamentally misaligned currencies.

The second is to get a summary of the administration’s positions on the relationship between trade and currency policies that will be presented at a World Trade Organization seminar on trade and currency policies


2 Responses to “Hatch Seeks Currency Provisions In TPP, Future Trade Deals To Guard Against Manipulation”

  1. Hugh J Campbell Jr CPA says:

    The horse is out of the barn and Orrin Hatch (R-UT) wants the Administration to apply a remedy only going forward. Currency manipulation via keeping the U.S. Dollar over-valued, need only be practices aggressively by ONE trading partner to adversely affect ALL U.S. Trade.

    Hatch’s proposal indicates a lack of understanding regarding the innovative currency manipulation currently being practiced and it’s an anti-systemic solution to a systemic problem.

    Ann Lee, the author of, “What the U.S. Can Learn from China: An Open-Minded Guide to Treating Our Greatest Competitor as Our Greatest Teacher”, during her current book tour has addressed China’s position on currency with the following:

    “Deregulation of China’s currency is merely another way of saying, ‘Let the foreign exchange traders have the power to manipulate the value of the currency to their ends.”

    The corollary to the above can be found among the 10 most popular Kindle version highlights from, the preface of the book, “Red Capitalism: The Fragile Financial Foundation of China’s Extraordinary Rise”, which is likely the REAL REASON China is against deregulating its currency, it follows:

    “China’s financial system is designed so that no one is able to take a position opposite to that of the government”

    American CAN LEARN FROM CHINA and adopt a model designed so that no trading partner is able to take a position opposite the aim of Optimal Comparative Advantage. Such is a Balanced Trade Model, with import VATs for countries that feel no need for cooperative trade agreements and Balanced Trade Agreements (BTAs) for those that genuinely want embrace the aim of Optimal Comparative Advantage.

  2. Rich says:

    Senator Hatch has gone sharply right since his colleague was ousted in 2010 for not being Conservative enough. The truth is Hatch isn’t a Fiscal Conservative. He’s got 17 debt raising votes under him, equally 7.6 trillion dollars. He voted for TARP, the Bank Bailouts, and many individual mandates.


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