The Trans-Pacific Partnership does not address a key driver of the job-sapping trade deficits the United States has with some of its trading partners, currency manipulation, says trade expert Pat Mulloy in this Burning Issues video.
Currency manipulation occurs when a government artificially lowers the value of its currency against the dollar so that its exports are relatively cheaper. It is a key reason so much of the United States manufacturing capacity, and the jobs that go with that capacity, have ended up overseas, where corporations can take advantage of not only the lower labor costs but the more favorable currency exchange rates.
“The TPP does not even address this problem,” he says. One of the 12 countries that would be covered by the TPP, Japan, “is a currency manipulator,” Mulloy says, as is South Korea, Taiwan, India – and, most consequentially, China.
Mulloy, who has served on the U.S.-China Economic and Security Review Commission and was a former assistant secretary in the International Trade Administration, says that Democratic presidential candidate Bernie Sanders has been a leading voice on this issue, but he adds that he is “heartened that the people are getting affirmation” from all of the leading presidential candidates “that this is an important issue if we are going to restore prosperity and rebuild our middle class in this country.”