Dems blame trade deal as Ford exits Japan

[eridani]

http://thehill.com/policy/finance/266981-top-senate-dem-blames-fords-exit-from-japan-on-tpp

Two congressional Democrats on Monday blamed Ford Motor Co.'s exit from Japan on the lack of currency manipulation provisions in a sweeping Asia-Pacific trade deal.Sen. Sherrod Brown (D-Ohio) and Rep. Debbie Dingell (D-Mich.), who are both opposed to the 12-nation Trans-Pacific Partnership (TPP) that includes Japan, said the agreement doesn't crack down on exchange rate policies or remove barriers to Tokyo's auto industry that would help U.S. manufacturers.

“The TPP’s lack of any meaningful currency protections means that it will be more of the same.” We need our government to fight for companies in the global marketplace in the same manner as some other countries do. This business decision by Ford is further evidence of the impact of unfair currency manipulation.”

"The ink isn’t even dry and we are already seeing proof that this massive agreement will sell out American workers and roll back the remarkable recovery of our auto industry," Brown said.Dingel said that "this business decision by Ford is further evidence of the impact of unfair currency manipulation.”

"Until our trade agreements meaningfully address currency manipulation, the mother of all trade barriers, American companies will continue to be threatened and disadvantaged by foreign governments who attempt to tilt the global playing field in favor of their industries and against the United States," Dingell said.

[pampango]

1. I wonder why the TPP does not include arbitration panels to address currency manipulation?

It has arbitration panels to resolve a host of other contentious issues, but not currency values.

Currency manipulation plan gets key endorsement

A currency manipulation plan connected to a far-reaching Pacific Rim trade pact received a key endorsement from the architects of a widely cited proposal to crack down on the practice.

Several leaders at the Peterson Institute for International Economics, who developed a framework for deterring currency manipulation that was embraced by a majority in Congress — said the side agreement to the Trans-Pacific Partnership (TPP) meets the standard set in the trade promotion authority (TPA) law passed by Congress and should strengthen the Treasury Department’s ability to stop the practice.

President Obama argued that adding currency rules into the TPP would be too complicated and could torpedo a final deal.

Fabio Ghironi, a professor of economics at the University of Washington, tweeted that there is a "very important novelty in a trade agreement: TPP, exchange rate policy, and macro cooperation." But the endorsement hasn’t quelled concerns of some lawmakers and firms that have deemed currency their top problem with global trade.

http://thehill.com/policy/finance/259756-tpp-currency-side-deal-gets-key-endorsement

FDR created an enforceable international agreement that provided for multilateral control of currency values. Nixon destroyed it. I don't see why we cannot do that again.

The main terms of this agreement were:

Formation of the IMF and the IBRD, which is today part of the World Bank.
Adjustably pegged foreign exchange market rate system: The exchange rates were fixed, with the provision of changing them if necessary.
Currencies were required to be convertible for trade related and other current account transactions. The governments, however, had the power to regulate ostentatious capital flows.
As it was possible that exchange rates thus established might not be favourable to a country's balance of payments position, the governments had the power to revise them by up to 10%.
All member countries were required to subscribe to the IMF's capital.

https://en.wikipedia.org/wiki/Bretton_Woods_Conference

[Vinca]

2. It's like another nail in the coffin of U.S. manufacturing.

I'll never understand why the POTUS thinks this is so wonderful.

[n2doc]

3. And another

http://www.foxnews.com/world/2016/01/21/gm-cadillac-opens-china-factory-to-target-luxury-market.html