Is China Cheating?
Foul play! How else, says the US, could China undercut American producers in so many areas?
For decades America seemed to dominate manufacturing, so US officials focused on liberalizing trade in manufactured goods. They put little effort into creating a level playing field for farmers, since they knew America couldn't compete in agriculture.
Now, China is out-competing everyone, racking up huge trade surpluses with the US. So America's Treasury Secretary accuses China of deliberately keepings its exchange rate low, and calls for China to let market forces determine the value of the reminbi. The IMF's departing Chief Economist, Ken Rogoff, warns that the surpluses put global stability at risk.