Congress heads into the Easter recess this week with one big piece of business – healthcare reform – largely out of the way. But when it returns, it will have to face one of the smouldering issues of recent years, which threatens again to burst into flames.
China's fixed exchange rate against the US dollar continues to be blamed by a large majority of US lawmakers for helping to create global economic imbalances and stealing jobs from US industries, notably manufacturing.
A House of Representatives ways and means committee hearing last week examined the tools at Washington's disposal to lever the renminbi off its peg. They were less drastic than earlier plans to simply slap an across-the-board import tariff on Chinese goods to compensate for the alleged undervaluation – or a less radical version, to incorporate estimates of currency undervaluation in the calculation of anti-subsidy duties imposed on Chinese imports. But none was free of either legal or political problems, or invulnerable to the charge it would end up in impotent jawboning.