American Protectionism and the China Currency Bill – Opinion Piece

Protectionist policies geared towards a war on terror in the US have quickly shifted their interests towards financial security and have left the metropolitan and globalized citizens of the world in a state of dismay.  The notion that sovereignty is in jeopardy and that transnational corporations (TNCs) and non-state actors really do have a stronghold on foreign policy in the US is easily called into doubt when one reads about the Senate’s latest China Currency Bill.  This bill, which was recently approved in a 63 to 35 vote in the senate, seeks to appreciate China’s currency as a means to correct an unfair competitive advantage.  Some argue that by building a fair trading ground with respect to currency, China’s products will become more expensive and in turn make it so that domestic US production becomes the cheaper alternative for Americans.

While this effort to appreciate China’s currency may provide benefits to smaller domestic corporations, it goes against how TNCs and larger international corporations do business. From a global political level, the China Currency Bill not only attacks the values of TNCs but also the rules of non-state actors such as World Trade Organization (WTO).  We don’t see the United States proposing the China Currency Bill to the World Trade Organization (WTO) due to the fact that the WTO does not recognise currency undervaluation.

On a broader note, the China Currency Bill helps to highlight a very relevant shift towards protectionist policies in the US that has visibly increased since 9/11.  This shift can be seen in the state led publicity that began with a war on terror and followed in a protection from the now more popular issues confronting Americans surrounding financial security.  However, the fact that the US has become more protectionists not only has dramatic implications domestically but from a global perspective as well. The United States is specifically fighting to be economically sound by building up walls instead of defending itself through the free market systems that it has promoted internationally.  This leads me to believe that globalization, to a certain degree, is nothing more than a tool that countries use in order to further their own self-interested ideals rather than that of a global interest.

When it is in a state’s interest to develop its global ties, the state embraces global values.  When it threatens its security, much like the way that China is doing towards the US, it protects itself.  This seemingly natural reaction is what seems to be happening in the US, for better or worse.

Ricardo Khayatte

Ricardo Khayatte

Editor-in-Chief