–Retransmitting Story Published 12:37 ET Thursday
–Treasury Secretary Does Not Try To Quiet Hill Criticisms of China
–Geithner: ‘Haven’t Decided Yet’ When Will Release Forex Report
–Geithner: Forex Report Will Be Released At ‘That Right Moment’
–Senate Finance Panel Members Voice Anger Over China’s Currency Policy
By John Shaw
WASHINGTON (MNI) – In recent years, there have been times when U.S.
Treasury secretaries have tried to ease congressional concerns over
China’s currency policy, saying in effect that reforms are coming soon.
And there have been times when Treasury secretaries have said to
Congress, in effect, that progress is stalled and that Congress can go
ahead and put as much verbal pressure on China as it can muster.
In his testimony to the Senate Finance Committee Thursday, current
Treasury Secretary Timothy Geithner appeared to signal that he would not
be unhappy if Congress ratchets up its rhetorical criticisms of China,
but pointedly did not embrace any legislation that could sharply
increase economic tensions between the two nations.
During a three hour hearing, Geithner said repeatedly that Chinese
officials have said they understand the need for currency reforms, but
have not yet moved in a way that is acceptable.
Geithner said Chinese officials have indicated that reforms are
coming but their actions show “they haven’t decided when they will do
it.”
When several senators threatened to move forward with
currency-related legislation directed at China, Geithner said he
understood the “broad bipartisan support” for some action against China.
Geithner declined to say when he will release the international
economic and foreign exchange report that was due April 15.
He said the report will be released “at that right moment.”
When pressed, he said “I haven’t decided yet,” but added he will
“take some stock” after the G-20 meeting in Toronto is concluded.
Geithner said the administration is trying to persuade China to
“move as quickly as possible” on currency reform and is seeking to build
a broad international coalition to make this case to China.
But he acknowledged that he is not certain what Chinese officials
are planning to do.
“I do not know if we are at the point now where we will see
meaningful progress in the short-term,” Geithner said,
A number of members of the Finance Committee made it clear they
have lost patience with China’s actions on currency reform.
Senate Finance Committee Chairman Max Baucus said that while he
believes the U.S. “must work multilaterally” on Chinese currency reform,
the nation “must be willing to take the lead.”
Sen. Chuck Grassley, the ranking Republican on the Finance
Committee, said the administration should say openly and clearly that
China is manipulating its currency.
Sen. Olympia Snowe said there is mounting frustration in Congress
with China’s currency practices, adding that previous indications from
the Bush and Obama administrations that Chinese currency reforms are
coming have not proven accurate.
“Essentially we have the status quo,” she said.
“Beyond soothing words what can we expect?” Snowe asked.
Sen. Chuck Schumer said he said he is determined to press ahead
with a currency bill in the coming weeks and predicted it would attract
strong support.
Geithner said he understood there is “very broad bipartisan
support” in Congress for pressing China on currency reform, but did not
endorse the effort that Schumer is leading.
In other matters, Geithner said there are many indications that the
American economy is strengthening, but said the administration is not
complacent about the recovery.
“We have a long way to go,” he said.
Geithner said that as the American economy picks up speed and the
recovery takes hold, it will be necessary to tackle the nation’s large
budget deficits.
“The fiscal position of the U.S. is unsustainable,” Geithner said,
adding the U.S. should “bring the deficit down as the economy recovers.”
** Market News International Washington Bureau: (202) 371-2121 **
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