Thank you, Mr. Chairman. I welcome the opportunity to discuss exchange rate policy and I appreciate that the Treasury Secretary and our other witnesses have come to testify before us today.
The issue of exchange rates and, in particular, currency manipulation is one that has a profound impact on my home state of Michigan, especially as it relates to the automotive sector. I am concerned that the Administration does not seem to be aggressively addressing this issue.
It is not a coincidence that the on-going weakening of the yen has occurred at the same time that Japanese automakers are experiencing record profits and American automakers are facing significant losses.
Indeed, recently, the weakened yen has effectively given Japanese automakers up to a 30% cost advantage over U.S. manufacturers.
On the floor of the Senate, we are beginning a discussion on promoting trade. Free and fair trade can be good for our country, but we must be outspoken about anti-competitive tools in the global marketplace. Currency manipulation is one of those anti-competitive tools.
Japan intervened in the currency market a staggering 11 times last September alone. This resulted in an 11% decline in the value of the yen against the dollar.
I understand that the Japanese face difficult economic challenges that create incentives for them to devalue their currency, but our government cannot stand idly by and watch our domestic manufacturers lose out.
Itís not fair to our domestic auto manufacturers who deserve to compete on a fair and level playing field. Itís not fair to our auto workers who will lose jobs due to this invisible tariff caused by currency manipulation. Indeed, Mr. Chairman, it is not fair to a whole number of industries who suffer unfairly.
I look forward to hearing from the Treasury Secretary today about what the Bush Administration is going to do about this problem and I also look forward to hearing the perspectives of our other witnesses.
Thank you, Mr. Chairman.