America’s manufacturing sector has struggled over the past 20 years. Five million manufacturing jobs have been lost in that time, and Wisconsin has been particularly impacted, losing roughly 100,000 good-paying factory jobs.
My family’s steel company has been in business for more than 90 years. We have operations in seven states, including two facilities in Wisconsin. We’ve weathered this downturn, even as it has hit many other U.S manufacturers, and we’ve withstood predatory trade from countries like China that continually game the global trading system to their advantage.
In recent years, one problem has risen to the top of the list of challenges facing my company and thousands of others just like us. The U.S. dollar has become increasingly overvalued. That makes our steel products — and indeed all goods produced by U.S. manufacturers — progressively more expensive when we try to sell them overseas. And if that’s not bad enough, it’s also making imported steel and other products extra cheap when they enter the United States.
For years, the chief problem we faced was currency manipulation by China and other countries. Our competitors intervened in global markets to weaken their currencies against the dollar. That made their exports cheaper in the United States while raising the cost of American-made goods. This currency manipulation is a key reason why America’s trade deficit has climbed so dramatically, doubling from $436 billion in 2000 to $875 billion last year.
In recent years, countries have started to relax their currency interventions. But the truth is, they no longer need to keep undervaluing their currencies. Instead, overseas investors are now doing the work for them. A flood of global capital is continually pouring into America’s financial markets, with foreign investors buying up stocks, bonds and other Wall Street assets. This creates huge demand for the dollar, and continually raises its value. As a result, my company’s steel — along with the goods made by all U.S. producers — keeps getting more and more overpriced, through no fault of our own.
Wisconsin’s farmers are feeling the impact, too. An overvalued dollar is also raising the price of their milk, corn, cattle, potatoes, soybeans and other agricultural products when they try to sell them overseas.
America’s domestic producers urgently need action on this issue. Thankfully, Wisconsin’s U.S. Sen. Tammy Baldwin, D-Madison, has just partnered with Sen. Josh Hawley, R-Mo., to introduce a new, bipartisan bill intended to rebalance the dollar and once again make American-made goods competitive.
Their legislation would empower the Federal Reserve to pursue balanced trade by managing the value of the dollar. Instead of using tariffs, the Fed would begin to impose a fee on incoming foreign capital. Slowing this flood of excess capital could gradually reduce demand for the dollar. And that could help to bring the dollar back to a level that would once again make U.S. exports globally competitive.
The legislation sponsored by Sens. Baldwin and Hawley is particularly encouraging because it’s bipartisan. Americans are often divided politically, but the struggles faced by our manufactures and farmers should be a pressing national concern. If we want to rebuild the U.S. economy and create good-paying, middle-class jobs, we need to restore the competitiveness of our industries.
The Baldwin/Hawley bill is a common sense step in that direction at precisely the time when Americans are looking for solutions. Their legislation offers a sensible plan to help get our economy moving again.