‘The Renminbi Is Failing the Chinese People’

U.S. government officials have long complained that China’s currency, the renminbi (RMB), is undervalued. In April 2010, Rep. Daniel Lipinski (D-IL) accused China of keeping its money cheap in order to make exports attractive, and thus "steal jobs" from the United States. During the 2012 U.S. presidential campaign, Republican candidate Mitt Romney repeatedly complained that China was manipulating the value of its currency. But as the RMB has appreciated — from roughly 6.8 to the dollar in 2010 to 6.09 today — the issue has dropped from most U.S. agendas. Now, some of those Chinese "job stealers" are the ones grousing about the "redback."

During the Third Plenum, an important Communist Party meeting held in mid-November, China’s state-run China Central Television interviewed Beijing residents about the conclave. CCTV generally tries to imbue important political events with a positive glow. But when a CCTV journalist asked a young man what he thought needed to be changed in China; he responded, "The RMB is failing the Chinese people." The station didn’t censor the comment from its taped program, and the clip went viral on the Chinese web, with more than 240,000 views on the online news portal Ifeng. A search for the phrase "The RMB is failing the Chinese people" returned more than 820,000 recent results on Sina Weibo, China’s Twitter; most of the responses sampled by FP criticized government policy.

In one widely-shared post, Weibo user Xu Shaolin, who frequently comments on finance matters, complained to his 357,000 followers, "U.S. consumers buy cheap goods produced in China, but the Chinese government takes away the dollars" to buy U.S. bonds. This leaves Chinese people "with more and more RMB that is worth less and less." Other Weibo posts under the same hashtag lament everything from the price of housing to the price of pigs’ feet, a popular Chinese snack.

Yes, netizens oversimplify the complicated relationship between the value of the RMB and the quality of their daily life. But that doesn’t mean their complaints are specious. Housing prices, for instance, continue to reach record highs — the cost of a new home in China jumped 9.6 percent year on year in October — while food prices are rising the fastest they have since May 2012. By ensuring an oversupply of RMB, one user wrote, the government is lowering the currencies’ value and "stealing money from people’s pockets." Though it may not be what Romney had in mind, that’s what "currency manipulation" means to some Chinese.