Devoted to Managers and those that seek to improve their management skills

The obsession by Congress with the growing trade surplus and China's rate of currency appreciation shows their lack of understanding about what's really going on.

The reason they keep attacking these two elements are because the overall American public understands the two things in general.

But when you look at the ignorant move by the  Senate Finance Committee in approving legislation that would force China to appreciate their currency faster, by allowing companies in the U.S. to seek anti-dumping duties in response to the alleged undervalued currency, you see their misguided efforts potentially hurting a lot of American consumers.

What these politicians don't understand is the increase of the Chinese currency means price inflation for American consumers and other consumers around the world.

Essentially they're wanting to add a hidden tax to low and middle class Americans who rely on Chinese imports for a lot of their wants and needs. Congress wants China to raise the currency price by up to 40%, even though the Chinese currency has risen by 5% over the last year.

The point is people in America are voting for Chinese imports with their dollars. For Congress to say they don't like it is to reject free markets. They ignorantly want to increase the cost of consumer goods by a huge amount. They won't think they're the heroes they're trying to potray themselves as being when the American public catches on.

U.S. Treasury Secretary Henry Paulson responded to Congressional claims he is too soft on China saying, "We are getting results through this process that wouldn't have been achieved without it. The Chinese currency's "rate of appreciation has gone up materially over the past year." 

Paulson added that a sovereign nation like China isn't going to respond to threats any more than the U.S. would from other countries.

"There's a lot of concern around the world about the pace of China's economic development and the perceived threat that represents to a lot of economies," Paulson said. "A lot of that is misplaced. The biggest concern is if China had a major shock or problem. The greatest risk is if they move too slowly."

Paulson said in a recent interview that his strategy is to continue showing the Chinese leaders that opening their markets more and having a more fexible exchange rate is in their interests.

In response to opening their markets, Chinese officials said in May they will open up their travel to more U.S. flights and allow international banks to issue yuan-denominated credit cars.

Most of the attacks by a malinformed American congress have come from politics as usual and fear. But one thing Paulson could be doing better, as Arthur Kroeber, managing director of Dragonomics Research & Advisory in Beijing, said, is to be managing expectations better in Washington and develop measurable goals he could bring back from Beijing to tout as victories.

Even so, many in Congress refuse to be patient and work at gradually getting changes. They don't want anything but immediate results; a sure sign of weakness by them. The best thing they could do is just shut up about it. They don't understand economics in our own country, let alone China. They need to listen to their Treasury Secretary who understands the Chinese and their market, and allow him to lead them in the best way to work it out.

To try to force them to raise their currency by the 40% would devastate a lot of American consumers.