Yuan blame game a distraction

As the November mid-term elections in the United States approach, the Democrats and the Republicans have both found a new villain to run against. "China emerges as a scapegoat in campaign ads," as The New York Times recently put it.

The China blame game is taking place amid escalating trade tensions. As the US puts pressure on China to allow its currency to increase in value, the rising euro and yen have led the European Union (EU) and Japan to join the chorus. The charges are not new, but the tone has escalated steadily since early summer, when the prospects of the Democrats' loss in the mid-term elections became evident.

Due to economic stagnation, political polarization and unemployment in the advanced world, the yuan has become a convenient scapegoat. Yet the very concept of "currency manipulation" is flawed. Today, all governments take measures that affect the exchange rates directly or indirectly.