06/21/2010 03:54 pm ET Updated May 25, 2011

China's Currency Charade

You may have heard by now that China's Central Bank has said that it will begin to allow its currency, the yuan, to follow a more flexible exchange rate. So, can we all celebrate now? After all, many economists, American businesses, unions, lawmakers, Obama Administration officials, and other industrial countries have been demanding such a change for months now.

I'm here to report that the fight is just beginning.

China would like nothing more than pressure from American lawmakers to disappear after its big announcement. Just over the past two weeks, Senators and Members of Congress of both parties have raised serious concerns over China's currency policy and grilled the Obama Administration on their response.

China's currency will undoubtedly rise against the dollar, but the change may not be significant or fast enough to put a real dent in our enormous trade deficit or boost our exports enough to create a considerable number of manufacturing jobs. As I said over the weekend: "I will believe it when I see it. Unless the move is rapid and significant, China's announcement is nothing more than a cynical ploy ahead of the G-20 and in the wake of mounting congressional pressure. America's workers and businesses still believe that a strong response from Congress is warranted."

World leaders -- including President Obama and President Hu of China -- are scheduled to gather in Toronto on June 26-27 for the G-20 summit. We hope that President Obama sets out objective criteria to China instead of merely offering praise for the announcement. We hope that our leaders in Congress on this issue -- Senators like Chuck Schumer (D-NY), Debbie Stabenow (D-MI), Sherrod Brown (D-OH) and Representative Tim Ryan (D-OH) -- will push forward with their efforts to deter China from cheating on its currency now and in the future.

Leading economists estimate that the yuan is undervalued by up to 40 percent. So, unless we see a 40 percent increase in the value of the yuan compared to the dollar over the coming weeks and months, we still have work to do. And even if the yuan does appreciate that much, we must make sure that other barriers to trade and jobs -- China's dumping, subsidies, and lax labor and environmental regulations -- are addressed.

China may well surpass America as the world's leading manufacturer next year. Many Americans think we've already lost our lead. And millions of American manufacturing workers remain unemployed. Stopping China's currency manipulation is not the only challenge facing our manufacturing sector, but it is a prerequisite for progress.

America's workers and businesses are guaranteed a level playing field under our own trade laws, and in theory, under the World Trade Organization. We're not asking for special treatment, we just want the opportunity to compete.

So far, China's announcement has been nothing but hot air. The President must demand results in Toronto this weekend and Congress must proceed swiftly with a legislative response. Acting otherwise will fulfill every Chinese wish: to make our demands for change disappear. We can't let that happen.