One of the themes that Governor Romney has been hitting at aggressively in his campaign ads is that he will get tough on China. The ads complain that China is a cheater, most importantly by "manipulating" the value of its currency. This means that China has been deliberately keeping down the value of its currency against the dollar.

A lower value for the yuan, which means a higher valued dollar, makes Chinese goods cheaper for people in the United States. It is the same thing as if China were to subsidise its exports to the US. On the other side, the over-valuation of the dollar makes our goods more expensive to people in China, meaning that they will buy less of them. It is comparable to putting a tariff on US exports to China.

Romney promises to be the tough guy who will reverse this situation. His ads claim that he will declare China to be a currency manipulator and take retaliatory measures

If a president were to demand that China raise the value of its currency, they would not only be coming into conflict with the government of China, they would be coming into conflict with the US companies that are profiting from the over-valued dollar. These companies could be expected to use all the political power at their disposal to prevent any steps that will lessen the value of the dollar against the yuan.

In fact, the domestic line-up against a lower-valued dollar is even more formidable than just the retailers and manufacturers who directly benefit from the over-valued dollar.