Niall Ferguson Testifies On China Exchange Rate Policy, Text

Harvard's Niall Ferguson testifed before the Committee on Ways & Means committee on China's exchange rate policy.  Below is part of the testimony.  Find the full testimony PDF here (  He basically says be careful of potential market implications if protectionism runs amok.  I will embed the video when it is available.
"In February 2007, before the onset of the financial crisis, Moritz Schularick and I coined the term “Chimerica” to describe the combination of the Chinese and American economies, which together had become the key driver of the global economy.2 We called it Chimerica for a reason: we believed this relationship was a chimera—a monstrous hybrid like the part-lion, part-goat, part-snake of legend. We identified it as one of the causes of the asset price bubble that was such a striking feature of the U.S. economy in the years from 2002 to 2006.3 More recently, we have argued that we may be witnessing the death throes of this strange creature.4 The central question the Committee must consider is whether U.S. policy should be to slay Chimerica, or to try to keep it alive. Should the U.S. Treasury brand Beijing a “currency manipulator” in its report due on April 15? Should Congress pass the “Currency Exchange Rate Oversight Reform Act”, paving the way for retaliatory tariffs against imports from countries with “fundamentally misaligned currencies”, as proposed by Senators Brown, Graham and Schumer?

These are questions of the utmost historical significance. The threat of tariffs has worked before to pressurize the Chinese into revaluing their currency. On the other hand, one of the most important lessons of the Great Depression was that protectionist measures, including competitive devaluations, tended to worsen the situation of the global economy in the early 1930s. A second historical lesson is that conflicts over currencies and trade are often the
"..... [read full testimony PDF]."