American Currency Hypocrisy

Ben Steil has a great op-ed (registration required) in the Financial News on the history of US currency policy, and the facts might surprise you.  In it, Steil highlights how the United States' kvetching about China's pegged currency is a diametric turnabout from historic US concerns about developing countries' unpegging their currencies in order to devalue them during tough economic times.  The reason for the 180?  Self-interest. (Shocking, I know!)  Steil notes:

"When the facts change," Keynes once famously remarked, "I change my mind. What do you do, sir?" And the facts have clearly changed for the United States. They are no longer the creditor nation they were during World War II, controlling most of the world's gold reserves. They are now a massive debtor. So they have changed their minds. Fixed exchange rates were good when their trading partners were devaluing against them. Floating exchange rates are good now that they wish to devalue against their trading partners. There is perfect consistency in narrow self-interest.

Such motives are clearly something to keep in mind as President Obama begins high level discussions with the Chinese about their pegged currency.

UPDATE: looks like China has floated a hint that it'll start letting its currency appreciate against the dollar.  No timetable, but interesting nonetheless.