Should We Think That China is Managing Its Currency Just Because Its Central Banks Says So?

One of the most bizarre debates in national politics is over whether China "manipulates" its currency. It is bizarre both because of the term used and also because the fact that China manages its currency is really not a debatable point.

The use of the term "manipulation" is bizarre because it implies that China is doing something sneaky in the middle of the night when no one is looking. There actually is nothing sneaky about it. China openly targets the value of its currency at a level that...