Title: Competitive Dollar for Jobs and Prosperity Act
Policy area: Foreign Trade and International Finance

Summary:
Competitive Dollar for Jobs and Prosperity Act
This bill requires the Federal Reserve Board to impose a market access charge on foreign purchasers of U.S. assets. The board must levy this charge in order to achieve and maintain a current account balance (i.e., current account surpluses or deficits that do not exceed an average of 0.5% of U.S. gross domestic product).

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 2357 Introduced in Senate (IS)]

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116th CONGRESS
  1st Session
                                S. 2357

To establish a national goal and mechanism to achieve a trade-balancing 
 exchange rate for the United States dollar, to impose a market access 
  charge on certain purchases of United States assets, and for other 
                               purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             July 31, 2019

Ms. Baldwin (for herself and Mr. Hawley) introduced the following bill; 
which was read twice and referred to the Committee on Banking, Housing, 
                           and Urban Affairs

_______________________________________________________________________

                                 A BILL


 
To establish a national goal and mechanism to achieve a trade-balancing 
 exchange rate for the United States dollar, to impose a market access 
  charge on certain purchases of United States assets, and for other 
                               purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Competitive Dollar for Jobs and 
Prosperity Act''.

SEC. 2. FINDINGS; SENSE OF CONGRESS.

    (a) Findings.--Congress makes the following findings:
            (1) The strength, vitality, and stability of the United 
        States economy and, more broadly, the effectiveness of the 
        global trading system are critically dependent on an 
        international monetary regime of exchange rates that respond 
        appropriately to eliminate persistent trade surpluses or 
        deficits by adjusting to changes in global trade and capital 
        flows.
            (2) In recent decades, the United States dollar has become 
        persistently overvalued, in relation to its equilibrium price, 
        because of excessive foreign capital inflows from both public 
        and private sources.
            (3) Countries with persistent trade surpluses maintain or 
        benefit from undervalued currencies over a long period of time. 
        As a result, those countries overproduce, underconsume, and 
        excessively rely on consumers in countries with persistent 
        trade deficits for growth. Those countries also export their 
        unemployment and underemployment to countries with persistent 
        trade deficits.
            (4) Countries with persistent trade deficits, including the 
        United States, absorb the overproduction of countries with 
        persistent trade surpluses, thereby reducing domestic wages, 
        manufacturing output and employment, economic growth, and 
        innovation.
            (5) The United States possesses fiscal and monetary tools 
        to pursue national economic goals for employment, production, 
        investment, income, price stability, and productivity. However, 
        exchange rates that do not adjust to balance international 
        trade can frustrate the achievement of those goals. The United 
        States does not have a tool to manage exchange rates in the 
        national interest.
    (b) Sense of Congress.--It is the sense of Congress that--
            (1) it is consistent with the obligations of the United 
        States as a member of the World Trade Organization and the 
        International Monetary Fund that the United States use a 
        capital flow management tool to move the United States dollar 
        to its trade-balancing exchange rate; and
            (2) it is in the national interest of the United States to 
        establish exchange rate management tools to consistently 
        achieve a trade-balancing exchange rate.

SEC. 3. DEFINITIONS.

    In this Act:
            (1) Covered buyer.--The term ``covered buyer'' means a 
        foreign person or a person located outside the United States 
        that purchases a United States asset in a covered transaction.
            (2) Covered transaction.--The term ``covered transaction'' 
        means the purchase or acquisition by a covered buyer of a 
        United States asset the value of which exceeds $10,000.
            (3) Current account balance.--The term ``current account 
        balance'' means that current account surpluses or deficits do 
        not exceed an average of 0.5 percent of the gross domestic 
        product of the United States in any 5-year period.
            (4) Domestic financial institution.--The term ``domestic 
        financial institution'' has the meaning given that term in 
        section 5312 of title 31, United States Code.
            (5) Entity.--The term ``entity'' includes--
                    (A) a corporation, partnership, or limited 
                liability company; or
                    (B) a trust or estate.
            (6) Foreign person.--The term ``foreign person'' means any 
        individual or entity that is not a United States person.
            (7) Market access charge.--The term ``market access 
        charge'' means the fee imposed under section 5 with respect to 
        a covered transaction.
            (8) Person.--The term ``person'' means an individual or 
        entity.
            (9) Secretary.--The term ``Secretary'' means the Secretary 
        of the Treasury.
            (10) Security; transfer agent.--The terms ``security'' and 
        ``transfer agent'' have the meanings given those terms in 
        section 3 of the Securities Exchange Act of 1934 (15 U.S.C. 
        78c).
            (11) United states asset.--
                    (A) In general.--Except as provided in subparagraph 
                (B), the term ``United States asset'' means--
                            (i) a security, stock, bond, note, swap, 
                        loan, or other financial instrument--
                                    (I) the face value of which is 
                                denominated in United States dollars;
                                    (II) that is registered or located 
                                in the United States; or
                                    (III) that is an obligation of a 
                                United States person;
                            (ii) real property located in the United 
                        States;
                            (iii) any ownership interest in an entity 
                        that is a United States person;
                            (iv) intellectual property owned by a 
                        United States person; and
                            (v) any other asset class or transaction 
                        identified by the Board of Governors of the 
                        Federal Reserve as trading in sufficient volume 
                        to cause a risk of upward pressure on the 
                        exchange rate of the United States dollar.
                    (B) Exceptions.--The term ``United States asset'' 
                does not include--
                            (i) a good being exported from the United 
                        States; or
                            (ii) currency or noninterest bearing 
                        deposits.
                    (C) Consideration by board of governors.--Not less 
                frequently than annually, the Board of Governors shall 
                consider whether to identify additional asset classes 
                or transactions under subparagraph (A)(v).
            (12) United states person.--The term ``United States 
        person'' means--
                    (A) a citizen or resident of the United States; or
                    (B) an entity organized under the laws of the 
                United States or any jurisdiction within the United 
                States.

SEC. 4. EXCHANGE RATE MANAGEMENT POLICY AND MECHANISMS.

    (a) Amendment to Federal Reserve Act.--Section 2A of the Federal 
Reserve Act (12 U.S.C. 225a) is amended--
            (1) by inserting ``the United States exchange rate and'' 
        after ``shall maintain''; and
            (2) by inserting ``current account balance (as defined in 
        section 3 of the Competitive Dollar for Jobs and Prosperity 
        Act),'' after ``stable prices,''.
    (b) Exchange Rate Management Policy.--
            (1) In general.--The Board of Governors of the Federal 
        Reserve System shall establish an exchange rate management 
        policy to achieve and maintain a current account balance.
            (2) Mechanisms.--To achieve a current account balance as 
        required by paragraph (1), the Board of Governors--
                    (A) shall use the market access charge imposed 
                under section 5; and
                    (B) may engage in foreign exchange intervention.

SEC. 5. MARKET ACCESS CHARGE.

    (a) Imposition.--On and after the date that is 180 days after the 
date of the enactment of this Act, there shall be imposed a market 
access charge on each covered buyer in a covered transaction.
    (b) Calculation of Rate.--
            (1) In general.--The Board of Governors of the Federal 
        Reserve System shall establish and adjust the rate of the 
        market access charge at a rate that--
                    (A) achieves a current account balance not later 
                than 5 years after the date of the enactment of this 
                Act; and
                    (B) maintains a current account balance thereafter.
            (2) Effects of noncrisis movements.--
                    (A) In general.--Subject to subparagraph (B), the 
                Board of Governors may take into consideration the 
                minimization of disruptive effects on output, 
                employment, interest rates, and foreign exchange, 
                securities, and asset markets.
                    (B) Limitation.--The Board of Governors may not 
                adjust the market access charge in reaction to 
                noncrisis movements in the markets described in 
                subparagraph (A).
            (3) Alternate initial market access charge.--If, on the 
        date that is 180 days after the date of the enactment of this 
        Act, the Board of Governors has not established the initial 
        rate for the market access charge, the initial market access 
        charge shall be established at the rate of 50 basis points of 
        the value of a covered transaction.
    (c) Collection and Reporting.--
            (1) In general.--The market access charge shall be 
        collected from a covered buyer in a covered transaction as 
        follows:
                    (A) In the case of a covered transaction involving 
                a registered security, the transfer agent shall collect 
                the market access charge.
                    (B) In the case of a covered transaction not 
                involving a registered security and through which a 
                domestic financial institution receives funds from the 
                covered buyer, the domestic financial institution shall 
                collect the market access charge.
                    (C) In the case of any covered transaction not 
                described in subparagraph (A) or (B), the United States 
                person that is the counterparty to the covered buyer or 
                otherwise receives funds from the covered buyer 
                pursuant to the covered transaction shall collect the 
                market access charge.
            (2) Transfer to treasury.--At the end of each month, each 
        person collecting a market access charge under paragraph (1) 
        shall transfer to the Secretary the amount of all market access 
        charges collected by the person during that month in such 
        manner as the Secretary may prescribe.
            (3) Reporting.--The Secretary shall require each person 
        collecting a market access charge under paragraph (1) with 
        respect to a covered transaction to keep records and file 
        reports with the Secretary that include, in the manner and to 
        the extent the Secretary prescribes--
                    (A) the identity and address of participants in the 
                transaction;
                    (B) a description of the legal capacity in which 
                each participant in the transaction is acting;
                    (C) the identity of real parties in interest;
                    (D) a description of the transaction, including the 
                nature of the United States asset involved and the 
                price paid;
                    (E) the amount of the market access charge 
                collected and the amount retained as a service fee 
                pursuant to paragraph (4); and
                    (F) such other information as the Secretary may 
                prescribe.
            (4) Service fee.--A person collecting a market access 
        charge under paragraph (1) may retain, from the amount of the 
        market access charge collected, a service fee, in an amount 
        prescribed by the Secretary, to compensate the person for the 
        administrative costs of collecting the market access charge.
            (5) Penalties.--
                    (A) Transfer agents.--A transfer agent that 
                violates the requirements of this subsection shall be 
                subject to a penalty under section 32 of the Securities 
                Exchange Act of 1934 (15 U.S.C. 78ff) to the same 
                extent as if that agent violated a provision of that 
                Act.
                    (B) Domestic financial institutions and other 
                united states persons.--A domestic financial 
                institution or other United States person that violates 
                the requirements of this subsection shall be subject to 
                a penalty under section 5321(a)(1) or 5322(a) of title 
                31, United States Code, to the same extent as if that 
                institution violated a provision of subchapter II of 
                chapter 53 of that title.
    (d) Deposit in Treasury.--The Secretary shall deposit all amounts 
received under subsection (c)(2) into the general fund of the Treasury.

SEC. 6. REGULATIONS.

    The Secretary shall prescribe such regulations as are necessary to 
carry out this Act.
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