Dr. Peter Morici of the University of Maryland is one of those talented college professors who can take an esoteric topic like global economics and explain it in language plain enough for almost anyone to understand. Perhaps that’s because, at least where trade with China is concerned, he sees the issue in simple black and white: To paraphrase, the Chinese are crooks, and the U.S. should slap tariffs on all their imports until they decide to play by the rules.

“The Chinese seem to be the export musclemen of the world, while American manufacturers seems to be weaklings. We’re not. We’re in a boxing match wearing gloves while they’re holding a shotgun. We can’t win that game,” Morici told service center executives at MSCI’s annual meeting in Maui earlier this month.

As he explained it, when Americans import from China, they essentially trade dollars for yuan. When Chinese import from America, they trade yuan for dollars. Because Americans buy so much more from China, this trade imbalance creates an excess demand for yuan and an excess supply of dollars.

That should cause the value of the dollar to fall and the value of the yuan to rise, which would make Chinese goods more expensive on the world market, and American exports to China less expensive.

Why doesn’t that happen? Because China’s central bank prints more yuan to buy up the excess dollars. This keeps the value of the yuan pegged at around 8.28 yuan per dollar, and ensures that Chinese exports retain a cost advantage estimated at 25 to 50 percent.

China’s foreign exchange reserves hit $608 billion last year. “When a country spends 12 percent of its GDP on foreign currencies, I think that’s market manipulation,” Morici said.

China’s monetary policies influence other countries in the region that also have been accused of playing exchange rate games. Morici equates this to an honest baker who refuses to buy stolen butter and flour from an unscrupulous deliveryman, only to find that suddenly he can no longer compete with the bakery down the street selling especially “hot” muffins. “If other countries in Asia don’t similarly intervene in currency markets, they will lose their exports to China,” Morici noted. “Until China stops, we really can’t convince anyone else to stop.”

Chinese currency manipulation has robbed the United States of growth and prosperity that is irretrievable. America’s trade deficit over the past decade has reduced capital investment enough to lower GDP by about 1 percent annually, which means the U.S. economy is about 10 percent smaller today than it would have been, Morici estimates.

Trading with countries that manipulate their currencies is a losing proposition. While U.S. trade officials have urged China to liberalize its monetary policy, not much more can be done diplomatically, Morici said. He urges support for legislation now in Congress that would open the door to countervailing duties on China’s subsidized exports, despite the negative effect that would have on consumer prices.

He predicts Chinese officials will eventually assent to a token 5 or 10 percent shift in the currency, to ease the political pressure. “Anything less than 20 percent doesn’t count”—and that would have to be followed by a series of further adjustments, he said. “Essentially, if China does not revalue its currency over the next two to three years to the point we have eliminated the trade surplus, we have failed.”