A bipartisan group of Senators show their support for the currency manipulation bill. (William Hicks/MNS)

A bipartisan group of lawmakers discuss the currency manipulation bill on Tuesday. (William Hicks/MNS)

WASHINGTON- Lawmakers on Tuesday announced bipartisan legislation that would protect U.S. businesses from foreign currency manipulation.

The top Democrat on the House Ways and Means Committee, Rep. Sander Levin of Michigan, said the plan has support in the House and Senate.

Currency manipulation occurs when a country undervalues its currency when trading for goods, allowing sellers to lower prices and be more competitive.

The bill would treat currency evaluation as a subsidy that the U.S. would be able to counterbalance with higher trade duties. Levin said the bill would allow U.S. manufacturing to be more competitive and promote job growth.

“For many years, countries like China and Japan have played the U.S. for a fool by manipulating their currency, robbing our people of millions of good paying jobs,” said Sen. Chuck Schumer, D-N.Y.

Currency manipulation by foreign governments has cost the U.S. as many as five million jobs over the last 10 years, according to an estimate from the Peterson Institute for International Economics.

“Somewhere between 10 and 20 countries have been manipulating their currencies,” said Fred Bergsten, senior fellow at the Peterson Institute. “They intervene extensively to hold their exchange rates down, strengthen their competitiveness and build their trade surpluses.”

The Commerce Department and the International Trade Commission have the authority under current policy to investigate, at their discretion, if other countries are undervaluing currency and impose counterbalancing duties. The bill proposed Tuesday would make this practice mandatory if a U.S. industry requests an investigation.

The announcement of the legislation intentionally coincides with President Barack Obama’s negotiations of the Trans Pacific Partnership, a trade deal between 12 Pacific Rim countries that does not include China.

If nothing is done about the currency manipulation problem, Schumer and Sen. Lindsey Graham, R-S.C., said they would not support passage of the trade deal.

“We don’t do a lot together,” Graham said. “So the fact we came together on this, tells you how powerful this issue is.”