Two Views of China and Trade

THE second anniversary of the Tiananmen Square massacre has passed. But the human rights concerns symbolized by Tiananmen have not been resolved. The Chinese government has still not accounted for thousands of persons who were killed and imprisoned. There is no sign of political liberalization.Instead, despite internal struggles, Beijing has returned to an emphasis on economic growth. The economy has been so successful that the trade surplus with the United States may reach $15 billion this year, up from $10 billion last year. There are other key issues in US-China relations. Although China did not veto United Nations Security Council resolutions on Iraq, Chinese cooperation on other issues of international peace and security has been poor. China continues to arm the brutal Khmer Rouge in Cambodia, and there are ominous signs that China is about to begin a major export drive for its newest missile systems. All these issues have become linked to the yearly decision whether to continue most-favored-nation (MFN) trade relations with China. President Bush has notified Congress of his intention to extend MFN for China for another year. In a recent speech at Yale University, the president argued that denying MFN would deprive the US of leverage on a broad range of issues, including human rights. It could further isolate the Chinese leadership and jeopardize the economic progress that has helped kindle democratic yearnings. Some in Congress, including leading Democrats, argue that the US should deny MFN, or at least make it conditional upon major improvements in Chinese policies on human rights and other issues. These issues are extremely important and should be addressed through all appropriate means. But imposing conditions on MFN that are unlikely to be met would threaten the well-being of the Chinese people and put at risk our own influence in China. The recurrent debate over MFN for China obstructs any coherent policy toward this extremely important country and has led to an unproductive stand-off between the president and Congress. The president, based on his personal experience, well understands the importance of maintaining orderly relations with China. Unfortunately, there is a perception that Bush has not turned the heat up high enough on human rights and other issues. The MFN debate has diverted attention from more practical approaches. At worst, it could lead to a complete collapse of our influence in China. A new approach would help us reach a greater level of domestic accord and realism on relations with China: First, the president and Congress should immediately establish a special commission on US-China relations, comprised of government officials, congressional leaders and distinguished private citizens including experts on China. It would review our overall relationship with China and make recommendations in a report to be filed prior to the time for the next renewal of MFN. Such a step could lessen conflict between the branches of government and improve public understanding. It would also help dispel the i mpression that US policy toward China is being run exclusively by the president, and that important issues are not being satisfactorily addressed. Second, we must adopt a flexible approach to our ongoing relations with China. Reasonable conditions attached by Congress to renewal of MFN could send an important signal to the Chinese leadership that the US expects improvements as a precondition for continued normal relations. At the same time, more could be done - separate from MFN - to address some of the outstanding issues in US-China relations. Third, there is a need to review the measures that were taken against China after Tiananmen and to determine which should be continued. Certain restrictions should probably be dropped since other countries are once again operating normally in China. Additional measures might be considered, however, in response to specific complaints, such as renewed Chinese jamming of Voice of America broadcasts and continued allegations of harassment of Chinese dissidents in the US. Fourth, trade issues should be pursued more aggressively. Whatever its causes, the massive trade deficit with China requires a governmental response. The administration should take further action under the trade laws, including on the issues of import and investment restrictions; dumping, subsidies, and other structural issues; convict-made goods; and establishment of criteria for renewal of the regular three-year trade agreement with China that expires in February. We must not burn our bridges with China until we see if they can be repaired. The important issues in US-China relations should be taken seriously and not reduced to a political morality play. A sense of unified national purpose must be restored to our relations with China. Only in this way can we retain our ability to influence events in China during a key period of economic and political transition.