MFN: a Blunt Instrument

THE United States upholds the cause of human freedom around the globe. The US also pursues commercial opportunities around the globe. When one cause conflicts with another, what is to be done?

Secretary of State Warren Christopher went to Beijing last week to warn that China was in danger of losing most-favored-nation (MFN) trading privileges unless its human rights record improves. The administration must report to Congress on this issue in June; if the legislature votes to withdraw MFN, a whole range of Chinese goods will be shut out of the US market.

China's stance is that trade is trade, and human rights is human rights. Chinese officials say they are perfectly willing to talk about one or the other, but not to link the two. Human rights activists in America respond that they would be untrue to their own history and profound beliefs if they did not employ every available means of pressure to end religious and political persecution, arbitrary arrests and torture, and to obtain the release of political prisoners. They have the fervor and moral passion of the abolitionists of an earlier age, but let them not forget that they are applying it to another country, not to their own. The most effective instrument in American hands today, they maintain, is trade.

China's stance reflects a communist nationalism that rejects foreign political interference even while claiming economic openness. Yet trade and human rights cannot be separated so neatly. A nation is, after all, the sum of its parts. When Chinese troops shot down students in front of the world's television cameras in Tiananmen Square five years ago, it was natural for the Western world to react in horror and to limit severely tourism, trade, and economic aid to China. The US took the lead, but its European allies supported it, and so, initially, did Japan.

But as the Chinese government emerged from its own paranoia, freed many dissidents, and pursued trade vigorously with the US, Japan, and other partners, most of the Western restrictions were progressively lifted.

Today China is booming, while much of the West, including Japan, is in a severe recession, and only the US economy shows signs of a robust recovery. The prospect of a market of 1.2 billion people emerging from ages of poverty with a pent-up demand for all kinds of consumer goods is a powerful incentive for Western businesses, including American, to rush into China.

Chinese dissidents and their supporters maintain that Beijing continues to imprison and to mistreat political and religious activists. They insist that such releases as have occurred are due entirely to ceaseless pressure from the US. Further, they say that, for all the Chinese government's defiant words, it knows its flourishing overseas trade would suffer enormous damage if MFN privileges were to be revoked.

But the threat to withdraw MFN is a blunt instrument, even some of its advocates admit. Businesspeople from many countries who have set up factories in China aimed at the American market would be wiped out. Their local employees would lose their jobs, and the means to indulge their increasing appetite for consumer goodies. China's budding entrepreneurs, who dream of following in the footsteps of Benjamin Franklin and Henry Ford, would be hard hit. Hong Kong, the capitalist world's beachhead into China, would lose much of its raison dtre.

If the Clinton administration ends up withdrawing MFN privileges from China, it will find few allies, either in Asia or Europe. Japan, a democracy at home, has never shown missionary zeal for spreading it abroad. Southeast Asian countries with a mixed record on human rights issues will also look the other way. And most Europeans think the American approach is quixotic.

The US already has enough complaints against China in the field of trade, properly speaking, similar to those it has against Japan and a couple of other growing Asian economies: booming exports and a severely restricted domestic market. The Clinton administration should be able to pursue its trade claims vigorously without getting them tangled up in human rights issues.

By all means, let Washington hold China accountable on human rights. But let it do so in a proper forum, where one nation does not sit in judgment on another.