People Of China Will Benefit From Free Trade

18 February 2000

By Stentor Danielson

Congressional Republicans recently announced that improving trade relations with China will be one of their top items during the coming year. Specifically, they want to eliminate periodic reviews of China's trade status by giving it permanent normal trade relations (NTR). This is seen as an important step toward accepting China into the World Trade Organization (WTO).

Under the proposed deal, China would reduce tariffs on U.S. goods from the current 22.1 percent to 17 percent and eliminate product quotas. In return, the United States would grant NTR, opening U.S. markets to Chinese exports.

The Representatives have called on President Clinton, a known supporter of free trade, to generate support among his fellow Democrats, ensuring that the proposal will clear some anticipated opposition. The world stands to benefit if Clinton succeeds.

Human and labor rights activists and their sympathizers in the government have voiced fears that the well-oiled machine of American business may out-compete China and cause Beijing to devalue its currency, hurting U.S. exporters. But such consequences are only of concern in the short run. Engagement with U.S. businesses -- and later with those of other WTO members -- will make Chinese businesses more competitive, thereby increasing standards of commerce and life in China.

Economic factors are not the only considerations in a deal with China. Critics argue that by permanently opening trade with China, we will lose a powerful tool we could use to pressure Beijing into correcting its human rights abuses. But free trade is a more powerful mechanism for social justice than economic bullying.

Granted, it is possible that social justice will not follow free trade. However, it is more likely to occur in an open market system than in a socioeconomic power struggle with the United States. We cannot expect China to join the modern global society without the resources free trade can bring.

Labor rights activists warn that giving China permanent NTR will essentially reward a dictatorial system that has a history of abusing its people and little concern for the fate of the average worker. Furthermore, more open trade would increase the market for goods produced in underpaid sweatshop-like environments. They would rather the United States kept such labor-intensive jobs here, where minimum wage laws insure that laborers get a fair shake.

But such working conditions, while poor by America's service economy standards, are a sign of increasing prosperity and wealth for a developing nation. Factory laborers may be paid little, but what would they be getting if they were not employed by the new shops that free trade would cause to grow?

A menial-labor-intensive manufacturing economy is far from being a dead end. After World War II, Japan went through just such a stage on its way to becoming a significant player in the world economy. Even the mighty United States used to be a land of impoverished, nonunion workers toiling in factories. While this is not a desirable situation, it can lead to better things.

Free trade will allow China to bring in the cash and resources it needs to improve the situation of its people. It is rather unreasonable to demand that Chinese firms pay their workers $5.15 an hour before we will do business with them. Once we open the doors to our west, China will grow more and more able to improve its human rights record.

Along trade routes flow not only goods and money but also ideas. Other nations -- particularly France -- have lamented the increasing acceptance of American goods and culture among their people.

There is no reason to think this exchange of ideas will not affect China. This is especially true in this age of communication technology. Electronic communication is both a necessity for doing competitive business and a desirable consumer commodity in itself.

If China and the United States can come to an agreement on free trade, human rights abusers will find their ideological hold on the population weakened by ideas that sneak in the door opened for trade.

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