American University Library

CHINA AND THE ISSUE OF MOST-FAVORED-NATION STATUS:

1989-1992

Sally Bryant

submitted to the

Faculty of the School of International Service

of The American University

in Partial Fulfillment of

the Requirements for the Degree of

Master of Arts

International Affairs

Signatures ^of Committee:

Chair:

Dean of the College Jfrnveuy■M ) f Date

1993

The American University

Washington, D.C. 20016

AMERICAN UNIVERSITY LIBRARY

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Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. CHINA AND THE ISSUE OF MOST-FAVORED-NATION STATUS:

1989-1992

SALLY BRYANT

ABSTRACT

Since the June 1989 Tiananmen Square Incident Sino-American relations have been

strained, especially human rights issues. This paper examines the sources of the conflict and

its effect on America’a China policy. Finding a consensus on how best to handle a country

like China that is repressive, Communist, and often at odds with the United States has been

difficult. Thus, the Bush Administration and Congress have struggled for the leading role in

forming U.S. policy toward China. Both sides differ on how change can be most effectively

accelerated in an authoritarian state like the PRC. Bush believes in active diplomatic

engagement with China, while Congress feels passing legislation conditioning China’s Most-

Favored-Nation status is the appropriate method. However, recent improvements in China’s

human rights have led President-elect Clinton to support unconditional MFN. Thus, there is a

new consensus that American economic involvement in China promotes the process of

economic and political reforms.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. TABLE OF CONTENTS

Abstract ii

List of Tables v

INTRODUCTION 1

Chapter

1. HISTORY 7

U.S. View

Reagan Administration

Bush Administration

2. BACKGROUND TO THE CURRENT DEBATE OVER MFN FOR CHINA 28

Other Trade Arrangements

Trade Act of 1974

Tiananmen Square Incident

Initial Reaction

3. HUMAN RIGHTS 42

Human Rights

Human Rights In China

The U.S. View

Chinese Student Movement

Abortion and Forced Sterilization

Chinese Dissidents

Tibet

iii

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. PART TWO: CONTINUATION OF CHAPTER THREE

The Baker Visit

Prison Labor Exports

Congressional Action

S. 2808

Presidential Election

Memorandum of Understanding

4. CONCLUSION 95

REFERENCE LIST 110

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. LIST OF TABLES

1. China's Statistics 18

2. U.S. Investment Position Abroad, by Country: 1980 to 1989 20

3. U.S. Government Foreign Grants and Credits, 1946 to 1989 21

4. MFN Duty Rates 29

5. Top 25 U.S. Imports from China in 1990 30

6. Population and Area 37

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. INTRODUCTION

In the three years since the incident at Tiananmen

Square friendly relations between the United States (U.S.)

and the People's Republic of China (PRC) have been strained.

Citizens of the United States were appalled as they watched

on television the Chinese Red Army massacre students of the

Chinese democracy movement in Beijing on June 3-4, 1989.

After viewing these events first hand, the American public

became critical of the Chinese government. Accordingly, the

American revulsion from the incident has broken down the

previous decade-long consensus on China policy in the United

States, and the issue has dictated the PRC policy of the

United States ever since.

Since Tiananmen Square, the Bush Administration and

Congress have struggled for the leading role in forming U.S.

policy toward China. There has been the presumption in

foreign policy that the President sets the long-term and

short-term objectives of the United States. Instead of

speaking of "U.S. foreign policy" Americans talk instead of

Nixon's foreign policy, Reagan's, or Bush's. Thus, the

President represents American interests abroad. However, in

a break from past procedure, Congress has attempted in the

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. last few years to shape the post-Tiananmen Square

relationship with China. This paper examines the sources of

the conflict, its consequences for the formulation and

conduct of foreign policy, and its effect on the China

policy of the United States.

This executive-legislative conflict has its roots in

the Constitution of the United States. The powers granted

by Article two give the President the role of Commander in

Chief of the military, the power to appoint ambassadors,

negotiate and ratify treaties, and receive ambassadors from

foreign nations. In Article one, however, Congress can

regulate intrastate and international commerce and taxes

which apply to Most-Favored-Nation (hereafter MFN) status.

Thus, Congress has the right to use trade as a vehicle to

become involved in foreign policy issues.

In the 1970s Congress sought new avenues to become

involved in foreign policy, especially in the area of human

rights. Through its power to control trade, legislators

exercised their rights to restrict (or grant) trade

preferences, or imposes trade sanctions to exert influence

over countries that are thought to abuse human rights. By

passing the Trade Act of 1974 Congress spoke out against

Soviet emigration laws which barred Soviet Jews from

resettling in Israel. Included in the act was the Jackson-

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Vanik Amendment, which made MFN status contingent upon the

liberalization of communist policies regarding emigration.

In subsequent years, trade has become a tool by which

Congressmen have guaranteed to U.S. allies special economic

privileges to American markets, while imposing penalties on

its Cold War enemies, particularly the Soviet Union and the

PRC.

When China received MFN status in 1980, the issue of

its human rights violations grew markedly more important to

Congress. Nonetheless, until June 1989 growing PRC economic

and political liberalization under the leadership of Deng

Xiaoping blunted American criticism of Chinese human rights

practices.1 During the 1980s, both Congress and Presidents

Reagan and Bush extended MFN annually to China with little

acrimony.

However, the incident at Tiananmen Square in June 1989

opened a floodgate of criticism from the American people and

government in regards to China's human rights abuses.

President Bush and his aides on the National Security

^ecil V. Crabb, Jr., and Pat M. Holt, Invitation to Struggle 4th edition (Washington, DC: Congressional Quarterly Press, 1992): 249.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Council took the lead in formulating the U.S. response.2

President Bush believes the correct China strategy (and one

he has followed since being elected in 1988) is

"'engagement: ' high-level consultations, his personal touch

and the expansion of economic contacts."3 In Congress

Bush's position is supported by Republican Leader Senator

(Sen.) Bob Dole, R-Kan., Minority Whip Alan K. Simpson, R-

Wyo., and Sen. Max Baucus, D-Mont.

However, Bush's engagement policy with Beijing is

perceived by many members of Congress as one of a "hands

off" policy to human rights. It is felt that extending MFN

to China with the knowledge of its poor performance in

regards to human rights issues does not live up to U.S. law

or supposed devotion to human rights issues. The main

opponent of Bush's China policy on Capitol Hill is Senate

Majority Leader George J. Mitchell, D-Maine.

Senator Mitchell and other liberal democrats such as

House Majority Leader Richard A. Gephardt, D-Mo.,

Representative (Rep.) Stephen J. Solarz, D-N.Y., Rep. Nancy

2Robert G. Sutter, "American Policy Toward Beijing, 1989-1990: the Role of President Bush and the White House Staff," Journal of Northeast Asian Studies Vol. IX, No. 4 (Winter 1990): 3.

3"Back From China," editorial from The Washington Post. 19 November 1991, 20 (A).

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Pelosi, D-Calif., and Rep. Donald Pease, D-Ohio, have been

frustrated with the Bush Administration's policy of

engagement with the Chinese. This main group of liberal

Democrats are joined by conservative Republicans Sen. Jesse

Helms, R-N.C., Sen. Malcolm Wallop, R-Wyo., and Sen. Mitch

McConnell, R-Ky., in opposing MFN. Thus, this unusual

liberal democrat-conservative republican coalition have

banded together to try to get legislation passed placing

conditions on or withdrawing MFN altogether because of

Beijing's human rights record (liberals) and anti-communism

(conservatives).

Therefore, this congressional focus on human rights

differs in emphasis from the Bush Administration's priority

of engagement with the Chinese government. However, the

ironic component of this is that both Congress and the Bush

Administration, "say they have exactly the same goal: to

enhance the prospects of China's moderates without totally

isolating the current Chinese government."4 Hence, this

argument over whether to place conditions on or withdraw MFN

altogether for the PRC raises a question that has shaped

American foreign policy since the first World War: What is

the best way to deal with a country that is repressive,

4Rochelle L. Stanfield, "It's Beiiina's Move." National Journal Vol. 22, No. 8 (24 February 1990): 446.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. dictatorial and often at odds with the United States?

Hence, this important question is at the heart of the

controversial human rights issues that have shaped the U.S.-

China relationship since the Tiananmen Square Incident of

June 1989. There are many vital reasons for this new U.S.

emphasis on human rights ranging from moral outrage over the

Tiananmen Square Incident, the end of the cold war, and a

new American emphasis on democracy. These reasons have

accentuated the human rights disputes between the U.S. and

the PRC, which consist of: the Chinese student movement,

abortion and forced sterilization, Chinese dissidents,

Tibet, and prison labor exports.

Of course, the U.S. debate over these problems in

regards to MFN turns on one point: will denial of MFN

induce the Chinese government to behave more responsibly?

This question is the most important issue affecting U.S.-

China relations since June of 1989. Hence, this paper

examines in detail the effect these important human rights

disputes between the U.S. and the PRC have on the overall

relationship.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. CHAPTER ONE

HISTORY

The U.S. domestic reaction to the Tiananmen Square

Incident has been interdependent on variables relating to

the shared history between the two countries. During the

Chinese Civil War of 1946-1949 the United States supported

Nationalist Party leader Chiang Kai-shik. Chiang did lead

the legitimate government of China at that time and was a

faithful ally of the United States. Nonetheless, the

American policy of support for the Nationalists was more

complicated than it appeared. Chiang was believed by the

Americans to be a trusted friend in the struggle against

communism. This view was held even though the American

White Paper on U.S.-China policy put out in 1949

acknowledged that Chiang's Nationalist Party was corrupt and

not supported by the majority of the Chinese people.5

Nevertheless, even when the truth was known about Chiang,

President Truman and the U.S. government were disappointed

when the Chinese revolution came to power under Mao Zedong

5Witold Rodzinski, The People's Republic of China (New York; the Free Press, 1988): 28.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. in October 1949.

After this victory by the Chinese communists Chiang and

his followers took refuge on the Chinese island of Taiwan

off the coast (previously called Formosa). Occupation of

Taiwan by Chiang left territorial unification and the

Chinese Civil War unfinished for the PRC. In addition,

American support of this combined with ideological

differences made mainland China believe it had little choice

but to ally itself with the Soviet Union. This alliance was

formalized with the signing in 1950 of the Sino-Soviet

Treaty of Friendship. To the PRC "this pledge represented a

significant enhancement of its security at a time of high

cold-war tension, and a means of balancing against what it

saw as the major threat to its survival, the United

States. "6

Of course, this Chinese perception of an American

threat was furthered by the Korean War conflict. When the

North Koreans invaded South Korea in June 1950 Truman

ordered the U.S. Seventh Fleet to patrol the Taiwan Strait

Rosemary Foot, "New Light on the Sino-Soviet Alliance: Chinese and American Perspectives," The Journal of Northeast Asian Studies Vol. X, No. 3 (Fall 1991): 17.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. as a "neutralization" move.7 However, when the 1953 Korean

truce was signed Taiwan was still under the military

protection of the United States. So, Taiwan's de facto

independence was sealed early on by U.S. military

protection.® Obviously this U.S. intervention created an

unstable situation in Asia and negatively affected the Sino-

American relationship.

view

From the U.S. side, the communist takeover of China of

1949 was not perceived as a Chinese achievement, but an

American "loss."9 In fact, it became a popular debate among

foreign policy experts whether China was squandered through

misrepresentation, deliberate treason, or failure to provide

crucial military and financial aid.10 Whatever the cause,

U.S. politicians and the general public was threatened by

communism in general because of tensions with the Soviet

Union (USSR) and Warsaw Pact nations; consequently, the

7Maurice Meisner, Mao's China (New York: The Free Press, 1979): 75.

®Thomas Omestad, "Dateline Taiwan: A Dynasty Ends," Foreign Policy Vol. 82, No. 71 (Summer 1988): 179.

9David Horowitz, The Free World Colossus (New York: Hill and Wang, 1971): 102.

10Jonathan D. Spence, The Search For Modern China (New York: W.W. Norton & Company, 1990): 533.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. victory of the Chinese Communist Party (CCP) in 1949

exacerbated America's belief that there was a united,

worldwide communist conspiracy. Thus, the U.S. supported

Taiwan as a natural extension of its objective to stop the

spread of communism.11

Therefore, from that time until 1972 the U.S. strategy

towards the PRC was one of "Containment." Thus, the primary

focus of American strategic thinking was the potential for

armed conflict with the Soviet Union.12 This policy to

frustrate Soviet ambition was formalized under the Truman

Administration in a document known as National Security

Council (NSC) 68. Consequently, hereafter the United States

crafted its policy for China and the Soviet Union by not

distinguishing between the two nations.

Ultimately, the policy of containment established

during the McCarthy era lasted through U.S.-China military

hostilities over Korea in the 1950s and Vietnam in the

1960s. In fact, Sino-American antagonism lasted longer than

the Sino-Soviet friendship, which began crumbling in the

“Dorothy Borg and Waldo Heinrichs, eds., Uncertain Years: Chinese-American Relations. 1947-1950 (New York: Columbia University Press, 1980): 3.

,2W.Y. Smith, "Principles of U.S. Grand Strategy: Past and Future," The Washington Quarterly Vol. 14, No. 2 (Spring 1991): 6 8 .

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. late 1950s. Both large communist countries began

disagreeing on the strategies and tactics for pursuing the

goal of worldwide revolution.13 The Soviet Union believed

its model of communism was the only one the developing

countries should follow, while China felt the different

national conditions of each country should determine the

model. This growing ideological difference between the two

nations was brought to a head at the 20th Communist Congress

in 1956. Here the dissension between the USSR (under the

leadership of Premier Khrushchev) and the PRC also was seen

in the way they wished to pursue the struggle against the

west. Mao Zedong wanted to put maximum pressure on the

capitalist countries; thus, he realized that the PRC needed

Soviet help in acquiring nuclear capabilities. On the other

hand, the Soviet Union during this time was not inclined to

accelerate the conflict with the U.S., and was hesitant

towards supplying the Chinese with nuclear technology. So

from 1962 onwards the Sino-Soviet alliance rapidly became

defunct.

But, beginning in the 1970s, Washington and Beijing

realized that they had a lot in common. At this point in

time both countries viewed the Soviet Union as their main

13Donald S. Zagoria, The Sino-Soviet Conflict. 1956-61 (New York: Atheneum Press, 1966): 5.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. menace. China had experienced border clashes with the

Soviet Union in the late 1960s and felt it was revisionist

and hostile to the PRC. This belief was furthered by

Moscow's announcement in the Brezhnev Doctrine that it would

act to save socialism wherever it was threatened.14 With

the announcement of this Soviet policy and the intense

border clashes between the two communist nations the PRC

believed the USSR was a threat to Chinese-style communism

and Chinese national sovereignty.

On the American side it was postulated at this time

that a closer relationship with China would be strategically

beneficial, particularly for American policy toward the

Soviet Union. President Richard Nixon and Secretary of

State Henry Kissinger argued that a stronger U.S.-PRC

relationship would counteract growing USSR world power and

help maintain peace and stability in Asia. Hence this U.S.

policy of utilizing improved relations with Beijing as a

lever against the Soviet Union was the tactic of playing the

"China Card."15 These views were implemented with

initiatives such as selling China technological equipment

14Nancy Bernkopf Tucker, "China and America: 1941-1991," Foreign Affairs Vol. 70, No. 5 (Winter 1991/92): 85.

15Charles W. Kegley, Jr., and Eugene R. Wittkopf, American Foreign Policy 4th ed. (New York: St. Martin's Press, 1991): 236.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. and advanced technology.16 Accordingly, after twenty-two

years of estrangement U.S.-PRC contact became highly

desirable.

This policy of detente — negotiation instead of

military confrontation — during the Nixon Administration

relaxed tensions between the United States and the USSR as

the expectation of Superpower war receded. In effect,

detente was the continuation of containment policy (NSC 68)

reached by political and economic cooperation. As a

consequence, "linkage" of cooperation in both areas implied

engagement with the Soviet Union on a broad range of issues.

Under this U.S. strategy of detente Sino-American relations

developed to the stage of full diplomatic representation and

normalization of relations on January 1, 1979, under the

16 "Prior to June 1989, U.S. policy generally reflected the belief that the benefits of increased technology sales to China outweighed the risks. Export controls on high technology products to China were gradually relaxed after enactment by Congress of the Export Administration Act Amendments of 1977, which stated for the first time that U.S. trade policy did not have to be equally restrictive toward all communist countries but could vary instead from one to another based on considerations deemed appropriate by the President. This provision facilitated a subsequent decision by the Carter Administration in April of 1980 to move China to a less restrictive trade classification for technology purposes. Responding to this change, the Department of Commerce announced in December 1980, that new, less restrictive guidelines would govern export controls for China."

Kerry B. Dumbaugh, "China-U.S. Relations: Issues for Congress," CRS issue Brief (16 October 1991): 8.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Carter Administration.

Reagan Administration - However, U.S.-PRC relations suffered

a setback during the early 1980s under President Reagan.

Reagan took office intending that the United States would

not abandon Taiwan. During the 1980 election Reagan implied

that he favored a return to the "two China" policy (giving

Taiwan an "official" status). Consequently, it was the

Taiwan issue that most complicated U.S.-China policy during

this time. There was a problem between the U.S. special

relationship with Taiwan, and the PRC's denial of legitimacy

to that government. In spite of this, a lot of the tension

over Taiwan between the U.S. and the PRC was alleviated by

the issuing of the Joint Communique in 1982. This document

was the first to place limitations on American arms sales to

Taiwan.17

U.S.-PRC relations further improved after a U.S. policy

reassessment in 1983 affirmed China's geopolitical

importance in American strategy.18 Thus, Reagan realized

that the PRC could divert parts of the Red Army from Western

17 (Dumbaugh, 7)

18Wenguang Shao, "China's Relations With the Super-powers," Survival Vol. XXXII, No. 2 (March/April 1990): 158.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Europe's military frontier.19 Therefore, China's friendship

with the United States was critical in the balance of power

in Asia. Hence, the Reagan Administration after 1983 took

the view that selected economic, technological, and military

cooperation with Beijing was in U.S. interests, and pursued

policies along these lines.

Reagan's motivation in building the new relationship

with China was a shared perception of a common danger —

which was fear of Russian dominance in the world. This

concern over the Soviet Union reactivated the cold war,

especially after the Soviet invasion of Afghanistan. Thus,

the Reagan Administration took a more confrontational

approach to the Soviet Union and viewed the Soviets as

hostile to the U.S. Hence, China became the most crucial

country in Asia to America politically because of Cold War

politics, and militarily because it is the only Asian

country with nuclear capabilities. Under the circumstances,

the security relationship between the U.S. and the PRC

evolved from confrontation to rapprochement.

This fundamental security change led to President

Reagan's visit to Beijing in April 1984, which resulted in

19Michael H. Hunt, Ideology and U.S. Foreign Policy (New Haven, CT: Yale University Press, 1987): 188.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. an informal nuclear agreement. The visit to China - his

first trip to a communist country - illustrated his new

priority of considering the PRC as a vital strategic partner

of the United States. Congressional approval of this

nuclear accord was sought by President Reagan; additionally,

the administration also submitted a proposal to Congress for

the first sale of weapons and weapons-related services to

the PRC. Naturally, security cooperation had a pragmatic

element - friendly relations with Beijing could contribute

to maintaining a strategic balance against the Soviet Union

as a way of offsetting Soviet influence in Asia, and also

help America's nuclear-power industry.

It follows that this emphasis on stronger bonds between

the two countries also spilled over into the area of foreign

policy. China and the United States both perceived that

they had common foreign policy interests in Afghanistan, the

Korean peninsula, Vietnam, and Cambodia. During his Beijing

visit President Reagan, "acknowledged the two countries'

mutual interests: 'America and China both condemn military

expansions, the brutal occupation of Afghanistan, the

crushing of Kampuchea; and we share a stake in preserving

peace on the Korean peninsula."20 Eventually, U.S. foreign

20Whan Kihl Young and Lawrence E. Grinter, eds., Asian-Pacific Security (Boulder, CO: Lynne Rienner Publishers, Inc., 1986): 30.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. policy strategic interests also helped forge closer

relations with the PRC.

Economic relations likewise improved between the U.S.

and the PRC during the 1980s. Under the leadership of Deng

Xiaoping, economic growth itself became the prime motivation

for China (open-door policy) .21 Reform produced increases

in growth rates, gains in civil and political rights, and

huge improvements in living standards.22 Table 1 shows how

the GNP of the PRC rose from 426.4 in 1980 to 1,117.9 in

1979. In addition to encouraging this new economic

liberalization, the U.S. also wanted to insure that China

continued its open-door policy even after the death of

current leaders.23 Hence, these internal changes in China

made the PRC a more attractive ally to the U.S, and helped

justify the American strategy of attempting to build an

enduring relationship between the People's Republic and the

west.

These U.S. beliefs were further implemented with

economic initiatives that made total trade between the two

21 (Spence, 697)

22Harry Harding, "Crises in Communist Reform: Lessons from Tiananmen," The Brookings Review Vol. 8, No. 3 (Summer 1990): 28.

23Nayan Chanda, "The Long March Back," Far Eastern Economic Review Vol. 24, No. 17 (26 April 1984): 17.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. TABLE 1; China 1 s Statist ics China, People’sRep. 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 924 Billions of Yuan International Transactions 13.48 13.97 16.76 21.17 127.12 36.75 41.44 43.85 57.96 80.92 108.58 147.18 176.95 195.25 293.06 Exports...... 8.07 8.89 8.44 12.60 19.81 11.35 14.78 12.67 13.58 21.02 Petroleum ...... 70a 5.60 6.15 5.72 9.35 15.40 8.57 11.71 9.61 10.04 16.00 Crude Petroleum ...... 2.36 2.63 2.60 3.14 4.25 2.60 2.85 2.54 2.82 4.14 Refined Petroleum ...... 70ab 12.93 13.28 18.74 24.29 1 29*88 36.77 35.78 42.17 61.44 125.97 149.89 161.51 205.75 220.02 251.23 Imports, c if ...... 71 11.86 12.18 17.19 22.28 27.41 33.73 32.83 38.69 56.37 115.57 137.51 148.17 188.76 201.85 230.49 Imports, fob ...... 71.V 1985=100 Volume of Exports 52.6 55.7 56.2 77.3 100.0 93.4 88.4 88.3 82.0 82.7 Petroleum ...... 72a 28.3 30.3 37.7 44.7 44.3 46.2 48.9 49.4 73.2 100.0 94.9 90.7 89.9 81.2 79.9 Crude Petroleum ...... 72aa 31.3 31.6 35.0 48.9 67.7 75.2 79.1 79.1 91.8 100.0 87.9 79.5 77.0 76.3 84.7 Refined Petroleum ...... 72ab Minus Sign Indicates Debit Balance of Payments 5,823 4,487 2,509 -11,417 -7,034 300 -3,802 -4,317 11.998 Current Account, nie ...... 77a.d 21.125 20,707 23,905 25,108 25,756 34,734 41.054 43,220 51.519 Merchandise: Exports fob ...... 77aad -16,876 -18.717 -23,891 -38,231 -34,896 -36,395 -46,369 -48.840 -42.354 Merchandise: Imports fob ...... 77abd 4,249 1,990 14 -13,123 -9,140 -1,661 -5,315 -5,620 9,165 Trade Balance ... 77ac

International Monetary Fund. International Financial Statistics Yearbook. Washington, DC: International Monetary Fund, 1991, Volume XLIV, page 265.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. nations rise from $4.8 billion in 1980 to $20.0 billion in

1990 — making China the 10th largest U.S. trading

partner.24 U.S. direct investments to mainland China in

millions of dollars rose from -6 in 1980 to 370 in 1989 (see

Table 2). In addition, after normalization of relations in

1979 Washington also helped the Chinese by giving grants and

credits. In millions of dollars these grants and credits

rose from 6 in 1985 to 35 in 1989 (see Table 3).

Accordingly, this dramatic rise in trade shows the U.S.

policy of linking economic ties with political relations.

Hence, both the U.S. and the PRC believed that strengthened

economic ties would enhance the overall relationship.

However, U.S. economic relations with the PRC were

mainly of secondary importance subject to changes in the

political arena.25 Reagan acknowledged the crucial

importance of security to the Sino-American relationship in

his visit to China in 1984. He said:

"Today, the peace of the world is threatened by a major power that is focusing its resources and energies not on economic progress but, instead, on military power. The shift in military might of the last decade has made trust and friendship between us even more vital. I know it is your

“Wayne M. Morrison, "China-U.S. Trade Issues," CRS Issue Brief (29 January 1992): 2.

“Qingshan Tan, "The Politics of U.S. Most-Favored-Nation Treatment to China: the Cases of 1979 and 1990," Journal of Northeast Asian Studies Vol. IX, No. 1 (Spring 1990): 42.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. TABLE 2: U.S. Investment Position Abroad, by Country 1980 to 1989

No. 139S. U.S. Investment Position Abroad, by Country: 1980 to 1989 In mIMont Of doKars. Oirect investments represent private enterprises in one country owned or controlted by investors in another country or in the management of which foreign investors have an important role. Negative position occurs when U S. parent com pany's liabilities to the foreign affiliate are greater than its equity in. and loans to the foreign affiliate. See also Historical Statis tics, Colonial Timas to 1970, series U 41-46]

1969 COUNTRY 1960 196S 1966 1967 1988 Manu Petro T otal1 facturing leum Finance 2 AH countries ...... 215,375 230,250 259,800 314,307 333,501 373,436 155,704 57,945 77,112 Developed countries ...... 156,214 172,056 194,260 237,506 252,757 279,310 126,468 39,966 53,994 Canada ...... 45,119 46,909 50,629 57,783 62,610 66,656 32,333 10,912 11,680 Europe 3...... 96,267 105,171 120,724 150,439 156,932 176.736 77,846 22,365 38,944 Austria...... 524 493 715 691 688 688 75 172 29 B elgium ...... 6,259 5,038 5,006 7,267 7.448 8,290 4,407 502 796 Denmark ...... 1,266 1,261 1,085 1,070 1,163 1,246 288 (0) 226 France ...... 9,347 7,643 8,952 11.868 13.150 14.747 9,490 1,050 872 Greece ...... 347 210 87 132 195 265 91 (D) (D) Ireland ...... 2,319 3,693 4,308 5,425 6,212 6,237 5,082 -28 1,160 Italy...... 5,397 5,906 7.426 9,264 9.540 10,634 6,830 574 1,055 Luxembourg...... 652 690 802 660 850 904 543 5 97 Netherlands ...... 8,039 7,129 11,643 14,842 16,017 17,168 7,541 1,907 3,798 Norway...... 1,679 3,215 3,216 3,843 4,371 3,640 66 3,007 157 Portugal...... 257 237 288 495 546 612 230 50 (D) Spain...... 2,678 2,261 2,707 4,076 4.979 6.002 3,865 98 28 Sw eden ...... 1,474 933 918 1,139 1,119 1,102 740 (0) 61 Switzerland ...... 11,280 15,766 16,441 19,665 18,357 19,952 1,757 75 Developing countries ...... 53,206 52,764 61,072 73,017 77,560 90,552 29,235 15,179 23,118 Latin America ...... 38,761 28.261 36,851 47,551 51,041 61,364 21,285 5,057 19,856 South America 3...... 16,342 17,623 19,813 21,227 21,690 23,557 14.427 2,185 1,905 Argentina ...... 2.540 2,705 2,913 2.744 2,597 2,624 1,316 489 177 Brazil...... 7.704 8,893 9,268 10,951 12,460 14,687 11,023 506 1,361 Chile ...... 536 88 265 348 691 1,081 170 51 282 Colombia...... 1,012 2,148 3,291 3.104 2,248 1,900 626 306 (D) Ecuador...... 3 22 361 413 466 431 395 168 125 (D) P e ru ...... 1,665 1,243 1,103 1,022 986 912 67 320 (0) Venezuela ...... 1,908 1,588 1,967 2,095 1,897 1,537 964 274 24 Central America ...... 10,193 9,658 10,698 12,218 13,119 15,880 6,600 1,691 4,562 Mexico ...... 5,986 5,088 4,623 4,913 5,694 7.079 5.837 68 130 Panama ...... 3,170 3,959 5,525 6,622 6.632 7.906 318 1,425 4,410 Other3 ...... 1,037 611 549 683 793 895 445 196 23 Costa R ic a ...... 303 113 113 141 169 163 143 1 5 El Salvador...... 105 73 50 51 56 62 21 (D) 1 Guatemala...... 229 213 181 174 200 221 110 45 19 Honduras...... 288 171 167 185 240 318 121 (D) (2) Other W. Hemisphere 3 . . . 12,226 980 6,341 14,106 16,232 21,928 256 1,181 13,389 Bahamas, The ...... 2.712 3.795 2,991 3,814 4.010 4,463 50 502 929 Bermuda...... 11,045 13,116 15,373 19,215 19.040 17,849 *169 17,368 Dominican Republic . . . 316 212 199 156 138 162 59 China: Mainland ...... -6 311 167 207 307 370 63 104 International ...... 3,955 5,426 4,448 3,782 3,184 3.S74 . 2,780 . Addendum-OP€C...... 4 6,090 10,383 10,235 9,899 8,825 8,977 1,747 5,264 807 - Represents zero. Z Less than $500,000. 0 Suppressed to avoid disclosure of data of individual companies. 11ncludes industries not shown separately. 2 Includes insurance. 3 Includes countries not shown separately. OPEC = Organization of Petroleum Exporting Countries. Includes Algeria. Ecuador, Gabon. Indonesia, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, United Arab Emirates, and Venezuela. Source: U.S. Bureau of Economic Analysis. Survey of Current Business, August 1990.

U.S. Department of Corrmerce, Bureau of the Census. Statistical S l 7 p. 797.J*Te Uni^ d States 1991- 111th ed. Washington, DC,

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. TAtiLE 3; U.S. Government Foreign Grants and Credits 1946 to 1989 No. 1397. U.S. Government Foreign Grants and Credits, by Type and Cx 1946 to 1989-Continued

(In mttions of doftar*. See headnote. p. 799]

1946- 1956- 1966- 1976- COUNTRY 1955, 1965, 1975, 198S, 1985 1986 1987 1988 1989, total total total total prel. A frica—Continued Somalia...... 42 47 582 117 111 68 62 32 Sudan...... 86 52 1.358 443 164 101 110 108 Swaziland ......

Canada ...... -1 4 272 317 -87 -61 -158 -50 -30 Chile ...... 100 740 724 -565 -7 56 26 11 -46 Colombia...... 43 446 846 298 93 63 22 -23 -36 Costa Rica...... 15 83 103 687 213 139 159 107 143 Dominican Republic...... 2 184 360 550 154 230 78 52 51 Ecuador...... 32 131 144 153 50 66 60 47 22 El Salvador...... 3 56 93 1,681 446 376 418 405 404 Guatemala...... 23 146 160 270 52 91 159 141 161 Guyana...... (Z) 7 71 36

Peru ...... 55 304 274 757 181 98 73 67 31 Trinidad and Tobago ...... 35 21 151 -21 -32 -33 -11 16 Uruguay...... 8 90 116 -9 -4 11 -3 9 -6 Venezuela ...... 6 156 115 -35 -30 -31 -38 28 -21 Central American Bank for Economic Integration ...... 6 121 36 -4 -5 -4 -3 (Z) Caribbean Development Bank ...... 8 108 1 -1 -1 -2 -2 Other 4 and unspecified ...... -6 218 496 1,236 198 188 197 229 235 Other International organizations and unspecified areas...... 969 1,335 4,018 9.739 1,405 1,319 1,648 1,664 2,268 - Represents zero. Z Less than $500,000. Includes European Atomic Energy Community, European Coal and Steel Community, European Payments Union, European Productivity Agency, North Atlantic Treaty Organization, and Organization for European Economic Cooperation. United Nations Relief and Works Agency for Palestine refugees. ^ Excludes transactions after October 1986. with Commonwealth of the Northern Mariana Islands; includes transactions with Federated States of Micronesia. Republic of the Marshall Islands, and Republic of Palau. 4 includes Andean Development Corporation, Eastern Carfcbean Central Bank, Inter-American Institute of Agricultural Sciences. Organization of American States, and Pan American Health Organization. Source: U.S. Bureau of Economic Analysis, press releases, and unpublished data.

U.S. DepaTtment of Commerce, Bureau of the Census. Statistical Abstract of the United States 1991. 111th ed. Washington, DC, 1991. p. 801. 21

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. desire, and that of the United States as well that peace be preserved."26

This thinly veiled attack on the Soviet Union emphasizes the

strong bond between the Chinese and Americans that had been

forged in reaction to Soviet aggressive expansionism.

Reagan further articulated this view in the same speech when

he remarked:

"A strong China, dedicated to peace, clearly is in the best interest of international stability and in the best interest of the United States. A strong and enduring friendship will bolster the security of both of both our countries without compromising the independence of either. It will be the trust between us that will keep us and the world at peace."27

Thus, in Reagan's view during this time the PRC is a

counterweight to the USSR. In fact, during the 1980s

because of the increased hostility between the U.S. and the

USSR, China's friendship had become so important in

President Reagan's view that he believed it would further

the prospects for world peace.

Bush Administration - When George Bush took office in 1988

the cold war between the Soviet Union and the United States

was on the wane. Following Gorbachev's rise to power in the

late 1980s the Soviet Union adopted modernization as its

26"Beijing, China," Weekly Compilation of Presidential Documents Vol. 20, No. 18 (27 April 1984): 604.

27("Beijing," 604)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. chief objective. This Soviet policy switch was seen in Asia

by Gorbachev's Vladivostok speech in July 1986 and his

December 1988 United Nations speech. Following these

speeches the USSR's military presence in Asia was reduced,

and Sino-Soviet border problems were under discussion.28

These Soviet gestures significantly reduced regional

tensions in Asia.

This Soviet change in defense significantly altered the

Bush Administration's view of the ''Strategic Triangle" with

the PRC. Bush explicitly mentioned this in his 1989 visit

to Beijing when he said:

"We've passed the day on the U.S.-China relationship where anyone talks about 'playing a card.' That was a term that was highly offensive to the Chinese, and properly so. And our relationship, the China-U.S. relationship, stands on its own in terms of cultural exchange and trade and on common strategic interests and on the way we view most of the world ... "29

Accordingly, even though a statement like this emphasizes

Bush's belief in China's importance, it also highlights the

crucial difference between Bush and Reagan's China policy.

Because of the context of the times Bush can stress many

areas of cooperation besides just security.

28Paul H. Kreisberg, "Containment's Last Gasp," Foreign Policy Vol. 83, No. 75 (Summer 1989): 146.

29"China-U.S. Relations," Weekly Compilation of Presidential Documents Vol. 25, No. 9 (25 February 1989): 246.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Hence, the American interest in China under the Bush

Administration is not just one-dimensional relating to

security interests, but multifaceted. President Bush

believes the PRC is important to American interests because

of its impact on a number of areas ranging from global

peace, regional conflicts in Asia, arms control, and the

environment. In an interview with Chinese television

journalists on February 26th Bush further articulated his

position on China:

"Now because, you see, I view the relationship between China and the United States as highly significant, and one of the very most important relationships that we have. And so, it has a lot to do with bilateralism, with our trade and our cultural exchanges and what I said here about the children. But it's more than that. It really has, because of China's importance and ours, a lot to do with world peace. And so, before much time went by, I wanted to reaffirm the importance that the United States places on this bilateral relationship, and I wanted to pledge to the Chinese leaders - and I've met the top four leaders in the last day and a half - that this relationship will grow and it will prosper."30

In this quote it is seen that President Bush regards the

U.S. policy of engagement with China as very consequential,

even with the difficulties inherent in the relationship.

Thus, Bush shifted American policy away from the belief in

the PRC's strategic importance as a foil against the Soviet

Union.

^"Interview With Chinese Television Journalists in Beijing China," Weekly Compilation of Presidential Documents Vol. 25, No 9 (26 February 1989): 251.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. In fact, since his election, a careful review of

publicly available White House documents does show that

President Bush views the U.S. relationship with the PRC as

indispensable, but not just for security interests.31 Of

course, Bush's position is also affected by his experience

as a former US envoy to the PRC in 1974-1975. When

President Bush returned to China in February 1989 he went to

the American Embassy in Beijing and said, "this relationship

is vital. It is absolutely essential to the foreign policy

interest of the United States and, I'd say, in our security

interests as well."32 Therefore, defense issues are still

of consequence; however, Bush would also like to see more

cooperation in other areas to further and strengthen the

overall relationship.

One enhanced area of engagement in George Bush's PRC

policy is his stress on the economic ties between the two

countries. Bush emphasized the economic angle to Sino-

American relations in his visit to Beijing, and he talked

about expanding trade and investment between the two

countries to improve the alliance. Bush also remarked, "the

United States, for its part, must keep its markets open to

31 (Sutter, 4)

32"Remarks Upon Greeting the American Embassy Community in Beijing, China," Weekly Compilation of Presidential Documents Vol. 25, No. 9 (26 February 1989): 249.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Chinese exports and continue to give China access to

advanced technology needed for modernization."33 Hence,

China's economic worth is given far more prominence under

the Bush Administration, and is considered equally as

significant as political considerations.

In fact, an important test of President Bush's China

policy occurred during his February 1989 stay in Beijing.

Bush's main motivation for the China trip was to help

further solidify strong relations between the two countries.

However, the visit was marred by the Chinese government's

refusal to allow Fang Lizhi (a leading Chinese dissident) to

attend a dinner given by President Bush. This generated a

lot of controversy in the American press and brought up talk

about human right practices in the PRC. Subsequently, Bush

expressed his belief in the correct way to handle human

rights complaints in the Sino-American relationship when he

talked to the American press on March 7, 1989. Bush stated:

"There's two schools of how you do the human rights agenda. I think that President Reagan was correct when he raised the human rights agenda with the Soviets privately rather than beating his breasts and doing it publicly. And I think the results have been rather penetrating - still a long way to go with the Soviets. But I have not only raised them [in China], but the very invitation to that dissident, that they thoroughly disapproved of, shows our public commitment to it... But I think quiet discussion is a good

33("China-U.S. Relations," 238)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. approach to try to effect the human rights objectives that I feel very strongly about."34

Therefore, this quote from President Bush describes how he

feels human rights ought to be addressed in the foreign

policy of the United States in regards to the PRC.

34"Human Rights," Weekly Compilation of Presidential Documents Vol. 25, No. 9 (7 March 1989): 291-292.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. CHAPTER TWO

BACKGROUND TO THE CURRENT DEBATE OVER MFN FOR CHINA

The U.S. switch to consideration of China as a friendly

country after the normalization of relations as noted above

included economic relations as well as political. Congress

approved the 1979 U.S.-PRC trade agreement in January 1980

and granted most-favored-nation (MFN) status effective on

February 1, 1980. In fact, Congress approved the trade

agreement by overwhelmingly majorities; the House voted 294-

88 and the Senate voted 74-8.35 Thus, granting MFN to

Beijing was a major part of the normalization of Sino-

American relations.

MFN is very important to the US-PRC relationship,

because without it economic relations are hindered by

artificial trade barriers set up by each country's

discriminatory trade policies. As shown by Table 4, if MFN

rates on imports from China are raised to full duty rates

the rate on men's trousers will rise from 29.7 percent to 90

percent. Table 5 also shows the devastating effects that

35(Tan, 49)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. TABLE 4: MFN Duty Rates

Illustrative MFN and Full Duty Rates Applicable to Imports from China

MFN Rate Full Rate

Shellfish Free Free Men’s trousers, man-made fiber 29.7% 90% Knit women’s sweaters, vegetable fiber (exc. cotton) 5% 45% Women’s silk apparel 6.9% 65% Artificial flowers, man-made fiber 9% 71.5% Crude petroleum 0.25c/gal 0.5c/gal (=0.52%) (=1.04%) Audio tape players 3.7% 35% Hair dressing appliances 3.9% 35% Luggage and handbags, textile fiber 20% 65% Plastic handbags 20% 45% Stuffed toys Free 70% Various other toys 6.8% 70%

Vladimir N. Pregelj • "Most—Favored-Nation Status of the People s Republic of China," CRS Issue Brief (March 4, 1992): 6.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Table 5: Top 25 U.S. Imports From China in 1990

Top 25 U.S. Import* from China In 1090 U.S. $ thousands

1990 Non-MFN Commodity MFN Non-MFN Collected Equivalent Number Hem Value Tariffs Tariffs Duties Duties

27090020 petroleum, oil* and ole from bituminous minerals $635,153 10.5< bbl 21C bbl $3,288 $8,766 64029916 footwear not elsewhere Indicated; uppers over 90% rubber or plastic $582,700 6.00% 36.00% $34,965 $203,963 61109000 sweaters, pullovers, sweatshirts, vests and similar articles; other textile materials $527,256 6.00% 60.00% $31,636 $316,360 95039060 other toys; without spring mechanisms $377,919 6.80% 70.00% $25,896 $264,543 64039990 nonwelt footwear; outer solas of rubber or plastic, leather upper, $2.50+/pair value $246,501 10.00% 20.00% $24,650 $49,300 65171000 telephone sets $231,760 8.50% 35.00% $19,700 $81,116 95034110 stuffed toys representing animals or nonhuman creatures $227,367 6.80% 70.00% $15,481 $159,157 95021040 dots; not stuffed, not over 33cm In height $200,753 12.00% 70.00% $24,090 $140,527 62061000 women's/girls' blouses and shirts; of silk or silk waste $194,792 7.50% 65.00% $14,609 $116,875 95034900 toys; representing animals or nonhuman creatures, other $169,958 6.80% 70.00% $11,557 $118,971 39269060 articles of plastics and other materials of headings $154,153 5.30% 80.00% $8,170 $123,322 84145100 fans; table, Door, wall, window, celling or roof, not more than 125W output $143,388 4.70% 35.00% $6,739 $50,166 65271111 radlo-tape player combinations; nonrecording $139,658 3.70% 35.00% $6,167 $48,880 65163100 electro thermic hair dryers $138,015 3.90% 35.00% $5,383 $46,305 42022215 handbags, with or without shoulder strap or handle $135,550 20.00% 45.00% $27,110 $60,899 62034240 men'sAroys' trousers, overalls and shorts; of cotton, other $131,098 17.70% 90.00% $23,204 $117,988 95049040 game machines; other than coin or token operated $126,572 3.90% 35.00% $4,936 $44,300 67029040 artificial flowers; man-made fibers, other $119,651 9.00% 71.50% $10,769 $85,550 61103030 sweaters, pullovers, vests and similar articles; man-made fiber, other $117,603 34.20% 90.00% $40,220 $105,843 61102020 sweaters, pullovers, vests and similar articles of cotton; 36%+ flax fiber, other $113,483 20.70% 50.00% $23,486 $56,742 64039960 nonwelt footware with outer soles of rubber or plastic $112,768 8.50% 20.00% $9,585 $22,554 42022160 handbags, with/without shoulder strap or handle; other, not over $20 value $110,343 10.00% 35.00% $11,034 $38,620 42029230 bags, travel, sports and similar with outer surface $102,168 20.00% 65.00% $20,434 $66,409 95038020 toys incorporating an electric motor $99,959 680% 70.00% $6,797 $69,971 62064030 women's/girls' blouses and shirts; man-made fiber, other $99,878 28.60% 90.00% $28,565 $89,890

Total: $5,238,498 $437,253 $2,487,027 Tariff as percentage of total value: 8.35% 47.48%

Note: About 69% of U.S. Imports from China are transshipped through Hong Kong.

Sourca: U.S. Department of Commerce Statistics Compiled by the U.S.-China Business Council

i ^ GS S £ v e rSS s^ i!0!^1^ rS m f ^ Renewal FOr China-"

3 0

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. non-MFN tariffs and equivalent duties would have on U.S.

imports from China. Without MFN the collected duties on

footwear would rise from $34,965 million to $203,963

million. On the top 25 imports from the PRC the tariff as a

percentage of total value would rise from 8.35 percent to

47.48 percent. This high tariff would make U.S.-PRC trade

fall; thus, the U.S. would end up punishing South China,

"the very region where free-trade market reform and the

challenge to central authority are the strongest."36

MFN status was established under the General Tariff and

Trade (GATT) by Article I, and means a country that is

treated in a nondiscriminatory way.37 However, MFN does

not mean, as the name implies, a special trading arrangement

granted to the PRC from the U.S. Rather, MFN is extended to

36George Bush, "Bush Says China MFN Status Will Be Catalyst for Change," Congressional Quarterly Vol. 49, No. 22 (1 June 1991): 1459.

37 "In practice, the principal benefit a country gains from being accorded the MFN status by another country is that the latter's imports from the former are dutied at concessionary rather than full rates. In a country like the United States, whose concessionary duty rates have been greatly reduced from their full levels, the extension of the MFN treatment to another country can mean a significantly lower cost — and hence, greater competitiveness — of imports from that country."

Vladimir N. Pregelij, "Most-Favored Nation Status of the People's Republic of China," CRS Issue Brief (4 March 1992): 2.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. almost all countries, including South Africa, Romania,

Hungary, and Poland.38 In all, the U.S. grants 159 out of

the 170 countries in the world MFN status.39 The other 11

countries - such as Cuba, North Korea, and Vietnam - have

been denied MFN because they do not meet specific criteria

of the United States, such as Section 402 (a) of the

Jackson-Vanik Amendment.40

Other Trade Arrangements - MFN is not the only way that

countries receive trade benefits from the United States.

Through other agreements, most countries actually qualify

for eyen lower U.S. tariffs. Examples of countries that

have lower tariffs than MFN with the United States are

Canada, Israel, and Mexico as of the summer of 1992. Israel

is an interesting case study of a country with a better

trade arrangement with the U.S. than MFN; yet, it has

questionable human rights violations - especially in regards

to its Palestinian population.41

38Spencer S. Griffith, "Trade, and Political Tensions Cloud MFN Renewal for China," East Asian Executive Reports Vol. 13, No. 6 (June 1991): 8.

39Strobe Talbott, "Least-Favored Nations," Time Vol. 138, No. 8 (26 August 1991): 33.

^(Talbott, 33)

41william B. Quandt, "The Middle East in 1990," Foreign Affairs Vol. 70, No. 1 (America and the World 1990/91): 66.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Trade Act of 1974 - In addition to other arrangements such

as the one with Israel, the United States also has MFN

status under its own legislation (section 402 of the Trade

Act of 1974), which grants MFN status to communist

countries.42 Hence, this amendment (called the Jackson-

Vanik Amendment) limits MFN status for Communist countries

on their adherence to freedom-of-emigration requirements.43

Under Jackson-Vanik, the President of the United States has

the authority to grant a waiver to extend MFN to China for

another year beyond its expiration date. However, this

42 "Unlike non-Communist countries, China is eligible for most of these trade benefits only under certain conditions imposed by U.S. law - - principally, the annual extension of the President's authority to waive freedom-of- emigration restrictions imposed under the Jackson-Vanik provision of the 1974 Trade Act. In addition to its MFN eligibility, China's access to export credit facilities of the Eximbank and to the full range of CCC programs is contingent on the Jackson-Vanik waiver."

(Dumbaugh, 8)

43 "Section 402 (a) of the Amendment states that the President may not conclude a trade agreement with a non- market economy country or extend MFN status to such a country if the President determines that the country: denies its citizens the right or opportunity to emigrate; imposes more than a nominal tax on emigration or on the visas or other documents required for emigration, for any purpose or cause whatsoever, or; imposes more than a nominal tax, levy, fine, fee, or other charge on any citizen as a consequence of such citizen's desire to emigrate to the country of his choice."

Lucille A. Barale, "U.S. MFN Renewal for China: the Jackson-Vanik Amendment," East Asian Executive Reports Vol. 12, No. 6 (June 1990): 10.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. annual waiver of MFN of China is subject to congressional

disapproval — both houses of Congress can pass a Resolution

of Disapproval. The President can then veto this

resolution, and the veto must be overturned by a two-thirds

majority vote in both houses.

Hence, this freedom-of-emigration requirement of the

Jackson-Vanik amendment is the principal determinate of MFN

for China. In regards to this, China has relatively free

emigration policies. Last year 18,000 Chinese received U.S.

immigrant visas. In the testimony of Arnold Kanter, Under

Secretary of State for Political Affairs before the House

Ways & Means Committee in June 1992, he said, "the principal

restraint on emigration is the capacity and willingness of

other nations to absorb Chinese immigrants, not Chinese

policy."44 In addition, President Bush said that the PRC

continues to have an open foreign travel policy in the 3

years since the Tiananmen Square Incident.45

^Testimony of Arnold Kanter, Under Secretary of State for Political Affairs, Before the House Ways and Means Committee, Subcommittee on Trade (29 June 1992): 3.

45"President's Report on MFN Status for China," U.S. Department of State Dispatch Vol. 2, No. 24 (17 June 1991): 430.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Tiananmen Square Incident

The Tiananmen Square Incident began with the death of

Hu Yaobang, Secretary-General of the Chinese Communist

Party, on April 15, 1989. Hu was made the scapegoat for

allowing the 1986-1987 student demonstrations to spread, so

the students viewed him as the leader who had been most

sympathetic to their concerns.44 With his death the

students in Beijing saw a way to pressure the government to

end corruption in government, make conditions better in the

universities, and allow for more democratic participation in

decision making.47 Soon students from Beijing University

and People's University began a rally in Tiananmen Square,

which quickly grew as the communist leadership did not take

a united stand on how to deal with the rebellion.48

In mid-May Mikhail Gorbachev, the Secretary-General of

the Soviet Communist party, came to Beijing for a summit

meeting with Deng Xiaoping. The student demonstrators began

a hunger strike during Gorbachev's visit to emphasize the

need for reforms. Hence, with this new development, the

^Gerrit W. Gong, "Tiananmen: Causes and Consequences," The Washington Quarterly Vol. 13, No. 1 (Winter 1990): 82.

47(Spence, 739)

48Howard G. Chua-Eoan, "The Wrath of Deng," Time Vol. 133, No. 25 (19 June 1989): 20.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. students and their supporters became a potent political

challenge to the Chinese government, and many planned

ceremonies for Gorbachev had to be canceled or changed

because of the Tiananmen activists.49

Everything came to a head on June 3rd when the army was

called in to quell the disturbance. On June 4th the army

began the bloody suppression of the democracy movement as

the world watched in horror on the television. An exact

number of victims may never be known, but it is estimated to

be as high as 5,000.50 The callousness of the attack was

stunning, but the Chinese government stopped the rebellion

and remained in power.

The startling events of June 3-4, 1989 did not go

unnoticed in the United States. Since the opening of

relations in the early 1980s the American public had been

interested in China's efforts to reform its economy and open

up to the modern world. It was amazing to see a country

with over a billion people (Table 6) attempt economic

liberalization. But the failure of the democracy movement

in the PRC shocked many Americans and brought about

disappointment.

49(Spence, 741)

50(Chua-Eoan, 19)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. TABLE 6 ; Population and Area

Comparative International Statistics

No. 1434. Population and Area, by Region and Country, 19S0 and 1990, and Protections, 2000 and 2010 {Population data generally are de facto figures for the present territory. Population estimates were derived from information avail able as of mid-1989. See table 1436 for country components of regions. See text, section 31, for general comments concerning the data. Data comptod from the International Data Base; see text, section 31. For details of methodology, coverage, and retiabiT ity, see sources. Minus sign (-) indicates decrease]

MIDYEAR POPULATION 1990, ANNUAL RATE OF 1990, (1.000) GROWTH 1 (percent) popula popula Area 2 tion tion 2000, 2010, 1980- (sq. mile) 1980 1990 rank 1990- peraq. pro*. pro]. 1990 2000 mHe World total...... 4,475,667 5,318,013 6,263,663 7,211,250 1.7 1.6 101 52,446,631 A fric a ...... 493,350 661,951 884,984 1,163,578 $ 2.9 2.9 57 11,692.673 Northern America 3 ...... 251,041 277.069 297,695 314,172 (X) 1.0 0.7 33 8,308,538 Latin America ...... 363,762 448,892 537,493 624,257 (X) 2.1 1.8 57 7,930,816 Middle Am erica ...... 02,109 116,938 145,230 173,234 (X) 2.4 2.2 121 963,397 Caribbean ...... 29,508 33,225 38,083 43,203 (X) 1.2 1.4 360 92,376 South...... 242,145 298,729 354,180 407,820 (X) 2.1 1.7 43 6,875,043 East Asia...... 1,181,094 1,335,079 1,508,424 1,626,704 (X) 1.2 1.2 293 4,550,909 South A sia...... 1,412,142 1,777,766 2,178,820 2,596,066 (X) 2.3 2.0 289 6,146,724 Europe...... 484,361 499,695 514,342 519,523 (X) 0.3 0.3 266 1,681,870 Soviet Union ...... 266,410 290,938 311,637 334,003 (X) 0.9 0.7 34 8,649,496 Oceania ...... 22,618 26,423 30,268 33,947 (X) 1.6 1.4 8 3,287,606 COUNTRIES Afghanistan ...... 14,988 15,662 25.430 33,641 50 0.6 4.7 63 249,999 A lbania ...... 2.673 3,273 3,824 4,265 109 2.0 1.6 295 11,100 Algeria...... 18,850 25,567 32,693 39,387 35 3.0 2.5 28 919,487 Andorra ...... 34 52 63 72 185 4.4 2.0 288 180 Angola...... 6,795 8,534 11,145 14,445 72 2.3 2.7 18 481,351 Antigua and Barbuda . . . . 69 64 69 76 181 -0.7 0.7 590 108 Argentina ...... 28,237 32,291 36,036 39,884 30 1.3 1.1 30 1,068,297 A ru ba...... 60 64 67 70 180 0.6 0.6 849 75 Australia...... 14,816 16,923 19,133 21,095 49 1.5 1.2 6 2,967,894 Austria...... 7,549 7,644 7,762 7,660 80 0.1 0.2 236 32,369 Bahamas, The ...... 211 246 275 302 156 1.6 1.1 46 5,380 Bahrain ...... 348 520 894 863 140 4.0 2.9 1.993 261 Bangladesh ...... 88,077 116,433 153,687 191,670 9 3.0 2.6 2,130 55,598 Barbados...... 252 263 283 311 154 0.4 0.7 1,582 166 Belgium ...... 9,847 9.909 9,989 9,889 66 0.1 0.1 840 11,792 B elize ...... 147 220 301 377 157 4.0 3.2 25 8,866 Benin ...... 3,444 4,674 6,509 8,939 95 3.1 3.3 107 43,483 Bhutan...... 1,281 1,566 1,909 2,277 124 2.0 2.0 87 18,000 Bolivia...... 5,393 6,707 8,151 9,671 86 2.2 1.9 16 424,162 Botswana ...... 903 1,225 1,561 1,898 128 3.0 2.4 5 231,804 Brazil...... 122,942 152,505 180.536 207,462 6 2.2 1.7 46 3,286,524 Brunei ...... 185 372 562 660 147 7.0 4.1 166 2,235 Bulgaria ...... 8,844 8,934 9,004 9,072 71 0.1 0.1 209 42,823 Burkina...... 6,939 9.078 12,464 17,158 70 2.7 3.2 98 92,741 Burma...... 33,530 41,277 49,787 58,601 24 2.1 1.9 158 261.217 Burundi...... 4,138 5,646 7.731 10,423 89 3.1 3.1 525 10,747 Cambodia...... 5,692 6,991 8,498 10,023 84 2.1 2.0 100 69,898 Cameroon ...... 8,577 11,092 14,453 18,625 59 2.6 2.6 60 183,567 Canada ...... 24,070 26,538 29,301 31,464 31 1.0 1.0 7 3,849,656 Cape V erde ...... 296 375 504 649 146 2.4 3.0 240 1,560 Central African Republic . . 2,269 2,877 3,702 4,712 113 2.4 2.5 12 240,534 Chad...... 4,022 5,017 6,204 7,652 93 2.2 2.1 10 495,998 Chile ...... 11,094 13,083 15,025 16,817 55 1.6 1.4 45 292,257 China: Mainland ...... 983,379 1,118,163 1.277,797 1,386.865 1 1.3 1.3 302 3,705,390 Taiwan ...... 17.848 20,547 22.436 24.098 41 1.4 0.9 1,650 12,456 Colombia ...... 26,580 33,076 39,745 45,603 29 2.2 1.6 75 439,735 Comoros4 ...... 334 460 656 920 142 3.2 3.5 549 838 Congo ...... 1,620 2,242 2,995 3,908 119 3.3 2.9 17 132,046 Costa R ica...... 2,307 3,033 3,803 4,546 112 2.7 2.3 155 19,575 Cuba...... 9,653 10,620 11,613 12,277 60 1.0 0.9 240 44,197 Cyprus...... 627 702 768 830 137 1.1 0.9 197 3,572 Czechoslovakia ...... 15,255 15,683 16,303 16,824 51 0.3 0.4 318 49,371 Denmark ...... 5,123 5,131 5,147 5,095 92 (Z)

U.S. Department of Commerce, Bureau of the Census. Statistical Abstract of the United States 1991. 111th ed. Washington, DC, 1991. p. 830.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Initial Reaction - Within two weeks of the Tiananmen Square

Incident President Bush announced a series of sanctions

against China. The first sanction imposed was suspension of

all government-to-government sales and commercial exports of

weapons to the PRC. Since the normalization of Sino-

American relations, the U.S. had gradually become more

permissive in regard to the flow of high technology and

defense technology to the PRC. One of the largest deals

suspended because of the sanctions was a $550 million

transaction for 55 avionics packages for China's J-8

fighter.51 Secondly, the President suspended military

exchange visits by top personnel. This cessation of

military leader exchanges resulted in the cancellation of

the planned visit to the U.S. by China's Minister of

Defense, Qin Jiwei.52 The third sanction ordered was a

sympathetic evaluation of requests for visa extensions by

Chinese students in the United States. This problem was

exacerbated by the presence of over 40,000 Chinese students

in the U.S., especially those caught between U.S. student

51 Jonathan Pollack, "China's Relations with East Asia and the Pacific Region: Part One," Adelohi Papers No. 217 (Spring 1987): 64.

52Seiichiro Takagi, "Sino-U.S. Relations Since the Tiananmen Square Incident," China Newsletter No. 88 (September-October 1990): 2 .

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. visa legislation and the problems in China.33

In addition, a second round of sanctions prohibited all

high-level government officials from having any official

contact with the PRC54, and asked international financial

organizations to defer loans to Beijing. This led to the

cancellation of visits to the PRC by the Secretary of

Commerce, Robert Mosbacher and the Secretary of Treasury,

Nicholas Brady. Also, the World Bank suspended China's $750

million dollars worth of loans after the crackdown.55 Of

course probably the most well-publicized action taken by the

U.S. was to allow famous Chinese dissident Fang Lizhi refuge

in the US embassy in Beijing.

Initially the U.S. Congress was satisfied with the

measures taken by President Bush. In fact, on June 6, 1989

both houses approved a nonbinding resolution on economic

53"Aid for Chinese Students," Congressional Quarterly Vol. 47, NO. 28 (15 July 1989): 1787.

^However, President Bush sent National Security Advisor Brent Scowcroft and Deputy Secretary of State Lawrence Eagleburger to Beijing twice; once secretly in July 1989 one month after the Tiananmen Sguare Incident, and again December 9-10, 1989. The administration said it was a conscious decision to begin improving ties with China.

(Sutter, 7)

55John Felton, "Bush Bid to Fix Beijing Ties Strains Those With Hill," Congressional Quarterly Vol. 47, No. 50 (16 December 1989): 3436.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. sanctions against the PRC which went further than Bush's

policy, and were seen as a mild rebuke for his gentle

response.56 The House adopted its resolution (H Con Res

136) by 406-0, and the Senate adopted its counterpart

measure (S Res 142) 100-0.57 This measure was a public

statement intended to express the moral outrage of the

Congress in regards to Beijing. It got congressional

disapproval of China's actions on the record, but it was not

a law.

Unfortunately, not long after the nonbinding resolution

was passed the inaugural consensus between the

administration and Congress ceased. Within 2 weeks of the

crackdown Ted Weiss (D-N.Y.), Stephen J. Solarz (D-N.Y.),

56 "A 'simple' resolution, designated H Res or S Res, deals with matters entirely within the prerogatives of one house or the other. It requires neither passage by the other chamber nor approval by the president, and it does not have the force of law. Most resolutions deal with the rules or procedures of one house. They also are used to express the sentiments of a single house such as condolences to the family of a deceased member or to comment on foreign policy or executive business. A simple resolution is the vehicle for a 'rule' from the House Rules Committee."

"Glossary of Congressional Terms," Congressional Quarterly Almanac 47th Annual (Washington, DC: Congressional Quarterly, Inc., 1992): 84-D.

57John Felton, "Brutal Crackdown in Beijing Deals Blow to U.S. Ties," Congressional Quarterly Vol. 47, No. 23 (10 June 1989): 1411.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. and Gus Yatron (D-Pa.) were already offering an amendment to

the foreign aid bill (H.R. 2655) suspending U.S. government

risk insurance for private firms that do business in

China.58 This harder line against the PRC was in reaction

to the Chinese government crackdown on the democracy

activists in late June 1989.

58,1 In Wake of Chinese Crackdown House May Halt OPIC Aid," Congressional Quarterly Vol. 47, No. 24 (17 June 1989): 1496.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. CHAPTER THREE

HUMAN RIGHTS

Human Rights - The atrocities of World War II led to an

international concern with human rights. For example, this

new emphasis on human rights is seen in several parts of the

Charter of the United Nations (U.N.) in 1945. In the

preamble of the Charter of the United Nations it says:

"we the people of the United Nations [are] determined to reaffirm faith in fundamental human rights, in the dignity and worth of the human person, in the equal rights of men and women and of nations large and small."59

In addition, Article 55 and 56 of the charter also pertain

to human rights. Article 55, Section C declares that there

should be, "universal respect for, and observance of, human

rights and fundamental freedoms for all without distinction

as to race, sex, language, or religion."60 Furthermore,

Article 56 states that all members should pledge to uphold

the equal rights and self-determination principles

59United Nations, Charter of the United Nations and Statute of the International Court of Justice, vol. XV, Documents of the United Nations Conference of International Organization. San Francisco 1945 (New York, NY: United Nations Information Organization, 1945): 336.

“ (UN Charter, 346)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. articulated in Article 55.

On December 10, 1948 the United Nations General

Assembly also adopted the Universal Declaration of Human

Rights. The preamble of the Declaration announces that it

is meant to serve as a common standard for all people of all

nations. In fact, the 30 articles in the Declaration state

that a primary goal of the U.N. is that all human beings are

born free and equal in dignity and rights, without

discrimination of any kind. Article 5 says that no one

should be subject to torture, and Article 19 asserts that

everyone has the right to freedom of religion.61 Thus,

civil and political liberties are enumerated in the first

articles, and then economic, social, and cultural rights

follow.

Since declarations are not legally binding to nations,

this document does not have the legal force of a charter or

an international treaty. Furthermore, the United States has

not signed it yet. Nevertheless, the U.N. Declaration is

the international standard for human rights, and it sets out

the basic rights and freedoms for people of all nations.

Furthermore, the Declaration under the Carter Administration

61Paul Williams, ed., The International Bill of Human Rights (Glen Ellen, CA: Entwhistle Books, 1981): 5-9.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. was joined by two international covenants on human rights

(one on Economic, Social and Cultural Rights and the other

on Civil and Political Rights) to make up the International

Bill of Human Rights.62

However, the main problem with the International Bill

of Human Rights is the controversy over what comprises basic

human rights. There are cultural, ideological, and

political disagreements about this definition, which make

consensus difficult. In accordance with this, it is obvious

that there is a fine line between stopping human rights

abuses and intervening in a country's internal affairs.

Taking this into account, the documents may express strong

standards, but they offer only weak measures of

enforcement.63

The U.N. is founded on an equally firm conviction about

the inviolability of sovereignty. In fact, the United

Nations is pledged to defend national sovereignty; it is a

62Jimmy Carter, foreword to The International Bill of Human Rights. edited by Paul Williams (Glen Ellen, CA: Entwhistle Books, 1981): ix.

63Peter Meyer, "The International Bill: A Brief History," in The International Bill of Human Rights, edited by Paul Williams (Glen Ellen, CA: Entwhistle Books, 1981): XXVII.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. core concept in the UN Charter.64 Sovereignty is, "(a)

supreme power especially over a body politic, and (b)

freedom from external control."65 But the problem is that

state legitimacy may be understood differently depending on

the country. For instance, in East Asia state stability may

be valued more highly than individual rights.66

The U.N. tried to overcome these different views about

human rights and sovereignty by setting up a Commission on

Human Rights in 1947. As a consequence the Human Rights

Commission is made up of 18 nations and it conducts

investigations and issues reports on human rights violations

in U.N. member nations. Hence, "this commission is the

first and only intergovernmental agency that challenges

states on domestic activities and practices that violate

their citizens' rights."67 However, this commission has

been weak because the states want to control and manage

64"Conference Report" in Changing Concepts of Sovereignty: Can the United Nations Keep Pace? 27th UN of the Next Decade Conference 1992 Held in Mackinac Island. Michigan. USA 28 June-3 July 1992 (Muscatine, Iowa: The Stanley Foundation, 1992), 16.

65Webster's Ninth New Collegiate Dictionary (Springfield, MA: Merriam-Webster Inc., 1987): 1129.

“ (Conference Report, 18)

67Patricia Swahn, "Fact or Fancy? The Law of Human Rights," Swords & Ploughshares Vol. 1, No. 2 (Spring 1992): 17.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. their own internal and international affairs.68

Human Rights In China - This U.N. mechanism was used in 1989

when the Human Rights Subcommittee of the U.N. brought a

charge against the Chinese government for brutally

suppressing the demonstrators in Tiananmen Square.

Interestingly, this measure lost its effect when the

committee moved to take no action on the resolution.69 The

main reason for this change of heart in the subcommittee was

that the Chinese protested that this was an invasion of

their sovereignty.70 However, this was the first time that

human rights charges had been brought against a permanent

member of the U.N. Security Council.

That being the case, the PRC believes that the

condemnation of China in the U.N. and in the U.S. is an

interference in the internal affairs of China. The embassy

of the PRC says, "China maintains that no country of

organization should be allowed to interfere in the internal

affairs of other countries by exploiting the issue of human

68(Conference Report, 8)

69Reed Brody, Penny Parker and David Weissbrodt, "Major Developments in 1990 at the UN Commission on Human Rights," Human Rights Quarterly Vol. 12, No. 4 (November 1990): 569.

70("Ma jor Developments, " 568)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. rights."71 For example, the Chinese government regards the

June 1989 crisis as a violent attempt to overthrow the

Chinese government and the socialist system of the PRC. On

June 3 1989 a PRC editorial said the riots were:

"the result of the vicious development of the turmoil plotted by a very few people for some time and exposes, in focus their sinister attempt to oppose the CPC's leadership and the socialist system. The party Central Committee, the State Council, and the Central Military Commission swiftly made the policy decision to suppress counterrevolutionary riots in order to defend the great PRC, the sacred Constitution, and the solemn capital."72

Also, on June 3 another article said the purpose of the

military involvement in the Tiananmen Square Incident was,

"to stop turmoil, to put an end to the grave anarchic state,

to restore normal order in the capital, and to prevent

further turmoil."73

Furthermore, in a statement at the U.N. in November

1989 Chinese Representative Chen Shiqiu pointed out:

"Adherence to reform and opening up is our

71Pamela Baldinger, "MFN: Sorting Out the Issues," The China Business Review Vol. 18, No. 4 (July-August 1991): 13.

^Jiefangjun Bao 4 June editorial, "Resolutely Support the Party Central Committee's Policy Decision, Resolutely Suppress Counterrevolutionary Riot," Foreign Broadcast Information Service: Daily Report China CHI-89-106 (5 June 1989): 77.

73Propaganda Department of the Beijing Municipal CPC Committee, "Get a Clear Understanding of the Nature of the Turmoil and the Necessity of Imposing Martial Law," Foreign Broadcast Information Service: Daily Report China CHI-89-106 (5 June 1989): 78.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. established state policy. But the question is that some foreign countries are trying to pressure China into a kind of reform along their lines by imposing sanctions and blockade and brandishing the human rights clubs."74

The Chinese delegate further said:

"The fundamental reason for the United States and some other Western countries to have gone out of their way to attack China on human rights in recent years is that the state of affairs in China has not developed in the direction they would have wished.,,7S

Thus, these quotes from the Chinese delegate represent a

fundamental difference in attitudes concerning human rights

They also aptly illustrates that the PRC was not backing

down to the United States or the U.N. when it felt its

internal affairs were being violated.76

Hence, all of this anger between the United States and

China regarding human rights is mainly over the definition

of what constitutes basic human rights. China's official

definition of human rights are:

"First, it is argued that there are no universal and abstract human rights, only, 'concrete human rights of a definite historical category.• In Marxist theory human rights are part of the superstructure that is determined by the economic base, and are therefore merely reflections of the

74Su Yuanchun, "State Rebuts U.S. on Tibet, June Events, Foreign Broadcast Information Service: Daily Report China CHI-89 227 (28 November 1989): 3.

75 (Su Yuanchun, 3)

7<(Crabb and Holt, 257)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. unique interests of the class that rules at any particular time. Different countries in different stages of political, economic, social and culture development will have very different concepts of the content of 'human rights' valid for its stage of development.

Secondly, citizens derive their 'rights' from membership of a society, not from some higher concept of inalienable individual rights. Human rights are privileges granted by the ruling power. They can therefore be modified or withdrawn at any time if the state considers that some other competing principle is paramount (such as 'unity of motherland').

Thirdly, to that extent that rights are embodied in the constitution, they are statements of future goals and not precise guarantees of presently enforceable legal rights. The government states that China is still culturally backward and that, because remnants of feudalism persist in China, it is necessary to introduce 'proletariat democracy' and guarantees of individual rights as part of a gradual process.

Fourthly, the western concept of individualism is rejected in favor of collective rights. The higher interests of society may often justify sacrificing personal liberty."*7

It follows from this definition that sovereignty is viewed

as the most important goal to the PRC. Besides, to a third

world country like China, social and economic goals such as

education, housing, and medical care are considered human

rights goals.78

^The Law Association for Asia and the Pacific Human Rights Standing Committee and Tibet Information Network, Defying the Dragon: China and Human Rights in Tibet (Manila, the Philippines and London, England: LAWASIA and T.I.N., March 1991): 96-97.

78(Crabb and Holt, 257)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. The U.S. View - On the U.S. side, there has been growing

concern over allegations of human rights abuses in China

since June of 1989. There are many vital reasons for this

new emphasis on human rights. Of course, moral outrage over

the Tiananmen Square Incident is one important reason for

the increased significance of human rights. As Secretary of

State James Baker said, "our hopes for a new, democratic

China turned to revulsion at the sight of tanks crushing

unarmed students."79 The refuge of Fang Lizhi in the U.S.

embassy in Beijing for a year also highlighted Chinese human

rights abuses.

Secondly, the strategic use of Beijing as a

counterbalance to Moscow has dissolved with the end of the

cold war. Because of this, "western leaders no longer see

any compelling logic to compromise or cooperate with China -

- hence the alacrity with which many agreed to economic

sanctions against Tiananmen."80 After the cold war the U.S.

can be truer to its ideals and support the promotion of

democracy and human rights. Hence, without a strategic

rationale the American policy towards China has shifted to

79James A. Baker, 111, "America in Asia: Emerging Architecture for a Pacific Community," Foreign Affairs Vol. 70, No. 5 (Winter 1991/92): 15.

80Robert Delfs, "Exit (World Stage Left) ," Far Eastern Economic Review Vol. 149, No. 34 (23 August 1990): 32.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. more human rights and economic concerns.

Thirdly, Sino-American relations in 1992 are

increasingly affected by ideology.81 In contrast, during

the 1970s and 1980s Washington downplayed communism in the

PRC because of its strategic importance against the Soviet

Union. Lessening importance of ideology was further

enhanced by Beijing's economic liberalization measures.

However, the fall of Eastern Europe in December 1989 and the

demise of the Soviet Union in December 1991 have positively

reinforced American public opinion regarding the wisdom of

having a democratic, capitalistic system. As Rep. Stephen

J. Solarz, D-N.Y., explains:

"Democratic countries are not only less likely to go to war [than despotic ones], they are also more likely to respect human rights and to embrace the type of free market economics that encourages economic growth."82

Thus, ideology has once again assumed center place in U.S.-

China relations.83 So now China has gone from being

81 Ideology is, "the aggregate of ideas, beliefs, doctrines, etc., of a large group of persons; popularly, a system of government."

Albert and Loy Morehead, eds., The New American Webster Handv College Dictionary (New York, New York: Signet Books, 1981): 268.

82Susumu Awanohara, "Pledging Allegiance," Far Eastern Economic Review Vol. 155, No. 26 (2 July 1992): 26.

83David Shambaugh, "China in 1991," Asian Survey Vol. XXXII, No. 1 (January 1992): 30.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. America's favorite communist country to practically the only

communist country left in the world. Therefore, the

euphoria over the end of the cold war in Europe accentuated

the frustration many Washington policymakers felt over the

failure of the Chinese democracy movement. Hence, leaders

in the United States, such as Rep. Solarz, would prefer a

return, "to a more open, reform-oriented, political,

economic, and foreign policy approach in China."84

Chinese Student Movement

The catalyst for all this concern about human rights

after Tiananmen Square was the issue of the status of the

over 40,000 students from the PRC in America. These

students were caught between the vagaries of U.S. student

visa legislation and the uncertainties in China. On July 31

the House passed H.R. 2712 to help the Chinese students on

restrictive "J" visas by waiving the usual requirement that

holders of such visas return home for two years before

seeking permanent-resident status in the U.S.85 This

legislation was introduced because it was felt that the

MRobert G. Sutter, "Changes in Eastern Europe and the Soviet Union: The Effects on China," Journal of Northeast Asian Studies. Vol. IX, No. 2 (Summer 1990): 38.

85"Waiver for Chinese Students Snags on Unrelated Issue," Congressional Quarterly Vol. 47, No. 32 (12 August 1989): 2124.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Chinese students would be in imminent danger if they

returned to the PRC because of their support of the pro

democracy movement.

However, President Bush had already agreed to permit

the students with expiring visas to apply for a one-year

delay in their departure.86 Bush vetoed the bill because he

did not want the Chinese to end the cultural-exchange

program with the U.S. like the Beijing government threatened

to do.87 At this time Bush attempted to appease Congress

and the American public by using his executive authority to

give the Chinese students all of the protection offered by

H.R. 2712. Bush said in his Memorandum of Disapproval on

November 30, 1989 that, "my actions today accomplish the

laudable objectives of the Congress in passing H.R. 2712

while preserving my ability to manage foreign relations."88

In spite of this, when President Bush vetoed the Chinese

students bill (H.R. 2712) November 30, 1989, Democratic

leaders vowed to override his action.89

86"Aid for Chinese Students Snags on Unrelated Issue," Congressional Quarterly Vol. 47, No. 28 (15 July 1989): 1787.

87George Bush, "Memorandum of Disapproval," the White House, Office of the Press Secretary, November 30, 1989.

88(Bush, "Memorandum of Disapproval")

89"Bush Vetoes Bill to Shield Chinese Students in the United States," in Congressional Quarterly Almanac 45th Annual, Vol. XLV (Washington, DC: Congressional Quarterly, Inc., 1990): 281.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Congress questioned Bush's authority to cancel H.R.

2712 and put his administrative order in its place. The

veto raised constitutional questions over whether Bush has

the authority to make the immigration changes he ordered as

an alternative to the rejected legislation.90 Henceforth,

the first priority of the new session of Congress in 1990

was the attempt to override Bush's veto of H.R. 2712.

In the House on January 24, 1990 H.R. 2712 was passed

390-25 (Rep. 145-25; Dem. 245-0).91 Nevertheless, Bush's

veto was sustained in the Senate's January 25, 1990 vote.

It was rejected 62-37 (Rep. 8-37; Dem. 54-0) .92 The vote

fell 4 short of the number needed to override the veto, and

all of those voting to sustain the veto were Republicans.

Thus, this said more about Republican solidarity than it did

about support for Bush's China policy, which was criticized

by both Democrats and Republicans in Congress.93 In spite

^Joan Biskupic, "Veto of Chinese-Students Bill Touches Off Furor on Hill," Congressional Quarterly. Vol. 47, No. 48 (2 December 1989): 3316.

91»H.R. 2712. Chinese Students/Veto Override," Congressional Quarterly Vol. 48, No. 4 (27 January 1990): 276.

^"H.R. 2712. Chinese Students/Veto Override," Congressional Quarterly Vol. 48, No. 4 (27 January 1990): 275.

93Joan Biskupic, "GOP Senators Save Bush in China Veto Test," Congressional Quarterly Vol. 48, No. 4 (27 January 1990): 245.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. of this bipartisan argument over his China policy, President

Bush and the administration believed that his foreign policy

decision over H.R. 2712 would help the Chinese students in

America and also strengthen the Sino-American relationship.

Abortion and Forced Sterilization - Another controversy over

legislation H.R. 2712 dealt with China's coercive

population-control policies. In 1979 the PRC instituted a

very strict family planning program to try to cut its high

population growth rate. But, some people in the United

States allege that these population control efforts include

coercive abortions, female infanticide, and involuntary

sterilization.94 This was backed up in the early 1980s by

American anthropologist, Steven Mosher, who had published

photographs of Chinese women undergoing involuntary

abortions.95 Regarding this, in his July 1985 American tour

Chinese President Li Xiannian said these stories were a "a

total fabrication."96 Hence, the issue of whether these

abortions and sterilizations were forced, or whether they

were voluntary as the PRC authorities claimed became a

sticking point in Sino-American relations.

^(Dumbaugh, 3)

95,,China: the Abortion Question," The Economist Vol. 294, No. 7383 (2 March 1985): 44.

Walter A. Taylor, "A Friendly Visit From China's President, But-" U.S. News & World Report Vol. 99, No. 5 (29 July 1985): 32.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. As a consequence, the controversy over the stringency

of the PRC population control program became a defining

issue in the U.S. abortion debate. These accounts detailing

forced abortions and sterilizations in China, whether true

or not, were used by the anti-abortionist movement in the

United States to cut off funds for private international

organizations - such as the U.N. - that had population

programs in the PRC. Cutoff of these funds was formally

implemented in the "Mexico City" policy of 1984, which

barred funding for international programs that support or

actively promote abortion.97

Of course, the debate over abortion and forced

sterilization in the PRC was also fueled by the elections of

Presidents Reagan and Bush, who both are against abortion.

During the Reagan Administration $10 million was withheld

from the United Nations fund for population activities

(UNFPA) because of these allegations against Beijing.98

Furthermore, the fight over funding UNFPA was continued in

the fiscal 1989, 1990, and 1991 foreign aid appropriations

bill under the Bush Administration.

^"Foreign Aid Bill Falls; Domestic Need Cited," in Congressional Quarterly Almanac 47th Annual, Vol. XLVII (Washington, DC: Congressional Quarterly, Inc., 1992): 471.

98"U.N. Family Planning Agency Denied Funds in Foreign Aid Bill," in Congressional Quarterly Almanac 46th Annual, Vol. XLVI (Washington, DC: Congressional Quarterly, Inc., 1991): 839.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. The brouhaha was further activated in 1989 by a U.S.

judge who granted political asylum to a man who claimed to

have left China because his wife would have been forced to

have an abortion." The Chinese embassy completely denied

that the Chinese state forces people to have abortions;

however, this controversial case caused a lot of tension in

the U.S.-PRC relationship. In fact, it stimulated a lot of

discussion in the American media and Congress over what to

do about these alleged Chinese human rights violations.

The antiabortion debate in Congress is headed by Rep.

Christopher H. Smith, R-N.J., and Sen. William L. Armstrong,

R-Colo. Rep. Smith cites Beijing's populations policies as

a reason why the UNFPA should not be funded by the U.S.

Smith says, "we're expressing the highest form of moral

leadership in saying that human rights conditions there have

meaning to us."100 Complementing this, in the 1989 H.R.

2712 debate, Sen. Armstrong wanted the statement: "refusal

to abort or be sterilized ... shall be viewed as an act of

political defiance justifying a 'well-founded fear of

persecution'..."101 to be included as an asylum-related

"Katherine Bishop, "Officials Debate Asylum for Chinese Fleeing Abortion Policy," The New York Times. 3 April 1989, 13 (A).

100("UNFPA," 839)

101 ("Waiver, " 2124)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. provision.102 However, when the amended H.R. 2712 came back

to the House it was rejected.

This rejection was set in motion by members of Congress

such as Rep. Jim Moody, D-Wis., who support UNFPA and other

such population control funding. They believe that the

anti-abortionists are too heavyhanded in cutting off all

funding to UNFPA and other international population control

groups because of questions about China's population

policies. For that matter, opponents of the Mexico City

policy argue that this amounts to an international version

of the domestic abortion-counseling ban upheld by the U.S.

Supreme Court in May 1991.103

Plus, this issue was complicated in June 1991 by an

amendment to the fiscal 1992 foreign operations spending

bill by Rep. David R. Obey, D-Wis. This controversial

amendment (H.R. 2621 - H Rept 102-108) linked MFN to China

with aiding the United Nations Population Fund. It says that

$20 million would be provided for the U.N. family planning

fund if Congress extends MFN to China; no assistance to the

102("Waiver," 2124)

103 "Vetoes Foil Abortion Rights Gains," in Congressional Quarterly Almanac 47th Annual, Vol. XLVII (Washington, DC: Congressional Quarterly, Inc., 1992): 340.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. fund would occur if MFN was denied.104 Additionally, it

said that none of the funds made available could pay for the

performance of involuntary sterilization as a method of

family planning or provide a financial incentive to any

person to undergo sterilizations.105 Ultimately this

amendment created a problem for Republicans who supported

MFN for Beijing, yet were against abortion and

sterilization. Rep. Obey wanted to show Bush that he could

not have it both ways in regards to China human rights

policy.106 In fact, the amendment was approved by the House

Appropriations Committee 30-19, but it was put on hold until

1992 over an unrelated issue.

Another bill on the House side concerning coerced

abortion and sterilization was Rep. Nancy Pelosi's, D-

Calif., bill H.R. 2212 which has a companion bill in the

Senate, S. 1367. However, in the House Ways and Means

committee Rep. Bill Archer, R-Texas, offered an amendment to

the bill that proposed giving Bush wide discretion to decide

104Carroll J. Doherty, "Amendment Links MFN Status to Family Planning Fund," Congressional Quarterly Vol. 49, No. 24 (15 June 1991): 1599.

los102nd Congress, 1st Session, H.R. 2621 in the Senate of the United States (24 June 1991): 80.

106("Vetoes," 345)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. whether to continue MFN in 1992.107 This amendment failed

in committee by a vote of 15-17. Of course, a committee

vote is not as important as a full House vote; nonetheless,

it was an attempt by some House Republicans to have a say

against this bill. At all events, when it went to the

entire House floor for consideration Rep. Pelosi's bill was

adopted on July 10 by a vote of 313-112.

Once the bill went to the Senate it had among its

provisions the requirement of the PRC to end coerced

abortion or sterilization, and account for and release

demonstrators arrested in Tiananmen Square in 1989.108

However, S. 1367 failed when the total was 12 votes short of

the 67 needed when all Senators vote. As a consequence,

this bill was postponed in 1991 in the Senate, and

rescheduled for MFN of 1992. This action thus let China's

MFN status remain in force for another year without

conditions.

Chinese Dissidents - In any case, the passage of H.R. 2212

in the House, as opposed to S. 1367 in the Senate,

107"Bill to Limit China Trade not Completed,” in Congressional Almanac Quarterly 47th Annual (Washington, DC; Congressional Quarterly, Inc., 1991): 125.

108" Issue: China's Most-Favored-Nation Status," Congressional Quarterly Vol. 49, No. 32 (10 August 1991): 2225.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. highlights the close eye Congress has been keeping on the

circumstances of the Chinese students who support the pro

democracy movement. In fact, S. 1367 set provisions for

renewal of MFN on Beijing:

"accounting for those citizens detained, accused, or sentenced as a result of the nonviolent expression of their political beliefs; and has released those citizens who were imprisoned after such detention, accusation, or sentencing."109

Thus, the emergence of this legislation shows how the U.S.

Congress has been concerned over alleged violations of human

rights of the pro-democracy protestors.

Since the Tiananmen Square Incident the Chinese

government has suppressed - through imprisonment - the

protests of all those who have been involved in what it

feels to be "counter-revolutionary violence." Amnesty

International has been monitoring these violations of human

rights in the PRC and believes that hundreds of prisoners of

conscience are still imprisoned solely for the expression of

their opinions.110 Also, there has been concern that the

trials for prisoners in China do not meet internationally-

109102nd Congress, 1st Session, S. 1367. A Bill To Extend to the People's Republic of China Renewal of Nondiscriminatory (Most- Favored-Nationl Treatment Until 1991 Provided Certain Conditions Are Met (25 June 1991): 5-6.

110Amnesty International, People's Republic of China: Violations of Human Rights (London, England: Amnesty International Secretariat, 1991): 1.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. agreed upon standards of fairness.111 This stifling of

dissent in the PRC has led to criticism in the U.S. that the

measures taken by the U.S. government have been

insufficient, and China should be penalized for human rights

abuses.112

Although Beijing has made major efforts since 1989 to

demonstrate its continued value of American friendship. One

important step was the release of Fang Lizhi from his year

long refuge in the U.S. embassy in Beijing on June 25, 1990.

Furthermore, in his testimony before the House Ways & Means

Committee in June 1992 Arnold Kanter, Under Secretary of

State for Political Affairs said that, "one dissident

informed our embassy that 70-80% of those detained in

Beijing after Tiananmen have now been released."113

Moreover, Chinese dissident writer Wang Ruowang will be

allowed to teach at Columbia University in the fall of

1992.114 This shows how Beijing has relaxed restrictions on

letting dissidents travel overseas. All of the above

m Amnesty International, The People's Republic of China: Trials and Punishments Since 1989 (New York, NY: Amnesty International, U.S.A., 1991): 1.

112"China Flunks a Freedom Test," editorial from The New York Times. 3 September 1992, A22 (L).

113 (Kanter Test imony, 13)

114"China Allowing Dissident to Teach in U.S.," The Washington Post. 5 August 1992, 29 (A).

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. mentioned examples are welcomed steps taken by China in

regards to its pro-democracy demonstrators.

In addition, in August 1992, Beijing began a more

liberal policy of providing information about political

prisoners. This new strategy is a reversal from the old

Chinese standpoint of almost never supplying information

about dissidents. Even as recently as March of this year

the PRC claimed that it accepted lists of dissidents from

foreign officials simply for courtesy's sake, and that they

often contained mistakes.115 However, in August PRC

officials gave an American businessman, John Kamm,

information about 23 individual political dissidents.116

This marks a positive step in growing Chinese cooperation on

the political prisoners issue. It also gives human rights

groups, such as Amnesty International and Asia Watch, some

valuable information about the condition of the convicts.

Furthermore, during August there was some talk about

the possible establishment of a joint Sino-American human

n5Ji Ping, "Who Actually Protects Human Rights, and Who Violates Human Rights?" Foreign Broadcast Information Service; Daily Report China CHI-92-041 (2 March 1992): 8.

116Lena H. Sun, "China Issues Information on Political Prisoners," The Washington Post. 27 August 1992, 28 (A).

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. rights commission.117 Of course, this proposal is just at

the talking stage and it will take a while before it is

acted upon. Despite the early stages of the proposal, the

fact that it even has been mentioned is an important step in

the right direction.

Tibet - China has also come under intense international

scrutiny for its policy towards the pro-democracy (or pro

independence) movement in Tibet. However, unlike pro

democracy human rights violations in China proper, the

Tibetan human rights question centers around the fundamental

legitimacy of Chinese rule in Tibet.118 Tibetans feel that,

"Tibet was an independent nation in law and practice before

it was invaded in 1950, and secondly, that they are a

'people' whose right to self-determination is being

denied."119 Hence, this question of the right to self-

determination is at the heart of the Sino-Tibetan issue.

In contrast, the PRC believes that Tibet has been a

part of China since the thirteenth century. In November

1989 at the United Nations, Chinese Representative Chen

Shiqiu noted that, "Since 1300 A.D., Tibet has been an

117(Sun, WP, 28 (A))

118(Defying the Dragon, viii)

119(Defying the Dragon, viii)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. inalienable part: of China's sacred territory. This fact has

been recognized by all countries including the United

States."120 It is true that the United States does not

acknowledge Tibet as an independent entity from China. L.

Desaix Anderson, Principal Deputy Assistant Secretary of

State for East Asian and Pacific Affairs, said in his July

1992 testimony before Congress that:

"The United States, like all other governments throughout the world, considers Tibet to be a part of China, with the status of an autonomous region. No country recognizes Tibet as independent of China. The United States has never taken the position that Tibet is an independent country, nor has it recognized the Dalai Lama as leader of a government-in-exile. "121

However, regardless of the self-determination issue,

there has been growing concern in the United States over

violations of human rights in Tibet. In fact, since the

1949 Chinese occupation of Tibet numerous clashes have taken

place between the Tibetans and the Chinese. In 1959,

because of Chinese repression of Tibetan culture, the Dalai

Lama (the spiritual leader of Tibetan Buddhism) fled in

exile to India, where he has lived ever since. Currently

there are 130,000 Tibetans living in exile around the world,

120(Su Yuanchun, 3)

121Testimony of L. Desaix Anderson, Principal Deputy Assistant Secretary of State for East Asian and Pacific Affairs, Before the Committee on Foreign Relations, United States Senate (28 July 1992): 6.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. with the largest community in India.122 These exiles,

headed by the Dalai Lama, lead the Tibetan movement for

independence.

A resurgence of demonstrations in favor of Tibet's

independence have been occurring in Tibet since September

1987. China has also put down Tibetan resistance in July

1988 and in March 1989. In 1991 the official New China News

Agency reported that 1,025 people had been arrested in Tibet

since September 1987.123 Furthermore, in 1991 360 cases of

Tibetan participants detained for political offenses were

identified by name.124 In addition, two Tibetan pro

democracy demonstrators, Lobsang Tenzin and Tenpa Wangdrag,

handed U.S. ambassador James Lilley a letter in April 1991

protesting the torture and ill-treatment of prisoners.125

These allegations of Chinese torture and ill-treatment of

Tibetan prisoners held on political charges have concerned

the Bush Administration and Congress, and led to the first

Senate hearing on the Chinese occupation of Tibet on July

l22Testimony of Richard Gere, Member of the Board of Directors, International Campaign for Tibet and Founding Chairman of Tibet House, Before the Senate Foreign Relations Committee (28 July 1992): 2.

123("Amnesty International - Violations," 4)

124Asia Watch and Tibet Information Network, Political Prisoners in Tibet (Washington, DC: Human Rights Watch, February 1992): 1.

125(Political Prisoners in Tibet. 31)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. 28, 1992.

This Senate hearing was devoted to the question of

Tibetan self-determination and human rights conditions in

Tibet, and was initiated because many members of Congress

have become increasingly concerned about the status of

Tibet. Sen. Paul Simon, D-Il., said in his opening

statement that, "there is no basis to assert, as the Chinese

do, that Tibet is an integral part of China because of a

tenuous link in the 13th and 18th centuries. This is solely

a case of might makes right, pure and simple."126 Of course

this emphasis on Tibetan self-determination has been further

encouraged by the break-up of the Soviet Union in December

1991. In his opening statement Sen. Claiborne Pell, D-RI,

remarked:

"With the break-up of the Soviet Union, self- determination has gained renewed strength, by oppressed peoples everywhere. President Bush last December stated 'there is no way that you can oppress people forever and keep down their aspirations for freedom.' He was speaking to a group of Cuban exiles. He could have said the same to the Tibetan exile community."127

Sen. Pell further stated that Chinese attacks on the

126Sen. Paul Simon, Opening Statement of Sen. Paul Simon (D-IL) on *US Policy Toward Occupied Tibet'. Senate Hearing (28 July 1992): 1.

127Sen. Claiborne Pell, Chairman, Committee on Foreign Relations, Opening Statement: U.S. and Chinese Policies Toward Occupied Tibet. Senate Hearing (28 July 1992): 1.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Tibetans, "reveals their guilty knowledge that the communist

system would be repudiated in Tibet if the Tibetan people

had a free choice of their destiny.128 Hence, these

comments reflect the renewed emphasis in American policy on

the Chinese occupation of Tibet and the principle of self-

determination .

As a consequence, many members of Congress believe that

improvement of human rights in Tibet should be a condition

for granting China MFN. For example, both H.R. 2212 and S.

1367 mention ending religious persecution in Tibet as a

prerequisite for allowing the PRC to keep MFN status. In

his testimony during the Senate hearing July 1992, Dr.

Jeffrey Hopkins from the University of Virginia said he knew

of the arrest of a Tibetan person who organized a lecture on

Buddhist philosophy.129 This suppression of Tibetan

religion and culture by Beijing has come under severe

criticism in the U.S. In fact, the U.S. Senate on March 18,

1992 unanimously adopted a resolution calling on the Chinese

government to take steps to ensure the full observance of

128(Pell, 2)

129Testimony of Jeffrey Hopkins, Professor and Director of the Center for South Asian Studies, University of Virginia, Before the Senate Foreign Relations Committee (28 July 1992): 6.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. human rights and fundamental freedoms of Tibetans.130

Congress also approved $1.5 million to Tibetan refugee

assistance this year and in Fiscal Year 1993 (H.R. 2621).131

Thus, all of these actions supporting Tibet in Congress have

been undertaken to pressure China to stop its human rights

violations.

The Bush Administration has also been critical of the

Chinese policy towards Tibet. In April 1991 President Bush

became the first U.S. President to meet with the Dalai Lama.

This was taken as a move by the President to demonstrate

concern for human rights in China.132 Also, during

Secretary of State Baker's visit to Beijing in November 1991

he expressed concern to the Chinese government over those

imprisoned in Tibet for political reasons.133 But the

executive branch has been encouraged by some developments in

Tibet. The 13-month imposition of martial law was lifted in

May 1990, and the Chinese security presence in Tibet was

130,,Senate Calls Upon U.S. Administration to Support Tibetan Human Rights at the U.N.," Tibet Press Watch Vol. IV, No. 2 (April 1992): 5.

131 (H. R. 2621. 113)

132Alan D. Romberg and Marshall M. Bouton, "The U.S. and Asia in 1991," Asian Survey Vol. XXXII, No. 1 (January 1992): 5.

133(L. Desaix Anderson, 5)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. scaled back.134 Furthermore, the Administration has been

encouraged by the slow but growing Chinese cultural and

religious tolerance in Tibet since the early 1980s. The

result of this has been the revival of Tibetan buddhism and

a rebirth of the Lhasa monasteries.135 It is recognized by

the Bush Administration that much needs to be done to help

human rights in Tibet as well as in the PRC in general, so

human rights issues became the central item of discussion

during Secretary Baker's visit to Beijing in November 1991.

The Baker Visit - Secretary of State James Baker's visit to

Beijing in November 1991 was the highest-level U.S. trip to

China since the Tiananmen Square Incident. For the Bush

Administration, it was hoped that the Baker trip would

symbolize the improvement in relations between the two

countries.134 In Beijing Secretary Baker talked with

Chinese President Yang Shangkun, Prime Minister Li Peng and

Communist Party Chief Jiang Zemin about many points of

contention ranging from human rights abuses, unfair trade

practices, and arms transfers to other countries. In

134Richard H. Solomon, "U.S. Relations with East Asia and the Pacific: A New Era," U.S. Department of State Dispatch Vol. 2, No. 21 (27 May 1991): 389.

135(L. Desaix Anderson, 2)

136Lena H. Sun, "Baker Says Gains Made With China," The Washington Post. 18 November 1991, 17 (A).

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. regards to human rights, Baker:

"specifically requested the release of some of the 800 advocates of democracy arrested after the Tiananmen Square killings who are being held for nonviolent, political acts. Mr. Baker also asked that the Red Cross be allowed to visit some of these political prisoners, and that the Chinese halt their jamming of Voice of America broadcasts. "137

As for trade and economic issues, one important aspect to be

discussed was the scheduled U.S. retaliation against China

for failing to protect intellectual property rights.138

Additionally, Baker wanted to an agreement from the Chinese,

"not to sell nuclear technology to countries such as Iran,

Syria or Pakistan, nor any ballistic missiles."139

During these talks bargaining began issue by issue, and

positive gains were made mainly on the issues of nuclear

nonproliferation and trade. China agreed to abide by the

international agreement barring exports of missile

technology, known as the Missile Technology Control Regime

(MTCR), and on trade Beijing agreed on improving China's

failure to respect patents or pay royalties on some American

137Thomas L. Friedman, "Baker's China Trip Fails to Produce Pledge on Rights," The New York Times. 18 November 1991, 8 (A).

138Don Oberdorfer and Lena H. Sun, "Chinese Offer No Word Yet on Baker Proposals," The Washington Post. 17 November 1991, 36 (A) .

139New York Times News Service, "Baker Begins Trip to Shape China Ties," Chicago Tribune. 11 November 1991, 4 (M) .

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. intellectual properties.140 All of these incremental gains

taken by China were important steps toward improving the

Sino-American relationship.

Some modest Chinese changes were also reported on the

question of human rights during the Baker trip. The Baker

mission did admit that human rights had been the toughest

talk in Beijing; however, positive results were gained from

the negotiations with the Chinese.141 In his statement

before the House Ways & Means Committee on June 29, 1992,

Arnold Kanter, Under Secretary of State for Political

Affairs, said that, "the Chinese confirmed to Secretary

Baker the release of 133 prisoners on our list of prisoners

of human rights interest of November 1991. Since then,

China has announced the release of additional prisoners.142

Furthermore, during his visit Secretary Baker did get to

meet Justice Minister Cai Cheng and talk about the treatment

of Chinese prisoners.143 Thus, for Baker this was a very

welcome meeting that symbolized a concession by the Beijing

government on the human rights agenda. After this talk the

140(Friedman, 8 (A))

141"Bargaining in Pariahville," The Economist Vol. 321, No. 7734 (23 November 1991): 37.

142 (Kanter, 13)

143(Oberdorfer and Sun, 36 (A))

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Chinese decided to relax the granting of exit permits to any

U.S.-bound Chinese "against whom no criminal charges were

pending."144

Prison Labor Exports - One of the most important human

rights issues discussed during the Baker mission to Beijing

was the recurring confrontation over the exportation of

Chinese prison labor goods. It is true that in the U.S.

convicts can work, however, the difference is that China's

felon population includes political prisoners. Also, the

dispute is compounded by the fact that in the PRC inmates

are forced to be employed.145 Of course, the main reason

the Chinese use indentured people to make goods is because

prisoners earn such low wages; thus, they are a nice supply

of cheap labor.

Initially, this prison labor disagreement came to the

forefront of Sino-American problems after a report by Asia

Watch (a human rights organization) asserted that Chinese

prison-made pipes, engines, and tools were being promoted at

144Lincoln Kaye, "Less Than Meets the Eye," Far Eastern Economic Review Vol. 154, No. 48 (28 November 1991): 12.

145Aaron Bernstein, et. al., "There's Prison Labor in America, Too," Business Week No. 3252 (17 February 1992): 42.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. a trade fair in San Francisco, California.146 Likewise,

Business Week magazine came out with a special investigation

it conducted on the extensive Chinese use of inmate labor.

Business Week reported that, "China's officials are crafting

a secret policy to use labor from its camps and prisons to

manufacture exports specifically for the U.S., Germany, and

Japan."147 Hence, these revelations (about the PRC's

utilization of forced labor to boost its exports) have made

convict labor exports one of the most contentious issues

dividing the two nations.

However, the Beijing government has not acknowledged

that illegal exports to the U.S. have occurred. During the

Baker visit, Wu Jianmin, a Foreign Ministry spokesman,

repeated the Chinese position that the central government

did not authorize exports of prison-made merchandise.148

Also, in August 1992 the Chinese State Council Information

Office issued a report entitled "Criminal Reform in China"

on conditions in Chinese penitentiaries. This report said

that 90 percent of the prison population works in the PRC,

and the total value of convict wares in 1990 was about $500

146Nicholas D. Kristof, "Rights Complaints Plaguing Beijing," The New York Times. 15 November 1991, 12 (A).

147Dinah Lee, et. al., "China's Ugly Export Secret: Prison Labor," Business Week No. 3210 (22 April 1991): 42.

148(Kristof, 15 November 1991, 12 (A))

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. million.149 But the Chinese deny that goods produced in

prisons and labor camps enter the export system.150

Ultimately, the key element at stake in the inmate

labor export issue is that the importation of products made

by forced labor is prohibited under the 1930 U.S. Smoot-

Hawley Act. The Smoot-Hawley Act (or Tariff Act of 1930),

raised U.S. tariffs on over 20,000 dutiable items to record

levels as the U.S. Congress used trade barriers to aid

Depression-hit American producers.151 In Section 1307 of

the Smoot-Hawley Act it states:

"all goods, wares, articles, and merchandise mined, produced, or manufactured wholly or in part in any foreign country by convict labor or/and forced labor or/and indentured labor under penal sanctions shall not be entitled to entry at any of the ports of the United States, and the importation thereof is hereby prohibited ...1,152

Thus, allegations of China's continuing violation of

the 1930 Smoot-Hawley Act have increasingly concerned the

Bush Administration and Congress. In July 1991 President

149Nicholas D. Kristof, "China Report Sees Prison as One Big, Happy Jail," The New York Times. 12 August 1992, 7 (A).

150Pamela Baldinger, "Trade Barriers and Human Rights Queer MFN Renewal," Asian Finance Vol. 17, No. 8 (15 August 1991): 67.

151I.M . Destler, American Trade Politics 2nd ed., (Washington, DC and New York, NY: Institute for International Economics and the Twentieth Century Fund, 1992): 6.

152Alan M. Stowell, ed., U.S. International Trade Laws 1986 ed., (Washington, DC: the Bureau of National Affairs, Inc., 1986): 20.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Bush sent a letter to Sen. Baucus, D-Mont., stating that the

U.S. Customs Service was going to "strictly enforce"

American laws against convict labor exports, and prohibit

entry of entire classes of merchandise suspected of having

been produced by prison labor.153 Shortly thereafter this

letter was put into force, as shown by the U.S. Customs in

San Diego, California barring the entry of 49 Jinma brand

diesel engines, made at Yunnan No. 1 Prison.154 In

addition, the U.S. Customs Service for the first time

imposed a fine of $750,000 on the E.W. Bliss Company in

Michigan for importing stamp presses made by Chinese

penitentiary labor.155 Moreover, in May 1992 the U.S.

Customs Service issued detention orders for 12 categories of

goods.156 All of these acts taken together show the Bush

Administration's new attempts to try to curtail the

indentured labor problem.

Congressional Action - The U.S. Congress has put a great

153"China MFN Action Plan," Congressional Record - Senate Vol. 137, No. 117 (29 July 1991): S11173.

154Amy Borrus, et. al., "Bush is Setting the Bloodhounds on Beijing," Business Week No. 3245 (23 December 1991): 36.

155Danlel Southerland, "U.S., China Draft Pact On Prison-Made Exports," The Washington Post. 20 June 1992, 10 (A).

156Testimony of Ambassador Michael H. Moskow, On Preservation of Most Favored Nation Status For China, Before the Subcommittee on Trade of the House Ways and Means Committee (29 June 1992): 4.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. deal of pressure on the executive branch for these changes

in dealing with the Chinese prison labor problem; this has

added fuel to the anti-Beijing sentiment in Washington.

Furthermore, the allegations of the PRC's use of prison

labor exports have bolstered the anti-MFN coalition's

arguments on Capitol Hill. This is shown by various bills

put out by Congress that aim to prevent the PRC from

receiving MFN status until it takes steps to stop the sale

abroad of goods made by convict labor. In May 1991 an

international agreement calling for the abolition of prison

labor was approved on a voice vote by the Senate Foreign

Relations Committee.157

Also - as mentioned previously - in 1991 the House side

passed Rep. Pelosi's measure, H.R. 2212, which sought to

prevent the President from extending MFN to China unless

steps were taken to stop the export of forced labor

products.158 In the Senate Rep. Pelosi's bill H.R. 2212 had

a companion bill called S.1367; this new change was endorsed

by the Committee on Finance.159 However, both pieces of

157 "Forced Labor Treaty Approved by Panel,” Congressional Quarterly Vol. 49, No. 19 (11 May 1991): 1217.

158 ( Dumbaugh, CRS . 11)

159102nd Congress, 1st Session, Senate Report: Extending to the People's Republic of China Renewal of Nondiscriminatorv (Most- Favored-Nation) Treatment Until 1992 Provided Certain Conditions Are Met. Committee on Finance, Report 102-101 (8 July 1991): 2.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. legislation specified changes in the "Chinese gulag" system

would be needed for continued MFN. For example, as passed,

one of S. 1367's provisions for renewal of MFN was the

cessation of, "exporting products to the U.S. manufactured,

wholly or in part, by convict, or indentured labor under

penal sanctions."160

Differences between H.R. 2212 and S. 1367 were worked

out in conference between the House and the Senate. The

approved conference report went to the House in November

1991, with one of the main changes in the legislation

pertaining to the felon labor dispute. In fact, convict

labor was downgraded in the new measure - called the

conference report or the United States-China Act of 1991 -

to be only one of four trade-related issues that Beijing

needed to improve.161 Moreover, the wording was changed

from, "cease exporting to the U.S. products made by convict

forced, or indentured labor under penal sanctions," to

making "significant progress" on the issue.162 This

softened stance on the forced labor question came after the

Baker visit to China earlier in the same month, and the

1<0(S. 1367, 6)

161102 Congress, 1st Session, United States-China Act of 1991 Conference Report 102-392 (26 November 1991): 3.

162(H Rept 102-392, 11)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. modest Beijing improvements that were gained during this

meeting. Subsequently, this new conference report to H.R.

2212 was approved on November 26 in the House by a vote of

409-21.163 This incredible victory shows how popular this

conference report was with both Democratic and Republican

representatives.

However, because of the congressional recess over

Thanksgiving and Christmas, the U.S.-China Act of 1991 was

not acted upon in the Senate until 1992 when it was

approved, 59-39.164 Bush then vetoed the legislation

because the administration, "continue[s] to believe that

China's unconditional MFN status provides our best approach

for encouraging positive change and U.S. interests in China,

particularly when coupled with aggressive pursuit of

specific issues of concern."165 So then the measure went

back to the House where there were easily enough votes to

override the presidential veto. The House vote was 357-61,

which was more than the two-thirds majority needed to

163Elizabeth A. Palmer, "House Approves Conditions on China MFN Status," Congressional Quarterly Vol. 49, No. 48 (30 November 1991): 3517.

164David S. Cloud, "Bush, Democrats Renew Battle Over MFN Status for China," Congressional Quarterly Vol. 50, No. 23 (6 June 1992): 1594.

165(Kanter Testimony, 2)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. override.166

Once passed in the House the legislation was sent to

the Senate for a vote. As is the case with the House, a

two-thirds majority of those voting and present in both

chambers is required to override a presidential veto.167

The Senate voted on the bill 60-38 (Rep. 9-34; Dem. 51-4);

which was five votes short of a presidential veto

override.168 One Senator, Jack Garn, R-Utah, switched his

vote to "no" to support Bush on the veto.169 Hence,

Republican solidarity (as shown by the 9-34 Republican

vote), combined with Democratic crossover votes were enough

needed to support President Bush.170 The nine Republican

Senators who did not support Bush usually vote very

conservatively.171 They were Jesse Helms, R-N.C., Connie

166.,House OKs Override of China MFN," Congressional Quarterly Vol. 50, No. 11 (14 March 1992): 608.

167.,H.R. 2212. Conditional MFN for China in 1992/Passage," Congressional Quarterly Vol. 50, No. 11 (14 March 1992): 676.

168"H.R. 2212. Conditional MFN for China in 1992/Veto Override," Congressional Quarterly Vol. 50, No. 12 (21 March 1992): 762.

169"Veto of China MFN Upheld by Senate," Congressional Quarterly Vol. 50, No. 12 (21 March 1992): 716.

170 (Cloud, 6/6/92, 1594)

171Congressional Quarterly, Who's Who in Congress 1991/1992 (Washington, DC: Congressional Quarterly, Inc., 1991): 26, 41, 50, 65, 67, 79, 93, 95, 99.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Mack, R-Fla., Trent Lott, R-Miss., Robert C. Smith, R-N.H.,

Alfonse M. D'Amato, R-N.Y., Arlen Specter, R-Pa., Larry

Pressler, R-S.D., Malcolm Wallop, R-Wyo., and Slade Gorton,

R-Wash.172

Not surprisingly, once the fight over the conference

report was lost a new battle between the legislative and the

executive branches over prison exports and MFN were soon

underway. Even though President Bush has won all the

skirmishes on China's MFN since June 1989, there is still a

great deal of opposition on Capitol Hill to his policy of

engagement with Beijing - as shown by the overwhelming House

vote of 357-61 favoring the implementation of the conference

report. In fact, analysis of China's conditional MFN votes

in the House (that have been mentioned before in this paper)

show very clear margins of victory. This is shown by the

U.S.-China Act of 1991, H.R. 2712, H.R. 2621, H.R. 2212, and

S. 1367. The authors and main proponents of these bills on

the House side have been Rep. Nancy Pelosi, D-Cal., Rep. Don

J. Pease, D-Ohio, and Rep. Stephen J. Solarz, D-NY.

Rep. Nancy Pelosi has been the most important player in

regards to MFN on the House side. Right after the Tiananmen

Square Incident Pelosi sponsored H.R. 2712, the Chinese

172(H.R. 2212, 762)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. student visa bill mentioned previously. Of course, an

important reason for Pelosi's concern about China is that

her San Francisco district (5th) has thousands of Chinese-

Americans.173 Pelosi does not want to just cut MFN off

altogether; nor does she want to grant it

unconditionally.174 Her main objection to MFN since

Tiananmen Square has focused on human rights; however, the

trade issues are becoming more important to her.175 This is

because she feels the United States cannot afford to lose

jobs because of the U.S.-China trade deficit. All of these

concerns are reflected in the legislation Pelosi has

sponsored in the House such as H.R. 2212.

Another key player is Rep. Solarz, who is currently the

energetic chairman of the Asian affairs subcommittee on the

House of Representatives. However, he lost his reelection

bid and will step down as chairman on January 3, 1993. Rep.

Solarz has built a whole career on urging foreign policies

based on a concern for human rights.176 Solarz' main

opposition to unconditional MFN for the PRC is human rights

173("Bush Vetoes," 279)

174Telephone Interview with Craig Middleton, California Office of Rep. Nancy Pelosi, 16 October 1992.

175 (Middleton interview)

176Kermit Lansner, "Facing Off Over China," Financial World Vol. 158, No. 22 (31 October 1989): 114.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. issues such as prison labor exports and Tibet. Regarding

MFN, Congressman Solarz has not proposed any legislation

himself, but he has cooperated with other people such as

Rep. Pelosi and Rep. Pease. A Solarz staffer says that,

"Solarz is opposed to revoking MFN altogether, but he also

is opposed to setting conditions that could never be

met."177 Thus, he wants MFN renewed with a few "achievable"

conditions attached, such as the release of political

prisoners and other human rights gains.178

This opposition to MFN obviously also extends to the

Senate - although not as strong - as shown by the 60-38

support of President Bush's veto of the U.S.-China Act of

1991. Bush's main adversary in the Senate is Majority

Leader George J. Mitchell, D-Maine, who believes that the

administration's policy has failed to influence Beijing and,

instead, the U.S. should use trade as a lever.179 Mitchell

also concludes that Congress needs to act to change the

China policy of the United States, because the president's

m Telephone Interview with Richard C. Bush III, Staff Consultant, Subcommittee on Asian and Pacific Affairs, House Committee on Foreign Affairs, 15 October 1992.

178,,Efforts at Hard Line on China Thwarted," In Congressional Quarterly Almanac 46th Annual, Vol. XLV (Washington, DC: Congressional Quarterly, Inc., 1991): 765.

179Chuck Alston, "George vs. George," Congressional Quarterly Vol. 49, No. 30 (27 July 1991): 2055.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. policy is a failed action.180 A Mitchell staffer says that

Mitchell believes U.S. goals in respect to China should

include, "an improvement in human rights, fair trade

practices, and keeping their word in the Missile Technology

Control Regime and limiting nuclear proliferation."181 All

of these goals have been put forth in the legislation

Mitchell has introduced since June of 1989. In

justification of his stand, he feels the government of the

PRC, "is not moving the system toward more democracy or more

openness. Instead, it is moving toward more repression."182

Interestingly, Sen. Mitchell has been joined by

conservative Republican Sen. Malcolm Wallop, R-Wyo., in the

fight to set terms for China's MFN. Sen. Wallop was the

only Republican cosponsoring Sen. Mitchell's bill, S.

1367.183 Wallop's background on the whole MFN for China

debate is mainly focused in ideological terms - democracy

versus communism. He believes:

i8°reiephone Interview with Ed King, Sen. Mitchell's Legislative Assistant for Foreign Affairs, 8 October 1992.

181Telephone Interview with Ed King, Sen. Mitchell's Legislative Assistant for Foreign Affairs, 14 December 1992.

182George J. Mitchell, "Should the Senate Approve S. 1367, the United States-China Act of 1991?" The Congressional Digest Vol. 70, No. 10 (October 1991): 232.

183David S. Cloud, "Mitchell Struggling for Votes to Restrict MFN for China," Congressional Quarterly Vol. 49, No. 29 (20 July 1991): 1972.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. "the Chinese people today see less, not more freedom. The climate for democratic change has worsened. Leaders in Beijing have taken a hard line toward intellectuals, and they have sought to impose their ideological conformity on the people."184

Because of Wallop's strong beliefs in the autocratic nature

of the Chinese state, he has been willing to challenge

President Bush and most of the members of the Republican

party.

Besides ideology, Senator Wallop is also concerned with

China's record on human rights, trade, and missile

proliferation.185 The PRC's sale of ballistic missiles and

nuclear technology to countries in the Middle East and other

parts of the world particularly alarm him.186 In fact,

Wallop believes, "the People's Republic of China has become

a rogue trader in sophisticated weapons capable of mass

destruction. "187

However, even though Sen. Wallop has been the only

184Malcolm Wallop, "Should the Senate Approve S. 1367, the United States-China Act of 1991?" The Congressional Digest Vol. 70, No. 10 (October 1991): 250.

185Interview with Kristin Hogarth, Assistant Press Secretary for Senator Wallop, 10 June 1992.

186Interview with Mario Meuli, Legislative Aide to Senator Malcolm Wallop, 14 December 1992.

187(Wallop, 252)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Republican who outright condemns the Bush China policy,

other Republicans have expressed reservations about the PRC.

For example, Sen. Alfonse M. D'Amato, R-NY, voted in support

of H Rept 102-392 because of information that the Chinese

were shipping weapons to Iran.188 Besides the problem of

Chinese arms proliferation to Iran and other parts of the

Middle East, Sen. D'Amato also has reservations about human

rights and prison labor.189

Although, even with influential Republicans such as

Senators D'Amato and Wallop expressing some reservations

about Beijing, the White House won Senate support for the

1992 conference report veto on March 18. As Sen. Hank

Brown, R-Colo., said, "It's a close call, but I've become

convinced that this is a job better left to the

president.1,190 So this support of the Bush Administration's

engagement policy with the Chinese won out over Sen.

Mitchell's conditional MFN coalition.

As discussed previously, this opposition to the

188 (CQ, 3/21/92, 716)

189Telephone Interview with Gregg Rickman, Legislative Correspondent for Sen. D'Amato, 14 October 1992.

190David S. Cloud, "China MFN Vote Falls Short of Veto-Proof Margin," Congressional Quarterly Vol. 49, No. 30 (27 July 1991): 2053.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. administration's engagement policy arises from human rights

issues such as Tibet, prison exports, etc., and also from

arms sales frictions. For these reasons, the many members

of Congress and their various home-state interests tie into

the volatile Sino-American relationship. To illustrate

this, in the House, Rep. Sander M. Levin, D-Michigan, calls

himself an "activist" legislator, because he does not fear

provoking trade wars with foreign countries owing to the

risk they run of losing access to the U.S. market.191 This

is especially true, Congressmen Levin believes, in the case

of the PRC, because it is unlikely China would start a trade

war with someone they need as badly as the U.S.192 Because

of this unique situation in the PRC, conditional MFN can

work.193 Thus, Levin supported the conference report vote

supporting conditional MFN for China.19*

On the Senate side, Sen. Ernest F. Hollings, D-South

Carolina, also choose conditional MFN for the PRC in the

191Richard J. Whalen and R. Christopher Whalen, eds., Trade Warriors: the Guide to the Politics of Trade and Foreign Investment (Washington, DC: the Whalen Company, 1990): 324.

192Telephone Interview with Robert LaRussa, Trade Legislative Assistant for Rep. Sander M. Levin, 20 October 1992.

193 (LaRussa interview)

194 (CQ, 3/14/92, 677)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. March 1992 vote.195 Sen. Hollings wants to level the

playing field between the U.S. and China; he has tried to

accomplish this through concentrating on the textile

industry (which is a big industry in South Carolina) ,196

Hence, Hollings labels himself a protectionist and has led

the effort to enact textile, apparel, and footwear quota

legislation because of his home-state interests.197 This is

shown by his bill S. 2411 (H.R. 4328 when it passed Congress

and the President in the last Congress). Additionally, Sen.

Hollings faced a tough re-election fight this year.

However, in contrast, Sens. John B. Breaux and J.

Bennett Johnston, both Louisiana Democrats, do not favor

conditional MFN because their state is a leading exporter of

fertilizers to the PRC.198 A Johnston staffer said that the

Senator believes it is a bad policy to use trade

restrictions as a rule.199 In this case, he feels it is not

practical because there is no support among other countries;

195 (CQ, 3/21/92, 762)

196Telephone Interview with James Assey, Legislative Assistant for Foreign Affairs for Sen. Ernest F. Hollings, 16 October 1992.

197(Whalen and Whalen, 155)

198(Cloud, 7/27/91, 2054)

199ntelephone Interview with Michael Babin, Staff Assistant for Sen. J. Bennett Johnson, 15 October 1992.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. in fact, no other countries are considering it.200 Sen.

Johnston also thinks that passage of conditional MFN for

China would hurt the people in the PRC the U.S. wants to

help.201 As a consequence, in the March conference report

vote both Democratic Louisiana Senators sided with George

Bush and choose unconditional MFN for Beijing.202 Thus, as

all these examples indicate, there are many factors tying

into the MFN debate between the two countries that have kept

the issue alive on Capitol Hill.

S. 2808 - This is also shown by the emergence of legislation

S. 2808, which was introduced by Senate Majority Leader

George J. Mitchell in the 102nd Congress. S. 2808 lays out

certain conditions that need to be met in order to extend

MFN to the PRC in 1993. Regarding prison labor exports, S.

2808 has set as a minimum standard the provision that China:

"has taken action to prevent export of products to the United States manufactured wholly or in part by convict, forced, or indentured labor and has agreed to allow United States Custom officials to visit places suspected of producing such goods for export."203

200(Babin Interview)

201 (Babin Interview)

203102nd Congress, 2d Session, S. 2808 To Extend to the People#s Republic of China Renewal of Nondiscriminatorv (Most-Favored- Nation) Treatment Until 1993 Provided Certain Conditions are Met. U.S. Senate (4 June 1992): 7.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. In addition to S. 2808, H.R. 5318 - or the United

States-China Act of 1992 - was passed in the Senate on July

23, 1992. This bill was enacted by the Senate and the House

together regarding the extension of MFN to the PRC. H.R.

5318 specifically mentions the need of China, "to ensure

access of international human rights monitoring or

humanitarian groups to prisoners, trials, and places of

detention."201* Thus, with the appearance of s. 2808 and

H.R. 5318 the legislative-executive struggle over keeping

China's unconditional MFN status has been extended for

another year.

Presidential Election - To further complicate this debate,

the U.S. presidential election this November between George

Bush and Bill Clinton is up in the air. Moreover, recent

polls show Clinton leading Bush 55 to 36 percent.205 As far

as the China policy of the United States is concerned, the

outcome of the November election will be a crucial

determinant. Within the last year Bill Clinton has said

that the U.S. government should withdraw MFN status from the

205Washington Post-ABC News National Telephone Poll, "Horse Race," The Washington Post. 1 September 1992, 6 (A).

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. PRC unless it cleans up its human rights record.206 Bill

Clinton in April of this year also stated:

"In China, the President continues to coddle aging rulers with undisguised contempt for democracy, human rights, and the need to control the spread of dangerous technologies. Such forbearance on our part might have been justified during the Cold War as a strategic necessity, when China was a counterweight to Soviet power. But it makes no sense to play the China card now, when opponents have thrown in their hand."207

Therefore, this quote sums up the difference in China

policy that will occur if Clinton wins the Presidential

election. Furthermore, a Clinton presidential victory will

probably effect the results of the Senate and Representative

elections. According to a Gallup poll released August 3,

Bush's dive in the polls has been driving Republicans in

Congress down with him.208 Thus, all these factors indicate

a change in both the legislative and executive approach to

Sino-American relations. In addition, as the emergence of

S. 2808 and H.R. 5318 indicate, the prison labor issue will

also still be a contentious issue in Sino-American relations

next year.

206,,Clinton & Tsongas on China and Tibet," Tibet Press Watch Vol. IV, No. 2 (April 1992): 7.

20f7Bill Clinton, Remarks Prepared for Delivery for the Foreign Policy Association of New York. New York (1 April 1992): 4-5.

208Beth Donovan, "GOP Candidates Loosen Grip on Presidential Coattails, " Congressional Quarterly Vol. 50, No. 32 (8 August 1992): 2329.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Memorandum of Understanding - However, there have been some

encouraging signs on the convict labor dispute recently.

For instance, on August 7, 1992 the U.S. and China signed a

Prison Labor Pact that prohibits exports to the U.S. of

goods from the PRC produced by prison laborers.209 This

agreement marks an important breakthrough in the areas of

American antagonism to Beijing's exportation of prison

labor. The key element in this memorandum is a provision

that, "U.S. officials could gain prompt access to and make

inspections of prisons, camps or companies employing prison

laborers that are suspected of exporting goods to the United

States."210 Also, as mentioned under the agreement, a U.S.

customs officer will be based in the American Embassy to

carry out the inspections.211 Thus, these measures are in

marked contrast to previous Chinese behavior and are a

positive step forward in Sino-American relations since June

1989.

Reactions to the agreement for the most part have been

affirmative. Human rights group Asia Watch welcomed the

209Daniel Southerland, "U.S., China Sign Prison Labor Pact," The Washington Post. 8 August 1992, 1 (B).

210(Southerland, WP, 6/20/92)

211Lincoln Kaye, "Party Cells," Far Eastern Economic Review Vol. 155, No. 34 (27 August 1992): 20.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. agreement as Ha positive step."212 Additionally, Asia Watch

believed the most important provision was providing for

inspection of sites suspected of exporting prison goods.213

However, Asia Watch also recommends that, "the pressure that

brought about this agreement must be continued and its

implementation must be closely monitored."214

Besides the positive reaction from Asia Watch over the

MOU, there have been interesting reactions from Congress.

Congressional Quarterly stated that Senate Majority Leader

George Mitchell, D-Maine, the main opponent of Bush's

policy, decided to postpone the introduction of legislation

urging conditions be put on MFN until September 1992.215

However, Mitchell's staff insists that Mitchell was not

impressed, and the vote was not delayed for that reason.216

Although Mitchell's staff and Congressional Quarterly

obviously disagree over the significance of the agreement,

there has been some positive acknowledgement from the main

212Barbara Crossette, "China Signs Pact with U.S. Meant to Curb Prison Labor on Exports," The New York Times. 8 August 1992, 3.

213Mike Jendrzejczyk and Sidney Jones, "China: Memorandum of Understanding on Prison Labor," Asia Watch Press Release. 7 August 1992.

214(Asia Watch, 7 August 1992)

215(Southerland, WP, 8/8/92, 1 (B))

216(King Interview, 8 October 1992)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. detractors of unconditional MFN that Beijing has begun to

address American concerns over its prison labor practices.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. CONCLUSION

In fact, the Chinese decision to sign the Prison Labor

Pact and address American concerns over its prison labor

practices was one reason cited by Democratic President-elect

Bill Clinton on December 14, 1992 when he announced he will

not revoke the PRC's MFN status.217 Clinton told the

national economic conference he called in Little Rock,

Arkansas that, "I don't think we'll have to revoke the MFN

status ... if we can achieve continued progress on human

rights and other issues."218 This change of heart by

Clinton is in marked contrast to his statement during the

campaign that he would put conditions on China's MFN if he

was elected President of the United States.219

This surprising announcement from the Democratic

President-elect seems to be a sign that President Bush's

active engagement policy with Beijing's leadership -

maintaining contact to bring about beneficial, incremental

217"Clinton Expects China to Keep MFN Trade Status with U.S.," The Japan Times. 16 December 1992, 3.

218(Japan Times. 3)

219("Clinton & Tsongas," 7)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. changes - is now recently being seen by more Democrats and

Republicans as the correct strategy of changing Chinese

behavior. Hopefully this new consensus on continuing MFN

for China while relying on diplomatic solutions to further

progress on human rights issues (such as prison labor

exports, Tibet, the Chinese student movement, abortion and

forced sterilization, and Chinese dissidents) will continue

once Clinton is inaugurated President. After all, as Arnold

Kanter, current Under Secretary of State for Political

Affairs said:

"I think all of us can agree on the basic objectives of our policy toward China: (1) promote respect for human rights; (2) encourage responsible and cooperative Chinese international behavior, particularly in the area of non proliferation; (3) promote peaceful and democratic reform within China; and (4) improve and sustain a trade relationship from which Americans - both producers and consumers - derive great benefit."220

Hence, these four hard to obtain basic goals have been

seen by both Democrats and Republicans as the correct U.S.

strategy of dealing with the PRC since Tiananmen Square;

however, it has only been very recently that some kind of

consensus on strategy has been declared.

Of course, finding some form of consensus on what is

the best way to deal with a country such as China that is

220(Kanter Testimony, 1)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. repressive, Communist, and often at odds with the United

States obviously has not been easy - especially since June

1989. Since that time both the executive and legislative

branches of the U.S. government have wanted to see positive

changes in the PRC's human rights performance, but have

disagreed over the methods to accomplish that goal.

Furthermore, both sides differ on how best to help the

Chinese moderates without strengthening the hand of the

hardliners. So the question has been: how can a process of

change be most effectively accelerated in a authoritarian

state like China?

Those who have wanted to put conditions on the PRC's

MFN, such as Senator George Mitchell, maintain, "that giving

MFN to China appears to legitimize a bankrupt leadership,

and that pursuing harsher measures against China will

eventually help bring about more enlightened policies."221

This view is shown by legislation such as H.R. 2712 and S.

1367 that Congress has passed. H.R. 2712 was initiated to

help the Chinese students in the United States; S. 1367 had

among its provisions the requirement of the PRC to end

coerced abortion and sterilization, and account for and

release demonstrators arrested in the June crackdown.

Additionally, this legislation is a symbol to Bush that

221(Dumbaugh, 1)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. something needs to be done regarding China's human rights,

arms control, and other violations.

It is also felt by many supporting conditional MFN that

the government of the United States has a lot of leverage

over Beijing because the U.S. market is the most important

market to China.222 In 1991 the U.S. trade deficit with

China was $12.7 billion or $2.3 billion larger than in

1990.223 Of course, the most obvious example of the power

of trade in the Sino-American relationship is shown by the

fight each year between the executive and legislative

branches over Beijing's MFN status. A good example of this

was the overwhelming approval by the House (409-21) and the

Senate (59-39) of the United States-China Act of 1991; which

eventually was vetoed by President Bush. Thus, Congress has

used the MFN issue to get itself involved in making China

policy.

The fight over MFN and the renewed stress on human

rights in the Sino-American relationship since June 1989 is

also because the strategic use of the PRC as a

222"Most-Favored-Nation Treatment to the Products of the People's Republic of China-Conference Report," Congressional Record-Senate Vol. 138, No. 23 (25 February 1992): S2132.

223United States Trade Representative, 1992 National Trade Estimate Report on Foreign Trade Barriers (Washington, DC: United States Government Printing Office, 1992): 43.

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. counterbalance to the Soviet Union has dissolved with the

end of the Soviet Union in December 1991. Without the

Soviet threat, the "China Card" rationale no longer exists

and many people believe that the PRC is no longer important

geopolitically for the United States. Hence, the U.S.

policy towards China has shifted to more human rights and

economic concerns, and Congress is attempting to take the

lead on this. Congress has made explicit amendments in

dealing with these problems and has tried to determine the

course of debate as much as it can. This is shown in the

way the executive branch has not shrank from confronting the

President on the China issue. However, there is a growing

doubt, as shown by the Clinton switch to favoring

unconditional MFN, of whether denial of MFN will induce the

Chinese government to behave more responsibly.

President Bush has always believed that maintaining MFN

is essential for promoting reform in China. He feels, "our

approach to China is to make clear our concern about human

rights abuses but also to recognize that cutting off all

contacts is not the way to effect change."224 As an example

of this, James Baker, Secretary of State, says, "MFN has

been a critical catalyst in the growth of our bilateral ties

and in the overall expansion of China's foreign trade during

224(Solomon, 388)

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. the 1980s to more than $100 billion annually."225 Hence,

these market-oriented institutions that have come about

under the PRC's economic liberalization of the 1980s are the

most open to the outside world, and are those that have the

greatest stake in unconditional MFN renewal.226

Thus, to the Chinese people whose livelihood depends on

strong economic ties to the United States - MFN is an

integral part of the Sino-American relationship.227 Many of

China's exports to the U.S. are garments and footwear, which

are extremely price sensitive, and will face sharp tariff

increases if MFN is revoked or conditioned.228 MFN is also

important for the PRC because the promotion of market

practices, i.e. capitalism, can indirectly foster democracy,

on account of, "functioning markets restrict the power of

the state, because by operating independently of governing

authorities, they expand the political space available to

the individual."229 Secondly, democratic governments seem

225James A. Baker III, "America in Asia," Foreign Affairs Vol. 70, No. 5 (Winter 1991/92): 16.

226(Kanter Testimony, 8)

227Michel Oksenberg, "The China Problem," Foreign Affairs Vol. 70, No. 3 (Summer 1991): 3.

228Susumu Awanohara, "First in the Firing Line," Far Eastern Economic Review Vol. 148, No. 18 (3 May 1990): 42.

229Michael Mandelbaum, "The Bush Foreign Policy," Foreign Affairs Vol 70, No. 1 (Winter 1991): 16.

100

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. to prosper most easily in conditions of economic success.230

This is apparent when you contrast China's economic

success with the staggering crises facing Eastern Europe and

the former Soviet Union. When the Berlin Wall fell in the

fall of 1989 noone adequately anticipated the severe

economic and political turmoil that has ensued since then in

Eastern Europe. Right now the war in the Balkans is seen as

the biggest European failure today.231 Russia has also

experienced a lot of pain since the end of the Soviet Union

in December 1991. When the Soviet Union went out of

existence it left a $68 billion dollar debt; $18 billion

should have been repaid this year but Russia is too broke to

pay it.232 In the Soviet Union Gorbachev gambled - and lost

- that he could start with political reforms and then tackle

economic reforms.233 Thus, radical Gorbachev reform has

made Eastern European and the former Soviet Union

democracies fragile by its huge transition costs and

230 (Mandelbaum, 16)

^Craig R. Whitney, "Europe's Doldrums," The New York Times. 3 December 1992, 1 (A).

^Louis Uchitelle, "New Man, Old Burden: Moscow Owes $86 Billion," The New York Times. 16 December 1992, 14 (A).

233Lena H. Sun, "Yeltsin Goes to China to See Economic Boom," The Washington Post. 17 December 1992, 40 (A).

101

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. economic chaos.

In China Deng Xiaoping took the opposite approach from

Gorbachev - restructuring the economy while keeping a lid on

political freedom.234 China's incremental economic approach

has improved productivity and efficiency.235 China's

economic performance in the 14 years since Deng Xiaoping's

policies have been implemented has brought about one of the

biggest improvements in human welfare anywhere at any

time.236

"200 million to 270 million Chinese citizens are thought to have been living in 'absolute poverty' (basically, not even enough food) in 1978. The number of absolutely poor in 1985, when the farming reforms had largely been accomplished, was 100 million. A Japan, two Britains, or half an America: about that many people were lifted out of poverty in China by the first six years of economic reform."237

Furthermore, China's GNP grew 7 percent in 1991, and

trade has expanded 17 percent in 1991.238 This economic

growth is not expected to change in the PRC anytime soon,

^("Yeltsin," WP, 40 (A))

235Mortimer B. Zuckerman, "The Steady-Hand Economy," U.S. News & World Report Vol. 110, No. 20 (27 May 1991): 45.

23«"China: the Titan Stirs," The Economist Vol. 325, No. 7787 (28 November 1992): 3.

237("Titan," 4)

238Chong-Pin Lin, "The Coming Chinese Earthquake," The International Economy Vol. VI, No. 3 (May/June 1992): 50.

102

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. either. During the 14th Party Congress in October 1992 Deng

got his theory of "socialism with Chinese characteristics"

written into the party's charter.239 Thus, economic

development is the party's core objective.

Since development is China's first priority, stability

is viewed as being very important. At an October 1990

luncheon held by the New York Council on Foreign Relations

Chinese Foreign Minister Qian Qichen said:

"For a country with a population of 1.1 billion people such as China, the most important thing is to maintain stability. Safeguarding China's stability is to protect the Chinese people's basic human rights. If China falls into chaos and national disintegration, the Chinese economy would inevitably be seriously damaged and the people would have to endure untold suffering... China needs stability, and the world needs a stable China. ,,24°

This Chinese emphasis on stability was evident during

the Yeltsin visit to the PRC in December 1992. When

Gorbachev came to visit Beijing in May 1989 he was admired

by the Chinese students for his views on democracy.

However, Yeltsin is regarded by many Chinese as a, "symbol

239Lincoln Kaye, "Uncertain Patrimony," Far Eastern Economic Review Vol. 155, No. 43 (29 October 1992): 10.

^Cang Lide, "Qian Qichen Discusses Sino-U.S. Relations," Foreign Broadcast Information Service: Daily Report China CHI-90- 196 (10 October 1990): 5.

103

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. o£ the dangers of overthrowing a Communist system."241

China now fears the chaos, economic decline, and instability

that has occurred in Russia since the Gorbachev reforms.

This Chinese fear of chaos is another reason why

Beijing does not want other countries imposing their human

rights standards on China. The PRC argues that it has

different perspectives on human rights than the West;

China's emphasis is on the right to have a decent home, a

job, and adequate health care.242 However, as Qian Qichen

stressed: "in order to bring Sino-U.S. relations back to

the normal path, the Chinese side has taken the initiative

in adopting some positive measures to show a high degree of

sincerity."243 These include banning the export of falsely

labeled goods and products manufactured by prison labor, and

releasing the vast majority of those detained in the wake of

the 1989 demonstrations."244 Also, since MFN is based on

emigration, China has continued to have respectable levels

^Sheryl WuDunn, "Yeltsin Starting 3-Day China Visit," The New York Times. 18 December 1992, 3 (A).

M2Hwei-Ling Huo, "Patterns of Behavior in China's Foreign Policy: The Gulf Crisis and Beyond," Asian Survey Vol. XXXII, No., 3 (March 1992): 273.

243("Qian Qichen," 5)

^("President's Report," 431)

104

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. of emigration.243

Besides gradual improvement in human right issues,

another reason for continued unconditional MFN for China is

that the United States still needs to cooperate with China

in many foreign policy areas. Even though it is true that

China is no longer a counterbalance to the Soviet threat, it

still is a permanent member of the Security Council, member

of the nuclear club, and a regional power in Asia. Also,

America needs China's help in dealing with Asian problem

areas such as North Korea and Cambodia. Furthermore, it is

easy to forget that Beijing still does cooperate often with

the United States. An example of this is China's role in

the Persian Gulf Crisis, where it supported all but one of

the U.N. resolutions.246

Additionally, China has worked to improve its strained

diplomatic ties since the Tiananmen Sguare Incident. Since

then it has established diplomatic relations with Saudi

Arabia, Singapore, Namibia, and Singapore.247 All of these

new diplomatic ties are in marked contrast to the isolated

245"Bush Defends China Decision in Meeting with Reporters," Congressional Quarterly Vol. 48, No. 21 (26 May 1990): 1684.

246 (Huo, 263)

247 (Huo, 271)

105

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. China of the 1960s and 1970s. Also, most western countries

except for the United States have removed the original

sanctions passed after the Tiananmen Sguare Incident.248

Finally, other countries in Asia such as Japan, Taiwan, and

the Republic of Korea have expressed support to the United

States for continuation of China's MFN status.249

This support for President Bush's policy of engagement

with the PRC has also been welcomed by the American business

community. American companies say denying MFN to China

would hurt U.S. exporters to China, American firms that

import from China, and also the U.S. consumer who would have

to pay higher prices for Chinese goods such as textiles,

footwear, etc.250 Therefore, the higher tariffs on Chinese

goods that would result from withdrawal of MFN worry the

business community.

Thus, the trade problems that would result from loss of

MFN have been a cause for concern for American companies as

well as the White House. One main trade factor has been how

nonrenewal or conditioning of MFN would hurt Hong Kong.

248 ("Bush," 1459)

^"Statement by Press Secretary Fitzwater on the Renewal of Most-Favored-Nation Trade Status for China," Weekly Compilation of Presidential Documents Vol. 26 (April-June 1990): 828.

250(Griffith, EAER. 10)

106

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Hong Kong was one of the dominant reasons mentioned by Bush

on May 24, 1990 for his recommended renewal of China's MFN.

Bush feared that revoking MFN would seriously injure Hong

Kong, which re-exported over $8 billion worth of Chinese

exports to the U.S. in 1989.251 Ultimately, the termination

of China's MFN status would result in duty increases and

severely hurt Hong Kong. "At stake is bilateral trade of

about U.S. $19 billion a year, according to the U.S.

Department of Commerce."252

Thus, isolating China would hurt Hong Kong and the

Special Economic Zones created in Southern China.

Termination would also trigger serious long-term

consequences in the Sino-American relationship that would

harm American interests. Once MFN is withdrawn, it cannot

be easily reinstated.253 Furthermore, if the United States

were to condition or withdraw MFN this would be regarded by

the leadership in Beijing and many of the people themselves

as a political symbol of hostility toward China.254

251 ("Bush," 1459)

252Susumu Awanohara, "Rights or Duties?" Far Eastern Economic Review Vol. 148, No. 18 (3 May 1990): 42.

253 (Oksenberg, 3)

254(Kanter Testimony, 17)

107

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Moreover, the American use of trade as a political

weapon to make countries behave has never worked in the

past.255 Castro's Cuba has survived a 30-year ban on

selling sugar, cigars and other things to the United

States.256 Also, when the Jackson-Vanik amendment

originally was passed to increase Soviet Jewish emigration,

Leonid Brezhnev decreased the number of Jewish exit visas by

two-thirds.257 Thus, how effective American sanctions can

be on China is in grave doubt.

Of course, the effectiveness of American sanctions

would be diluted by the fact that the U.S. would be the only

country imposing them. Bilateral sanctions just are not as

effective as multilateral sanctions, because the primary

effect will simply be to hand over the Chinese market from

American exporters to European and Japanese businesses.258

From a multilateral perspective, the U.S. would also lose

leverage in pressuring for Chinese trade reforms to confirm

with the General Agreement on Tariffs and Trade or other

^Strobe Talbott, "How Not to Break China," Time Vol. 140, No. 5 (3 August 1992): 53. 256("Least-Favored Nations," 33)

^(Talbott, 53)

M8Harry Harding, "China in the 1990s: Prospects for Internal Change," NBR Analysis No. 1 (September 1990): 22-23.

108

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. multilateral bodies.259 So withdrawal or conditioning of

MFN would isolate the U.S. from China.

Whereas a China engaged in international markets and

institutions will have a greater incentive to pursue a

responsible foreign policy. Also, by engaging economically

with the PRC, the U.S. can support and promote continued

economic development in China. Through this promotion of

economic development the United States will have a means of

influencing China, and can send clear signals on changes

needed on human rights and other issues. Since June 1989

the results of this policy can be seen by China agreeing to

adhere to the MTCR guidelines, protect intellectual property

rights, and ban prison labor exports. Thus, American

economic involvement in China promotes the process of

economic and political reforms.

259(Moskow Testimony, 15)

109

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