Senate Oks China Trade Bill

Supporters Say Vote Will Boost Human Rights

September 20, 2000|By William Neikirk, Washington Bureau.

WASHINGTON — The allure of new markets in a country with one-fifth of the world's population proved politically irresistible Tuesday as the Senate gave final congressional approval to a historic bill normalizing trade relations with China.

Economics and the spreading influence of global commerce triumphed over concerns such as human-rights abuses and nuclear proliferation in an 83-15 Senate vote that handed President Clinton a major foreign policy victory.

Approval of the legislation, which now goes to the White House for Clinton's signature, also proved a signature achievement for a Congress that has spent most of the year locked in partisan combat. It also could mark a turning point in often-contentious U.S.-China relations.

Businesses and farmers had lobbied furiously on behalf of the measure, which would ratify a 1999 market-opening trade deal between the administration and China and also clear the way for Beijing's communist regime to join the World Trade Organization, the police of international commerce.

Supporters of the agreement said that by liberalizing trade, China would over time be forced to liberalize its approach to human rights and introduce free-market competition to an economy dominated by state enterprises.

"This landmark agreement will extend economic prosperity at home and promote economic freedom in China, increasing the prospects for openness in China and a more peaceful future for all us," Clinton said at the White House.

Both major presidential candidates, Vice President Al Gore and Texas Gov. George W. Bush, also support permanent trade.

In Beijing, Foreign Ministry spokesman Sun Yuxi said, "The early resolution of this issue not only serves the interests of China. It is also in the interests of the United States itself."

Organized labor waged a vigorous campaign against the bill, particularly in the House, arguing it would encourage U.S. businesses to shift more of their production to China despite claims to the contrary by supporters.

Labor's protests never gained traction as the administration and its backers on Capitol Hill said the agreement requires only China to reduce its tariffs and trade barriers without imposing similar demands on the United States.

In supporting the bill, Sen. Dick Durbin (D-Ill.) said America might be able to demand more human-rights concessions from China if the U.S. were reducing its own trade barriers, but he said the U.S. is in no position to demand such concessions because "we are receiving the benefits from this agreement."

By granting China permanent normal trade relations, Congress would no longer be required to approve annual legislation providing Beijing the same breaks on tariffs that the U.S. extends to other trading partners, which it has done since 1980. Critics of the legislation argued that such annual reviews served to curb Chinese abuses of human rights and its military ambitions.

Supporters predicted enormous benefits in bringing China into the World Trade Organization and in Beijing's decision to open its markets and reduce its trade barriers on a wide range of goods and services, including agricultural products, computers and even banking.

They warned that the economic benefits would build gradually because many American companies are still more comfortable trading with countries where the laws and business practices are clearly laid out.

"It is going to be slow at the beginning," said Dave McCurdy, a former Oklahoma congressman and president of the Electronics Industries Alliance, an organization of high-tech corporations that hope to expand their markets in China. He added that future sales for computer and telecommunications companies in China would be enormous.

The alliance foresees new riches for U.S. high-tech exporters. From 1990 to 1998, such exports rose 500 percent, it said, adding that China is the world's fastest growing market in semiconductors and telecommunications and the largest personal computer market outside the U.S.

Barry Bosworth, an economist at the Brookings Institution, a Washington think tank, said he doubted the agreement would bring major benefits to the U.S. economy in the short run.

In some respects, he said, the legislation poses risks for China's inefficient state-run enterprises. Over time, they would be exposed to more competition from U.S. companies and financial institutions that have little patience in providing capital to businesses propped up with state help, he said.

Sen. Peter Fitzgerald (R-Ill.) said that as a result of the bill "there will be an expansion of the private sector and institutions that are independent of the government." He predicted that retailers such as Wal-Mart would gain a foothold in China and hire workers who now labor for state-run companies.

"The government's grip on employees will be loosened," he said.