[Congressional Record Volume 144, Number 75 (Thursday, June 11, 1998)]
[Senate]
[Pages S6146-S6149]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                   ENGAGING CHINA IN THE 21ST CENTURY

  Mr. BAUCUS. Mr. President, I rise today to address the upcoming 
summit in China and to stress the importance of this visit to U.S.-
China relations.
  Mr. President, as the age old adage says, ``A journey of a thousand 
miles begins with a single step.'' We should begin this journey with 
the first step--by defining our goals in Asia, and, more directly, in 
China.
  America's goals are simple: we want peace; we want prosperity and 
fair trade; and we want a decent world to live in.
  How do we achieve these goals? First, by guaranteeing peace and 
stability in the Pacific. That means preserving our permanent military 
presence in Asia. Remaining committed to our alliances with Japan, 
Korea and Southeast Asia. Defining our interests clearly to China.
  But it also means preventing unnecessary conflicts. And to do that we 
must find common ground. Remain engaged. Preserve and foster our 
working relationship with China. We must build and strengthen our 
diplomatic ties.
  In many ways China remains a challenge--a great wall in and of 
itself. Its intransigence in many areas of trade, human rights and arms 
proliferation presents a clear challenge for U.S. policy. Whether the 
topic is pirated software or the incarceration of political

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prisoners, China has often proved unwilling to adopt practices that the 
rest of the world perceives as reasonable and just. And when China 
behaves contrary to accepted norms, or to the rule of law, we must not 
look the other way.
  But we also must not fail to recognize China's importance to the 
United States and the rest of the world. And to engage China, we must 
understand China. This is a vast and old nation. When Kublai Khan 
conquered southern China in 1279, he presided over the largest empire 
the world had ever seen. And at that time the Chinese empire was 
already 1,500 years old, and Chinese history 2,500 years old. Today's 
People's Republic of China is the world's most populous nation, 
accounting for one-fifth of humanity; a nuclear power; and one of the 
world's fastest-growing economies.
  It is also a diverse nation. China is a mosaic of language, religion 
and culture. The majority of its 1.2 billion population are Han. The 
remaining 70 million people belong to 55 different ethnic minorities. 
China has eight major languages and 600 dialects. Yet we often think of 
China as one mind, one voice. China has many voices.
  Those who have not traveled to China may find it hard to truly grasp 
the differences in lifestyles. How many Americans today live without a 
telephone? Many have two or more. In China, one in four homes has 
telecommunications capability. And about six out of ten have a radio.
  The average per-capita income in China is estimated at $360 to $700. 
Yet it is possible that in the next century China will become the 
world's largest economy. At the same time, it will continue to face 
enormous problems of unemployment, overpopulation, a low level of 
education, and poverty.
  Now is the time for the United States to help bring China into the 
21st Century. Now is the time to engage China with great expectations. 
In the areas of weapons proliferation, Most Favored Nation Trading 
status and the World Trade Organization. And with human rights and the 
environment.
  Mr. President, Secretary Albright recently stated that ``we have an 
abiding political interest in a region whose cooperation we seek in 
responding to the new global threats of proliferation, terrorism, 
illegal narcotics, and the degradation of our environment. And we have 
an abiding interest as Americans in supporting democracy and respect 
for human rights in this, the most populous region of the world.''
  Our relationship with China will be essential to all these interests. 
And we must begin with peace and security, because our diplomatic and 
security interests in China are critical to maintaining a peaceful and 
strategic relationship in Asia, as recent events in the Taiwan Strait, 
South Asia and the Korean Peninsula show.
  China regards our Taiwan policy as the most critical and sensitive 
issue in this relationship. So while we must treat Taiwan policy with 
great care, our historic policy, based on commitments to Taiwan's 
security through the Taiwan Relations Act, and our commitments to 
acknowledge China's view of sovereignty under our three Joint 
Communiques, remains sound today. And the events of the past few years 
show that. China has made its point about how seriously it views 
independence in the crisis of 1996; and former Secretary Perry made our 
point about Chinese threats of military force.
  Today the situation has calmed. Taiwan and China are beginning to 
talk once again. And we can, with caution and foresight from all three 
sides, expect if not reconciliation, at least stability in the Taiwan 
Strait. We need make no major changes, and in particular should avoid 
deals at Taiwan's expense as relations with China improve.

  For us, the division of the Korean Peninsula, and the continuing 
threat posed by the 1.2-million-man North Korean Army just above the 
demilitarized zone, is equally sensitive. In fact, this is the only 
issue that ever brought the U.S. and China to war
  And to maintain the peace, we need a cooperative working relationship 
with China; and on this issue we have it. China is doing precisely what 
we hope it will do. It offers the North Koreans advice that only a one-
time ally can give. It provides food aid. And it does what it can to 
move the four-party talks ahead, even if that is limited to figuring 
out seating and handshake arrangements that the two Koreas will accept.
  Then let us look to the spread of nuclear weapons in South Asia. This 
has created an immense danger for the world of a breakdown in the Non-
Proliferation Treaty; an immediate danger of war between India and 
Pakistan; and a new strategic question for China, as the Indian 
government has indicated that its decision to test nuclear weapons was 
due to fears about China.
  China's potential as a positive mediator in South Asia cannot be 
underestimated. I remain concerned that China may have contributed to 
the arms race by aiding Pakistan in its development of a nuclear 
device. It is incumbent on all nations to prevent the spread of nuclear 
weapons, and we must hold China to its signed commitments on this 
issue. Just as China worked constructively to avert further spread of 
the recent Asian currency crisis, so too must it be expected to work 
towards preventing the further proliferation nuclear arms in Asia.
  Mr. President, before I speak about the issue of China and trade, let 
me say a few words regarding the recent flap over satellite launches.
  First, the concept of allowing China to launch American satellites is 
sound. It can be done without transferring technology useful for ICBMs. 
And to suggest that we would willingly facilitate the process of other 
countries launching ICBMs does not make any sense.
  However, the controversy over this question indicates the large 
emerging question of a proper approach to the rapid advance of 
technology from military to commercial fields. This is the basic 
question not only in satellite launches but in software encryption, 
technology exports and many other issues. Our country needs a strategic 
approach to the entire question, and the time to begin is now. With 
respect to the specific question of satellite launches, if oversight 
was weak, we should strengthen our policy. If any American companies 
broke the law they should be punished. But derailing potential progress 
in U.S.-China relations does not improve the situation one iota.
  The second thing we need is a fair, mutually beneficial economic 
relationship. And that begins with the most urgent question--the Asian 
financial crisis.
  I think China's performance--along with that of the Hong Kong S.A.R. 
government--during the Asian financial crisis has been impressive. With 
Southeast Asia's currencies suffering, China's competing exports are 
under intense pressure. A devaluation of the yuan could ease life for 
many Chinese businesses. But it would start a new panic in the currency 
market, just as Thailand, South Korea, the Philippines and other Asian 
nations are beginning to rebuild from last year's collapse. Up to now, 
China and Hong Kong have remained committed to avoid devaluations. And 
if Asia recovers this year, it will be in no small part because of 
China and Hong Kong.
  We also need a stable bilateral trade relationship. And the 
foundation for this relationship is Most Favored Nation Status.
  President Clinton has just put forth his annual request for renewal 
of Most Favored Nation status for the Republic of China. Not 
surprisingly, this request has been greeted with suggestions that the 
United States should use MFN as a tool. As a weapon, to convince China 
into making dramatic reforms. It is not. It is the foundation of 
commercial relations and should be left alone.
  As Winston Churchill once said: ``A pessimist sees the difficulty in 
every opportunity. An optimist sees the opportunity in every 
difficulty.'' Those are good words to live by. I stand here today 
because I believe that we should use MFN as our way of helping China 
address its internal reforms while preparing for its accession to the 
World Trade Organization.
  I do not believe that an open trade policy means Americans should be 
indifferent to human rights abuses in China. The United States should 
take a strong stand against serious infractions against workers, 
dissidents, women and children. But restrictions, such as the denial of 
MFN trading status or the use of sanctions that hurt

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Chinese people and fail to directly punish the abusers of power, do 
little to encourage social reconstruction on the mainland.
  In fact we should do the opposite. We should give China unconditional 
MFN trading status, upon China's accession to the World Trade 
Organization. I have long promoted this process. And I will do so again 
as we prepare for this historic summit. The extension of permanent MFN 
status to China would benefit both of our countries. It would reduce 
uncertainty in our trade relations. It would increase the chances of 
China moving to a more open economy. In addition, it would ensure that 
the U.S. is able to benefit fully from the economic liberalization 
measures that China must adopt in order to be accepted as a WTO member.
  Finally, we need a fair trade relationship. China's market should be 
as open to our goods and services as we are to theirs. And today it is 
not. In this case, the numbers speak for themselves. It may be true 
that we have a large and growing deficit with China. At the same time, 
U.S. exports to China have increased from $11.7 billion in 1995 to 
$12.8 billion in 1997. In the first quarter of 1998, our exports have 
reached $3.3 billion. My home state of Montana exported $6.2 million 
worth of products to China just last year.
  Furthermore, our agriculture industry relies on Asia. Ag exports to 
Asia constitute 40 percent of all agricultural exports. In the United 
States we produce more than we could ever possibly consume. Our 
agricultural producers simply cannot survive without markets in China 
and the Pacific Rim.
  Our economic goals and China's economic goals are not so far apart. 
China seeks a working market economy for China's people. We seek that 
as well. We want a fair and open market for our goods and services. Yet 
we continue to face the startling implications of the trade imbalance 
between the United States and China--our deficit is almost $50 billion 
and growing.
  British writer G.K. Chesterson once said: ``Do not free a camel from 
the burden of his hump; you may be freeing him from being a camel.'' We 
cannot change China to make its leaders think like Americans, act like 
Americans, and participate in the world marketplace like Americans. We 
should accept our differences. But we must insist on a minimum standard 
of behavior.
  We must continually push for the elimination of unfair trade 
barriers, such as the phony ban on Pacific Northwest wheat due to TCK 
smut. We must encourage private investment over State-Owned 
Enterprises. We must fight for market transparency. We must insist that 
President Jiang Zemin and Premier Zhu Rongji open China to more U.S. 
imports. And the way to do that is a commercially meaningful accession 
for China to the WTO.
  This is in everyone's best interest. It is good for China and it is 
good for the United States for the world's largest country to become a 
member of the WTO.
  But the accession is going too slowly. It is not good enough to wait 
for China to reach internal consensus on WTO membership. We need to 
show China that the status quo is not acceptable. I believe that by 
engaging China, we can help China's reformers balance internal change 
and global opening. This does not mean delivering WTO carte blanche. 
Rather, the Administration and Congress should pursue a three-pronged 
approach to serious engagement.
  First, the United States must give China a material incentive to 
enter the WTO. The Administration should endorse, and Congress should 
pass, a law to make permanent MFN status automatic when China enters 
the WTO.
  Second, the United States should target China's moral incentive to 
enter the WTO. With our bilateral talks on Taiwan's WTO membership 
complete, the Administration should push for Taiwan's rapid entry into 
the WTO, regardless of where talks stand with China.
  Third, the United States must convince China that unnecessary delay 
in entering the WTO is costly and counterproductive. Distribution and 
market access are just two issues that farmers and traders want fixed. 
At the same time, we want to make certain that China will be able to 
agree to, live with and abide by a signed agreement. If talks remain 
stagnant after President Clinton's visit to China at the end of this 
month, we should strongly consider opening a broad market access case 
under Section 301 of our trade law. It should begin with the areas 
where China is violating our 1992 agreement. It should set a deadline 
for sanctions if they do not shape up.
  Let me now turn to our third goal: a decent world to live in.
  President Clinton is right to go to Tiananmen Square when he visits 
China this month. But he will also be right to speak out on human 
rights and the rule of law.
  It is a sad fact that those who would speak out against the 
government are still in danger of being imprisoned or subject to house 
arrest. Just as China will be expected to abide by the standards of 
nuclear non-proliferation and the WTO, it also should be expected to 
live up to the international standards of human rights, beginning with 
the Universal Declaration of Human Rights.
  Although I welcome the recent release of political prisoners Wang Dan 
and Wei Jingsheng, I am disheartened that they are subject to a de 
facto exile, unable to return to their homeland because of their 
political activities. Upwards of 2,000 political prisoners remain in 
China, imprisoned for the simple expression of their beliefs.
  Mr. President, Americans hold freedom of expression as one of their 
most cherished rights. It is a prerogative that is all too often denied 
the Chinese people, but one that I view as essential to that country's 
political and economic viability. Where ideas are suppressed, 
creativity and innovation are lost. And we need look no further than 
the world's leading economy to see the importance of innovation and 
expression. America's economic power is indicative of its political and 
economic freedom and the extent to which ideas and innovation are 
exchanged. It is true that China's economic success in the last 20 
years is impressive. But how far can innovation and growth proceed in 
the absence of true freedom to carry out discourse and exchange ideas? 
The global marketplace grows increasingly competitive every day. China 
and the rest of the world stand to lose if that great country's people 
aren't allowed maximum ability to express, innovate and progress.
  Finally, Mr. President, we must also engage China when it comes to 
environmental concerns. As economies develop throughout the world, they 
use more fossil fuels. Of course, with increased usage often comes 
significant pollution. Nowhere is that more true than in China. In the 
coming years, China will likely burn more fossil fuels, dispose of more 
chemical and industrial waste and emit more carbon dioxide than any 
country in the world. As economic growth in China accelerates, demand 
for electricity and the coal used to generate it will also increase.
  Mr. President, 9 of the last 11 years have been the warmest of the 
20th century. If the emissions from China's burgeoning power plants are 
not subject to controls, our efforts to prevent global warming will be 
undermined. China is part of the problem, and should be part of the 
solution. Although this is true for all developing nations, it is 
especially true for China, its appetite for hydrocarbons being what it 
is
  When I worked on the Clean Air Act 1990, emissions trading was 
proposed as an alternative to inflexible, across-the-board efforts to 
control emissions. Initial reports indicate that the system of 
emissions trading works. I am interested in possibly applying the 
concept on a global scale, to include developing countries such as 
China.
  Again, Mr. President, if we are to minimize the impact of these 
outputs, the United States must engage China in a cooperative 
relationship. We must do it in the areas of environmental protection, 
international security, human rights and trade. Although I agree with 
the Chinese proverb that says, ``It is better to light a candle than 
curse the darkness,'' I also think that the words of that great 
American Henry Ford are apropos here: ``Coming together is a beginning, 
staying together is progress, and working together is success.'' Mr. 
President, the United States and China have come together. For our 
benefit and that of the rest of the world, let us continue to work 
together for success.

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  Finally, Mr. President, let me say a few words about the approach I 
see developing in Congress.
  We have not covered ourselves with glory recently. We have not passed 
our IMF replenishment. We have not passed our UN dues. We have not 
passed the Comprehensive Test Ban Treaty. We have not passed fast 
track. And some have seen the recent satellite launch controversy as an 
opportunity to make points in domestic politics.
  This is not the way a great power behaves. We have serious 
responsibilities in our foreign affairs--whether in peace and security, 
in economics and trade, human rights or environmental protection. And 
we diminish our institution at home, and our country abroad, if we do 
not take these responsibilities seriously.
  We have time to fix our deficiencies. But it is not unlimited time, 
and as we see in South Asia; in Hong Kong; in Korea; events will not 
wait for us. So as the President makes this historic trip, let us 
reflect a little more deeply on ourselves, on our responsibilities, and 
on what we can do for our national, rather than political, interest.
  Thank you, Mr. President, and I yield the floor.
  Mr. GRAMM addressed the Chair.
  The PRESIDING OFFICER (Mr. Inhofe). The Senator from Texas.

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