[Congressional Record Volume 146, Number 9 (Monday, February 7, 2000)]
[Senate]
[Pages S345-S346]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




             PERMANENT NORMAL TRADING RELATIONS WITH CHINA

  Mr. GRASSLEY. Mr. President, I want to spend a few minutes talking 
about two very important issues, one of which will come before the 
Senate later on this year, and that is the trade agreement with China 
which has just been negotiated. We call that permanent normal trading 
relations. The other subject is the WTO, which is an ongoing situation 
on which we probably will not take any action--at least negative 
action--this year, but it is something we always have to consider 
because every day and every hour there are certain decisions and 
discussions going on at the World Trade Organization that affect the 
U.S. economy.
  On China and the permanent trade relations vote we are going to have, 
it is very important that we do this right and do it soon but not do it 
before we have all the information we need. It is also important to get 
China into the World Trade Organization.
  We do not vote on China going into the World Trade Organization as a 
Senate, but it seems to me it is very necessary that we establish China 
with permanent normal trading relations with the United States in order 
to set the stage for China to be in the WTO.
  This is the first time China has agreed to submit itself to 
international trade disciplines. That, in and of itself, is a very 
historic and important development. Clearly, China acts in its own 
national interest and, of course, the United States should act in its 
own national interest. That is why I say it is most important to our 
national interest to agree to rules by which we can conduct more open 
commerce with China. Common sense dictates that it is a win-win 
situation for the United States since we have few restrictions on 
imports of China's products into the United States. Basically, it is a 
no-brainer, as far as I am concerned, to accept their lowering barriers 
to our exports to that 1-billion-people Nation.

  As far as the issue of human rights and national security--and they 
always come up when we discuss this issue with China--I believe the 
United States

[[Page S346]]

is big enough, the United States is strong enough, we are sophisticated 
enough, and we are smart enough to serve more than one vital national 
interest at the same time.
  In other words, we can be concerned about human rights, we obviously 
have to be concerned about our national security because no other 
nation will be, but we can also be concerned about our commerce with 
other countries, particularly the biggest country in the world, a 
country that has reduced, through this agreement, barriers for our 
goods to go to their country; in other words, setting the stage for a 
more level playing field because we already let a lot of Chinese goods 
into this country. There are very few restrictions.
  We can take our commerce into mind, we can take human rights and 
national security into mind, and we do not have to compromise. We can 
and must have a national security policy that protects our vital 
security interests. When there is a breakdown that threatens our 
security, we must and will fix it. We can and must speak out for the 
oppressed who cannot speak for themselves, and we can and must advance 
our interests in open markets and trade liberalization.
  We can and must do all these things at the same time. We can do this 
because trade, in and of itself, has so many different dimensions. 
Through trade, we export more than goods. We export more than 
manufactured products and services. When we have people-to-people 
relations that come about through commerce, we export part of our 
values, part of what makes America great: our American values. We also 
export, it seems, part of our society. That is why we must engage China 
commercially.

  While I would like to see the Senate vote to approve permanent 
trading relations for China as soon as possible, the timing of this 
vote is not entirely in the Senate's hands.
  First, China has to complete its remaining bilateral negotiations, 
especially with the European Union. The European Union may conclude a 
bilateral deal with China later this month. But some tough issues still 
remain between those two giants. So it is not clear when these 
bilateral talks will end.
  If China finishes its negotiations with the European Union, China 
still has to conclude negotiations with 10 other trading partners, as 
well as the Association of Southeast Asian Nations.
  Second, we have to complete work on the protocols that provide the 
underpinnings for the United States-China agreement that was signed 
last November and which is the basis for permanent normal trading 
relations between the United States and China. Several challenging 
protocol issues remain to be resolved.
  In my view, we can only have the permanent normal trading relations 
vote after all these steps in the process are completed. Senators, 
including this Senator, of course, will want to carefully review--in 
fact we have the responsibility to make sure we carefully review--the 
results of the protocol working party, which may be held in March, and 
carefully look at all the details before we schedule the permanent 
normal trading relations vote.
  As far as the Senate action on normal trading relations is concerned, 
I expect that every aspect of the agreement be transparent. That means 
everything besides the protocols--meaning the written protocols, 
including side letters, oral or even wink-of-the-eye understandings--
must be put on the table before the Senate so that each of the 100 
Senators are aware of them. That is what I mean when I say 
transparency.
  As Senators, we cannot make the same mistake we made with the 
Canadian Free Trade Agreement, of being oblivious to the side letter, 
the agreement contents of which have been unfair to our wheat farmers 
ever since. Senators never knew about that until about 5 or 6 years 
after the Canadian Free Trade Agreement was voted on by the Senate. 
That is why, when it comes to normal trading relations with China--and 
it is very important we approve that agreement--everything has to be on 
the table.
  On the issue of the World Trade Organization, the most shocking thing 
that happened in Seattle--apart from the riots and the mindless 
destruction--was that there was no consensus to move forward. No agenda 
was agreed to. This lack of consensus is especially shocking when you 
consider how much trade has helped bring unprecedented prosperity not 
only to the United States but around the world.
  In 1947, when this all started with the first round of multilateral 
trade negotiations--that was called the Geneva Round--the total world 
value of trade was only $50 billion. Today, it is $7 trillion. It is 
hard to think of a moment in history when such prosperity has been 
generated in such a short period of time.
  But despite this huge increase in our collective wealth, the world's 
trade ministers in Seattle could not reach agreement over how to keep 
this great economic engine going and create even more prosperity that 
will naturally result not just to the United States but to everybody in 
the world through freer trade. It does not take a rocket scientist to 
understand how much greater our national wealth is because of freer 
trade. Common sense dictates that we should continue down this path.

  The mandated negotiations on agriculture and services, the so-called 
building agenda, are now underway in Geneva. We may even have a special 
agricultural negotiation process to continue the agricultural portions 
of the talks. But I do not think we will see any quick agreement on the 
items that were left on the table in Seattle or even on the question of 
whether to restart the negotiations on drafting a ministerial 
declaration.
  Instead, I think we will see, in Geneva, a period of quiet 
consultation and consensus building. Considering the disaster that took 
place in Seattle, maybe it is easy to conclude that we do need a period 
of quiet consultation, and particularly consensus building, because 
nothing happens in the WTO except by consensus. So if everybody worries 
about America's interests being compromised at the WTO, just remember, 
it is done by consensus. If the United States does not agree to it, it 
will not get done.
  Seattle, of course, was a huge shock to the World Trade Organization 
and the process. We must try to restore mutual confidence among all the 
parties. The negotiators will need some time, perhaps even a few 
months, to refine their positions after the start of consultations.
  In summary, I see the next few weeks and months in Geneva as a period 
where we try to restore faith in the World Trade Organization and in 
each other and try to rebuild the groundwork for the process of 
establishing a consensus on trade. Progress may be incremental, but I 
believe we can achieve it.
  When it comes right down to it, rebuilding this confidence is not 
just a job for the WTO or just for our negotiators; it is a challenge 
we will have to address in the Senate, particularly in the Finance 
Committee and in my trade subcommittee.
  How can we get there? I believe there is one way. We must make a 
moral case for free trade. We must do a better job of making the case 
that free trade has helped us keep the peace, that free trade has 
brought freedom and prosperity to millions, that it has helped families 
and nations attain new levels of economic progress. I believe it is up 
to Congress to help make the moral case for free trade. The future of 
our international trading system may depend upon how well we do it. I 
intend to address this topic of the moral case for free trade many 
times this year. It may be one of the most important things we do this 
year in the Senate.
  Mr. President, I notice there are no other Members who have come to 
speak, so I ask unanimous consent to continue on my time in morning 
business to address another issue. I ask unanimous consent for 15 
minutes at the most.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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