[Congressional Record Volume 146, Number 102 (Wednesday, September 6, 2000)]
[Senate]
[Pages S8067-S8069]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




 TO AUTHORIZE EXTENSION OF NONDISCRIMINATORY TREATMENT TO THE PEOPLE'S 
            REPUBLIC OF CHINA--MOTION TO PROCEED--Continued

  Mr. THOMAS. I will proceed with PNTR on that basis. I thank the 
Chair.
  Mr. President, as chairman of the Subcommittee on East Asian and 
Pacific Affairs of the Senate Foreign Relations Committee, I rise today 
in strong support of H.R. 4444, a bill to establish permanent normal 
trade relations with the People's Republic of China.
  Let me begin today by disposing of the principle argument offered by 
opponents of this bill--that this bill somehow is a ``gift'' to the 
PRC, a reward. To hear the opponents of this bill talk, you would think 
that we were on the losing end of this equation.
  However, examining the basic facts shows there is a fatal flaw in 
that assertion. Our markets are already open to the Chinese and to 
Chinese goods; the same is not true about our ability to enter China's 
markets. This bill, and the accompanying accession of China to the WTO, 
changes that. This bill opens up their markets to the United States. 
This bill lowers tariff and nontariff barriers to our goods and 
services. This bill gives us a level playing field. In other words, it 
is a win-win situation for the United States.
  It is estimated that in the first year after this bill is enacted, 
and China accedes to the WTO, our trade with China will increase by $14 
billion; in other words, almost double today's volume. And that 
translates into more jobs for U.S. workers and U.S. companies.
  To use my home State of Wyoming, as an example, which is not a large 
export State, China ranked as Wyoming's 15th largest export destination 
in 1999; that is up from 16th in 1998 and 19th in 1997. Our largest 
exports are agricultural products, such as beef, grains, and, in 
addition to that, minerals.
  Under this agreement, Wyoming farmers and cattlemen will no longer 
have to compete with export subsidies China uses to make its 
agricultural products unfairly competitive. China has agreed to 
eliminate sanitary requirements which are not based on sound scientific 
bases and which act as artificial barriers to products from America's 
Northwest, which includes Wyoming. Wyoming producers will benefit from 
a broadening of the right to import and distribute imported products in 
China, and from wide tariff cuts on a wide range of products.
  To illustrate, under the agreement, China has cut its tariff on beef 
from 45 percent to 12 percent. It has cut its tariff on pork from 20 
percent to 12 percent. And, significantly for a great number of my 
constituents in Sweetwater County, it will reduce its exorbitant 
tariffs on soda ash--90 percent of which is mined in Wyoming--from 
double-digits to 5.5 percent.
  Passage of this bill means fewer barriers to U.S. exports. Fewer 
barriers mean more exports, and more exports mean more jobs for Wyoming 
farmers, ranchers, cattlemen and small business owners.
  I don't need to tell my colleagues about the present sorry economic 
state of many of our agricultural sectors and small businesses. The key 
to their continuing viability and growth is increasing their share of 
foreign markets. It is for that principal reason that I support this 
bill and for China to go into the WTO. Clearly, it is going to be more 
advantageous for us to deal with the People's Republic of China through 
this organization than on a unilateral basis which we have done for the 
last number of years. By the way, this same trade arrangement has been 
available to them on an annual basis.
  Let me make one more observation before moving on. Defeating the bill 
will not keep the PRC out of the WTO. China will accede to that body 
regardless of what we do this week, regardless of whether or not we 
want it. We don't have a veto over their admission, and we make it 
sound as if that is the case from time to time.
  What defeating this bill will do, however, will be to deny us the 
benefits of an open Chinese market, at least a more open Chinese 
market. It would allow China to keep its doors closed. It would give 
our allies and competitors a huge advantage over us.
  I was there a while back, when we had a feud going on between the 
United States and China. They canceled large orders from Boeing and 
bought airbuses from France. That is the way the world has become. They 
can do that. It would set in stone our present trade regime where 40-
percent tariffs are the norm, not the exception. That is what would 
happen if we don't pass this bill.
  These are not the only bases for my support. Unlike some of my 
colleagues, I believe China is changing for the better and that 
admitting them to the WTO will, hopefully, speed that process. One has 
only to compare the China of 1978--the China of the Cultural 
Revolution, of Mao suits, and Marxism-Leninism-Mao Zedong theory--with 
the China of 2000, the China of the economic revolution, to see that 
changes are indeed both substantial and widespread.

[[Page S8068]]

  This is not to say that everything is great there. That is not really 
part of the discussion. Of course, there are a number of things that 
need to be done. The country continues to have an abysmal human rights 
record, to stifle political dissent, to subjugate Tibetans, to 
stridently attempt to cow Taiwan into submission. All these things 
continue to go on. No one likes that, but that is not really the issue. 
The issue is how can we best bring about change.
  There is no argument in this Senate as to whether China needs to 
change. We all agree it does. I believe the real issue is how do we 
effectuate that change. Do we do it by continuing to attempt to isolate 
China, as some Members would have us do, by pushing them away from us, 
or do we accomplish the task by seeking to engage China, by drawing it 
further into the community of nations, by giving its people an 
opportunity to see how others live in the world and then become 
impatient to make that transformation for themselves?
  We can see that happening in a number of places around the world. Is 
it too slow? Sure. Isolating China off by itself is to some a feel-good 
position, a solution for some people. Improve your human rights record 
or we will cut off trade. Stop threatening Taiwan or we will cut off 
military exchanges. Stop selling military hardware to other countries 
or we will cut off high-tech transfers. Do we want a policy that makes 
us feel good or do we want something that works?

  I don't believe you can unilaterally isolate a country such as China. 
Cut off trade and the European Union is more than happy to step in, 
sell China Airbuses, as I mentioned, in place of our Boeings. Cut off 
military-to-military exchanges and we lose the opportunity to impress 
the PLA with the vast superiority of our military while improving 
increasing mutual distrust among our two militaries. Cut off high-tech 
transfers and Beijing simply gets it somewhere else. Add that to the 
fact that foreign governments rarely react kindly to ultimatums from 
other governments--take, for example, how we in the U.S. would react to 
another country if they told us how to manage our affairs--and I 
believe the unworkability of the ``isolationist solution'' becomes 
self-apparent.
  Instead, I believe the best way to influence China is to engage it, 
to draw it inextricably into the world community, to expose it to the 
world of ideas.
  In 1995, on my first trip to China as subcommittee chairman the 
difference that contacts and trade with the West made in the PRC were 
clearly evident. I have not traveled there over the years as many 
people have, but just in the last few years there has been great 
change. Perfect? Absolutely not. More change is needed, of course.
  In Beijing, the vast majority of the population was still riding 
bicycles. There were, 5 years ago, very few private cars, and political 
questions, especially in Taiwan, and the party line were the sole topic 
of discussion. In Shanghai, bicycles were replaced by mopeds and more 
private cars. While Taiwan and ``one China'' were still topics of 
discussion, individuals I met there were more interested in talking 
about trade, what they could do to facilitate economic change and 
growth. In Guangzhou, there were fewer bicycles or mopeds to be seen. 
Private cars, including BMW and Mercedes Benz, appeared to be the norm. 
Politics wasn't talked about a great deal.
  The lesson was quite clear. The establishment of the rudiments of a 
market economy coupled with trade with the outside world leads to 
increased personal wealth and to increased personal entrepreneurship. 
That in turn leads to an increased interest in and expectation of 
growth and certain basic personal freedoms. We have seen that same 
development in Taiwan and South Korea where authoritarian governments 
have been replaced by thriving democracies over the last 20 years. The 
same hopefully will happen with China. Once the genie is out of the 
bottle, there is no putting it back. The march toward an open 
democratic society will happen. The only question is how long it will 
take.
  I am told by experts that in Asia it probably takes a generational 
change before some of those things happen. I am sure that is true. I 
believe, however, that we do speed its pace by passing this 
legislation. I also believe that Chinese accession will remove a major 
irritant in our relationship. Whenever we have a disagreement with 
China over trade relations, be it intellectual property or market 
access or whatever, our reaction is to apply some unilateral sanctions 
on China, sanctions which only serve eventually to limit the rest of 
our relationship and our exports to that country. It is ineffective 
here and it has been ineffective other places. We have removed a number 
of those sanctions this year.
  By bringing China into the WTO, we turn trade disputes 
from unilateral into multilateral issues. We transform the dispute from 
``I said/he said'' to one mediated by an independent international 
body. We thereby lessen the irritation of bilateral affairs while at 
the same time increasing the likelihood that China will find a remedy 
to the problem.

  For all those reasons, I support H.R. 4444.
  Before I close, let me add a word or two about possible amendments 
which may be offered for consideration. Regardless of their relative 
merit, I, as Senator Roth, chairman of the Finance Committee, and many 
others am strongly opposed to adding any amendments to the China PNTR 
bill. Any amendment will only have the effect of killing it for this 
year, since amending would require it to be sent back to the conference 
committee. Once in conference, it is unlikely the bill would emerge 
before we adjourn sine die. We only have some 20 legislative days 
remaining in this session and a full plate of domestic appropriations 
and legislation with which to deal. It would be a herculean task under 
any circumstances, but this year makes it more difficult because, of 
course, some on the other side of the aisle are doing everything they 
can to stall the process. We hope that won't continue to happen.
  There is not, realistically, enough time for a conference and to pass 
it back through both Houses. It is clear the House fully supports the 
present unamended version. It passed by a vote of 237-197. So does a 
vast majority of the members of the Senate Finance and Foreign 
Relations Committees, and so do I.
  Mr. President, despite all the hyperbole about passage of H.R. 4444, 
it does not mean we are selling out to the Chinese, that we are telling 
them it is all right to proliferate, to abuse human rights, or to 
threaten Taiwan. It means we expect them to play by the same rules we 
do; we expect them to be a responsible member of the world community, 
and we expect to be able to reap the same benefits they do from an 
ever-expanding global economy. No more, no less. The bill is good for 
the United States, good for U.S. companies, good for U.S. workers, and 
good for the U.S. consumers.
  In the final analysis, this is good for China because it will 
undoubtedly bring about the kind of changes that many would like to see 
in that country, including many Chinese. Many Chinese would like to see 
democratization, rule of law, and respect for basic fundamental human 
rights.
  For all these reasons, I urge my colleagues to support the passage of 
H.R. 4444.
  Mr. SCHUMER. Mr. President, I rise to echo the remarks made yesterday 
by Chairman Roth and also to concur with my friend and senior colleague 
from New York, Pat Moynihan, regarding China's compliance, or lack 
thereof, with the U.S.-China bilateral agreement signed as part of 
China's admission to the World Trade Organization.
  I am concerned that after laboriously working out a bilateral trade 
agreement that addressed myriad economic issues, China seems to be 
picking and choosing which aspects of the agreement to follow and which 
to ignore. A prime example is insurance. Under the bilateral agreement 
signed last November, China agreed to preserve the existing market 
access currently enjoyed by foreign insurance companies. In other 
words, under the agreement, a foreign-owned insurance company in China 
would be able to continue to operate and to add new branches and sub-
branches as a wholly-owned company once China entered the WTO. Less 
than a year after this historic and painstaking agreement was signed, 
China is unilaterally rewriting the rules and treating these 
grandfathered companies like new entrants into the China

[[Page S8069]]

market. This puts the very companies that invested in China's economic 
growth at a competitive disadvantage to new entrants.
  Fundamental to the foundation of the U.S.-China bilateral agreement, 
to China's ascension into the WTO, and to the possible establishment of 
Permanent Normal Trade Relations with China is the belief that 
agreements will be honored, not on a piecemeal basis, but fully. This 
``interpretation'' by the Chinese government on insurance begins to 
cast doubts about whether ironclad agreements with China will truly be 
completely and totally honored.
  I still intend on supporting PNTR for China, but I am disappointed 
that China appears to be backsliding on its agreement regarding 
insurance. I hope that the Chinese leadership will adhere to the 
agreements signed last year on insurance, and absent that, I hope the 
Administration continues to apply forceful pressure to see that China 
keeps its end of the bargain. That is the essence of free, fair and 
open trade.
  I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. LEAHY. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Vermont is recognized.
  Mr. LEAHY. I thank the Chair.
  (The remarks of Mr. Leahy pertaining to the introduction of S. 3011 
are located in today's Record under ``Statements on Introducted Bills 
and Joint Resolutions.'')
  Mr. LEAHY. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. SPECTER. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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