DISAPPROVAL OF MOST-FAVORED-NATION TREATMENT FOR CHINA (House of Representatives - July 22, 1998)

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The SPEAKER pro tempore. In the matter pending before the House, the following time remains: The gentlewoman from California (Ms. Pelosi) has 4 minutes remaining. The gentleman from California (Mr. Matsui) has 6 1/2 minutes remaining. The gentleman from Nebraska (Mr. Christensen) has 4 1/2 minutes remaining. The gentleman from Illinois (Mr. Crane) has 3 1/2 minutes remaining.

The Chair recognizes the gentlewoman from California (Ms. Pelosi).

Ms. PELOSI. Mr. Speaker, as the House is coming to order, as one who has had a long interest in this U.S.-China trade debate, I want to commend you for your distinguished presiding over the House today during this very important issue to the American people.

Mr. Speaker, I now have the privilege of recognizing our distinguished Democratic leader of the House, a champion for promoting democratic values throughout the world, promoting our own economy through promoting exports, and stopping the proliferation of weapons of mass destruction.

Mr. Speaker, I yield 4 minutes to the gentleman from Missouri (Mr. Gephardt).

Mr. GEPHARDT. Mr. Speaker, I would begin my statement today with a question that I think all of us have to ask as we decide which way we are going to vote. The question is, if we had kept in place in the mid-1980s a policy of constructive engagement with South Africa that is very much like the policy of constructive engagement we now have with China, would not Nelson Mandela be the President of South Africa today, or would he still be in jail? That is the question.

I know no two countries are alike. I know no two sets of policy can be exactly the same. But I believe with all my heart that the policy we are following, which is basically a policy of saying that more trade, more economic relationships, more communication is sufficient to bring about real change in China, is a failed policy and it has not worked.

If you will, simply look at the facts. Let us first look at trade. In 1987 the trade deficit with China was about $3 billion between the United States and China. Today it is over $60 billion.

Our own Trade Representative has stated, as of this year, as of this year, that there is essentially a closed market in China to American products. Put aside the tariff difference. Our average tariff on their goods coming here, 2 percent. Their average tariff on our goods going there, 17 percent.

But put that aside. The greatest barrier to our products going into China are nontariff barriers. Our own Trade Representative has said that their market is essentially closed now to our products. They had been unwilling to meet up with our demands to put them in the WTO. They are simply unwilling to allow for fair and free trade.

So if my colleagues look at this in terms of trade policy, we are not making progress. We are going in the wrong direction. We are not going in the right direction.

Let us take a look at human rights. Again, no progress. The President was there, and I admire him for going, and I think it was right to go. But let me tell my colleagues something. The Chinese leadership is happy to have our President or anybody else come and make statements about human rights as long as they do not have to do anything about human rights. Talk is cheap. I am from Missouri. Show me. Nothing is happening.

One hundred fifty dissidents who were in Tiananmen Square are still in jail. Even as our President came to China, people were locked up. People were locked up for no causes. People were locked up because they dared to try to express themselves politically freely.

There are no human rights in this country. Every violation that could be made of human rights has been made, and there is no progress. Look at the record. If the policy were working, the record would be different. It is not. So if a policy is not working, we need a new policy, and I believe that policy has to have actions as well as words.

I respect deeply my colleagues who believe that more trade and more talk will work. I respectfully disagree. I do not think that anything but solid action will make a difference.

I want to remind my colleagues of what was said in the debate about South Africa in 1985. I want to read my colleagues a statement. One of our Members in 1985 said this: `South Africa is making positive and concrete strides under an American policy of constructive engagement. Given the progress already made and the virtual irreversibility of the trends, sanctions and other punitive activities can hardly be expected to produce more salutary results than President Reagan's policy of constructive engagement.'

Our respected colleague, the gentleman from Illinois (Mr. Hyde), said those words on this floor in 1985, but this House in a bipartisan way stood for taking a definitive action. Words were not enough. We had to stop having a normal trading relationship with South Africa to get their attention.

Our trade deficit with China is financing the present leadership in China. They have a deficit with other countries put together. We are the only country they have a huge surplus with. In effect, our trade policy is financing the policy that they follow.

Let me end with this: We always are told that the reason we cannot do this is because of money. We are going to lose contracts. We are going to lose business. We are going to lose a billion consumers in the future.

Let me just end by saying this to you as you search your heart in this vote: This country has always stood for much more than simply money and economic success. This country is an idea. It is a universal idea that applies to every citizen of the world.

Abraham Lincoln in 1861 said this: `I have often inquired of myself, what great principle or idea it was that kept this Nation so long together. It was not the mere matter of the separation of the colonies from the Motherland but something in that declaration giving liberty, not only to the great people of this country but hope for the world for all time.'

That is what we are. That is what we have to be. That is what we have to represent to the people of China and the people of the world. Wei Jingsheng was in my office a few months ago and I asked him what we should do on this vote, and he said, `Congressman, please understand that the only thing the leaders in China understand is money and trade and whether or not you are willing to really stand for what you believe in.'

Your vote today is for what we believe in. Let us change China. Let us have real engagement. Let us bring about liberty finally, as only we can, for the people, the great people of China. Vote against a normal trading relationship with China.

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Mr. MATSUI. Mr. Speaker, I yield such time as he may consume to the gentleman from Texas (Mr. Stenholm).

(Mr. STENHOLM asked and was given permission to revise and extend his remarks.)

Mr. STENHOLM. Mr. Speaker, I rise in strong opposition to the resolution that would end normal trade relations with China.

Mr. MATSUI. Mr. Speaker, I yield the balance of my time to the distinguished gentleman from Indiana (Mr. Hamilton), the former chair of the Committee on Foreign Affairs and the ranking member of the Committee on International Relations.

Mr. HAMILTON. Mr. Speaker, I rise in opposition to H.J. Res. 121. I support retaining normal trade relations with China. This is not just a vote today about trade. NTR, or Normal Trade Relations, is the keystone of our policy of engagement. So the question today is the fundamental one: Do you wish to pursue a policy of engagement or of isolation?

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Members have argued on the floor today that you can vote to end normal trade relations with China and still work with Beijing on nonproliferation and human rights and all of the other problems we have with China. That argument cannot be sustained. To withdraw normal trade relations from China is to declare economic warfare against China. We cannot declare economic warfare against China and expect China to play by our rules on nonproliferation and human rights and security. Political engagement and economic cooperation go hand-in-hand. You cannot separate the two.

What we must ask ourselves on the floor of this House today and what we must understand is that China is changing. Go back 20 years, when our policy of engagement began. At that time it was simply unimaginable to have a public discussion on any issue with China.

Today American businesses operate in China, the state share of the economy is falling, the standard of living of the people of China has improved sharply, two presidents debate with one another in Beijing about human rights, the American president is given access to all the people of China on Chinese television. The average Chinese citizen today has more freedom, not enough, but more freedom than that citizen has ever had in the history of China. The rule of law is making progress. Local elections are being held.

How can you describe that policy as a failed policy? That is not a failed policy. This is a policy under six presidents that has been one of engagement, and it has worked.

These trends that I have identified are good for China and they are good for the United States. They show that engagement, including engagement's foundationpiece, normal trade relations, works. And I believe that as the doors to freedom in China begin to open, they will be increasingly hard to shut.

Now, the stakes are very high in this vote today, because China does stand at a crossroads. Whether it emerges as a stable country, integrated into the world community, will be decided by China. But we can influence China, and we have influenced China over a period of years.

We should not, however, delude ourselves into thinking that by withholding normal trade status from China we will have greater influence with China. Not on your life. It would mean less influence with China.

Now is not the time to slap China. No matter how you may have voted on this question in the past, the case for normal trade relations with China today is stronger than it has ever been. Look what happens if you have a financial Asian meltdown. China has played a key role by maintaining the value of its currency.

Withdrawing normal trade relations from China at this juncture would be the worst step we could take. Look at China's economy. It is precarious. Premier Ju is committed to an ambitious program of economic reform. It moves in the direction we want China to move. The United States supports those reforms. But if we come along now and strip most-favored-nation treatment, as we used to call it, or normal trade relations from China, that will help kill those reforms.

Look at what China is doing on all kinds of regional problems, I do not have time to go into that, but with India, Pakistan and Korea. Terminating access to U.S. markets would almost certainly mean that China is less willing to work with us on key security problems.

Take a look at the American economy. Everybody in this Chamber has noted the drop in growth in the second quarter compared to the first quarter, one of the most dramatic drops in the history of our economy. We must not take a step that would exclude one person out of every four on the face of the Earth from trade relations if we deny normal trade relations.

We can all acknowledge a very difficult problem on trade deficits. China is not an open market, but you have to address that problem in such a way that you do not penalize the American producer.

Mr. Speaker, I urge Members to vote no on the resolution.

Mr. CHRISTENSEN. Mr. Speaker, I yield the balance of my time to the gentleman from New York (Mr. Solomon), the chairman of the Committee on Rules and the author of this resolution for the last 9 years, a champion of human rights.

The SPEAKER pro tempore (Mr. Pease). The gentleman from New York is recognized for 4 1/2 minutes.

Mr. SOLOMON. Mr. Speaker, I thank the gentleman from Nebraska for yielding me time.

First of all, let me just thank those who have stood for human rights in this House for many, many years. I talk about the gentlewoman from California (Ms. Pelosi), certainly the gentleman from New Jersey (Mr. Smith), certainly the gentleman from Virginia (Mr. Wolf), and my good friend from Nebraska. But, Mr. Speaker, as I sat through this 4 hours of debate and it will be my last debate, I will not carry this bill again but you would think there is nothing wrong.

I heard my good friend, the gentleman from Illinois (Mr. Crane), whom I have served with for 20 years, say, well, we have to worry about 200,000 jobs that would be lost if we do not renew MFN for China today. I look at my district, and I just wonder whether it is different from his.

I represent the old Rust Belt in America. We used to manufacture shirts like I have on here. These were choice shirts. We had most of the market. We used to manufacture gloves, a whole litany of things. Today, in my district, there just are no more jobs. GE has laid off some 24,000 people. IBM has laid off some 14,000 people. There are hardly any entrepreneurial manufacturing companies left that used to create all of these jobs.

I look at people who have served in the military, came home, got married, have three or four children, and they work in Little League and Boy Scouts. Now they are 45 and 50 years old, and they do not have a job, they do not have a decent job. They no longer have that job with GE, where they made $40,000 or $50,000 as a laborer. Now they have three little jobs, and they do not even make $25,000 in total. They cannot make a living for their families. Yet I hear people stand up here and say there is nothing wrong.

Well, when only 2 percent of our exports go to China, but they unload on us, there is something wrong there. What was the note I just had? Ambassador David Aaron, the Undersecretary of International Trade, U.S. Department of Commerce, just testified about an hour ago, and he was posed with the question, Why do we have this $60 billion trade deficit with China, bigger than Japan's now? Ambassador Aaron's comment was the reason for our trade deficit with China is trade barriers.

Now, what is normal trading relations if we cannot export? A major electrical razor manufacturer closed its plant, 250 people out of work, and it went to China. Now, in China, I do not know whether you have been there. I have been there several times and they do not buy electric razors. They do not even use them much. Therefore, all of those razors are going to be exported back to the United States. Yet 250 people are out of work. So something is drastically wrong.

Withholding MFN for China, right now, today, does not mean we are doing it for a year, 10 years or 20 years. We are doing it temporarily. It can be for 30 days, because this Congress can turn it around like that.

Let me tell you, the Chinese people are the smartest people in the world. If we ever withheld this favored treatment and came back to regular relations, so we would have the same trade tariffs between our countries, do you not think China would come to us crawling, because we have 250 million Americans with the greatest buying capacity in the world? They would lick their chops to do business with us. And we do nothing? That is a disgrace.

That is why we ought to pass the Solomon resolution now. Whether MFN is withdrawn for a week, 2 weeks, a month or 3 months, we would find we would pretty soon renegotiate our trade with China to where we would no longer have that $60 billion deficit and Americans would have jobs in this country.

Please support my amendment.

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Mr. CRANE. Mr. Speaker, I yield myself the balance of my time.

The SPEAKER pro tempore. The gentleman from Illinois is recognized for 3 1/2 minutes.

(Mr. CRANE asked and was given permission to revise and extend his remarks.)

Mr. CRANE. Mr. Speaker, this is an interesting experience. We had a debate on the floor yesterday and I was semi-joking about the gentleman from Illinois (Mr. Yates) coming to Congress when I graduated from high school, but that was the same year that Lee Hamilton and I met each other in our freshman year in college. We were college chums together for a couple of years. Of course, we are going to be losing the gentleman from New York (Mr. Solomon) too, who retires after this year, and we have had our agreements and disagreements along the way on a lot of issues.

But I am particularly proud of the eloquent presentation today by the gentleman from Indiana (Mr. Hamilton) on behalf of maintaining our normal trade relations with China. It is probably the most important country that we can have relations with on the face of this Earth, and I say that because of what the future holds for China.

In those years that I described, talking about the election of the gentleman from Illinois (Mr. Yates), his first term here, and the gentleman from Indiana (Mr. Hamilton) and I going off to college together, the fact of the matter is that was the beginning of the Great Leap Forward, that you remember cost 30 million Chinese lives from starvation. That is when they put the wall up, for all practical purposes, and locked out contact with civilized human beings. Then they did the Great Leap Forward after that for another decade, and hundreds of thousands of Chinese people were executed, put to death, for political reasons.

Then Deng Xiaopeng finally took charge, and Deng Xiaopeng, to his credit, believed in what he referred to as Leninist capitalism, the ultimate oxymoron. What he passionately was embracing was free enterprise, he did it with a vengeance, and he turned China around.

Today more Chinese people enjoy a higher standard of living than ever before in the 5,000 years of recorded history. It is providing hope and opportunity. A middle class has already developed in South China.

Now, these are accomplishments that we can aid and abet with our presence and our influence. The Chinese have respect for us, and our leaders in this country, and this goes back to Gerry Ford, it goes back to Jimmy Carter, Ronald Reagan, George Bush, to the current occupant, Bill Clinton, they have all embraced going forward with this policy. It is not a partisan question. It is not Republican versus Democrat, it is what is in the best interest. We can have legitimate disagreements, as I have had with the gentleman from New York (Mr. Solomon) throughout the years, have disagreements on this.

But I submit, if you look at the reforms taking place in China, and that is local democratic elections, one-third of the Chinese people have already participated in the democratic process, and they are not communists. In addition to that, as I say, the advancement of free enterprise, and the advancement also of religious freedom and what is going on there with a vengeance today, in contrast to not that long ago when this was impermissible, now an estimated 20 million Protestants, possibly as many as 10 million Catholics, 100 million Muslims, these are accomplishments that are far from perfect, but we know that it is movement in the right direction.

I argue that trade relations provide that opportunity for personal contact, which ultimately has the most civilizing impact on mankind.

I urge all Members to think long and hard and vote against this resolution.

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The SPEAKER pro tempore (Mr. Pease). Pursuant to the order of the House of Friday, July 17, 1998, the previous question is ordered.

The question is on the engrossment and third reading of the joint resolution.

The joint resolution was ordered to be engrossed and read a third time, and was read the third time.

ANNOUNCEMENT BY THE SPEAKER PRO TEMPORE

The SPEAKER pro tempore. The Chair announces that proceedings will resume on the motion to suspend the rules and pass the bill, H.R. 1689, immediately following this vote, and without objection, the Chair will reduce the time for that vote by the yeas and nays to not less than 5 minutes.

There was no objection.

The SPEAKER pro tempore. The question is on the joint resolution.

The question was taken; and the Speaker pro tempore announced that the noes appeared to have it.

RECORDED VOTE

Mr. SOLOMON. Mr. Speaker, I demand a recorded vote.

A recorded vote was ordered.

The vote was taken by electronic device, and there were--ayes 166, noes 264, not voting 5, as follows:

Roll No. 317

[Roll No. 317]

AYES--166

NOES--264

NOT VOTING--5

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Mr. RUSH and Mr. McCRERY changed their vote from `aye' to `no.'

Mr. VISCLOSKY and Mrs. MYRICK changed their vote from `no' to `aye.'

So the joint resolution was not passed.

The result of the vote was announced as above recorded.

END