 In 2000 the U.S. Congress passed legislation establishing Permanent Normal Trade Relations with China, enabling China ultimately to enter the World Trade Organization in 2001. President Bill Clinton wanted to cement his legacy with what would be viewed as a landmark agreement. Twenty years later we can only begin to describe how wrong the assessments were about China and how damaging this single decision has been to the global economic order. Pictured: Clinton and Chinese Premier Zhu Rongji at the White House on April 8, 1999. (Photo by Pool/JE) |
In 2000 the U.S. Congress passed legislation establishing Permanent Normal Trade Relations (PNTR) with China. The foundation for this successful China vote was established in 1998 when Congress adjusted terminology to rebrand "most favored nation" as "normal trade relations." These and other shenanigans by Congress enabled China ultimately to enter the World Trade Organization (WTO) in December 2001. This fundamentally changed the economic role that China plays globally, propelling it to the second-largest economy in the world today.
The pressures and negotiations leading up to the House of Representatives voting on PNTR were significant. President Bill Clinton wanted to cement his legacy with what would be viewed as a landmark agreement. Many of us in Congress were skeptical of the arguments that were being made about granting China PNTR, and realized it was much more than that.
In 1998, the official language had been changed from most favored to normal trade relations. Therefore, to the average constituent, China would only be receiving normal treatment, nothing special. But this was anything but normal, and China would be receiving a huge economic boost from this new treatment on trade.
Prior to receiving PNTR, trade relations had been debated and voted on annually. Congress clearly understood that trade with China was important to the U.S. economy, our workers, and our businesses, but the ability to vote annually provided Congress the opportunity to flex its muscle and try to hold China accountable for a number of issues of concern. Those issues included human rights, unfair trade practices, theft of intellectual property, and limits on access to China's markets. It was hoped that annually highlighting these issues, and potentially even denying normal trade relations, would provide a big enough incentive to get China to change its behavior.
The business community had their arguments as to why PNTR should be passed and China's ultimate accession to the WTO would be a positive development. PNTR would remove the uncertainty that China was experiencing but also companies doing business with or considering doing business with China faced every year. These uncertainties made it more difficult to plan and increased the risk of doing business with and in China. Companies from all over my congressional district would come to me personally to explain how PNTR would help their businesses, and more importantly, how it would benefit their employees. Many with little or no experience with China also offered a full throttled endorsement that it would lead to a democratization of China -- China would become more like us.
Congress voted on a bipartisan basis to provide China with PNTR and President Bill Clinton with a huge legislative accomplishment. Presumptive Republican nominee for President George W. Bush stated, "Passage of this legislation will mean a stronger American economy, as well as more opportunity for liberty and freedom in China."
Twenty years later we can only begin to describe how wrong the assessments were about China and how damaging this single decision has been to the global economic order. China and the Chinese Communist Party have regressed in all areas of human rights and democratization. The U.S. and others have labeled China as practicing genocide against China's Uyghur minority populations and reports of organ harvesting in China continue. Its regressive actions against the freedom movement in Hong Kong and threats against Taiwan are only the top line examples that show China has not become more like us.
As the U.S. Ambassador to the Netherlands, I frequently had to address the issues of unfair trade practices and the theft of intellectual property by China. It was using predatory practices to drive out European competitors to Huawei so that the CCP would soon dominate this key market. Rather than following the rules, China abused its new access to go into more countries and engage in market manipulation, predatory pricing and lending, and surreptitiously to seed its national security apparatus abroad.
Most American companies have not had the backbone to defend themselves against China's unfair policies and to stand up for their workers in the U.S. and human rights and freedom in China. More often than not, the only consideration these companies have is the bottom line.
Considering China's abysmal behavior with the international community in confronting the threat from COVID, and its behavior on trade for the last 20 years, it is time to face brutal reality: China will remain a no-faith, bad actor on the international scene. We must seriously reevaluate and confront China for its policies and actions. Twenty years is enough of sacrificing American jobs, technology and national security on the altar of full access to the Chinese market that the U.S. and the West will never get. Two years of avoiding responsibility and transparency on COVID that has cost 800,000 American lives is enough.
China understands strength, and in our political system, strength on foreign policy emanates from the President. President Joe Biden should:
- Build an international coalition, including our European and Asian allies to confront China;
- Demand transparency by China on COVID and reform of Chinese economic and human rights practices;
- Expand the targeting of specific Chinese companies and industries that pose national security or economic threats, e.g. Huawei, ZTE, and Hikvision, whose products should be prohibited from key parts of our economies;
- Impose tariffs on an ever-expanding list of Chinese products and services; and
- Encourage the U.S. Congress to repeal PNTR for China.
These are tough actions. Some might even describe them as dangerous. In all honesty, what is really dangerous is ignoring the long list of abuses and evil behavior by China and the Chinese Communist Party for another 20 years. Now is the time for the West finally to wake up before it is too late.
Peter Hoekstra was US Ambassador to the Netherlands during the Trump administration. He served 18 years in the U.S. House of Representatives representing the second district of Michigan and served as Chairman and Ranking member of the House Intelligence Committee. He is currently Chairman of the Center for Security Policy Board of Advisors.
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