By Walden Bello and Anuradha Mittal* Institute for Food and Development Policy May 2000
[ cont'd... Part 2 of 2 ]
The Anti-China Trade Campaign: Wrong and Dangerous
It is against this complex backdrop of a country struggling for development under a political system, which, while not democratic along Western lines, is nevertheless legitimate, and which realizes that its continuing legitimacy depends on its ability to deliver economic growth that one must view the recent debate in the US over the granting of Permanent Normal Trade Relations (PNTR) to China.
PNTR is the standard tariff treatment that the United States gives nearly all its trading partners, with the exception of China, Afghanistan, Serbia-Montenegro, Cuba, Laos, North Korea, and Vietnam. Granting of PNTR is seen as a key step in China's full accession to the World Trade Organization (WTO) since the 1994 Marrakesh Agreement establishing the WTO requires members to extend NTR to other WTO members mutually and without conditions. This is the reason that the fight over PNTR is so significant, in that it is integrally linked to China's full accession to the WTO.
Organized labor is at the center of a motley coalition that is against granting PNTR to China. This coalition includes right wing groups and personalities like Pat Buchanan, the old anti-China lobby linked to the anti-communist Kuomintang Party in Taiwan, protectionist US business groups, and some environmentalist, human rights, and citizens' rights groups. The intention of this right-left coalition is to be able to use trade sanctions to influence China's economic and political behavior as well as to make it difficult for China to enter the WTO.
There are fundamental problems with the position of this alliance, many of whose members are, without doubt, acting out of the best intentions.
First of all, the anti-China trade campaign is essentially another manifestation of American unilateralism. Like many in the anti-PNTR coalition, we do not uphold the free-trade paradigm that underpins the NTR. Like many of them, we do not think that China will benefit from WTO membership. But what is at issue here is not the desirability or non-desirability of the free trade paradigm and the WTO in advancing people's welfare. What is at issue here is Washington's unilateral moves to determine who is to be a legitimate member of the international economic community--in this case, who is qualified to join and enjoy full membership rights in the WTO.
This decision of whether or not China can join the WTO is one that must be determined by China and the 137 member-countries of the WTO, without one power exercising effective veto power over this process. To subject this process to a special bilateral agreement with the United States that is highly conditional on the acceding country's future behavior falls smack into the tradition of unilateralism.
One reason the anti-China trade campaign is particularly disturbing is that it comes on the heels of a series of recent unilateralist acts, the most prominent of which have been Washington's cruise missile attacks on alleged terrorist targets in the Sudan and Afghanistan in August 1998, its bombing of Iraq in December 1998, and the US-instigated 12-week NATO bombardment of Kosovo in 1999. In all three cases, the US refused to seek UN sanction or approval but chose to act without international legal restraints. Serving as the gatekeeper for China's integration into the global economic community is the economic correlate of Washington's military unilateralism.
Second, the anti-China trade campaign reeks of double standards. A great number of countries would be deprived of PNTR status were the same standards sought from China applied to them, including Singapore (where government controls the labor movement), Mexico (where labor is also under the thumb of government), Saudi Arabia and the Gulf states (where women are systematically relegated by law and custom to second-class status as citizens), Pakistan (where a military dictatorship reigns), Brunei (where democratic rights are non-existent), to name just a few US allies. What is the logic and moral basis for singling out China when there are scores of other regimes that are, in fact, so much more insensitive to the political, economic, and social needs of their citizenries?
Third, the campaign is marked by what the great Senator J. William Fulbright denounced as the dark side of the American spirit that led to the Vietnam debacle--that is, "the morality of absolute self-assurance fired by the crusading spirit."10 It draws emotional energy not so much from genuine concerns for human and democratic rights in China but from the knee-jerk emotional ensemble of anti-communism that continues to plague the US public despite the end of the Cold War. When one progressive organizer says that non-passage of the PNTR would inflict defeat on "the brutal, arrogant, corrupt, autocratic, and oligarchic regime in Beijing," the strong language is not unintentional: it is meant to hit the old Cold War buttons to mobilize the old anti-communist, conservative constituency, in the hope of building a right-left populist base that could--somehow--be directed at "progressive" ends.
Fourth, the anti-China trade campaign is intensely hypocritical. As many critics of the campaign have pointed out, the moral right of the US to deny permanent normal trading rights to China on social and environmental grounds is simply nonexistent given its record: the largest prison population in the world, the most state-sponsored executions of any country in the world, the highest income disparities among industrialized countries, the world's biggest emitter of greenhouse gases, and quasi-slavery conditions for farm workers.11
Fifth, the anti-China trade campaign is intellectually flawed. The issue of labor control in China lies at the core of the campaign, which blames China's government for the low wages that produce the very competitively priced goods that are said to contribute to displacing US industries and workers. This is plain wrong: the relatively low wages in China stem less from wage repression than from the dynamics of economic development. Widespread poverty or low economic growth are the main reasons for the low wages in developing countries. Were the state of unionism the central determinant of wage levels, as the AFL-CIO claims, labor costs in authoritarian China and democratic India, with its formally free trade union movement, would not be equal, as they, in fact, are.
Similarly, it is mainly the process of economic growth--the dynamic interaction between the growing productivity of labor, the reduction of the wage-depressing surplus of rural labor, and rising profits--that triggers the rapid rise in wage levels in an economy, as shown in the case of Taiwan, Korea, and Singapore, which had no independent unions and where strikes were illegal during their periods of rapid development.12
Saying that the dynamics of development rather than the state of labor organizing is by far the greatest determinant of wage levels is not to say that the organization of labor is inconsequential. Successful organizing has gotten workers a higher level of wages than would be possible were it only the dynamics of economic development that were at work. It is not to argue that labor organizing is not desirable in developing economies. Of course, it is not only desirable but necessary, so that workers can keep more of the value of production for themselves, reduce their exploitation by transnational and state capitalist elites, and gain more control over their conditions of work.
Sixth, the anti-China trade campaign is dishonest. It invokes concern about the rights of Chinese workers and the rights of the Chinese people, but its main objective is to protect American jobs against cheap imports from China. This is cloaking self-interest with altruistic rhetoric. What the campaign should be doing is openly acknowledging that its overriding goal is to protect jobs, which is a legitimate concern and goal. And what it should be working for is not invoking sanctions on human rights grounds, but working out solutions such as managed trade, which would seek to balance the need of American workers to protect their jobs while allowing the market access that allows workers in other countries to keep their jobs and their countries to sustain a certain level of growth while they move to change their development model.13
Instead, what the rhetoric of the anti-China trade campaign does is to debase human rights and democratic rights language with its hypocrisy while delegitimizing the objective of protecting jobs--which is a central social and economic right--by concealing it.
Seventh, the anti-China trade campaign is a classic case of blaming the victim. China is not the enemy. Indeed, it is a prisoner of a global system of rules and institutions that allows transnational corporations to take advantage of the differential wage levels of counties at different levels of development to increase their profits, destabilize the global environment by generalizing an export-oriented, high-consumption model of development, and concentrate global income in fewer and fewer hands.
Not granting China PNTR will not affect the functioning of this global system. Not giving China normal trading and investment rights will not harm transnational corporations; they will simply take more seriously the option of moving to Indonesia, Mauritius, or Mexico, where their ability to exact concessions is greater than in China, which can stand up to foreign interests far better than the weak governments of these countries.
What the AFL-CIO and others should be doing is targeting this global system, instead of serving up China as a proxy for it.
A Positive Agenda
The anti-China trade campaign amounts to a Faustian bargain that seeks to buy some space for US organized labor at the expense of real solidarity with workers and progressive worker and environmental movements globally against transnational capital. But by buying into the traditional US imperial response of unilateralism, it will end up eventually eroding the position of progressive labor, environmental, and civil society movements both in the US and throughout the world.
What organized labor and US NGO's should be doing, instead, is articulating a positive agenda aimed at weakening the power of global corporations and multilateral agencies that promote TNC-led globalization.
The first order of business is to not allow the progressive movement to be sandbagged in the pro-permanent normal trade relations, anti-permanent normal trade relations terms of engagement that now frames the debate. While progressives must, for the time being, oppose the more dangerous threat posed by the unilateralists, they should be developing a position on global economic relations that avoids both the free trade paradigm that underlies the PNTR and the unilateralist paradigm of the anti-PNTR forces. The model we propose is managed trade, which allows trading partners to negotiate bilateral and multilateral treaties that address central issues in their relationship--among them, the need to preserve workers jobs in the US with the developing countries' need for market access.
Advocacy of managed trade must, however, be part of a broader campaign for progressive global economic governance. The strategic aim of such a campaign must be the tighter regulation, if not replacement, of the model corporate-led free market development that seeks to do away with social and state restrictions on the mobility of capital at the expense of labor. In its place must be established a system of genuine international cooperation and looser global economic integration that allows countries to follow paths of national and regional development that make the domestic market and regional markets rather than the global market the engine of growth, development, and job creation.
This means support for measures of asset and income redistribution that would create the purchasing power that will make domestic markets viable. It means support for trade measures and capital controls that will give countries more control over their trade and finance so that commodity and capital flows become less disruptive and destabilizing. It means support for regional integration or regional economic union among the developing countries as an alternative to indiscriminate globalization.
A key element in this campaign for a new global economic governance is the abolition of the International Monetary Fund, the World Bank, and the World Trade Organization that serve as the pillars of the system of corporate-led globalization and their replacement with a pluralistic system of institutions that complement but at the same time check and balance one another, thus giving the developing countries the space to pursue their paths to development.
The IMF, World Bank, and WTO are currently experiencing a severe crisis of legitimacy, following the debacle in Seattle, the April protests in Washington, and the release of the report of the International Financial Institutions Advisory Commission (Meltzer Commission) appointed by the US Congress, which recommends the radical downsizing or transformation of the Bank and Fund.14 Now is the time for the progressive movement to take the offensive and push for the elimination or radical transformation of these institutions. Yet, here we are, being waylaid from this critical task at this key moment by an all-advised, divisive campaign to isolate the wrong enemy!
Another key thrust of a positive agenda is a coordinated drive by civil society groups in the North and the South to pressure the US, China, and all other governments to ratify and implement all conventions of the International Labor Organization (ILO) and give the ILO more effective authority to monitor, supervise, and adjudicate implementation of these conventions. This campaign must be part of a broader effort to support the formation of genuine labor unions in China, the Southern United States, and elsewhere in a spirit of real workers' solidarity. This, instead of relying on government trade sanctions that are really self-serving rather than meant to support Third World workers, is the route to the creation of really firm ties of solidarity across North-South lines.
This social and economic program must be tied to a strategy for protecting the global environment that also eschews sanctions as an approach and puts the emphasis on promoting sustainable development models in place of the export-led, high-consumption development model; pushes the adoption of common environmental codes that prevent transnational firms from pitting one country against another in their search for the zero cost environmental regimes; and promotes an environmental Marshall Plan aimed at transferring appropriate green process and production technologies to China and other developing countries.
Above all, this approach must focus not on attacking China and the South but on strategically changing the production and consumption behavior and levels in the North that are by far the biggest source of environmental destabilization.
Finally, a positive agenda must have as a central element civil society groups in the North working constructively with people's movements in China, the United States, and other countries experiencing democratic deficits to support the expansion of democratic space. While the campaign must be uncompromising in denouncing acts of repression like the Tienanmen Square massacre and Washington's use of mass incarceration as a tool of social control, it must avoid imposing the forms of Western procedural democracy on others and hew to the principle that it is the people in these countries themselves that must take the lead in building democracy according to their rhythm, traditions, and cultures.
Abandoning Unilateralism
The anti-PNTR coalition is an alliance born of opportunism. In its effort to block imports from China, the AFL-CIO is courting the more conservative sectors of the US population, including the Buchananite right wing, by stirring the old Cold War rhetoric. Nothing could be a more repellent image of this sordid project than John Sweeney, James Hoffa, President of the Teamsters, and Pat Buchanan holding hands in the anti-China trade rally on April 12, 2000, with Buchanan promising to make Hoffa his top negotiator of trade, if he won the race for president.
Some environmental groups and citizens groups which have long but unsuccessfully courted labor, have, in turn, endorsed the campaign because they see it as the perfect opportunity to build bridges to the AFL-CIO. What we have, as a result, is an alliance built on the assertion of US unilateralism rather than on the cornerstone of fundamental shared goals of solidarity, equity, and environmental integrity.
This is not a progressive alliance but a right-wing populist alliance in the tradition of the anti-communist Big Government-Big Capital-Big Labor alliance during the Cold War, the labor-capital alliance in the West that produced the Exclusion and Ant-Miscegenation Acts against Chinese, Japanese, and Filipino workers in the late 19th and early 20th centuries, and, more recently, the populist movement that has supported the tightening of racist immigration laws by emphasizing the divide between workers who are citizens and workers who are not, with the latter being deprived of basic political rights.
It is a policy that will, moreover, feed global instability by lending support to the efforts of the US right and the Pentagon to demonize China as The Enemy and resurrect Containment as America's Grand Strategy, this time with China instead of the Soviet Union as the foe in a paradigm designed to advance American strategic hegemony.
As in every other instance of unprincipled unity between the right and some sectors of the progressive movement, progressives will find that it will be the right that will walk away with the movement while they will be left with not even their principles.
It is time to move away from this terribly misguided effort to derail the progressive movement by demonizing China, and to bring us all back to the spirit of Seattle as a movement of citizens of the world against corporate-led globalization and for genuine international cooperation.
*Walden Bello is executive director of Focus on the Global South, a program of research, analysis, and capacity building based in Bangkok; Anuradha Mittal is co-director of the Oakland-based Institute for Food and Development Policy, better known as Food First. We would like to thank Nicola Bullard, Peter Rosset, and Sal Glynn for their invaluable advice and assistance.
Footnotes:
1. Quoted in John Gershman, "How to Debate the China Issue without China Bashing," Progressive Response, Vol. 4, No. 17, April 20, 2000. 2. Lester Brown, Who Will Feed China? (New York: Norton, 1995). 3. Anil Agarwal, Sunita Narain, and Anju Sharma, eds., Green Politics (New Delhi: Center for Science and Environment, 2000), p. 108. 4. Ibid., p. 16. 5. FAO and IMPACT data cited in Simeon Ehui, "Trade and Food Systems in the Developing World," Presentation at Salzburg Seminar, Salzburg, Austria, May 11, 2000. 6. Amnesty International, Unted States of America: Rights for All (London: amnesty International Publications, 1998). 7. Thomas Friedman, The Lexus and the Olive Tree (New York: Farrar, Straus Giroux, 1999), p. 50. 8. Chalmers Johnson, Blowback: The Costs and Consequences of American Empire (New York: Metropolitan Books, 2000), p. 50. 9 John Gray, False Dawn (New York: New Press, 1998), pp. 189-190. 10. J. William Fulbright, quoted in Walter McDougall, Promised Land, Crusader State (Boston: Houghton Mifflin, 1997), p. 206. 11. See Anuradha Mittal and Peter Rosset, "The Real Enemy is the WTO, not China," Peaceworks, March 1, 2000; and Jim Smith, "The China Syndrome--or, How to Hijack a Movement," LA Labor News, Aprl 2, 2000. 12. For the state of the labor movement in these societies in the period of rapid growth, see Walden Bello and Stephanie Rosenfeld, Dragons in Distress: Asia's Miracle Economies in Crisis (San Francisco: Institute for Food and Development Policy, 1990). 13. For more on managed trade, see, among others, Johnson, p. 174. 14. Report of the US Congressional International Financial Institution Advisory Commission (Washington: DC, US Congress, Feb. 2000).
For the full article, visit the Food First website at: http://www.foodfirst.org/media/opeds/2000/5-china.html
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