Commentary

Don’t Make Trade a Pawn

There is growing sentiment in Congress and elsewhere for a hard-line U.S. policy toward China. One manifestation has been the annual controversy about whether the United States should continue China’s most favored nation (MFN) trade status. Critics seek to condition extension on improvements in Beijing’s human rights record and a host of other issues.

A more recent variation is to oppose China’s membership in the World Trade Organization (WTO) unless concessions are forthcoming. Both are deeply flawed strategies.

The temptation to use trade as leverage, especially on human rights, is understandable. Beijing’s brutality toward dissidents offends anyone who values individual freedom. America cannot allow moral outrage to govern its trade relations, however. Repression is all too common in the world, and the United States would have to sever commercial ties to numerous nations. How could we purchase oil from Saudi Arabia, for example?

Americans who want to withhold MFN status and WTO membership to coerce the Chinese government into being more cooperative and democratic advocate precisely the wrong policy. Such actions would primarily injure the sectors of China’s economy that are the most dynamic and have the most extensive connections to the outside world. Those sectors are dominated by younger, cosmopolitan Chinese who view the aging communist autocrats in Beijing with thinly disguised distaste and impatience. We should strengthen such potential sources of change and power, not weaken them by restricting trade relations.

That is not to say that Washington ought to ignore human rights abuses—or other, equally troubling aspects of Beijing’s behavior, including a growing belligerence toward its neighbors and a careless (at the very least) policy on arms transfers. But such problems should be handled in the realm of diplomacy. Linking trade to the resolution of those disputes merely creates further friction in an already tense U.S.-Chinese relationship.

Finally, it needs to be emphasized that the freedom to buy or sell products and services without arbitrary government interference is itself an important human right—for Americans as well as Chinese. Trade should not become a pawn in a game of global political chess.

Ted Galen Carpenter is vice president for defense and foreign policy studies at the Cato Institute.