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and other nations, has merit. It is certainly a

than sacrificing them piecemeal to special

better description of post-Maoist China than

interest groups, would be the best defense of

much of the heated rhetoric heard on Capitol

freedom, peace, and prosperity. The United

Hill. China is less apt to cause trouble if it con-

States and China are both net importers of oil;

centrates on wealth creation and poverty

and both depend heavily on imports from

reduction rather than global dominance--the

Saudi Arabia, which is neither a democratic

goal of the former Soviet Union.

regime nor one that respects human rights.

Today, after more than 25 years of eco-

China is not a centrally planned economy like

nomic reform and liberalization, the Chinese

the former Soviet Union or North Korea. It is

people are far more prosperous than they

one of the most liberalized economies in the

were during the reign of Mao Zedong. It

developing world. The United States has more

would be a tragedy if that progress were jeop-

to gain from a "cooperative and constructive"

ardized by a confrontational U.S. approach

policy of engagement with the PRC than from

toward China. U.S.-China relations ultimate-

one based on the premise that China wants to

ly should rest on adherence to a rules-based

and can dominate the world. Such an attitude

liberal trading order, which means that pure-

shows a lack of confidence in the institutions

ly commercial decisions should be market

that have made America great--namely, limit-

driven, not politicized.

ed government, the rule of law, and freedom of

As congressional reaction to the CNOOC-

choice in a market system.

Unocal deal shows, however, the rising U.S. hos-

Those liberal values should be practiced at

tility toward China could lead to a train wreck

home, and free trade with China is the best way

unless calmer voices prevail. As Joseph Borich,

to transmit them abroad. As Montesquieu

former U.S. consul general in Shanghai and

wrote in his classic treatise On The Spirit of the

now executive director of the Washington State

Laws in 1748: "Peace is the natural effect of

China Relations Council, notes:

trade. Two nations who traffic with each other

become reciprocally dependent; for if one has

There is no question about the existence

an interest in buying, the other has an interest

of an influential group in and outside

in selling; and thus their union is founded on

their mutual necessities."45

of Congress (often called the "Blue

Team") that views China as a threat to

Even if commercial engagement does not

the U.S. on the same order as the former

preclude conflict, it clearly reduces the likeli-

Soviet Union. They see trade and virtu-

hood of conflict. China's growing commercial

relations with Taiwan are a case in point.46 With

ally all other U.S. dealings with China as

zero-sum, with no possibility for win-

massive investments in China, Taiwanese busi-

win relations with China. For the Blue

ness owners and politicians have an incentive to

Team, CNOOC's bid to acquire Unocal

take a cooperative rather than a confrontational

is not simply a business transaction; it

approach in dealing with Beijing, and China has

represents a direct threat to vital U.S.

an incentive to avoid conflict that could cause a

The United States

security interests.47

significant loss of trade and wealth. Stability

requires that China continue to grow, which, in

needs a firm

turn, requires peaceful international trade and

If future U.S.-China relations are to improve,

commitment to

the ability to attract foreign investment.

that zero-sum, mercantilist mentality must give

engagement, and

way to a more positive way of thinking about

economic relations and security. Chinese and

China needs to

Peaceful Development

American companies should be left alone to

adhere to

trade, unless there is a legitimate threat to

national security.

President Hu's term "peaceful develop-

"peaceful

We should not be blinded by the fact that

ment," as a way to describe China's rise and as

development."

China is a nominally communist country. There

a strategy for dealing with the United States

10