Trade and Human Rights in China

A free‐​market approach to human rights policy does not mean Americans should be indifferent to human rights abuses in China. Steps should be taken by the United States and other nations to restrict China’s use of slave labor, political prisoners, and very young children to compete in international markets. But blanket restrictions, such as the denial of MFN trading status or the use of sanctions not directly targeting the wrongdoers, should be avoided.

The problem is that even limited actions are very difficult to enforce and unlikely to bring about political change in an authoritarian regime. The logical alternative is to use the leverage of trade to open China to competitive forces and let the rule of law and democratic values evolve spontaneously as they have in South Korea and Taiwan.

An individual’s right to trade is an important and fundamental human right, not a privilege bestowed by government. The proper function of government is to safeguard that right, not to restrict trade to protect special interests at the expense of the general welfare. America should not play the dangerous game of pitting human rights activists against free traders.

President Clinton’s decision, in May 1994, to separate trade policy from human rights policy in considering China’s MFN trading status was logical and moral. That policy should be extended to give China unconditional MFN trading status, which should be renamed “normal trade relations.” Extending permanent MFN status to China will reduce uncertainty in trade relations and benefit Taiwan and Hong Kong.

The fact that freedom has not included political freedom is not a sound argument for attempting to use the blunt instrument of trade sanctions to win democratic rule for China. Keeping millions of Chinese in poverty by restricting their right to trade, in the hope of promoting human rights, is neither logical nor moral. Likewise, depriving Americans of the freedom to trade and invest in China violates their rights to liberty and property.

A positive program should also repeal the Jackson‐​Vanik amendment to the Trade Act of 1974. That amendment, which denies MFN status to communist countries if they do not allow relatively open emigration and necessitates the annual renewal of China’s MFN status, is unsuitable for China. From a practical standpoint, no one believes that the United States is going to allow a billion Chinese into the country, so requiring China to have an open emigration policy is nonsensical as a condition for MFN status. Instead of focusing on emigration, Congress should focus on immigration and continue to provide a sanctuary for the victims of human rights violations in China and elsewhere. The number of refugees admitted into the United States each year is determined by consultation between the President and Congress. In that process, the Congress should be open and generous. Continuing to provide an exit option for those fleeing tyrannical regimes will send a clear message that America is still the land of the free.

Finally, a positive program should recognize that free markets foster economic development and provide individuals with the means to liberate themselves from the state. A growing middle class will have a strong economic stake in determining their own political fate. As Taiwan’s newly elected President Lee Teng‐​hui stated, “Vigorous economic development leads to independent thinking. People hope to be able to fully satisfy their free will and see their rights fully protected. And then demand ensues for political reform.”

Governments everywhere need to get out of the business of trade and leave markets alone. Western democratic governments, in particular, need to practice the principles of freedom they preach and recognize that free trade is not a privilege but a right.