Us Free Trade With China Essay Research

Us Free Trade With China Essay, Research Paper

Should the US allow China’s entry into the World Trade Organization?

Sino-American relations have always been characterized as complex and

tumultuous. Presently, the United States must reach a decision that would drastically

affect the politics, environments, militaries, technology, and most importantly the

economies of both nations. This problem the United States must face is whether it ought

to allow China’s entry into the World Trade Organization. There is much hesitation in

taking such steps as American protectionists are weary of a nation whose expanding

economy could further “Chinese influence in American politics as a result of Donorgate;

continued doubts about Beijing’s dismal human rights record; and worries about the U.S.

trade imbalance with China- $40 billion and growing.” (Shribman 44) Yet there are also

many benefits to free trade which outweigh the negative. Sino-American free trade will

boost US sales to the world’s most populous nation, while building diplomatic relations,

and ultimately liberalizing China both politically and socially. (Christian Science Monitor

98)

China, a country in East Asia, is the world’s third largest country by area

(after Russia and Canada) and the largest by population. China’s most populous city is

its capital, Beijing. Officially People’s Republic of China, it is bounded on the north by

the Republic of Mongolia and Russia; on the northeast by Russia and North Korea; on

the east by the Yellow Sea and the East China Sea; on the south by the South China Sea,

Vietnam, Laos, Burma (Myanmar), India, Bhutan, and Nepal; on the west by Pakistan,

Afghanistan, and Tajikistan; and on the northwest by Kyrgyzstan and Kazakhstan. China

includes more than 3400 offshore islands, of which Hainan, in the South China Sea, is by

far the largest. The total area of China is about 9,571,300 sq. km (about 3,695,000 sq.

mi.), not including Nationalist China, known officially as the Republic of China

(Butler/Encarta 1996)

The formation of the Chinese Weltanschauung (world view) can be

explained, in part, by the historical and political evolution of China as it emerged from

semi-colonial subservience. At the beginning of the twentieth century, China was a

weak and divided country under the corrupt rule of the Manchu dynasty. Exploited by

the so-called “open door,” China had been subjected to the degradation of imperialism

and the spheres of influence imposed by the major Western powers, including Japan. As

a consequence of foreign economic penetration and intervention, one of the main

currents of Chinese political thought that emerged was a distinct xenophobia that

resented any foreign involvement in Chinese affairs. Not only were foreign values and

culture rejected, but this was paralleled by a reaffirmation of Chinese nationalism. The

various strains of political thought that combined to form the ideological fabric of the

PRC cannot be fully understood without first examining the historical background that

led to the Chinese Communist state in 1949.

The induction of the Communist government in 1949 set a groundwork for

Chinese history; in a remarkably short period of time radical changes were effected in both

the Chinese economy and society. Since the 1970s, China has forsaken its self-imposed

isolation from the international community and has sought to modernize its economic

structure. In 1971 the United Nations (UN) admitted the People’s Republic of China and

expelled Taiwan from membership.

For more than 2000 years the Chinese economy operated under a type of

feudal system where land was concentrated in the hands of a relatively small group of

landowners whose livelihood depended on rents from their peasant tenants. Further

adding to the peasant farmers’ burden were agricultural taxes levied by the imperial

government and crop yields subject to drought and floods. Under these conditions,

agriculture remained essentially underdeveloped. The conclusion of the Opium Wars in

1860 formally initiated a period of Western exploitation of China from the coastal treaty

ports. Railroads and highways were constructed, and some industrial development was

begun. Such activity had little impact, however, on the overall Chinese economy. In

effect, China was set up into a number of competing colonial spheres of influence.

“Japan, which tried to attach China to its East Asia Co-prosperity Sphere, was able to

create only isolated nodes of a modern economy” (Butler/Encarta 1996). This laid the

foundation for a China that was to be exploited by other nations.

The Chinese Communist party emerged in the 1920s in the midst of a

mounting economic crisis caused by foreign intervention and increased landlord

influence in the countryside. For more than two decades, it expanded its control over

large rural areas by introducing an agrarian program based on the control of rent and

usury, and by giving power to peasant associations. On October 1, 1949, the Communist

party successfully established a unified national government and economy on the

mainland for the first time since the end of the imperial period in 1912. There was

attention specifically paid to dealing with problems ranging from inflation, food

shortages, unemployment, and land reform. Under the first five-year plan (1953-1957),

92 percent of the agricultural population was organized into cooperative farms. In 1958

the rural people’s communes were established, and these dominated agriculture in China

until the early 1980s.

State ownership of property and of industrial and commercial enterprises

was gradually extended in the urban-industrial sector. The second five-year plan was

introduced in 1958, and in the summer of that year the regime initiated the Great Leap

Forward. This program was characterized by large investments in heavy industry and the

establishment of small-scale versions of such industries as steel refining. The program,

however, caused great disruptions in economic management and in rational economic

growth and was ultimately abandoned in 1960. The Chinese economy then entered a

period of readjustment, but ran into problems again, this time being much a result of the

Cultural Revolution. Yet again, a fourth five-year plan was introduced in 1971 as the

economy began its recovery.

In an effort to deal with the failure of the Cultural Revolution in 1976,

China’s leaders began to boost up the economy. A fifth five-year program was begun in

1976 but was interrupted in 1978, when the Four Modernizations program was launched.

It called for the “all-round modernization of agriculture, industry, national defense, and

science and technology by the end of the century so that the economy can take its place in

the front ranks of the world” (Butler/Encarta 1996). In at attempt to attract Western

technology and investment more programs and plans were put into effect such as one in

October 1984 which called for further decentralization of economic planning and for

increased reliance on market forces to determine the prices of consumer goods. However

the economy temporarily stagnated due to the political crackdown in 1989. Luckily, the

Chinese economy expanded rapidly during the early 1990s as the government continued to

loosen controls on the economy.

From a political perspective, it would be in the United State’s best interest

to engage in free trade with China. There has been much opposition from the far right to

labor unions to any such association with a nation that has been “suspected of pirating US

nuclear secrets – and whose military – industrial barons probably orchestrated illegal

campaign contributions during the 1996 US presidential campaign” (Christian Science

Monitor 10). However, there are great political stakes that are being overlooked here.

An important advantage in free trade lies in the influence western culture will have over

China, so as to liberalize this nation. First of all, it must be noted that China is already

metamorphosing and great changes are taking place regardless of US involvement. For

instance, power is becoming decentralized and infusing private enterprises with greater

freedom. Another important effect American trade will have in China would be that of

multinational organizations whose presence will change the working climate. These

multinational corporations are said to “create safer workplaces, follow more progressive

personnel practices, raise living standards, and introduce new ideas, attitudes, and ways of

thinking. A number of American companies such as Mattel and Nike, have adopted codes

of conduct requiring local subcontractors and suppliers to eschew child labor and other

practices common in China…” (Weidenbaum 223). As far as the cultural influence that

foreign markets will have in China, the benefits are wide. Advertisers will promote

messages of free choice and democracy through marketing. In this day and age of

technology, we can not overlook the key role media, Internet, and privately owned

satellite dishes will play in transmitting new ideas to this developing nation.

It is crucial to understand the importance a healthy economy plays in the

politics of China. It is with this thought, that one can correlate a weak economy to the

strengthening of the “old-line communists who have reluctantly gone along with Deng’s

reforms only because they appear to work” (Weidenbaum 223). In order for a more