DATE=04/16/99
TYPE=ON THE LINE
NUMBER=1-00731
TITLE=WHITHER U.S.-CHINA RELATIONS?
EDITOR=OFFICE OF POLICY - 619-0037
CONTENT=
THEME: UP, HOLD UNDER AND FADE
ANNCR: ON THE LINE -- A DISCUSSION OF UNITED STATES
POLICIES AND CONTEMPORARY ISSUES.
THIS WEEK, "WHITHER U.S.-CHINA RELATIONS?" HERE
IS YOUR HOST, ROBERT REILLY.
HOST: HELLO AND WELCOME TO ON THE LINE.
THE RECENT VISIT TO THE U.S. BY CHINESE PREMIER
ZHU RONGJI CAME AMIDST REVELATIONS OF CHINESE
NUCLEAR SPYING. THERE IS ALSO GROWING CONCERN
AMONG AMERICANS OVER INCREASED POLITICAL
REPRESSION IN CHINA. DESPITE THESE NEW
TENSIONS, BOTH PRESIDENT BILL CLINTON AND
PREMIER ZHU SPOKE OF MAINTAINING A "CONSTRUCTIVE
STRATEGIC PARTNERSHIP" BETWEEN THE U.S. AND
CHINA. JUST WHAT LIMITS TO SUCH COOPERATION
THERE MIGHT BE REMAINS A QUESTION IN THE MINDS
OF MANY.
JOINING ME TODAY TO DISCUSS RELATIONS BETWEEN
THE U.S. AND CHINA ARE TWO EXPERTS. DAVID
LAMPTON IS DIRECTOR OF CHINA STUDIES AT THE
JOHNS HOPKINS SCHOOL FOR ADVANCED INTERNATIONAL
STUDIES. AND STEPHEN YATES IS CHINA POLICY
ANALYST AT THE HERITAGE FOUNDATION.
WELCOME TO THE PROGRAM.
HOST: DAVID LAMPTON, WHEN PREMIER ZHU AND PRESIDENT
CLINTON BOTH REFERRED TO A CONSTRUCTIVE
STRATEGIC PARTNERSHIP, WHAT WERE THEY TALKING
ABOUT?
LAMPTON: WELL, FIRST OF ALL I THINK IT'S VERY IMPORTANT
TO REALIZE THAT NEITHER SIDE BELIEVES THEY HAVE
A CONSTRUCTIVE STRATEGIC PARTNERSHIP NOW. IT'S
SOMETHING BOTH ASPIRE TO AND THE REASON BOTH
ASPIRE TO IT IS, QUITE FRANKLY, CHINA REALIZES
THE UNITED STATES IS ESSENTIAL TO ITS OBJECTIVES
OF MODERNIZATION AND GREAT POWER STATUS. WE
HOLD THE KEYS WITH RESPECT TO TAIWAN. WE ARE
THE BIGGEST EXPORT MARKET FOR CHINA. WE
GENERATE FIFTY-SEVEN BILLION [DOLLARS] IN
FOREIGN EXCHANGE. WE HAVE HIGH TECHNOLOGY. WE
HAVE FIFTY THOUSAND OF THEIR STUDENTS AND
SCHOLARS HERE AT ANY GIVEN TIME. SO, WE'RE VERY
IMPORTANT TO CHINA AND THEY WANT TO MAINTAIN A
PARTNERSHIP, AS OPPOSED TO A CONTAINMENT-TYPE
RELATIONSHIP WITH THE UNITED STATES. MANY
AMERICANS ASK WHAT ARE THE INTERESTS THEY HAVE
WITH RESPECT TO THIS RELATIONSHIP. AND I THINK
WE VALUE PEACE ON THE KOREAN PENINSULA. CHINA
IS VERY IMPORTANT TO THAT. IF ANYBODY HAS ANY
INFLUENCE WITH NORTH KOREA, IT'S CERTAINLY THE
CHINESE. WE NEED EXPORT MARKETS FOR OUR
HIGH-PAYING EXPORT RELATED JOBS. CHINA IS THE
FASTEST GROWING MAJOR ECONOMY IN THE WORLD,
ASIAN FINANCIAL CRISIS NOTWITHSTANDING. SO OUR
ECONOMIC AND SECURITY GOALS ARE VERY BOUND UP.
I THINK THERE'S JUST ONE OTHER ASPECT AND THAT
IS, BASICALLY, IF THE UNITED STATES DOES NOT
HAVE A CONSTRUCTIVE RELATIONSHIP WITH CHINA, THE
1950'S AND 1960'S INDICATED WHAT THE RESULT IS.
AND WE HAD A KOREAN WAR AND, IMPORTANTLY, WE HAD
A VIETNAM WAR TO WHICH CHINA WAS RELATED. SO,
IF WE DON'T HAVE AT LEAST A WORKABLE, PRODUCTIVE
RELATIONSHIP WITH CHINA, IT'S GOING TO BE VERY
DIFFICULT TO MANAGE PEACE IN THE TWENTY-FIRST
CENTURY IN ASIA.
HOST: DO YOU AGREE WITH THAT, STEPHEN YATES?
YATES: WELL, I THINK ONE OF THE PROBLEMS WE'VE HAD IN
THE CHINA POLICY DEBATE OVER THE LAST SEVERAL
MONTHS IS ESPECIALLY THAT THE ADMINISTRATION HAS
OVERSOLD THE VALUE OF CHINA IN SOME OF OUR
STRATEGIC OBJECTIVES. AND IN SO DOING, THEY
HAVE SET STANDARDS THAT ARE VERY HIGH AND VERY
EASY FOR CRITICS IN THE CONGRESS OR ELSEWHERE TO
SAY, WELL, THE RESULTS OF YOUR POLICY DO NOT
MATCH UP TO PREDICTIONS YOU MADE WHEN YOU SET
FORTH YOUR GOALS.
HOST: FOR INSTANCE?
YATES: FOR INSTANCE, ON THE KOREAN PENINSULA. IT'S
VERY DIFFICULT TO SAY NORTH KOREA IS A SAFER
PLACE TODAY OR A LESS UNCERTAIN PLACE TODAY THAN
IT WAS FOUR YEARS AGO, WHEN WE STARTED THE
AGREED FRAMEWORK AND OTHER KINDS OF THINGS LIKE
THAT. IT'S DIFFICULT TO SAY WHAT CHINA HAS
GIVEN US TOWARD RELATIVE PEACE IN THE KOREAN
PENINSULA. IN FACT, WE HAVE A LAUNCH OF SOME
KIND OF DEVICE, WE THINK IT WAS A ROCKET THAT
WENT OVER JAPAN. IT'S GREATLY ADDED TO THE
DEBATE OVER THEATER MISSILE DEFENSE, SOMETHING
CHINA NOW RESOLUTELY OPPOSES. AND SO, I THINK
IN SOME WAYS OUR STRATEGIC OBJECTIVES, OR WHERE
THEY COME TOGETHER IS VERY TENUOUS MEETING OF
THESE OBJECTIVES, AND ONLY A FEW EVENTS HAVE TO
TAKE PLACE AND THOSE OBJECTIVES CAN BEGIN TO
DIVERGE. ON SOUTH ASIA, WE ARE SUPPOSED TO HAVE
A PARTNERSHIP TO TRY TO BRING PEACE AND MOVE
AWAY FROM NUCLEAR WEAPONS STATUS, OR AT LEAST
TESTING OF NUCLEAR WEAPONS IN SOUTH ASIA. WELL,
IT WASN'T THAT LONG AGO WHEN CHINA STOPPED
TESTING THEIR NUCLEAR WEAPONS. SO I DON'T KNOW
HOW MUCH LEVERAGE A PARTNERSHIP WITH CHINA GIVES
US IN NEW DEHLI IN TRYING TO PERSUADE THEM AWAY
FROM THE NUCLEAR OPTIONS THAT THEY'VE NEWLY
DEVELOPED. SO I THINK THERE ARE SOME LIMITS TO
WHAT WE CAN REALLY ACCOMPLISH.
HOST: WELL, MIGHT THESE LIMITS BE AN EXPRESSION OF AN
INCOMPATIBILITY IN THE LARGER GOALS OF EACH
COUNTRY'S STRATEGIC OBJECTIVE? FOR INSTANCE,
THE UNITED STATES WISHES TO REMAIN, FOR ECONOMIC
AND STRATEGIC PURPOSES, A PACIFIC POWER. CHINA
MIGHT VERY WELL WISH TO BECOME THE PARAMOUNT
POWER IN ASIA. THE PRINCIPAL OBSTACLE TO THEIR
REACHING THAT OBJECTIVE IS U.S. POWER IN THE
REGION. SO IN THAT PERSPECTIVE, OUTSIDE OF THE
ECONOMIC ARGUMENT YOU GAVE, WHICH IS VERY
PERSUASIVE, MIGHT THERE NOT BE A FUNDAMENTAL
INCOMPATIBILITY?
LAMPTON: I THINK THE TRUTH OF THE MATTER IS THAT WE HAVE
SOME AREAS WHERE OUR INTERESTS CONVERGE AND SOME
AREAS WHERE THEY DIVERGE. AND THAT'S WHAT MAKES
THIS VERY DIFFICULT TO MANAGE, BECAUSE CRITICS
POINT TO THE AREAS WHERE WE DO HAVE GENUINE
CONFLICTS AND PEOPLE WHO ARE MORE SUPPORTIVE OF
THE RELATIONSHIP POINT TO THOSE AREAS WHERE
THERE IS A CLEARER CONVERGENCE. AND THEY ARE
TALKING PAST EACH OTHER. THE REALITY OF
MANAGING THIS IS THAT BOTH SIDES ARE AMBIVALENT
ABOUT THE OTHER. LET ME JUST GIVE YOU AN
EXAMPLE. THE FORWARD PRESENCE BASING OF
AMERICAN TROOPS IN KOREA AND IN JAPAN. NOW, IF
THE PURPOSE OF AMERICAN TROOPS IN ASIA, IN
EFFECT, IS TO REMOVE THE NECESSITY FOR JAPAN TO
BECOME MILITARIZED, CHINA SHARES THAT OBJECTIVE.
ON THAT PART OF IT, THEY WELCOME AMERICAN
TROOPS. IF ON THE OTHER HAND, THE PURPOSE OF
AMERICAN TROOPS IN JAPAN IS TO POSSIBLY
INTERVENE IN A TAIWAN STRAITS CRISIS, THEY FIND
THAT INTOLERABLE. SO IT'S PARTLY CHINESE
UNCERTAINTY ABOUT WHAT AMERICA INTENDS TO DO, OR
WHAT IT MIGHT DO WITH ITS FORCE IN THE FUTURE.
SIMILARLY ON THE KOREAN PENINSULA, RIGHT AT THE
MOMENT CHINA VIEWS OUR TROOPS ON THE KOREAN
PENINSULA AS A BASICALLY STABILIZING FORCE. BUT
IF KOREA BECAME UNIFIED, IT'S FAR FROM CLEAR TO
ME, IN FACT IT'S PRETTY CLEAR TO ME THAT CHINA
WOULD NOT WANT THEM THERE. AND WE'D HAVE A
PROBLEM. SO LIFE HAS CHANGED, LIFE IS
AMBIVALENT. WE ARE AMBIVALENT ABOUT SOME
ASPECTS OF GROWING CHINESE POWER. THEY ARE
AMBIVALENT ABOUT OUR PRESENCE IN THE AREA, BUT
IT'S NOT A SIMPLE CASE OF ANTAGONISM ACROSS THE
BOARD IN EITHER CASE. AND OUR OBJECTIVE OUGHT
TO BE TO PREVENT THIS RELATIONSHIP FROM
DETERIORATING INTO ACROSS-THE-BOARD ANTAGONISM.
HOST: DO AGREE WITH THAT, STEPHEN?
YATES: I AGREE WE SHOULD TAKE REASONABLE STEPS TO AVOID
PROVOKING A FIGHT THAT DOESN'T NEED TO HAPPEN.
THERE ARE DEFINITELY SOME THINGS WE COULD DO ON
TAIWAN, OR SOME OTHER AREAS, THAT WOULD PROVOKE
A DIPLOMATIC FIGHT, IF NOT A HOT WAR. THERE ARE
ACTIONS THAT CHINA COULD TAKE THAT COULD DO THE
SAME, SO WE SHOULD MAKE SURE WE HAVE CHANNELS OF
COMMUNICATION OPEN SO THAT WE MAKE SURE WE DON'T
RUN INTO ONE OF THESE CONFLICTS DUE TO
MISCALCULATION OR MIS-COMMUNICATION. I THINK
THAT'S VERY IMPORTANT.
HOST: LET'S TALK ABOUT ONE OF THE AREAS IN WHICH BOTH
SIDES SEEM TO BE EARNESTLY SEEKING COOPERATION,
AND THAT IS IN THE ECONOMIC ARENA AND, OF
COURSE, THE WORLD TRADE ORGANIZATION AND CHINA'S
ENTRY INTO IT. SOME PEOPLE EXPRESS
DISAPPOINTMENT THAT PRESIDENT CLINTON DID NOT
OUTRIGHT SUPPORT CHINA'S ENTRY DURING PREMIER
ZHU'S VISIT, SAYING A GOLDEN OPPORTUNITY WAS
MISSED. WHAT DID YOU THINK?
LAMPTON: WELL, I THINK THERE ARE A NUMBER OF THINGS.
FIRST OF ALL, I THINK IT'S IN THE UNITED STATES
INTEREST THAT CHINA JOIN THE WORLD TRADE
ORGANIZATION. AND WHILE I HAVEN'T SEEN ALL THE
FINE PRINT OF WHAT WAS AGREED TO THUS FAR, WHAT
I UNDERSTAND LEADS ME TO THINK WE'VE NOW REACHED
THE POINT THAT IT IS ALMOST INDISPUTABLY IN THE
OVERALL AMERICAN INTEREST. IT DOESN'T MEAN IT'S
IN THE INTEREST OF TEXTILE WORKERS OR PARTICULAR
SECTORS. AND THAT CONFUSES THINGS. ALSO, I
THINK IT'S A LITTLE PREMATURE YET TO SAY WE WILL
NOT GET A DEAL IN THE NEXT FEW MONTHS, BUT I DO
BELIEVE THE ADMINISTRATION IS QUITE WORRIED
ABOUT WHETHER IT CONVINCED CONGRESS THAT THIS IS
IN OUR INTEREST. IT'S NOT SELF-EVIDENT TO SOME
PEOPLE ON CAPITOL HILL THAT THAT IS THE CASE.
HOST: SO, YOU THINK THE DELAY MAY ACTUALLY BE MORE FOR
DOMESTIC U.S. REASONS, THAN IT IS FOR SOMETHING
SUBSTANTIVE IN THE NEGOTIATIONS?
LAMPTON: I BELIEVE IF THIS FAILS IT WILL BECAUSE OF
DOMESTIC REASONS AND IT CERTAINLY WAS DELAYED
FOR DOMESTIC REASONS.
HOST: DO YOU AGREE WITH THAT, STEPHEN YATES?
YATES: A HUNDRED PERCENT. I BELIEVE THAT THERE ARE TWO
THINGS THAT ARE POLITICAL HANDICAPS ON THE W-T-O
DEAL RIGHT NOW. NUMBER ONE, IS THAT THE
POLITICS OF CHINA AND WASHINGTON ARE VERY BAD.
ON A NUMBER OF FRONTS, THE ADMINISTRATION'S
POLICY IS UNDER ATTACK. THERE'S A LOW LEVEL OF
TRUST BETWEEN CONGRESS AND THE WHITE HOUSE.
THERE'S A LOW LEVEL OF TRUST BETWEEN CONGRESS
AND CHINA. AND SO THOSE THINGS COMBINE TO MAKE
THIS A DIFFICULT DEAL TO TALK ABOUT. ANOTHER
THING IS TRADE IN GENERAL. WE SHOULDN'T FORGET
THAT FAST TRACK AND OTHER IMPORTANT TRADE
LEGISLATION HAVE FAILED RECENTLY IN THE
CONGRESS. SO COMBINING THE CONTROVERSY
SURROUNDING TRADE IN GENERAL WITH ALL THESE
OTHER CONTROVERSIES THAT SEEM TO BE CONVERGING
OVER CHINA, AND YOU'VE GOT A W-T-O DEAL THAT
COULD BE VERY, VERY DIFFICULT IN THIS
ENVIRONMENT. IF YOU WAIT UNTIL AFTER THE
MOST-FAVORED-NATION NORMAL TRADE RELATION STATUS
DEBATE THIS SUMMER, THERE'S SORT OF A CALM AFTER
THE STORM WHERE YOU HAVE AN AUGUST AND A
SEPTEMBER TIME FRAME, WHERE IT'S STILL FEASIBLE
FOR A DEAL TO BE INKED AND FOR CHINA TO BE
BROUGHT INTO THE W-T-O AT THE MINISTERIAL
MEETING AT THE END OF THIS YEAR. IF I WERE
STRATEGIZING FOR THE ADMINISTRATION, THAT'S WHAT
I WOULD BE LOOKING FOR. IT BRINGS TOGETHER THE
DEAL WITH THE POLITICS.
LAMPTON: I WOULD JUST SAY THERE WAS ONE OTHER THING
THOUGH AND THAT IS PRESIDENTIAL POLITICS. AND
EVERY DAY THIS DEAL IS DELAYED THE INCENTIVES
FOR POLARIZATION WITHIN BOTH PARTIES GROW
BECAUSE YOU HAVE MORE CANDIDATES MORE
DESPERATELY LOOKING FOR MONEY, MORE DESPERATELY
LOOKING FOR FOOT SOLDIERS TO KNOCK ON DOORS TO
GET SUPPORT IN THE PRIMARIES. SO WHILE THERE
MAY BE SUMMER RECESS IN CONGRESS, AND THAT MIGHT
GIVE A BREATHER, WE'RE ON A STRAIGHT LINE TO
GREATER POLARIZATION IN OUR PRESIDENTIAL
POLITICS RIGHT NOW.
HOST: ON THE OTHER HAND, YOU DO HAVE A HUGE AMERICAN
BUSINESS COMMUNITY WHICH IS HEAVILY INTERESTED
IN SEEING CHINA ENTER THE W-T-O SO TRADE CAN
INCREASE, AND CHINESE TARIFFS DROP AGAINST U-S
GOODS.
LAMPTON: FRANKLY, I THINK ONE REASON THE PRESIDENT
DEFERED, IF THAT'S WHAT HAPPENED HERE, AN
AGREEMENT WAS TO SEE IF THE AMERICAN BUSINESS
COMMUNITY WOULD MOBILIZE AND, IN FACT, KNOCK
DOWN SOME OF THE CONGRESSIONAL BARRIERS, SO HE
WOULDN'T HAVE TO EXPEND WHAT LITTLE POLITICAL
CAPITAL HE HAS LEFT.
HOST: ALL RIGHT, WELL, NOT ALL OF THESE PROBLEMS ARE
DOMESTIC U-S POLITICAL PROBLEMS, AS WE KNOW.
THE UNITED STATES DECIDED, ON THE BASIS OF
RECENT HUMAN RIGHTS PERFORMANCE WITHIN CHINA, TO
TABLE A RESOLUTION AT THE U-N HUMAN RIGHTS
COMMISSION MEETING IN GENEVA TO FOCUS ON HUMAN
RIGHTS ABUSES THERE. PREMIER ZHU OBJECTED TO
THIS DURING HIS VISIT SAYING THIS WAS
UNWARRANTED INTERNAL INTERFERENCE IN THE AFFAIRS
OF CHINA. WHEREAS CHINA, HOWEVER, RECENTLY
SIGNED THE INTERNATIONAL COVENANT ON CIVIL AND
RELIGIOUS RIGHTS. THIS LEAVES THE POLITICAL
PEOPLE IN BOTH PARTIES IN THE CONGRESS WONDERING
WHETHER THEY OUGHT TO BE SUPPORTING A REGIME
THAT THEY CAN'T UNDERSTAND IN TERMS OF THESE TWO
STANDS.
YATES: TABLING THE RESOLUTION IN GENEVA AT THE HUMAN
RIGHTS COMMISSION, I THINK, WAS ABSOLUTELY
NECESSARY TO TRY TO ADDRESS THE POLITICAL
ENVIRONMENT HERE, BUT ALSO THERE'S A STANDARD
THAT IS SET HERE, TOO. THIS ISN'T JUST
CRITICIZING CHINA FOR THE SAKE OF CRITICIZING
CHINA. THERE IS A GREATER LEVEL OF LEGITIMACY
WHEN THERE'S AN INTERNATIONAL COVENANT SIGNED.
AND YOU PERCEIVE THERE TO HAVE BEEN ACTION TAKEN
THAT VIOLATES THE SPIRIT OR THE LETTER OF THAT
COVENANT. THERE'S A FORUM WITHIN WHICH THESE
DIFFERENCES CAN BE RESOLVED, AND IT'S THAT HUMAN
RIGHTS COMMISSION. SO I THINK IT'S ENTIRELY
APPROPRIATE ON ITS SUBSTANCE, BUT ALSO IN TERMS
OF ITS POLITICS. IT WAS A NECESSARY STEP FOR
THE ADMINISTRATION TO DEMONSTRATE THAT WE DON'T
HAVE A COMMERCE-ONLY CHINA POLICY. THEY ARE
WILLING AND ABLE TO STAND UP ON HUMAN RIGHTS.
LAMPTON: I WOULD JUST SAY THERE ARE TWO ASPECTS OF THIS
ONE. ONE IS WHETHER THE UNITED STATES GOES TO
GENEVA TO SEEK CONDEMNATION OR NOT. THAT'S ONE
DECISION. ANOTHER IS WHETHER WE TIE
CONSIDERATION OF W-T-O TO THE ISSUE OF OUR
DISSATISFACTION WITH HUMAN RIGHTS. I THINK THE
CHINESE POSITION IS VERY CLEAR. ECONOMICS OUGHT
TO STAY WITH ECONOMICS AND HUMAN RIGHTS SHOULD
STAY IN A DISCRETE ZONE. THE FEELING IN MANY
QUARTERS OF CAPITOL HILL IS THAT THESE THINGS
OUGHT TO BE LINKED. SO YOU HAVE A SEPARATE
POLICY QUESTION. SHOULD WE LINK THESE? YOU PUT
THE QUESTION, AS I RECALL JUST A SECOND AGO,
THAT PEOPLE ARE OPPOSED TO REWARDING THE CHINESE
WITH, IN EFFECT, W-T-O OR TRADE ARRANGEMENTS
WHEN THEIR POLICIES WITH RESPECT TO HUMAN RIGHTS
ARE SO DEPLORABLE. I THINK WE HAVE TO SEPARATE
THESE IN MY VIEW A LITTLE BIT. THE W-T-O
AGREEMENT IS IN THE INTEREST OF THE UNITED
STATES, OR AT LEAST IT SHOULD BE CONSIDERED
WHETHER OR NOT IT IS IN THE ECONOMIC INTERESTS
OF THE UNITED STATES. ALSO, GETTING CHINA
COMMITTED TO A TIMETABLE BY WHICH IT WILL
OBSERVE LEGAL REGULATIONS IN ITS GLOBAL
BEHAVIOR, I THINK, IS DESIRABLE AND HAS
IMPLICATIONS FOR HUMAN RIGHTS. SO, THERE ARE
TWO QUESTIONS. ONE, DO YOU GO TO GENEVA? I
THINK THERE IS A CASE TO BE MADE THAT YOU
SHOULD. ON THE OTHER HAND, DO YOU LINK THAT TO
ALL THE OTHER ISSUES IN THE RELATIONSHIP LIKE
W-T-O. THERE, I THINK THAT'S ILL-ADVISED.
HOST: ON THE OTHER HAND, MANY PEOPLE WERE HOPING THAT
THE ECONOMIC REFORMS THAT ZHU RONGJI AND OTHERS
HAVE SPONSORED INSIDE CHINA WOULD PRODUCE
PRECISELY THE KIND OF POLITICAL TRANSFORMATION
THAT THEY WERE HOPING TO SEE IN CHINA WITH
GREATER DEMOCRATIZATION. AND INSTEAD, WE SEE
THREE LEADERS OF THE NEW CHINA DEMOCRACY PARTY
PUT IN JAIL IN A CLOSED-DOOR TRIAL. MIGHT NOT
THAT BE PART OF THE FRUSTRATION? THAT THE WHOLE
POLITICAL PREMISE IN ENGAGING IN BROAD ECONOMIC
COOPERATION -- THAT THE ECONOMIC ENGINE WOULD
EVER SO SLOWLY TRANSFORM THE POLITICS OF CHINA,
AWAY FROM THE COMMUNISM THEY STILL OPENLY
ESPOUSE, TO GREATER AND GREATER FREEDOM -- IS
THAT A FALSE PREMISE? STEPHEN YATES, HAS THAT
BEEN DISPROVED NOW?
YATES: I DON'T THINK ITS BEEN DISPROVEN. I THINK WHAT
WE HAVE IS AN INCOMPATIBILITY BETWEEN THE
POLITICAL GOAL AND THE TIME HORIZON IT SETS AND
THE KIND OF DAY-TO-DAY, HOUR-BY-HOUR,
NEWS-DRIVEN POLITICS WE HAVE HERE. THAT WE HAVE
PEOPLE WHO STAND BEFORE A CAMERA EVERY DAY AND
ARE EXPRESSING AN OPINION ON WHAT'S HAPPENING
HERE AND NOW. AND WE HAVE A POLICY IN PLACE
THAT'S SUPPOSED TO TRANSFORM CHINA OVER FIFTY TO
A HUNDRED YEARS. I THINK ONE THING IT'S
IMPORTANT TO REMEMBER, WE HAD A VERY CLOSE AND
COOPERATIVE RELATIONSHIP WITH THE REPUBLIC OF
CHINA ON TAIWAN FOR MANY DECADES. AND IT TOOK A
VERY LONG TIME FOR HUMAN RIGHTS AND DEMOCRACY TO
FLOURISH IN THAT SOCIETY. WE HAD A GREAT DEAL
OF AID, WE HAD MILITARY COOPERATION. AND IT
WASN'T REALLY UNTIL THE MIDDLE 1980'S THAT
THINGS BEGAN TO OPEN UP MORE. AND IT WASN'T
UNTIL THE MID-1990'S THAT EVERY LEVEL OF
LEADERSHIP IN TAIWAN WAS ELECTED DIRECTLY BY THE
PEOPLE. AND SO I THINK THIS IS A LONG-TERM
STRATEGY.
HOST: BUT THE ANSWER YOU WOULD LIKELY RECEIVE FROM
SOMEONE LIKE JEANE KIRKPATRICK WOULD BE THAT THE
REPUBLIC OF CHINA ON TAIWAN WAS AN AUTHORITARIAN
REGIME, NOT A TOTALITARIAN ONE.
YATES: AND JEAN KIRKPATRICK SAYS TODAY THAT CHINA IS A
AUTHORITARIAN REGIME AND NOT A TOTALITARIAN
REGIME. SHE MAKES THE DISTINCTION OF MAO TO
DENG.
HOST: DO WE AGREE WITH THAT?
YATES: I DO AGREE WITH THAT BECAUSE I THINK THERE ARE
AREAS OF CHINESE SOCIETY THAT ARE OPEN TO BE
INFLUENCED RIGHT NOW. THERE ARE WAYS OF HAVING
INTERACTION WITH ORDINARY CHINESE PEOPLE AND
THEY ARE HAVING EXPOSURE TO OUR IDEAS. THEIR
HAVING OPPORTUNITIES TO CREATE FREEDOM
THEMSELVES. IT'S SLOWLY GROWING AND EXPANDING.
AND WE SHOULD BE TRYING TO EXPLOIT THESE CRACKS
IN THE SYSTEM TO TRY TO HELP BUILD GREATER AREAS
OF FREEDOM, RATHER THAN CLOSING THOSE OFF AND
WAITING FOR CHANGE TO OCCUR.
HOST: ASIDE FROM THE WORLD TRADE ORGANIZATION HOW, DO
WE DO THAT, DAVID LAMPTON?
LAMPTON: WELL FIRST OF ALL, I THINK ONE OF THE GREAT
HIDDEN SECRETS OF AMERICAN FOREIGN POLICY HAS
BEEN THE SUCCESS WE'VE HAD IN DEALING WITH
CHINA, IN MY VIEW. IN 1978 WE DECIDED TO ALLOW
IN FIVE HUNDRED CHINESE STUDENTS AND SCHOLARS.
THAT'S GROWN NOW TO FIFTY THOUSAND. MANY OF
THEM, A LOT OF THEM ARE NOT GOING BACK, BUT MANY
OF THEM ARE GOING BACK. THEY ARE TRANSFORMING
THE FACE OF COMMERCE IN CHINA. THEY ARE
BEGINNING TO MOVE IN TO THE POLITICAL SYSTEM.
THEY ARE BEGINNING TO CREATE SOCIAL
ORGANIZATIONS. SO I THINK JUST THE CULTURAL
EXCHANGE HAS HAD AN ENORMOUS EFFECT. IF YOU
LOOK IN THE ECONOMIC AREA, BEYOND WORLD TRADE
ORGANIZATION, WORLD BANK, I-M-F, CHINA DRAWS
MORE FOREIGN DIRECT INVESTMENT THAN ANY OTHER
COUNTRY IN THE WORLD OTHER THAN THE UNITED
STATES. IN MANY RESPECTS IN TERMS OF
INVESTMENT, CHINA IS MORE OPEN TO FOREIGN
INVESTMENT THAN JAPAN. IN OTHER AREAS, WE HAVE
DIFFICULTY WITH MARKET ACCESS, SO IT'S NOT AN
UNDIFFERENTIATED GOOD RECORD, LET ME BE CLEAR ON
THAT.
HOST: LET ME JUST STOP ON THAT POINT AND ASK WHETHER
YOU ARE WORRIED ABOUT AN ECONOMIC SLOWDOWN IN
CHINA BECAUSE A NUMBER OF PEOPLE HAVE POINTED
OUT THAT THE CAPITAL INFLOWS HAVE SLOWED
CONSIDERABLY AND THAT, AFTER ALL, THE FREE
MARKET IN CHINA STILL IS ONLY PERHAPS TWENTY
PERCENT OF THEIR ECONOMY. AND THEY ARE STILL
FUNNELING STATE BANK MONEY INTO THESE STATE BANK
ENTERPRISES. AND THEY ARE FACING HUGE, HUGE
PROBLEMS IN THEIR NEXT STEP. HOW DO YOU ASSESS
THEIR CHANCES OF DOING THIS SUCCESSFULLY?
YATES: I, ALONG WITH A LOT OF PEOPLE IN THIS TOWN,
REALLY RELY ON THE WORK OF ONE EMINENT SCHOLAR
IN THIS FIELD, AND THAT'S NICK LARDY. HE'S
WRITTEN AN IMPORTANT BOOK THAT LOOKS AT CHINA'S
FINANCIAL SYSTEM AND BANKING SYSTEM, AND
OUTLINES A VERY CHALLENGING ROAD AHEAD IF THEY
WANT TO FINISH THE REFORM PROGRAM THEY BEGAN
MANY YEARS AGO. AND IN MANY WAYS, THE MOST
DIFFICULT REFORMS HAVE BEEN LEFT FOR THE LAST.
I BELIEVE THAT YOU CAN'T REALLY HAVE A
SUCCESSFUL FREE MARKET ECONOMY WITHOUT CERTAIN
INSTITUTIONS BEING HEALTHY AND FUNCTIONING
WITHIN YOUR SYSTEM. I THINK THE OPENING OF THE
FORMER SOVIET UNION, TODAY'S RUSSIA, PROVES THAT
FREE ACCESS TO THE WORLD MARKETS CAN DESTROY AN
ECONOMY IF YOU DON'T HAVE INSTITUTIONS THAT
WORK. AND I THINK THAT THE ARTERIES OF A FREE
MARKET ECONOMY ARE FUNCTIONING BANKS. THEY HAVE
TO BE WELL SUPERVISED. THEY NEED TO HAVE
CAPITAL IN THEM THAT IS DISPERSED ACCORDING TO
MARKET DECISIONS, NOT POLICY DECISIONS. AND I
THINK CHINA KNOWS WHAT NEEDS TO BE DONE, AND I
THINK PREMIER ZHU RONGJI KNOWS BETTER THAN ANY
ONE ELSE IN CHINA WHAT NEEDS TO BE DONE. THE
QUESTION IS: HOW DO YOU UNDO THE ENMESHING OF
POLICY AND BANKING THAT'S GROWN OVER DECADES,
OVER A SHORT PERIOD OF TIME, COMBINED WITH A
SHORT W-T-O TRANSITION PERIOD? IT'S A HUGE
CHALLENGE. CAN IT BE DONE? I BELIEVE IT CAN
BE, BUT IT IS GOING TO NECESSARILY SLOW GROWTH.
IT IS GOING TO NECESSARILY INCREASE
UNEMPLOYMENT. AND THE CHALLENGE FOR ZHU RONGJI
IS, HOW DOES HE CONVINCE THE WORLD THAT THIS
SLOWDOWN IS A RESULT OF DOING THINGS THAT ARE
RIGHT FOR CHINA, RIGHT FOR CHINA. THIS IS
SHORT-TERM PAIN FOR LONG-TERM GAIN. AND KEEP IT
FROM APPEARING AS THE OTHER SHOE DROPPING IN THE
ASIAN FINANCIAL CRISIS.
HOST: I'M AFRAID THAT'S ALL THE TIME WE HAVE THIS
WEEK. I'D LIKE TO THANK OUR GUESTS -- DAVID
LAMPTON FROM THE JOHNS HOPKINS SCHOOL FOR
ADVANCED INTERNATIONAL STUDIES AND STEPHEN YATES
FROM THE HERITAGE FOUNDATION -- FOR JOINING ME
TO DISCUSS U.S.-CHINA RELATIONS. THIS IS ROBERT
REILLY FOR ON THE LINE.
16-Apr-99 1:55 PM EDT (1755 UTC)
NNNN
Source: Voice of America
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