15 March 2000
Text: Commerce Secretary Daley March 14 on China Trade Status
(China trade debate has implications for world security) (2560) U.S. Commerce Secretary William Daley remarked March 14 that while he was confident that the Clinton Administration would win congressional support for China's accession to the World Trade Organization (WTO), he nonetheless was bothered by the fact that "the intensity is not there yet -- by any means." Speaking to the Electronic Industries Alliance in Washington, DC, Daley stressed that the trade debate over China "really is broader than trade," with implications for American leadership and world security. "It all boils down to this: we live in a new economy; we are watching old China wanting to become a new China; and, I really hope, we are seeing old trade politics give way to new trade politics that is more than about jobs and economics," Daley said. "It is about creating a better and more stable world," he explained. With so much at stake, Daley said the president, vice president, and "all of us in the cabinet will be working our hearts out ... (and) will do everything we can to encourage the passage" of U.S. legislation to approve China's accession to the WTO. "Frankly, the new China still has dark sides to it that no one likes," Daley admitted, "and I'm no apologist for them." Nonetheless, he said that voting against China's accession to the WTO "won't free a single prisoner in China" and "would leave China with less access to information ... [and] with less contact with the democratic world." "It would be a very negative message, especially after Seattle, for America to turn this down," he added. "If this fails, it would send, at the start of the 21st century, the wrong signal to the world of America's leadership." Following is the text of Daley's remarks, as prepared for delivery: (begin text) REMARKS BY COMMERCE SECRETARY WILLIAM M. DALEY ELECTRONIC INDUSTRIES ALLIANCE WASHINGTON, D.C. MARCH 14, 2000 In Dave McCurdy's introduction, he left out one little fact: I am now the longest serving Commerce Secretary in this century -- all of 74 days. I don't want to brag too much because the longest serving in the last century was Herbert Hoover! I am grateful to serve during the longest economic expansion in our history, when you have created 21 million jobs, when we have the lowest unemployment rate in 30 years. But as I look at my tenure -- and I have a lot of energy left in these 10 months -- there is nothing I wish for more than to help open a market of over a billion consumers to American businesses. I can't imagine any Commerce Secretary in the next 30 years having the kind of opportunity I have in the next three months: to help open the biggest potential market in the world. There is no larger step to take than to bring China into the world trading system. So, tonight, before the businesses that are the symbol of the 21st century, I want to put the trade debate over China in a broader perspective, because it really is broader than trade. It is easy for me to feel confident America in the end will do the right thing, because it all boils down to this: we live in a new economy; we are watching old China wanting to become a new China; and, I really hope, we are seeing old trade politics give way to new trade politics that is more than about jobs and economics. It is about creating a better and more stable world. Look around this room and the new economy is obvious. No question, we have a huge advantage in high-tech. Since President Clinton took office, one-third of the growth of this remarkable economy has come from information technologies. More and more, new economy companies grow by selling abroad, and in this century that has to include China. Let me illustrate with some numbers. Next year, the second largest market in the world for personal computers will be China. In telecommunications, China is the largest potential market in the world, and only 5 percent of it has been tapped. The Internet is growing faster in China than anywhere in Asia. Think about how important small businesses have been to driving our new economy. Then think about this: the third fastest growing market for American small and medium-sized exporters is China. And as old economy industries want to become new economy industries -- and anybody who watches Wall Street knows they do -- they better look half a world away, also. Right now every man, woman, and child in China consumes less than a dollar's worth of American agricultural goods -- a year. The salad you just ate was more than the average Chinese consumes from the greatest farmers in the world for the entire year. But look to the future -- and China will account for nearly 40 percent of the future growth of U.S. agricultural exports. My point is this. In a new economy, where the way we work is different, the way we live is different -- the way we relate to each other across national boundaries also has to be different. In our country, trade has grown from 10 percent of GDP 30 years ago, to 24 percent today. But it would never have happened if there had not been a rules-based world trading system. It would never have happened if governments hadn't helped bring trade barriers down As we grow our new economy, China is growing one, too. In the last 20 years, China has lifted more than 200 million people out of absolute poverty. It is linking so many people through wireless communication, it is like they add a new Baby Bell every year. No question, they still have problems. Their economy is still plagued by corruption. 100 million people in China are looking for work. Economic growth has slowed, just when it needs to be rising. And less than one-third of China's economy is private. Having been in our public service for three years, I can't imagine their bureaucracy is any more efficient than ours! This was no easy decision for China's leaders to join the world trading system. If we were in their shoes, I could hear the opposition now: the Pat Buchanan's of China telling us this will cost 10 million farmers their jobs. But the Chinese concluded without open markets, they cannot build the world-class industries they need in this century. So, they have handed us what every president since Richard Nixon hoped for: a more open market. We will gain unprecedented access. For the first time, companies can sell and distribute products in China made by American workers without transferring technology in manufacturing. For the first time China will agree to play by the same open trading rules we play by. Under the agreement, Chinese tariffs in basically every sector will be cut by half or more in five years. Today we have a $69 billion trade deficit with China, because our market is open -- and theirs is not. We even have in the electronics sector, a $20 billion trade deficit with China. I know your products are the best in the world. One-third of what your industry produces is exported overseas -- some countries obviously like them. But they can't make it into China with the high tariffs and the even costlier non-tariff barriers until this agreement lifts those barriers. Usually when you negotiate trade deals, every party has to give up something -- but not here. This is all one way. We give nothing -- because they already have access to our market, the most open in the world. And we now get access to theirs. So far, in this debate, unlike NAFTA, the economics are not really in question. I haven't talked to very many members of Congress who are challenging the economics, although there are members with tough choices as we transition from old to new economy. People like Cong. Phelps from Illinois. He has half a district of pro-traders because there are a lot of farmers and Caterpillar workers. And half are worried about trade because there is a depressed coal industry. It is a very complex issue to grapple with. Let me say, so far I haven't seen the opposition coming out with job loss studies, as they did with NAFTA. The fact is, in the last two years union jobs are up by almost 400,000. China offers them what they need to maintain the momentum: a growing market, with low tariffs. Jimmy Hoffa, along with 300 members of Congress, just wrote my colleague, Secretary Slater, asking him to grant UPS permission to land planes in China. Let me read you from Mr. Hoffa's letter: "For every 40 additional international packages delivered by UPS each day, a new job is created at UPS -- and that is most likely a Teamster job." Yet, my good friends in the union, are not a fan of this deal. And one reason is that the new politics of trade agreements is about more than money. It's much more complicated than that. How you can tell is that in this debate, so far nobody has come up with the great one-liner, like the sucking sound that defined NAFTA. Instead, in the new politics, there are many issues they criticize. All of which are legitimate, because, frankly, the new China still has dark sides to it that no one likes -- and I'm no apologist for them. But we better weigh the arguments. Some people are concerned that China is a growing threat to Taiwan, and we should not be strengthening it. But do you know who the biggest supporter of China's entry into the WTO is? Do you know who is doing everything she can to cement economic ties with the mainland? Taiwan. Some say China is a drag on labor and environmental market rights. And if we put China in the WTO, they will block further progress on these important issues. I was in Seattle. I can tell you, first hand, environmental and labor issues are already a hard sell. And that won't change substantially if China is there. That is just not a real argument, given where all the other developing countries are on these issues. Some say China is an offender of human rights. They are concerned about the religious liberty issues, as clearly I am as a Catholic. I am proud that America, two years in a row, has stood up to China, submitting a human rights resolution in Geneva-- the only nation that did so. But the fact is the groups involved in missionary work in China for years are overwhelmingly in favor of this. So are many of the people who have paid the greatest price under Chinese repression. People like Ren Wending, who helped lead the demonstrations at Tiananmen Square. Those who oppose this have not been in China, seeing how society works. Any vote against this won't free a single prisoner in China. And I don't think lecturing them or threatening them works either. Invariably, every time I visit a country -- any country -- and suggest publicly the government needs to change its ways, do you know happens? Somebody looks me in the eye and asks: who do you think you are, lecturing us? A vote against this would leave China with less access to information. It would leave it with less contact with the democratic world. Ironically, it would do it as the cyberworld has brought great change to our society, and could do the same for China. The leaders of China are smart people. They know if our high tech industry goes in and wires China, and everybody is connected to the Internet, that change will come more rapidly in ways they cannot control. They have made the decision to let it happen. We should not let our disagreements get in the way. Let me just add, it would be a very negative message, especially after Seattle, for America to turn this down. Here we are, an economy 10 times larger than China's; here we are, with exports to the world four times greater than China -- and we're thinking about turning China down, we're afraid to make permanent trade status that we have granted every year for almost two decades? If this fails, it would send, at the start of the 21st century, the wrong signal to the world of America's leadership. Obviously, the question I get asked most is: is this winnable? Maybe we should ask all the members of the House here. In my opinion, if we had to take the vote today, it would be tough in the House. Easier in the Senate, but I don't think we have the votes in the House yet. As Dave and every member here will tell you, passage is always tough for every big trade agreement we've ever voted on. At this time in NAFTA we faced the same situation. People who oppose trade agreements are far clearer about their opposition than people who support them this far in advance of a vote. In the end, we will win it, I'm confident. But timing is important. The longer we wait, the harder it is. A vote in April is better than May ... May is better than June. The President has asked the leadership if it can be done before Memorial Day. After that you run into conventions and elections. After that, we would be back to old politics. In April, Secretary Glickman and I will lead congressional delegations to China. We want members to see it all: local factories and U.S. facilities. We want them to talk with dissidents and Chinese officials. And I hope every member goes back to their districts, and talks with normal Americans about this -- people outside of Washington. There was a recent poll showing Americans favor this 48 percent to 36 percent. I wish we had a majority, but look, we're 12 points ahead, and gaining ground. What bothers me is the intensity is not there yet -- by any means. The President gave a speech on Sunday to 3,000 mayors and local leaders. It was the world's friendliest crowd. They applauded him on every issue -- but when it came to China, there was silence. Not that they were against it, there is just no intensity. The President, the Vice President, and all of us in the cabinet will be working our hearts out from now until Memorial Day. We will take the steps, we will do everything we can to encourage the passage. I hope you do the same. In the end, as the President said in the State of the Union, we cannot predict what China will do. We don't know what choices China will make. But we do control the choices we make. We can work to move China in the right direction, and offer the promise of the new economy to a new China. In my opinion, that is the choice America will follow. Thank you very much. (end text) (Distributed by the Office of International Information Programs, U.S. Department of State. Web site: usinfo.state.gov)
|
NEWSLETTER
|
| Join the GlobalSecurity.org mailing list |
|
|
|
