Agonizing Debate Expected on China Trade Privileges

Even in normal times, the annual debate over granting China routine trade privileges with the United States has been a rowdy exercise in free speech, as partisans point fingers, raise voices and claim the moral high ground.

Yet today, when the White House plans to announce an extension of normal trade ties with China, it will spark a debate more agonizing than any in recent years, with some chance that the House might vote it down for the first time in years.

Allegations that China stole U.S. nuclear secrets and sought to manipulate the 1996 presidential election are only part of the volatile backdrop to the emerging dispute. In a case of devastating symbolism, the proposed extension comes just one day before the 10-year anniversary of the Tiananmen Square massacre, further enraging China’s critics.

Other issues, meanwhile, such as America’s burgeoning trade deficit with China, which is running 20% above the 1998 pace and could approach $70 billion this year, are further eroding political support for a measure seen as helpful to Beijing.

“There’s no question it’s going to be much more difficult this year,” said Rep. Robert T. Matsui (D-Sacramento), adding his concern that support for normal trade relations “will continue to deteriorate over the next few months.”

Trade advocates long have argued that the United States stood to reap financial rewards by expanding its commercial ties with China, and that a growing economic relationship between the two nations would stimulate political reform inside China. And despite a history of controversies over alleged human rights abuses by the Beijing regime, such arguments generally carried the day in Congress.

Vehement efforts to sever normal trade ties with China, formerly known as Most Favored Nation status, lost in the House by margins of 98 votes and 86 votes in 1998 and 1997, for example.

Attitudes in Congress have been soured by the recent findings of a congressional panel on Chinese espionage, concerns about illegal U.S. technology transfers to China, and China’s bellicose response to NATO’s accidental bombing of the Chinese embassy in Belgrade.

But proponents of normal trade with Beijing contend that the economic and political logic of continued commercial ties has not been contradicted by those events.

“I don’t think you can say that one single issue makes it harder,” said Rep. David Dreier (R-San Dimas), an influential proponent of preserving the trade ties and chairman of the House Rules Committee. Rather, he continued, a combination of factors will complicate this year’s debate.

Nevertheless, Dreier predicted in an interview: “In the end, we’ll prevail.”

Beyond the boiling controversies of recent months, a hazier, emotional factor also may influence the coming battle: Memories of China’s violent suppression of protesters in Tiananmen Square, almost exactly 10 years ago, put the matter in a highly charged emotional context.

Some legislators see the 10-year anniversary as an appropriate time to reassess the U.S. policy of engaging Beijing in a web of peaceful activities such as trade, a policy long touted as a way to encourage desirable reforms in China.

White House officials were reluctant to propose renewing China’s trade status immediately after the appearance of the congressional report that alleged Chinese nuclear espionage. But by waiting a bit longer to formalize the proposal, the initiative coincided with the Tiananmen anniversary.

“Just as the president’s timing is sad, so too is his policy,” maintained Rep. Nancy Pelosi (D-San Francisco) in a statement. “This administration’s China policy, like that of the administration before it, has not succeeded in making trade fairer, people freer or the world safer.”

She added in an interview: “This is a particularly poignant year. It’s 10 years, and in 10 years that’s enough time to see what kind of a difference this policy made.”

The concerns of Pelosi and others may be increasingly common in Congress. One lobbyist, who requested anonymity, maintained that a growing number of members “have just finally had it” with China over various issues, and predicted that the trade measure would be defeated in the House for the first time since the early 1990s, when memories of Tiananmen Square were fresh.

No one is predicting that the Senate or House could muster a veto-proof margin against normal trade with China this year. Yet the emergence of strong opposition could have far-reaching significance, most obviously if the administration is able to present a comprehensive U.S.-China trade accord to Congress later this year.

Certainly the current restiveness also serves as a gauge of congressional sentiment for a more profound normalizing of the trade relationship, which would include the trade accord and China’s entry into the World Trade Organization. Although denial of annual trade privileges might be considered a more belligerent step than many are prepared to take, denial of membership in the WTO, which supervises global trade rules, is viewed as a less provocative step.

Currently, only seven countries in the world are denied such trade status. They include Cuba, Vietnam and North Korea. (Trade with some other countries, such as Iraq, is restricted by other legislation.)

“Most of the members feel that in the last analysis, we can’t rupture trade relations with China,” Matsui said Wednesday.

“But some members will think that voting to allow China to join the WTO would be rewarding China--and that would be a much more tenuous vote.”

Times staff writer Janet Hook contributed to this report.