WASHINGTON-The collapse of World Trade Organization talks in Seattle has put the U.S.-China telecom agreement in potential jeopardy and has introduced a powerful political dynamic into the 2000 presidential and congressional elections.
Labor, environmental and human rights advocates have been energized and emboldened by the embarrassing failure of the WTO to get a new round of trade negotiations off the ground earlier this month in Seattle.
Indeed, the 135-member trade body could not even agree on an agenda. The 30,000 protesters in Seattle stole the show. And they signaled it was only the beginning.
As such, anti-WTO activists believe they can convince the GOP-led Congress next year to vote down legislation to give China permanent Normal Trade Relations status. Lawmakers currently take up China NTR on a yearly basis.
The U.S.-Sino telecom pact, part of a wide-ranging agreement that would permit up to 50-percent foreign investment in Chinese telecom carriers, is tied indirectly to China’s bid for membership in the WTO. The 135-member Geneva-based body sets and enforces global trade rules.
Once the trade deal between China and the United States was struck last month in Beijing, President Clinton finally agreed to back China’s 13-year bid to join the WTO. But the administration still needs Congress to approve permanent NTR status for China to give the trade accord meaning.
Without congressional consent, the U.S.-China trade agreement evaporates and the wireless industry’s access to China’s 1.3 billion market is greatly diminished. That would be a severe blow to U.S. wireless companies, which are anxious to invest in the world’s biggest emerging market and compete for billions of dollars in wireless consumer equipment and infrastructure contracts.
“The collapse of the talks was not a helpful development,” said Eric Nelson, vice president of international relations for the Telecommunications Industry Association. “This is going to be a bigger debate than there would have been had talks succeeded conclusively in Seattle.”
China, even lacking Congress’ OK for NTR status, still can become a WTO member if it secures support from the European Union and others.
Given that prospect and the damaging trade implications for American companies, observers predict Congress will approve permanent NTR status for China. But not before a bloody fight in Congress next year-one that will force lawmakers and presidential candidates to position themselves for the fall elections without alienating U.S. workers in their districts and states and special interest groups that include business, organized labor, religious leaders, environmentalists, human-rights advocates and others.
It’s a complicated call for lawmakers, who must balance many competing interests-not the least of which is national security.
“I think Congress will be hard pressed to vote `no’ [on permanent NTR for China] but I think you will see a hard-pressed, vigorous debate,” said Greg Mastel, a China expert at the New America Foundation.
The U.S. trade deficit with China was $57 billion last year, and is expected to grow to nearly $67 billion by the end of this year. Through June 30, the United States exported $307 million of telecom gear to mainland China and imported $976 million of telephone, wireless, satellites, optical fiber, transmitters and other equipment from China.
AFL-CIO President John Sweeney has vowed to wage an all-out fight to kill permanent China NTR status next year. He is expected to have help from far-right Republicans and liberal Democrats. As such, conservative Democrats and moderate GOP lawmakers will be the key swing votes.
“The fevered rush to admit China to the WTO is a grave mistake,” said Sweeney after Clinton announced support for China WTO entry. “It is disgustingly hypocritical of the Clinton White House to invoke the need to `put a human face on the global economy’ while prostrating itself in pursuit of a trade deal with a rogue nation that decorates itself with human-rights abuses as if they were medals of honor.”
At greatest risk is Vice President Gore, who could see union support for his presidential run wither away if organized labor comes to believe he does not have its best interests at heart.
“They [the Gore campaign] have a political problem,” said John Feehery, a spokesman for House Speaker Dennis Hastert (R-Ill.).
Clinton and Gore have fueled trade and political controversies by saying labor rights and environmental standards-and possible sanctions for violations-should be considered by WTO.
Developing nations, which heavily depend on cheap labor and young workers, oppose any such interference with trade.
Clinton, for his part, promised, “The recent WTO agreement we made with China protects us from … unfair dumping.” The president and others, including most presidential candidates, argue engaging China through trade will help leverage improvements elsewhere in U.S.-Sino relations.
Labor and others believe the opposite is true.
As for permanent NTR status, Feehrey said, “I think he [Hastert] supports expanding trade with China, especially if they follow the law.”
Rep. Michael Oxley (R-Ohio), an influential telecom lawmaker on the House Commerce Committee, stated, “It will be harder to get NTR for China because of what happened in Seattle. This is good news for anti-trade folks and the luddites who were protesting in Seattle.”
Others, like Rep. Christopher Smith (R-N.H.), take a harsher view of China WTO membership. “We must not abandon the American ideals of freedom and democracy for the sake of marginally cheaper consumer goods and access to cheap labor.”
Smith, besides representing the state that will host the first presidential primary next year, chairs the House International Relations subcommittee on human rights. At last Tuesday’s hearing before Smith’s panel, political activist Harry Wu and representatives from human rights, labor, trade organizations strongly opposed China’s admission to the WTO.
