Statement of the Hon. Earl Blumenauer, a Representative in Congress from the State of Oregon

Testimony Before the Subcommittee on Trade
of the House Committee on Ways and Means

Hearing on Renewal of Normal Trade Relations with China

July 10, 2001

Thank you, Mr. Chairman and Members of the Committee for providing me with the opportunity to testify on this important issue. Last year Congress overwhelmingly made a difficult decision that we were following path of engagement with the Chinese by voting to approve China's admission to the WTO and extending Permanent Normal Trade Relations. In so doing, the majority of Congress and the leaders of both political parties aligned themselves with the forces of change and reform in China.

Oregon has seen its aggregate exports to China grow from $56 million in 1993 to $216 million in 1999, according to Department of Commerce trade statistics, a percentage increase of 289%. Almost 10% of all jobs in the State of Oregon are in some way related to the export of manufactured goods (to the World), making Oregon the tenth most export dependent state in the country. It's easy to understand how important the growing Chinese market is economically to me, my constituents in Portland, and Oregon as a whole.

Just because Chinese ascension to WTO has taken longer than we anticipated, we are back again with the need to do the last annual extension. We continue the roller coster relationship although nothing has fundamentally changed. China continues to be ruled at the top by party and military leaders who are threatened by China's engagement with the United States and the broader world. Theses leaders fear the restructuring of the Chinese economy and the resulting social, economic, and communication changes that would weaken their grip on the vast Chinese population.

The distance that China has traveled from the butchery and starvation of the Great Leap Forward to today is almost unfathomable. I would note it was a Republican President preaching engagement, Richard Nixon, which in many ways allowed us to take this step forward. Its important we give our new President the same opportunity.

China's Human Rights record is atrocious, and we need to continue to shine a light on the behavior of the Chinese, and engagement through the WTO provides us with an excellent vehicle to do so. Further penetration of the Chinese market by foreign economic powers, especially the United States, tearing down economic barriers that would permit us to trade effectively would have a destabilizing effect on the repressive regime and would play to the other forces of change that are strengthening the new regeneration of entrepreneurial spirit, provincial and municipal leadership, and new business partnerships.

The classic example happened earlier this year where there was an explosion at a fireworks factory where children where being forced to assemble firecrackers as young as 3^rd and 4^th graders in this school. The official Chinese line was that a suicide bomber had entered a fireworks factory and detonated an explosion. Within days, due to the work of the domestic Chinese internet media, the Chinese Premier was forced to acknowledge that the "Factory" was in reality a school which employed child labor to build fireworks. Through modern communications the reality was out instantly all across China and the truth triumphed.

This is just an example of how reform is happening daily, in dozens, hundreds of examples on a smaller scale that illustrate the point. It's not going to be easy. It's not going to be quick. But we can use the leverage of WTO membership to accelerate the progress and hasten the day when the Chinese enjoy the liberties that we to often take for granted.

Failure to renew would be at this point a serious mistake. First because have already made that determination and established a policy on it. For us to reverse course now would have an extraordinarily destabilizing effect on our relationship with China and economics would be the least of our worries, at a time when we are attempting to reduce tensions between the two countries. This would be a gratuitous and unfortunate escalation of pressures on our side, which would frustrate, infuriate the Chinese. It would confuse our allies and delight our business competitors.

History suggests it will not have the impact desired by opponents of normal relations with China. If going through this annual process has had no impact according to our opponents, why is going to make a difference now?

It's particularly ironic at a time when we are now inching towards acknowledging our policy of attempting to isolate a much smaller country, Cuba, has been a failure. It's only harmed the Cuban people and prolonged the life of the Cuban dictatorship. Had we opened our borders, engaged in commerce and interaction, Castro would certainly less powerful, and probably a thing of the past.

My interest in Congress is promoting livable communities around the United States and around the world. Engagement with China ranks very high on the list of opportunities. If 1.3 Billion Chinese develop in patterns like the United States: energy demands, air pollution, disruptions of oceans and waterways, the impacts will be devastating.

There are tremendous opportunities for economic, cultural, and scientific and governmental exchange to bring about a different future. For instance, this summer we are having two groups of Chinese municipal planners come to Portland, OR where they will meet with municipal officials and members of the community to discuss ways of improving quality of life in a sustainable fashion, a prospect that excites both parties.

We have just concluded a difficult period surrounding incident with the Chinese fighter and the American Surveillance plane. (Imagine if the roles had been reversed and it was a Chinese spy plane that was forced to land at the military facilities in Anacortes, Washington after spying off the West Coast of the United States. Imagine if the Chinese had bombed our embassy in Belgrade.) Its time to get on with this difficult past.

China's behavior continues to be troubling, the potential is great that the frustrations may even escalate in the near term. Having China in the WTO is not going to solve all our problems. We are still going to have to be aggressive in our negotiations, vigilant for human rights, the environment, and trade compliance. With China in the WTO we will have more tools and more allies in this struggle.

I would cite one final example of the importance of engagement in the Marshall plan. The Marshall plan , which contemporary historians call the "defining moment of the Cold War," poured over $100 billion in inflation adjusted dollars into Europe over three years into 16 Western European nations. These nation's form the basic core of the developed, democratized world. Stalin rejected the offer of President Trumen's and General Marshall's assistance, because he knew the engagement would bring down his totalitarian regime. The nation's of the Iron Curtain remain mired in poverty, corruption, and lack of basic, fundamental human rights that plague them to this day.

I strongly recommend this committee exercise its leadership with a bold and comprehensive report and the recommendation to support the President's determination to extend to China another year of Normal Trade Relations.