USA Today
As Congress prepares today to vote on normalizing trade with China, the air is choked with competing arguments, just as it was during the debate on free trade with Canada and Mexico in 1993. Now, as then, the easiest way for Americans to cut to the heart of the matter is to assess what's in the deal for them.
The short answer is "plenty."
Congress faces the option of extending to China the same, normal trade relationship that the USA has with most other countries. After the vote, China will join the World Trade Organization, a move that will obligate the country to remove hundreds of barriers to U.S. products and services.
As the barriers fall, U.S. sales to the fastest-growing economy in the world will rise an extra $3 billion to $13 billion by 2005, according to estimates from Goldman Sachs and the Institute for International Economics. Americans, already reaping the benefits of trade, will make further gains:
* China trade creates U.S. wealth. Trade with China is part of the engine of prosperity that has been transforming America. The USA now conducts one-third of the world's trade. Since 1980, U.S. exports to the world have climbed from $272 billion annually to almost $1 trillion, exports to China alone have doubled, and U.S. national income has leaped by 85%. Every state in the union has found something to sell the Chinese.
* China trade creates new U.S. jobs. Trade and the high-tech revolution have added 250,000 U.S. jobs every month since the mid-1990s. This has driven the unemployment rate below 4% and fueled the longest economic expansion in U.S. history. While China represents just a piece of global trade, the Institute for International Economics estimates that for every $1 billion in new U.S. manufacturing that China demands, 6,800 U.S. jobs are created.
* China trade tamps down U.S. consumer prices. Americans buy more than $100 billion in foreign imports every month, about $6 billion of them -- primarily clothes and household goods -- from China. Import prices rose only 4% between 1985 and 1999. By comparison, there has been a 45% rise in overall U.S. prices.
With this China vote, Congress has a historically rare opportunity to improve the lives of Americans -- without spending their tax dollars. But it's not just the added U.S. prosperity that makes this deal a winner. The deal also would make trade fairer. For the first time since the USA helped open China to the world economy two decades ago, the Chinese would have to play by the world economy's rules.
World Trade Organization members are not able to block individual countries' goods and services with taxes and other barriers the way China has blocked U.S. pork, beef and poultry, or U.S. cars and telecommunications services. And WTO members face penalties for stealing business secrets -- something Chinese firms have been guilty of and for which they couldn't effectively be punished while outside the WTO.
The WTO enforces its prohibitions through a tough trade tribunal that punishes violators on behalf of the whole global trading community. So far, the USA has had great success in bringing violators before the global court.
Opponents of the trade deal suggest that the USA shouldn't reap the benefits of trade with China at the expense of Chinese peoples' human rights. But Americans need not see their gain as a loss to Chinese workers.
Since China opened to trade under former leader Deng Xiaoping, the average Chinese person has prospered as never before in history. Urban incomes have risen to $657 per year from about $40 in 1980. Rural incomes have risen to $259 from $16. This rise out of poverty gives hundreds of millions of people the power to make independent decisions, where before they were vassals under an overlord's thumb.
Better yet, trade is weakening the relative power of the communist Chinese state. For example, the WTO deal will let U.S. farmers deal directly with Chinese farmers, without Chinese government go-betweens. Trade has meant that one-third of the urban, industrial workforce no longer works for the state. Half of the rural, non-farm workforce now has private employers.
The more China trades with the USA and the world, the more it shakes off its old similarities with the Soviet Union.
The unfolding of global trade has brought rising incomes and other benefits to households the world over.
Congress, which ushered in the golden age of free trade with the USA's northern and southern neighbors, can now with one vote expand trade across the Pacific with China, and enrich all households further still. Today's debate: Doing business with China 'Yes' vote in Congress could bring further prosperity to U.S., China.
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