The Political Economy of U.S.-China Relations

November 07, 1997

Mark Weisbrot
The Cleveland Plain Dealer, November 7, 1997

It would be easy to get the impression from news reports of the US-China summit that there is some kind of high level dispute over human rights in China. It seems that the Chinese government thinks that human rights are relative to culture and place, whereas the Western notion, represented by our President, is that they are universal.

This makes good text for an undergraduate philosophy class, but the soulless, cynical leaders of these powerful nations are well aware that all this talk about human rights is just a sideshow. The real action is in the deals already done: $3 billion for Boeing’s planes, and up to $60 billion for the US nuclear power industry.

If that were the whole story, it would be repugnant but not all that interesting. Our foreign policy has long been driven by the special greed of special interests. But unfortunately it’s worse than that.

The real reason for our friction with China is not about what they have done wrong but what they have done right. China has not, unlike most of the rest of the world over the last two decades, become an economic colony of the rich industrialized nations.

Two-thirds of all countries, with the majority of the world’s people, do not have control over their most important economic decisions. Those decisions are made for them, right here on H street in Washington– at the International Monetary Fund and the World Bank.

This is not a conspiracy theory, because no conspiracies are necessary. A country that doesn’t get the IMF’s approval just doesn’t get credit, whether from other multilateral lending institutions or private banks. Since most countries need to borrow foreign exchange just to finance essential imports like oil and medicines, this gives the IMF and its sister organization, the World Bank, control over their economic destiny.

The IMF and the Bank have used this power primarily to promote a rigid set of economic policies that have slowed economic growth in much of the world. These policies have also benefitted certain transnational corporations, private banks, and other interest groups within the wealthier nations.

Because of its size and economic independence inherited from the past, China has managed to avoid the IMF/World Bank program. While the Chinese have moved toward increasing use of markets and welcomed foreign investment, they have done so on their own terms and without sacrificing their goals of growth and national economic development. The Chinese economy has quadrupled over the last 20 years, a rate of growth unsurpassed in the economic history of the world.

The contrast could hardly be greater if we look at China’s hapless neighbor, the once powerful Russia, who attempted its transition to a market economy under IMF tutelage. In just six years of taking Western economic medicine as prescribed, they lost half of their national income– a catastrophe worse than our own Great Depression.

None of this excuses China’s abysmal human rights record. But unfortunately the United States is not in a position to give lectures on this subject. If people outside the United States were counted as humans, then the US would certainly rank as one of the worst human rights abusers in the post-World War II era. The murder of tens of thousands of civilians in Central America in the 1980s, sponsored by our government, is just the most recent large-scale example. If we go back a little further, there are the war crimes in Indochina, the overthrow of democracy in Chile, and one of the worst genocides of the postwar era, which hardly anyone in the United States even knows about: the killing of more than 500,000 people in Indonesia 32 years ago, which brought the current regime to power and was aided and abetted by the US government.

The list is long and unfortunately has not stopped growing with the end of the Cold War. Of course, America remains one of the freest countries in the world for most of its citizens. But we must forgive the rest of the world if they cannot see the moral distinction between assassinating political dissidents in foreign countries versus your own. Nor should they be expected to distinguish– just as our own jurisprudence does not– between those who pull the trigger and those who hire the murderers.

So it should not be surprising if President Clinton’s pronouncements about human rights are greeted with skepticism outside the United States. Our government has made it clear that intellectual property rights take precedence over human rights, and they would not forego the royalties on one “Independence Day” videotape in order to free all the political prisoners in China.

This is not to disparage the efforts of those really do care about human rights, such as the protesters who have dogged Mr. Jiang’s visit– celebrities included. In our own limited democracy, shame can be a powerful weapon against morally bankrupt policies.

There will continue to be conflict within China over democratization and human rights, as well as economic questions having to do with the role of the market and government. But China will probably retain its political and economic independence for the foreseeable future. It is for this reason that we can expect a rocky road ahead for relations between the US and China.

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