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April 13 2000

ONCE AGAIN, CHINA AND THE WTO

By Robin Hahnel

Wednesday, April 12, 2000, 6 PM, Washington DC: I just got back from the rally organized primarily by the AFL-CIO and Citizens Trade Campaign outside the Capital building calling for the US Congress NOT to vote in favor of the Clinton Administration bill granting permanent normal trading relations (PNTR) status to China. The rally, officially titled “No Blank Check for China” was also endorsed by many other organizations including A16/Mobilization for Global Justice which I have worked with for the past three months. But this was primarily an AFL-CIO/CTC event even though many of us from A16 attended, just as many of us from A16 attended the Jubilee 2000 rally on the mall last Sunday, April 9.

It is no secret that while all of the organizations and groups involved in the various events scheduled between April 9 and April 17 oppose corporate sponsored globalization, we do not always agree on what aspects of that process to focus on, what tactics are most effective, what reforms to demand, and what reasons justify our stands. At  today’s demonstration I agreed with the demand – no China in the WTO – but not with the reason for doing so offered by many of the speakers – the Chinese government is guilty of major human and labor rights violations. Adding China to the neoliberal international economic order forged by multinational corporations with the help of politicians like Clinton, Blair and Schroeder and international organizations like the IMF, World Bank and WTO is detrimental to the interests of most Americans, most Chinese, and the world’s environment. That is reason enough to oppose China’s entry into the WTO on the terms negotiated. But the obvious illogic of excluding China from the WTO on grounds of human and labor rights violations when these are not, in fact, criteria for membership, when no other country has been queried, much less excluded on these grounds, and when many of the 135 member countries of the WTO are lead by governments who are gross violators of human and labor rights themselves, simply cannot escape me. And the obscene hypocrisy of the US Congress appointing itself as prosecutor, judge, jury and executioner regarding the human and labor rights violations of any other government given its own dismal record of blatant violations of human rights and international treaty obligations whenever they are deemed in conflict with US corporate or military international interests, is difficult for me to stomach.

In one previous Znet commentary (December 1999) I evaluated the deal struck by the Clinton Administration and the Chinese government for China’s entry into the WTO focusing on who were the winners and who were the losers in each country. I warned that in the US: “Wall Street wins, Main street loses. High-tech and finance win, light industry loses. High skill wins, low skill loses. If you are lucky enough to keep your job and avoid a drop in your real wage, you will be able to buy more (Chinese made) toys to put under your Christmas tree. If you lose your job, or, like most Americans, fail to get wage increases commensurate with inflation, Christmas will be all the more bleak for you and yours if China enters the WTO.” In China I warned: “The nimble among the Party elite will get far richer than they have ever been before, and have an easier time passing their wealth and power onto their children. The better educated and the well established in mega cities like Shanghai will also do well. Displaced peasants and workers will suffer. Hundreds of millions of them will suffer in ways that will be hard for Westerners to even imagine. Others who are lucky enough to find work for the profitable enterprises that survive the great shake down are unlikely to enjoy rising real wages to go along with their rising productivity.”

In a second commentary (February 2000) I addressed the issue of whether or not we in the movement fighting against corporate sponsored globalization should oppose China’s entry into the WTO even though the Chinese government wants to enter, and if so, why we should do so. I argued that the deal struck by the Clinton Administration and Chinese government “serves the interests of important segments of the ruling elite in each country but sacrifices the interests of an overwhelming majority of Chinese peasants and workers to the interest of some in the old Party elite and many in the newly educated elite – just as it sacrifices the interests of most Americans to the interests of powerful segments of the US business community. This is not China vs. America. This is a deal that enhances the economic prospects of a small minority who are already better off in both countries while significantly diminishing the economic prospects of the majority in both countries.. Which means it is a ‘no-brainer.’ Opponents of corporate sponsored globalization can oppose China’s entry into the WTO in good conscience.” I also argued that “we should NOT oppose China’s entry on grounds of human rights violations. Unlike the Clinton Administration, I do not excuse nor make light of Chinese human rights violations. The Chinese government denies its citizens the right of free speech, the right to organize politically, the right to organize independent unions, the right to strike, the right to a fair trial, and the right to privacy. The Post-Mao government has routinely resorted to arbitrary arrests to suppress dissent, and has not hesitated to imprison millions and kill tens of thousands to maintain its monopoly on political power. And these abuses, along with others, are more than enough reason to give Chinese citizens ‘the right to rebel,’ in Mao’s words, and replace totalitarian Communist rule with a system of political democracy that protects human rights and civil liberties. But all these violations of political, labor, and human rights do not distinguish the Chinese government from many of the 135 governments who are presently members of the WTO in good standing.”

Many of the labor union leaders who spoke at today’s rally explained that US corporations were pressing Congress to grant PNTR status to China despite overwhelming popular opposition in order accelerate the “race to the bottom” effect of globalization that benefits multinational corporations. Many of the speakers expressed solidarity with Chinese labor leaders and workers who are denied their labor rights, and vowed to struggle for labor rights everywhere. And many expressed their devotion to political freedom. Some even explained that the deal struck for China’s entry into the WTO would unleash great hardship on the majority of Chinese. I was both impressed and moved by their words and their passion. But unfortunately, in my view, some of the labor leaders and Representatives Pelosi (D-CA) and Bonior (D-MI) in particular unnecessarily and illogically argued for exclusion largely on grounds of Chinese government human rights violations. Hopefully the US labor movement will realize that it can best protect the interests of US workers and workers everywhere by aiming its fire at US multinational corporations and their servants within the Clinton Administration and the Republican Party rather than arguing as if the Chinese government is the only violator of human and labor rights in the world, when of course it is not.

Let me offer two recent accounts that make clear how devastating Chinese entry into the WTO will be for ordinary Chinese. Clay Chandler reported in the Washington Post on March 30: “Shenyang China: With a broad smile and a flourish of his pen, the mayor of this snow-swept industrial city ceded authority to sell off hundreds of floundering city-run factories 12 days ago to 35-year-old Timothy Rucquoi-Berger. As flashbulbs popped at the signing ceremony in a stately guest house, Mayor Mu Suixin toasted Rucquoi-Berger, a fast-talking, Michigan-born investment banker, for helping Shenyang reverse the decay that has infected its old-line industries. At least a third of Shenyang’s labor force is unemployed. Thousands gather in public parks in hope of getting temporary work. In a speech to party colleagues in Beijing two months ago, Mu issued an extraordinary warning that conditions in his city could be spinning out of control. ‘Our ability to govern is being seriously affected’ by rising joblessness, he acknowledged. ‘All the work units have collapsed. It’s a dangerous situation.’ Experts say that out of an urban labor pool of about 350 million, at last 80 million Chinese are unemployed. Moreover, Beijing has ordered state-owned enterprises to shed another 10 million employees this year. ‘These numbers inspire fear and awe,’ economist William H. Overholt concluded in a recent essay surveying unemployment in China. ‘What is going on here is so far removed from the previous experience of the human race that it is difficult to put into perspective.’ Mu has been among the most aggressive of China’s local leaders in scrambling for outside cash. He has auctioned off a slew of Shenyang companies to investors for just one yuan – about 12 cents – inviting criticism that the city is dumping public assets. This month’s signing ceremony with Rucquoi-Berger awarded SCA, a joint venture between the city government and the Chinese subsidiary of the Wyvern Group, a small British investment bank of which Rucquoi-Berger is a managing director, exclusive rights for the next nine months to negotiate terms of sale for nearly 300 of the city’s largest companies. Mu’s critics howl that this amounts to paying a cat burglar for advice on how to give away the family jewels. After nine months of rummaging through Shenyang’s portfolio, Rucquoi-Berger and his team have identified only three immediately salable prospects. So far they have no buyers.”

John Pomfret reported in the April 5 Washington Post: “Yangjiazhangzi China: More than 20,000 workers and their families battled with police and soldiers in this northeastern Chinese mining town for three days in late February in one of the most explosive known incidents of urban labor unrest in years, witnesses said. Miners were incensed at the loss of their jobs and alleged corruption among the officials who run this rugged region deep in China’s rust belt 250 miles northeast of Beijing. They burned cars, barricaded streets, smashed windows and set oil drums afire in protests that were finally quelled by a detachment of soldiers from the People’s Liberation Army. The eruption in Yangjiazhangzi underscored the challenge facing the Chinese government as it attempts to shut bloated state-owned enterprises, leaving millions of laborers out of work. This challenge will become all the more critical as China prepares to enter the WTO. ‘It’s obvious that the leaders are cheating us,’ said Wang Jian, 56, who has worked at the mine since he was 19. ‘They have sold parts of the mine to their friends, They have sold all the mine’s trucks. But we haven’t seen this money. There is no open accounting. They eat it and drink it away.’ Many workers such as Wang said they had not been paid since early last year. A local joke says miners who married farmers’ daughters are now the happiest of the lot – they can go home and grow vegetables. ‘The process was totally opaque,’ said He Binghan, a 42-year-old driver who still works in one of the pits. ‘We miners have been working here for China, for the Communist Party, since the revolution. And now suddenly my part of the mine is private. And no one told me how.’”

The World Bank estimates that of the 140 million workers in the state-owned sector, as many as 35% could be fired. Experts estimate 80 million unemployed workers in China’s cities already. And there are estimates that as many as 100 million peasants could be put out of work by provisions in the deal to enter the WTO that liberalize imports of foreign grains. That is roughly 230 million unemployed Chinese -- without a safety net in sight. “So far removed from the previous experience of the human race that it is difficult to put in perspective” is no exaggeration.