FRIENDLY ADVICE FOR CHINA’S LEADERS
Saturday, August 25th, 2018
Some Friendly Advice for China’s Leaders
You can’t expect to keep receiving favorable trade and investment terms unless you reciprocate.
The trade dispute between the U.S. and China threatens to destabilize arguably the world’s most important bilateral relationship. A better understanding of the countries’ shared history may encourage wiser negotiations.
There is a great deal of pride in China for the country’s remarkable success. Compared with our population of roughly 300 million, China has a population of 1.4 billion. It should be no surprise that China is now the world’s second-largest economy. Since its economic opening in the 1970s, many Chinese citizens have been educated in the U.S. and then returned to China to become leaders in government and industry. The China of today is fully capable of competing with foreigners in its domestic markets on a level playing field, as its firms have proven overseas.
The contributions the U.S. has made to China are worth noting. Starting in 1900, the Open Door policy, advanced by the U.S., spared China from European colonization. Prior to World War II, the U.S. imposed an embargo on Japan and deployed military assets to the Pacific in defense of that policy. Before the U.S. entered the war, the Flying Tigers, an American volunteer group, were recruited from the U.S. military and mobilized to assist China’s defense against Japan. The U.S. provided extensive additional support throughout the war to the Chinese and ultimately spilled considerable blood on their behalf. At war’s end, the U.S. ensured that China was included as one of the five permanent members of the United Nations Security Council.
After the Chinese Revolution in 1949, Mao Zedong established the People’s Republic, sending the Chinese into international isolation for two decades. Then in 1972, President Nixon and national security adviser Henry Kissinger re-established bilateral ties by signing the Shanghai Communiqué during the president’s historic visit to China. It was in the national interest of both countries to foster a more constructive relationship. Both viewed the Soviet Union as a strategic threat.
China was populous and rich in natural resources, but its economy was minuscule and in shambles from a decade of internal conflict. After Mao’s death, Deng Xiaoping sought stronger ties with the U.S. He understood that China’s future political stability would hinge on its economic success.
When bilateral trade resumed, the U.S. extended favorable trade terms to foster China’s economic growth. Tariffs on Chinese imports into the U.S. were low—on average a third of those on U.S. exports to China. Bilateral trade grew from zero to several billion dollars within a few years. In 1979 President Carter re-established formal diplomatic relations, and China was given most favored nation trading status. In 1981 the Reagan administration created a separate trade category for China to exempt it from restrictions on trade with every other communist country.
