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China Remains Bold In Face Of Paper Tiger

If your mind has been overwhelmingly occupied by Newt Gingrich, football bowl games and the holiday season, then perhaps this slipped past you: the U.S. trade deficit with communist China has plunged to $29 billion, second only to our deficit with Japan.

Not only that, but the Chinese continue pirating American movies, computer software and music - so much so that the U.S. now is contemplating punitive tariffs against China, a country for which Bill Clinton last year renewed most-favored-nation trade status while saying such status should not be weighed in political terms.

In other words, it matters not if the tank rolls over the dissident in Tiananmen Square, or if Chinese prison labor churns out goods for the American market. What matters most, it would appear, is how good it can be for the boys who do business on the Big Board.

When Clinton was reconsidering his campaign pledge to cut off favored-nation status with China because of that country’s miserable human rights record, he found himself deluged by lobbyists from big U.S. corporations who saw the prospects of doing business in China, in taking advantage of cheap labor and of a hungry, unsophisticated market that would snap up Western products.

The corporations won and America lost.

China, again, sees in the United States a paper tiger, a country that talks tough but doesn’t back up its words.

The Chinese have flooded the U.S. market with cheap products. In turn, however, most of the business we do with China involves the big corporations: Boeing, IBM, Coca-Cola …

This past summer, Boeing announced it would spend $100 million building an aircraft parts plant in Xian, China, including making tail sections for its 737 jetliners. Those sections originally were exclusively made in Wichita, Kan. How soon after the Chinese plant becomes active will Boeing announce layoffs in Wichita?

Much of what now is being made in China - radios, shirts, caps, toys, athletic shoes - once were made in the United States but long ago shifted to factories in Japan, then Thailand, the Philippines, Malaysia, South Korea; anyplace where cheap labor could be exploited.

As more and more U.S. corporations ducked the American labor market and went to the Far East, jobs were lost in this country. Now, practically everything being sold in this country - with the possible exception of the congressional Medal of Honor - is being manufactured elsewhere.

It not only costs American jobs, but it also tilts the balance of trade to astronomical numbers.

To compound matters, an American company can produce a computer software program only to find the Chinese cloning it without compensating the copyright owners.

The Chinese government is fond of telling the United States that it is closing in on ending this piracy, but it isn’t. The president of the U.S. Business Software Alliance recently complained that there is virtually no enforcement of copyright law in China.

Now, as before, the Clinton administration is talking tough. Where a year ago, it talked of cutting off favored-nation status over human rights violations but then crumbled under corporate pressure, it now talks of punitive tariffs of more than 100 per cent on certain Chinese goods entering the United States.

The Chinese, who talk tough and stick to it, say that if the United States imposes those tariffs, they will break off negotiations with U.S. companies seeking to invest in China, and ban U.S. movies, TV programs and laser discs in addition to retaliating further with 100 per cent tariffs of their own.

There is no doubt that the Chinese would follow through on their threats. There is considerable doubt, however, that the United States would, based on its previous timidity - and acquiescence to powerful U.S. corporations.

The last time we ever stood up to the Chinese was in Korea 45 years ago, and even then, we forced our fighting men and women to do it with one hand tied behind their backs.


The following fields overflowed: CREDIT = Howard Kleinberg Cox News Service

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