Land of the un-free

...Chinese courts regularly refuse to honor them despite the PRC's accession ten years ago to the New York Convention on Foreign Arbitral Awards...

...It is premised on the notion that there is a "free-market communism" with which we can engage...

...But instead of insisting on these requisites, the Clinton administration is ploughing on with negotiations to bring China into the WTO now, as is—the world's largest Communist country...

...Well, just how significant is that, in fact...

...But in fact it will have the opposite effect...

...The children and relatives of top party cadres—known as "princelings" to Sinologists—have routinely been appointed to run the "businesses" created under Deng Xiaoping's order in the last two decades...

...Thus, with a silence as eloquent as President Reagan's international appeals for freedom that helped topple the Soviet Empire, the Clinton administration made clear it was forswearing a policy of anti-communism...

...According to the latest official statistics, the Laogai operates 140 export enterprises, selling to over 70 nations abroad...

...Not until the demise of communism and the advent of genuine free enterprise in China will we truly witness the kind of vibrant trade between our two countries that we, the Chinese, and the world deserve...

...Freedom House's latest World Survey of Economic Freedom reports that Communist officials "detained or seized passports of foreigners to exert pressure in commercial disputes" and that "kidnappings and other forms of violence" are used to settle debts and enforce contracts...

...Compounding the lack of market norms in China is the extensive influence of party-controlled businesses that do more than compete with private firms...

...According to a 1996 Clinton administration report, despite Communist China's 1992 commitment to publish all laws and regulations affecting imports, a large number of directives remain unpublished...

...Even at its current level, Communist China's per capita GNP in dollars ranks below such emblems of Third World poverty as Lesotho, the Congo, Senegal, Bolivia, Guatemala, and Honduras...

...No dissidents were known to be active at year's end...

...I asked him why the State Department and our president could not say clearly that we hope China will rid itself of communism...

...Charlene Barshef-sky observed on January 29 that in WTO accession talks, "China's offers thus far have been largely inadequate...

...If China still has a Communist economy, they insist, then how has it managed to double its GNP in a decade...

...This is half right...

...If China wants WTO membership, it must first meet the organization's standards: minimal central planning, private ownership, free-trade policies, and the determination of economic decisions according to comparative advantage...

...He told me he agreed, of course: It would be better if China were not Communist...

...policy toward China must be premised on promoting it...

...The Chinese who live across the strait on Taiwan have a thriving free-enterprise economy with a per capita GNP over 20 times that of the Communist mainland...

...trade representative, was forced in June 1996 to negotiate an intellectual-property understanding with the PRC identical to one signed in March 1995...

...As Robert Kagan has rightly pointed out in these pages, this naive view exhibits an almost Marxian economic determinism...

...The result, in combination with state-run enterprises, has been predictable: A recent study by the congressional Joint Economic Committee, China's Economic Future, found that state subsidies have dangerously depressed farm prices, shielded unprofitable enterprises from competition, and limited production of food for China's destitute population...

...None of this means that American influence cannot work to change things for the better...

...one notorious princeling is He Ping, Deng's son-in-law, the president of the Poly Group—an enormous conglomerate run by the People's Liberation Army that is engaged in arms sales as well as commercial enterprises...

...Our most significant lever to accomplish this is not most-favored-nation status, but China's pending application to enter the World Trade Organization...

...Private rights of ownership in real estate are negligible...

...Just as in the former Soviet Union—where even under Brezhnev firms such as Pepsico and International Harvester followed Armand Hammer's example and profited—it requires the approval of party functionaries to undertake business transactions...

...Freedom of choice in occupation for Chinese citizens is severely limited...

...Nor does the Chinese government consider international agreements to be binding...

...Communist China's economic order is indeed Stalinist...

...Just as Stalin's Gulag added massive slave labor to a centrally planned, state-controlled system and relied extensively on Communist-controlled "enterprises," China's Communists in the late 20th century continue to burden their economy with a repressive statism only slightly ameliorated by the heavily publicized Special Economic Zones...

...But by naming China soft-liner Lee Sands as chief negotiator with China on its admission to the WTO, the Clinton State Department has signaled Beijing that America won't press hard for economic, political, or human rights reforms...

...In the teeth of such overpowering evidence that the Communist Chinese economy is anything but a free market, many—and not just apologists in the Clinton administration—argue that its economic progress is miraculous...

...It sounds impressive only because of the base of impoverishment against which it is measured...

...Chinese individuals (let alone foreign nationals) are not free to interact on their own in the economic sphere, so a handful of large multinational corporations preponderates in the Chinese "market...

...While the Communist party boasts of making its high-handed decisions about people's lives on the basis of labor "market" prices, its treatment of human beings as state-owned chattel marks one of the key aspects of classic socialist central planning...

...But instead of encouraging progress, the Clinton administration's passive China policy has coincided with the Communist government's alarming moves against civil and economic liberties, against dissidents like Wei Jingsheng, and against Hong Kong...

...This anti-legal atmosphere has, in a host of instances, reduced what should be binding commercial arrangements to nothing more than a starting point for further negotiations...

...It is a sobering and sad fact that the PRC purchases far less from the United States than does tiny Taiwan, despite the fact that the Communist giant has over 50 times its population...

...There is no such thing...

...Similar cycles of boom-and-bust contract signings and cancellations have followed regularly...

...This extends to international agreements as well...

...Just when the Communist government will deign to grant its approval, and when it will not, is inherently unknowable because there is no enforceable positive law in China...

...Charlene Barshef-sky, then the acting U.S...

...Often the most important rules are the unpublished ones—a fact that creates all-too-tempting opportunities for the official corruption that pervades China's "market" economy...

...But we just can't say so publicly, he added knowingly...

...The trend is away from, not toward, the rule of law in China...

...This year's State Department human rights report offers a grim assessment: "All public dissent against the party and government was effectively silenced by intimidation, exile, the imposition of prison terms, administrative detention, or house arrest...

...Through Poly and similar firms, Deng has found a "free market" means of subsidizing the Communist Chinese armed forces, now allied with Iran and Syria...

...The Communist regime is working hard not only to censor the PRC's version of the Internet, but also to restrict the availability of financial information and news of commercial affairs even among business journalists...

...But the damage these "market" activities inflict extends further: Last year, He Ping's company was indicted in San Francisco for smuggling thousands of AK-47s to California street gangs and offering for sale machine guns, mortars, and shoulder-fired missiles that could "take out a 747," in the words of one Poly agent...

...In non-state enterprises, the government regulates access to employment by refusing to grant residency permits (and social and health services) to the hundreds of millions of Chinese who float into urban areas in search of any alternative to working for the state...

...Freedom of commercial speech does not exist in China...

...In April 1996, the official news agency, Xinhua, announced that no foreign news agency could publish economic information in China without prior government examination and approval...

...The New York Times reported in February 1996 the promulgation of regulations steering the flow of electronic information through monitoring "ports" controlled by the PRC's Ministry of Posts and Telecommunications...

...Slave labor is responsible for producing many key commodities, including graphite, rubber, and asbestos...

...Land of the Un-Free by Christopher Cox The Clinton administration, finally and completely converted from candidate Clinton's 1992 attacks on President Bush's China policy, now subscribes religiously to the notion that commercial engagement with the People's Republic of China will leaven the militaristic impulses of nascent hardliners and ipso facto lead to political liberalization and rectification of human rights abuses...

...Nor can an economy that employs so much slave labor be considered a free market...

...A few glib observers have characterized China's economy as "market Stalinism...

...Contract disputes are governed by a hodgepodge of at least five overlapping and inconsistent authorities...

...Last spring, President Clinton's assistant secretary of state for East Asian and Pacific affairs, Winston Lord, paid a visit to my Capitol Hill office...

...Nor should China be judged by a different standard because of some inherent strain in the Chinese national culture...

...Within the state-owned sector of the economy, which employs two-thirds of the working population in urban areas, there is no occupational choice whatsoever...

...But there is an even more fundamental flaw in the thinking behind the "engagement" approach...

...one-third of Chinese tea is grown by Laogai prisoners...

...Communist China is not a free market and shows no signs of becoming one...

...Some 6 to 8 million people are currently captive in the notorious Laogai slave labor camps...

...The Communist government's record of enforcing foreign arbitration awards is abysmal...

...it is in the area of contracts that we can truly see the heart of the problem...

...Transparency International, a non-profit watchdog organization, recently rated China the fifth most corrupt nation in the world (behind Nigeria, Pakistan, Kenya, and Bangladesh...

...The Clinton policy ostensibly supports free trade...

...The antidote to Communist corruption, slave labor, and denial of commercial freedoms in China is free enterprise, and U.S...

...Christopher Cox, a Republican from the 47th District of California, is chairman of the House Republican Policy Committee...

...Private ownership of land, meanwhile, is simply forbidden in units larger than so-called Township Village Enterprises...

...After China's initial economic liberalization in the late 1970s, there followed a wave of abrupt, unilateral cancellations of contracts with foreign concerns...

...Similarly, both domestic commerce and international trade are impeded by the arbitrariness and secrecy of Chinese "law...

...An even larger difficulty is the Communist government's frequent preference for relationships (guanxi) and personal empathy (ganqing) in place of the actual terms of contracts...