Congressional critics of President Bush's decision last month to extend favorable tariff status for China are gearing up to mount a legislative challenge to the move.
Bush's move to maintain the status quo in the two countries' $18 billion two-way trade could well be the most contentious trade issue playing out on the Hill in coming months, according to congressional aides, but a decision to undo it will not come easily because economic sanctions invariably cause pain on both sides.
Critics say the favorable status should be revoked to protest China's bloody suppression a year ago of pro-democracy demonstrations and the subsequent arrest of thousands of political opponents. The White House contends that the best way to foster reform in China is to keep channels to the outside world open.
Yesterday, the House Ways and Means Committee's trade subcommittee heard testimony from both sides on the issue. In questions and comment, legislators indicated that they are by no means united in how or whether to proceed.
Condemning White House policy, Rep. Barney Frank (D-Mass.) told the panel: "The Chinese appear to have been wholly unimpressed by President Bush's approach. ... They ate all the president's carrots and we have nothing to show for it."
But Rep. Robert T. Matsui (D-Calif.) said that some of his constituents felt that a hard line was unlikely to work on the current Chinese leadership. Rep. Frank J. Guarini (D-N.J.) said that revoking the status could disrupt trade and result in tens of thousands of U.S. jobs being lost.
Groups representing U.S. companies that do business with China called for continuation of the favorable status. Cutting it off, they said, would hurt Hong Kong, an American friend, and almost certainly lead China to retaliate by stopping business with U.S. companies.
"Our Japanese, European and other competitors will pick up the benefit," said Douglas R. Hanson of the Emergency Committee for American Trade. " ... Once you're out of there it's very difficult to get back in."
Yang Ye of the Independent Federation of Chinese Students and Scholars, a U.S. dissident group, opposed extending the status unless certain political conditions were met, including the release of political prisoners and the end of emigration restrictions and other harassment of opponents.
Before Congress can act, it must enact trade legislation that would give it the power to move quickly to overturn a presidential decision. Yesterday afternoon, House and Senate conferees met for an hour to discuss a bill that would make that and other changes to trade law. They agreed that Rep. Dan Rostenkowski (D-Ill.) and Sen. Lloyd Bentsen (D-Tex.) would meet again to try to work out the problems.