by James A. Dorn
The author is vice president for academic affairs at the Cato Institute and editor of the Cato Journal.

Vigorous economic development leads to independent thinking. People hope to be able to fully satisfy their free will and see their rights fully protected. And then demand ensues for political reform. . . . The model of our quiet revolution will eventually take hold on the Chinese mainland.

-- Lee Teng-hui
President, Republic of China¹

Some American policymakers would erect trade barriers against countries that are not democratic or that violate the human rights of their citizens. But as well-meaning as those restrictions might be, they in fact would have effects adverse to the cause of human rights.

China provides a good case study. That country rightly is criticized as a violator of human rights, especially in light of the bloody 1989 crackdown on democratic activists in Tiananmen Square. Unlike most countries, China's trade status with the United States is reviewed annually by Congress. Periodically some of China's critics attempt to suspend the standard trade arrangement (called "most-favored-nation" status) that most countries enjoy with the United States.

There are good reasons to maintain free trade with China, in spite of its record on democracy and human rights:

• The right to trade is a basic human right. Depriving Chinese as well as Americans of this right because of Beijing's repressive policies only makes matters worse.
• American trade barriers are unlikely to change the policies of China's communist leaders.
• Trade liberalization itself is a powerful weapon to push a country toward respect for life, liberty, and property, and ultimately toward a democratic regime.

The Path toward Freedom

Over the past two decades China has taken monumental steps away from failed policies of central planning and toward a market economy. Allowing farmers after 1978 to sell much of their produce on the open market, rather than turn it over to the government, has allowed China to feed its 1.2 billion people. Since that year China's economy has grown at an average annual rate of more than 9 percent, and has the potential to become the world's largest economy over the next three decades.

In terms of political power, although the Chinese Communist Party (CCP) has held onto its monopoly, China is a more open society today than a decade ago. More Chinese students now study abroad; and the more they experience freedom, the more they will understand that liberty offers a prosperous and humane society. Faxes, e-mail, and other forms of communication keep freedom-loving Chinese in touch with the outside world. And a population growing more prosperous, thanks to market reforms, is less tolerant of repression.

There are still serious violations of human rights in China. But a case can be made that the country is creeping toward freedom and that current development and expansion of free-market institutions will maintain pressure for further liberalization. Denying China most-favored-nation status or imposing sanctions would only politicize trade, strengthen the communists, and harm many innocent consumers and businesses in both China and the United States.

Free Trade as a Human Right

Critics of China's human rights record are justified in pointing out the abuses that are occurring in that country. Yet, many of the critics forget that freedom to trade is just one of the liberties that many Chinese individuals and enterprises have gained in past decades. For America to restrict access to its market first and foremost deprives the Chinese, as well as Americans, of an important liberty.

The proper function of government is to protect life, liberty, and property -- including freedom of contract, which encompasses free international trade. Government should not undermine one freedom in an attempt to secure others. The right to trade is an inherent part of property rights and a civil right that should be protected as a fundamental human right.

The supposed dichotomy between the right to trade and human rights is a false one. The rights to own property and to trade with others are natural rights. The freedom to act without interference, provided one respects the equal rights of others, is the core principle of a market economy and the essence of human rights.

Without private property and freedom of contract, other rights -- such as free speech and religious freedom -- would have little meaning, because individuals would be at the mercy of the state for their survival and prosperity. The human rights fabric is not strengthened by unraveling economic liberties in the hope of enhancing other liberties.

Protectionism violates human rights. It is an act of plunder that deprives individuals of their autonomy -- an autonomy that precedes any government and is the primary function of just governments to protect.² As Rep. David Dreier (R-Calif.) stated during the July 1994 congressional debate, "Denying trade is a violation of human rights and a reprehensible one."³

Americans already find their economic liberty diminished by trade restrictions. Import restrictions presently cost the United States some $70 billion a year.⁴ Further trade restrictions on China will simply increase that costly burden.

Economic Sanctions: A Blunt Instrument

Critics of China often fail to appreciate that trade sanctions usually are not effective and have little prospect of fundamentally changing a country's human rights policy. Moreover, trade sanctions could confirm to China that America is not a trustworthy trade partner and push that country more to diversify both its import and export markets.

Two questions need to be addressed when considering the use of economic sanctions: First, are sanctions legitimate? Second, are they effective -- that is, will sanctions promote a market economy and will the economic effects of sanctions promote freedom and democracy?

The Question of Legitimacy

Although the general rule for governments should be non-interference with free trade, governments often cite several cases to justify economic sanctions. The following five "exceptions," however, are narrowly focused, not blanket bans, and remain open to practical problems.

(1) Sanctions would be legitimate in preventing trade that would directly enhance an enemy's military capability. The U.S. government, for example, would be justified in preventing the sale of military technology and weaponry that could be used by an enemy to harm U.S. citizens.

(2) Sanctions would be legitimate in preventing a country from profiting from the use of slave labor. Goods made with slave labor should not be allowed into the United States. Because individuals have property in their lives and labor, selling goods made by slave labor is akin to selling stolen property. However, it would not be legitimate for the United States to ban all trade with a country if only a small part of its exports were made with slave labor. Private parties should have the right to trade. To ban all trade or to use sanctions to ban many products not directly connected with slave labor would harm many innocent people.

(3) Sanctions would be legitimate in preventing the exporting and importing of goods produced by political prisoners who have not violated anyone's rights to life, liberty, or property. This case is analogous to the case of slave labor, except the slaves are behind bars. Part of the problem with such sanctions is determining what goods are made by such prisoners and in what quantities.

(4) Sanctions would be legitimate in protecting the rights of minors. But the use of child labor is complicated: in a poor country it may make sense for children to go to work at a much earlier age than in a rich country. There is no clear-cut answer as to when economic sanctions should be used to cut off trade in goods made by child labor. Only a short time ago in the United States, it was not uncommon for 12-year-olds to work long hours on a farm or in a factory to help their families survive. Should the United States now prevent such children from working in poor countries to improve living standards? Economic sanctions would do just that.

(5) Sanctions would be legitimate in safeguarding intellectual property rights. The U.S. government has a legitimate right to ban the importation of pirated computer software or compact discs, and is justified in penalizing foreign producers for violating U.S. copyright laws. Intellectual property rights are no less important than other forms of private property. Allowing thieves to sell CDs at very low prices would only create greater incentives to steal.

The tactic of using sanctions to enforce compliance with U.S. copyright laws should be supplemented with multilateral agreements to protect intellectual property rights. Admitting China into the World Trade Organization would require China to take better care to protect these rights and thus should be a top priority for the United States and other developed countries.

The Question of Effectiveness

Whether sanctions are legitimate or illegitimate, they may not be effective. Sanctions are likely to be effective only when all the following conditions are met:

• They have the near-unanimous support of the target country's major trading partners;
• The government of the target country is responsive to the concerns of its citizens; and
• The benefits of the sanctions to the governments of the sanctioning countries exceed the costs. Few sanctions meet all three conditions.

Institute for International Economics scholars Gary Hufbauer, Jeffrey Schott, and Kimberly Elliott found that economic sanctions "are of limited utility in achieving foreign policy goals that depend on compelling the target country to take actions it stoutly resists."⁵ Instead of liberalizing a repressive regime, sanctions may in fact make the regime more repressive by banning exchanges that would extend markets and weaken the power of government.

Seven potential problems make it difficult to use sanctions successfully to further human rights. In the case of China, each of these factors would pose problems that could make sanctions ineffective.

(1) Target countries may circumvent sanctions by substituting new sources of supply if exports to it are cut. Historically, sanctions have not been very effective because the targeted countries have been able to find suitable substitutes. When the U.S. government blocked the sale of grain to the Soviet Union in 1980, the Soviets simply purchased more from Argentina, Australia, France, and other countries.

Even if the U.S. government could block flows of goods and capital to China, other countries likely would step in to fill the gap. Instead of buying aircraft from Boeing or looking to American investors, the Chinese would shift to Airbus Industries and look to European and Asian trading partners for additional capital -- and U.S. investors would try to reroute their funds through other countries into China rather than abandon their invested capital.

(2) A country can close its markets in retaliation for trade sanctions. If America simply restricted imports from China but did not try to restrict American exports to that country (which amount to $11.7 billion), China likely would retaliate against American exports, making American firms civilian casualties of the ensuing trade war. China's state-owned enterprises certainly would support such retaliation since protectionism always benefits inefficient firms. Strengthening those enterprises would be bad for China and bad for the United States.⁶

(3) If trade sanctions against a country are minimal, that country will have little motive to change its policies and might find other markets or suppliers. If sanctions are tough enough to hit hard, American consumers and exporters, as well as America's allies in the region, certainly will be victims.

In the case of China, economic sanctions have little chance of success. Although the United States accounts for more than 30 percent of China's export market, the threat of placing prohibitively high tariffs on a range of Chinese products is not politically feasible. American consumers would immediately see the higher prices and protest. It is estimated that revoking China's most-favored-nation status would cost American consumers from $16 billion to $29 billion in higher prices and lead to the loss of up to 200,000 American jobs.⁷

Even if such a policy were politically feasible, it would be difficult to implement: China could transship products through Hong Kong or other countries, and U.S. customs officials would find it hard to identify the point of origin. In the end, tougher action would harm Hong Kong, which has the world's freest trade policy, operates under the rule of law, and respects individual liberty.

Political leaders in Taiwan and Hong Kong oppose sanctions against China even though they strongly favor democracy and human rights. They favor delinking trade agreements and human rights, because they recognize the importance of open markets for the stability and prosperity of the entire Asian-Pacific region. They also understand that trade liberalization is a prudent long-run strategy for promoting human rights in China.

According to an editorial in the South China Sunday Morning Post, President Clinton's 1994 decision to delink trade and human rights "was welcomed with a collective sigh of relief."⁸ If the United States were to deny China most-favored-nation status, the resulting punitive tariffs would destroy "the Hong Kong-Guangdong partnership, which has been the engine of China's economic growth." Moreover, "the political and economic focus would have shifted back towards the Centre." Human rights in China then would be nipped in the bud as the state sector gained ground and the nascent market sector diminished. Yet, as the Post notes, "For all the economic progress trade with the West has encouraged, China remains a harsh political dictatorship."

(4) The costs of monitoring the target country for violating human rights, or for violating intellectual property rights, rise with the size and complexity of transactions and with the extent of the market. Sanctions, therefore, may be very difficult to enforce in large countries such as China.

Monitoring the use of prison labor and tracing goods made by political prisoners in China would be very difficult.⁹ But even if the West were able to effectively monitor such activities, there is no guarantee that other countries would do the same. In fact, many countries have supported China against the United States when it comes to human rights. At the 52nd session of the U.N. Commission on Human Rights in April 1996, an attempt to pass a U.S.-sponsored resolution critical of China's record on human rights -- especially with regard to Tibet, the criminal justice system, and religious freedom -- did not even get off the ground. China proposed a "no action" motion, meaning no discussion of the resolution and no vote on it. That motion passed by a vote of 27 to 20, with 6 countries abstaining.¹⁰

(5) In many cases, systemic change is needed to deal with some of the deeper economic problems. The piracy of intellectual property, for example, is a significant problem for Western firms. Chinese producers have been major violators of copyright laws. China's membership in the World Trade Organization should be conditioned on China's adherence to international law. If China cannot play by the rules, it should not be allowed to play with those who do.

But the problem is not limited to China. Producers in most less developed countries, and even some developed countries, violate intellectual property rights. (More than 84 percent of Chile's software, for example, is pirated.)¹¹ Using economic sanctions to punish pirates sounds good in theory, but in practice sanctions are seldom effective. The real solution to piracy may have to wait for technological changes that make it very costly to steal intellectual property and for the rule of law to evolve in China and other less developed countries.

As China develops its own intellectual property, there will be a demand for new laws to protect private entrepreneurs in China. The uncertainty created by China's failure to protect intellectual property rights can only harm China in the long run. Investors will not enter a market if they cannot reap the full benefits of their investment. Fan Gang, an economist at the Chinese Academy of Social Sciences, notes that:

[People] are bound to find that all this cheating and protecting yourself from being cheated consume too much time and energy, and that the best way to do business is playing by a set of mutually respected rules. New rules and laws will be passed, and people will be ready to abide by them.¹²

Meanwhile, the United States should continue to criticize China and other countries for their violations of copyright laws and put as much pressure on countries to protect intellectual property as possible short of sparking a trade war.

(6) Economic sanctions may lead to political backlash in the targeted country and fail to have a positive impact. That problem may be especially acute in regimes with an entrenched political class, no freedom of the press, and a strong anti-West bias.

The biggest obstacle to successfully using economic sanctions to promote human rights in China is the CCP. Hard-liners in the party will not tolerate any invasion of their stronghold of power, as the world witnessed in Tiananmen Square. They see sanctions as a capitalist tool designed to undermine China's rapid growth and weaken the CCP's hold on political power. Even if sanctions disrupted economic life, they would have no lasting effect on China's political system -- and might even serve to strengthen the ruling elite's resolve to promote communism at any cost. Closing China off to the outside world by means of sanctions would be more apt to play into the hands of the hard-liners than to overthrow them.

(7) Sanctions are apt to politicize trade further in the sanctioning country, because politicians seek to win votes by using the rhetoric of protectionism to retain jobs for special interests in their districts. The danger is that once sanctions were imposed, there would be strong pressure from special interest groups to retain them even if a target country changed its offending policies.

During the July 1994 congressional debate over using trade policy to promote human rights, for example, Rep. Gerald Solomon (R-N.Y.) revealed this motive clearly. He stated that Americans "must apply leverage where we can in order to defend freedom, deter aggression, and, yes, protect American jobs."¹³ And during a May 1995 congressional hearing on trade, Rep. Bill Thomas (R-Calif.) observed:

What I have seen as arguments on workers' rights tend not to be so much for underscoring the international agreements that I think all of us would agree with in terms of fundamentals -- the slave labor, prison labor, and the rest -- but appear to me to be more and more actually the reverse of what their proponents would hope people would think they were. Frankly, I think a number of them have been protectionist.¹⁴

Incubating Freedom and Democracy

In contrast to the "feel good" approach of sanctions, developing free markets and the rule of law more effectively secures human rights and helps establish democracy. Unlike sanctions, trade liberalization weakens the power of government.¹⁵

Even though free markets are neither necessary nor sufficient for democracy, much evidence supports the argument that economic liberalization breeds political liberalization. As markets spread, people acquire greater wealth and have a stronger interest in participating in the political process and protecting their property through the rule of law and an objective, nonpoliticized judicial system.

Traditions of liberty

The rule of law is a by-product of commercial society. Traders who were discriminated against by rulers found ways to circumvent the sovereign and increase their wealth.

Montesquieu, in his 1748 work The Spirit of the Laws, explained how Jewish merchants invented the bill of exchange to prevent having their property subject to the whim of rulers,¹⁶ and how foreign exchange markets provided constraints on the ability of rulers to debase the currency.¹⁷ Today international capital markets put pressure on government policymakers to protect private property rights and to pursue prudent monetary, fiscal, and regulatory policies or face massive capital outflows. Global market competition helps good government crowd out bad government.

In The Wealth of Nations, Adam Smith in 1776 described how the development of commercial life in Europe "gradually introduced order and good government, and with them, the liberty and security of individuals."¹⁸ And in the 1835 classic, Democracy in America, Alexis de Tocqueville observed that "trade makes men independent of one another and gives them a high idea of their personal importance; it leads them to want to manage their own affairs and teaches them how to succeed therein."¹⁹

Harvard economist Robert Barro, in empirical work summarized in his book Getting It Right, found "that improvements in the standard of living . . . substantially raise the probability that political institutions will become more democratic over time." He concluded,

The advanced Western countries would contribute more to the welfare of poor nations by exporting their economic systems, notably property rights and free markets, rather than their political systems, which typically developed after reasonable standards of living had been attained. If economic freedom can be established in a poor country, then growth would be encouraged, and the country would tend eventually to become more democratic on its own.²⁰

Markets and Democratization

A strong case can be made that the gradual introduction of markets in China and the opening of China to the outside world have made the Chinese people freer and reduced the power of government.

The end of collectivized agriculture in 1978 and the return of farming to families under the household responsibility system (baochan daohu) changed the whole dynamic of economic, social, and political life in China. The state was no longer the master for 80 percent of China's population who lived in rural areas. Farmers became risk takers, created new markets, developed rural industries, and migrated to urban areas.²¹

Commenting on China's cultural transformation, Jianying Zha writes in her book China Pop:

The economic reforms have created new opportunities, new dreams, and to some extent, a new atmosphere and new mindsets. The old control system has weakened in many areas, especially in the spheres of economy and lifestyle. There is a growing sense of increased space for personal freedom.²²

The new urban centers, such as Shishi in the province of Fujian, are characterized by the market, not the plan. Their model of development, writes Kathy Chen of the Wall Street Journal, is "xiao zhenfu, da shehui -- small government, big society -- which advocates less involvement by cash-strapped governments and more by society."²³ Ambitious young people want to become capitalists, not communists.²⁴ A recent survey found that young people ranked being an entrepreneur first among 16 job choices and employment with the national government eighth.²⁵

New rules will evolve as individuals grope for ways to lower the costs of exchange and expand markets. Liu Ge, a lawyer trained in both China and the United States, says about the dynamics of the move toward markets:

Gradually, there will be more laws and rules; the market will be more mature, more compatible with international standards, the competition more fair and open. Then, China will have been structurally transformed! Political change will come after that.²⁶

According to Zha, "A lot of the educated urban Chinese . . . echo this way of thinking." There is reason to believe, therefore, that institutional change in China will bring about what Princeton University professor Minxin Pei has called "creeping democratization."²⁷

Pei believes that Western liberal traditions, such as the rule of law, "have set implicit limits on the state's use of power" and have promoted the democratization of the legal system. People are starting to use the court system to contest government actions that affect their lives, liberty, and property. There has been a sharp rise in the number of civil lawsuits against the state, and individuals are beginning to win -- perhaps as many as 20 percent of their cases, according to official sources.²⁸

The opening of the legal system is important because it paves the way for the transition from "rule by law" to "rule of law." Marcus Brauchli of the Wall Street Journal writes,

The state's steel-clad monopoly on the legal process, which makes the courts just another arm of government, is corroding. China's economic liberalization . . . has spawned a parallel legal reform that raises the prospect of rule of, not merely by, law.²⁹

Unfortunately, as Brauchli recognizes, "legal ambiguity" remains "a ruthless weapon" for harassing the population. Until that facet of China's institutional structure changes, no one's rights will be secure.Foreign firms now have more than 120,000 projects operating in China with a total investment of over $135 billion.³⁰ That amount of investment already is reinforcing incentives for regional and local leaders to protect the market, and is making the rulers in Beijing reluctant to reverse economic liberalization. Pressure may eventually mount for political liberalization. Western companies have already had an impact on China's civil society. They have raised business standards and demanded a legal infrastructure.³¹ Continued economic liberalization is sure to raise business standards further and help cultivate an institutional infrastructure based on the rule of law. The changes will occur first in the nonstate sector (especially in the southern coastal provinces) and then spread throughout China as competition and openness become the norm.

Democracy is multi-dimensional; the right to vote is only one dimension, albeit an important one.³² A free society requires constitutional constraints to limit the power of government so that the right to vote does not infringe on the right to property.³³ China's future prosperity will depend increasingly on the development of a legal system that safeguards persons and property against the arbitrary force of the state and on the nation's commitment to comply with international commercial codes and customs.

The surest route to China's freedom and prosperity is to keep trade open and develop China's civil society. Greater economic freedom will spill over into greater political freedom, as it has in other parts of Asia. Imposing economic sanctions, on the other hand, will destroy China's nascent market system and block the surest path toward freedom and democracy.

Real stability will come to China only when its leaders abandon their fatal conceit and realize that it is impossible to plan the market or society.³⁴ Although the leadership is willing to tolerate gradual reform to keep the economy strong, it is unwilling to tolerate political reform and has vowed to prevent Hong Kong from following Taiwan's path to democracy. But economic reform takes on a political dynamic of its own. In the long run, the Chinese communists probably will not be able to withstand the tide that will sweep away not only socialism but also political repression.

Creating a Market-Liberal Order

To depoliticize economic life, China needs constitutional change and new thinking (xin si wei). Chinese scholar Jixuan Hu writes, "By setting up a minimum group of constraints and letting human creativity work freely, we can create a better society without having to design it in detail. That is not a new idea, it is the idea of law, the idea of a constitution."³⁵

As the world's leading constitutional democracy, the United States should spread its ethos of liberty by keeping its markets open and extolling the principles that made it great. America should not play the dangerous game of pitting human rights activists against free traders. American prosperity and global prosperity are better served by open markets than by well-intended economic sanctions. History has shown that the best route to freedom and prosperity is market liberalism not market socialism. China should be admitted to the World Trade Organization as soon as possible and be given most-favored-nation status (which should be called "normal trade relations") unconditionally.

Governments everywhere need to get out of the business of trade and leave markets alone. Western democratic governments, in particular, need to practice the principles of freedom they preach and recognize that free trade is not a privilege but a right. They need to understand that

it is neither possible nor desirable to stop individual European and American companies from doing business in China. What can and should be stopped are the efforts by western politicians to promote trade with China on a government-to-government basis. Such state-sponsored trade promotion is dubious at the best of times. With China it is particularly damaging. It merely reinforces the Chinese government's notion that access to the Chinese market is a political gift to be handed out as a reward to countries China favors.³⁶

Using the threat of sanctions to promote human rights in China is illogical and risky. Freedom is better advanced by expanding international trade and by improving our own market-liberal system so it can act as a beacon of liberty for all the world to see. America should not let the dark hand of protectionism prevent that beacon of light from reaching China's shores.

---

Notes

1 Teng-hui Lee, "Taiwan's Quiet Revolution." Interview in the Wall Street Journal, March 27, 1996, A22.

2 For a discussion of this issue, see the 1849 essay by Frederic Bastiat, "Protectionism and Communism," in Selected Essays on Political Economy, G. B. de Huszar, ed. (Irvington-on-Hudson, N.Y.: The Foundation for Economic Education, 1964), pp. 194-228.

3 U.S. Congress, "Oxford-Style Debates: Resolved that the United States Should Use Trade Policy to Implement Human Rights Policy," 103rd Cong., 2nd sess., July 20, 1994. Congressional Record -- House, H5937-49.

4 J. R. Junkins, "Statement of Jerry R. Junkins, Chairman, President, and Chief Operating Officer, Texas Instruments, Inc., on Behalf of Business Roundtable," in U.S. Congress, Fast Track Issues, Joint Hearing before the Subcommittee on Trade, House Ways and Means Committee, and the Subcommittee on Rules and Organization, House Committee on Rules, 104th Cong., 1st sess., May 11 and 17, 1995, pp. 66-74.

5 Gary C. Hufbauer, Jeffrey J. Schott, and Kimberly A. Elliott, Economic Sanctions Reconsidered: History and Current Policy. 2nd ed. (Washington, D.C.: Institute for International Economics, 1990), p. 92. Also see Bruce Bartlett, "What's Wrong with Trade Sanctions?" Policy Analysis, No. 64 (Washington, D.C.: Cato Institute, 1985).

6 State-owned enterprises accounted for only 20 percent of China's export growth in 1991-92 compared with over 80 percent in 1986-87. See Nicholas R. Lardy, "Economic Engine? Foreign Trade and Investment in China," Brookings Review 14, No. 1 (1996): 10-15.

7 Y. Donghui, "If China's Most-Favored Nation Status Is Revoked, the United States' Long-Term Interests Will Be Hurt Even More Deeply," Zhongguo Xinwen She (Beijing), May 3, 1996, p. 3. (In Foreign Broadcast Information Service, Daily Report: China, "PRC: Trade 'Expert' Warns U.S. Not to Revoke MFN Status," May 6, 1996, pp. 3-4 [FBIS-CHI-96-088]). C.S. Duffy and M. Harrold, "Don't Break the China: Why Continued MFN Status Helps Americans and Chinese," Issues Analysis No. 33 (Washington, D.C.: Citizens for a Sound Economy, 1996), pp. 4-5.

8 South China Sunday Morning Post, "Trade Goes on But Human Rights Falter," June 4, 1995, p. 10. (In Foreign Broadcast Information Service, Daily Report: China, "U.S. Shows 'Loss of Interest' in Human Rights," June 5, 1995, pp. 97-98 [FBIS-CHI-95-107]).

9 Harry Wu notes that there are "more than 1,100 labor reform camps called the laogai" in China. As he puts it, "The laogai is not simply a prison system. It is a political tool for maintaining the Communist Party's totalitarian rule. Many of the laogai's 6 million to 8 million inmates are political prisoners." According to Wu, "forced labor from the laogai produces about one-third of China's tea and a significant amount of its cotton. About 60 percent of China's rubber vulcanizing chemicals are produced in a single laogai camp in Shanyang." See Harry Wu, "A Chinese Word to Remember: 'Laogai'," Washington Post, May 26, 1996, C7.

10 C. Weibin and B. Wei, "PRC: West Criticized for Politicizing Human Rights," Xinhua (Beijing), April 23, 1996, p. 3. (In Foreign Broadcast Information Service, Daily Report: China, April 24, 1996, pp. 3-4 [FBIS-CHI-96-080]).

11 R. W. Holleyman II, "Statement of Robert W. Holleyman II, President, Business Software Alliance," in U.S. Congress, Fast Track Issues, pp. 113-14.

12 Quoted in Jianying Zha, China Pop (New York: The New Press, 1995), p. 203.

13 U.S. Congress, "Oxford-Style Debates," Congressional Record -- House, H5938.

14 U.S. Congress, Fast Track Issues, p. 155.

15 Bartlett, in "What's Wrong with Trade Sanctions?" (p. 10), concluded that economic sanctions "are a way of making ourselves feel that we are doing something substantive about a serious problem without really doing anything at all. The problem is that we are paying a heavy price for invoking this 'feel good' policy over and over again."

16 Baron de la Brde et de Montesquieu, The Spirit of the Laws, A. Cohler, B. Miller, and H. Stone, eds. (New York: Cambridge University Press, 1989), Bk XXI, Ch. 20.

17 Ibid, Bk. XXII, Ch. 13.

18 Adam Smith, The Wealth of Nations, Edwin Cannan, ed. (New York: The Modern Library, Random House, 1937), p. 385.

19 Alexis de Tocqueville, Democracy in America, J.P. Mayer, ed. (Garden City, N.Y.: Anchor Books, Doubleday, 1969), p. 637.

20 Robert J. Barro, Getting It Right: Markets and Choices in a Free Society (Cambridge, Mass.: The MIT Press, 1996), p. 11. For studies of the degree and scope of economic freedom, see James Gwartney, Robert Lawson, and Walter Block, Economic Freedom of the World: 1975-1995 (Vancouver, B.C.: The Fraser Institute, 1996); Bryan T. Johnson and Thomas P. Sheehy, 1996 Index of Economic Freedom, (Washington, D.C.: The Heritage Foundation, 1996); and Rick Messick, World Survey of Economic Freedom: 1995-1996 (New Brunswick, N.J.: Transaction Publishers, for Freedom House, 1996).

21 See Kate Zhou, How the Farmers Changed China (Boulder, Colo.: Westview Press, 1996).

22 Zha, China Pop, p. 202.

23 Kathy Chen, "Chinese Are Going to Town as Growth of Cities Takes Off," Wall Street Journal, January 4, 1996, A1, A12.

24 Joseph Kahn and Marcus Brauchli report, "Top university graduates used to consider party membership a career-gilding rite of passage, required for advancement through the ranks. Now, they scorn party recruiters." See Kahn and Brauchli, "China's Communists Face Serious Threat: Creeping Irrelevance," Wall Street Journal, December 19, 1994, A1 and A9.

25 N. D. Kristof, "China Applauds as Its Officials Plunge into Profit," New York Times, April 6, 1993, A6.

26 Quoted in Zha, China Pop, p. 204.

27 Minxin Pei, "'Creeping Democratization' in China," Journal of Democracy 6, No. 4 (1995): 65-79.

28 Minxin Pei, "Economic Reform and Civic Freedom in China," Economic Reform Today, No. 4, 1994, pp. 10-15.

29 Marcus Brauchli, "China's New Economy Spurs Legal Reforms, Hopes for Democracy," Wall Street Journal, June 20, 1995, A1, A8.

30 G. Melloan, "China's Growth Model Has Problems Too," Wall Street Journal, May 13, 1996, A21.

31 See Rep. Philip Crane's discussion of how American firms raise standards in less developed countries in U.S. Congress, Fast Track Issues, p. 153.

32 James A. Dorn, "Economic Liberty and Democracy in East Asia," Orbis 37, No. 4 (1993): 599-619.

33 See Friedrich A. Hayek, The Constitution of Liberty (Chicago: University of Chicago Press, 1960); and Roger Pilon, "On the First Principles of Constitutionalism: Liberty, then Democracy," American University Journal of International Law and Policy, 8 Nos. 2-3 (1992-93): 531-49.

34 James A. Dorn, "China's Fatal Conceit," Cato Policy Report, 18, No. 3 (1996): 6-9.

35 Jixuan Hu, "The Nondesignability of Living Systems: A Lesson from the Failed Experiments in Socialist Countries," Cato Journal, 11, No. 1 (1991): 44.

36 The Economist, "China's Wedge," May 11, 1996, p. 18.

Freedom to Trade: Refuting the New Protectionism is Copyright © 1997 by the Cato Institute. All rights reserved.

---

| Home | Table of Contents | Publications | Cato Institute |