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Trade and Human Rights: Cutting the Gordian Knot

US needs new consensus on whether the two issues should be linked

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SHARP debate has unfolded over the wisdom of President Clinton's vain attempt to secure improvements in China's human rights record by threatening to revoke its most-favored-nation trading status. But little attention has been paid to the story behind the controversy.

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The MFN fight is part of a larger struggle between those who believe the United States should use its economic muscle to promote human rights and those who oppose using trade to promote political objectives. As cold-war-era concerns over national security begin to diminish, conflicts between human rights and trade policy have become a major component in the debate over US foreign policy.

In addition to China and MFN, other potentially contentious issues are on the administration's agenda:

* The administration is either investigating or considering investigating whether to revoke General System of Preferences (GSP) rights from the Dominican Republic, Indonesia, and Malaysia. GSP provides developing countries with the right to export many goods to this country duty-free.

* Just before the April signing of the General Agreement on Tariffs and Trade in Morocco, the US announced it would try to place workers' rights on the agenda of the new World Trade Organization (WTO). Developing countries derided the move as a thinly veiled attempt to justify protectionism.

* In an apparent response to the caning of Michael Fay, US Trade Representative Mickey Kantor said that the US would oppose Singapore's bid to host the initial meeting of the WTO.

* The US and China may again collide over the administration's call for strict enforcement of the anti-forced-labor provisions in US trade law.

The clash between human rights and trade is not new. Nearly 20 years ago, Sen. Henry M. Jackson fought to incorporate human rights into US trade policy through the passage of what is commonly known as the Jackson-Vanik amendment. It mandates that the president cannot extend MFN to a communist state without certifying that it permits free emigration. Mr. Clinton's executive order on China is based on the authority granted him by Jackson-Vanik.

A number of parallels exist between the battle over Jackson-Vanik and the current debate. Then as now, ``realists'' like Henry Kissinger argued that linkage did little to promote human rights and could damage delicate negotiations on other key issues.

Business leaders contended that American investment offered the best path to political liberalization. They warned that not extending MFN damaged American competitiveness, cost American jobs, and permitted international competitors to control the next big market - the USSR. Human-rights activists countered that democratic governance and respect for human rights would produce greater benefits for average citizens than US investment in what was a statist economy.

Today the declining relevance of national security has changed the rules of the game. Policymakers can no longer use the superpower standoff to secure the cooperation of other countries in implementing trade sanctions.

As the reaction of Europe, Japan, and Canada to the MFN debate has demonstrated, fierce international competition for markets makes such cooperation improbable. With the rapid expansion of US trade, domestic economic lobbies on behalf of China are far stronger and more numerous than were the economic interests linked to trade with the Soviet Union of Senator Jackson's day. Future American attempts to use economic sanctions to secure human-rights gains probably will have to be undertaken unilaterally, if at all.

Conversely, opponents of linkage can no longer use national security as justification for excluding human-rights concerns. In the 1980s, President Reagan cited national security concerns in opposing more-stringent economic sanctions against South Africa. Despite a popular movement on behalf of divestment, Mr. Reagan managed to delay implementing American sanctions for several years. Were such a debate held today, Clinton probably would not count on such a tactic.

The diminished emphasis on national security has raised the stakes for both sides in the current debate. Where Jackson and Kissinger argued over the degree to which human rights and trade should be allowed to influence policy, today's partisans fight to determine which side will control policy. With the stakes so high, rights activists treat their opponents as immoral materialists, while the business community views its rivals as hopelessly out-of-touch idealists who don't appreciate the democratizing value of market reform.

It was in this atmosphere of mistrust and outright hostility that Clinton announced he would de-link human rights from trade in China. But the debate is far from over. In the year since he issued his executive order on MFN, he has done little to resolve the schism between trade and human rights, in large part because both his administration and his Democratic Party base are deeply divided on the issue.

It is not too late for the president to cut this Gordian knot. In 1974, Jackson and Kissinger held a series of difficult and contentious discussions to reach a national consensus. The time has come for Clinton to begin a similar dialogue with the American people. With polls reporting that many Americans do not approve of his handling of foreign policy, Clinton can demonstrate leadership. He has conducted national debates on issues as diverse as the North American Free Trade Agreement and health care. A similar discussion of the relationship between trade and human rights could develop a much-needed consensus on this important aspect of US foreign policy.

* Charles J. Brown is special projects coordinator for the Washington office of Freedom House. Charles Graybow covers Asian human rights issues for Freedom House.