Hollywood – and freedom – sail further into China
A WTO ruling against Beijing's curbs on imports of foreign entertainment is a victory for the rule of law.
When the Berlin Wall fell 20 years ago and helped end communism in Soviet-bloc nations, China stood its ground. Only brick by brick has the great wall of its ruling Communist Party come tumbling down.
The latest brick to fall is Beijing's curb on the imports of Hollywood movies, iTunes music, books, and other foreign culture. The World Trade Organization ruled this week that Beijing cannot force foreign-made entertainment to be sold through its state-run monopolies. Such media imports must be sold freely to China's 1.3 billion people, the WTO said.
The ruling runs counter to the party's attempts to shelter its restless population from outside cultural influences – which can often help drive revolutions against iron-fisted regimes. But the decision also helps push the party to accept an important universal principle – the rule of law – instead of relying on capricious dictates and censorship to keep itself in power.
China joined the WTO only in 2001, two decades after adopting a limited market economy in order to keep its peasants from revolting against rising poverty. Its entry in the rules-based trade organization was one way to win access for Chinese exports and to prevent other nations, especially its biggest customer, the United States, from putting up trade barriers. But it's been losing legal cases brought by other countries at the Geneva-based WTO – and often not complying with adverse rulings.
Multilateral organizations such as the WTO and the International Monetary Fund (IMF) are a powerful force for democratic norms and fair practices around the world. The IMF recently chided China for manipulating the value of its currency to boost exports and limit imports. Feeling threatened, China, along with Russia, has been challenging or disrupting these organizations. Yet even these two antidemocratic, repressive regimes recognize the long-term value in becoming members.
Russia itself is wary of joining the WTO, having seen how China is being forced to open up its society more than its rulers want to. Prime Minister Vladimir Putin suspended talks for Russia's entry in June after 16 years of negotiations. Russia is the largest economy not yet a member of the WTO and, by one estimate, may be losing about $2.5 billion a year in trade by not joining.
By participating in a global economy, both China and Russia must face up to the responsibilities of being a stakeholder in the rules-based system of international commerce.
It's been a difficult lesson for China to learn. It recently had to back down from imposing software filters called Green Dam on new computers after an international outcry. And it was forced to drop espionage charges against foreign executives of mining giant Rio Tinto after this attempt to protect domestic industries sent shivers through foreign investors.
Now China's monopolistic stranglehold on imports of books, songs, and movies will need to end, too. An attempt to appeal the WTO ruling would only further isolate China and contribute to economic nationalism in other countries.
To enjoy the benefits of free trade, Beijing's rulers will need to accept more freedom in China.