JUNE is a tense time for US-China relations. Both the anniversary of the 1989 Tiananmen Square massacre and the annual White House decision to renew China's most-favored-nation trading status come up. President Bush relieved China's leaders last week by again extending full MFN rights to China - probably ensuring a $12 billion Chinese trade surplus with the US. But this does not relieve those in the US who feel Beijing is still too repressive and unregenerate for business as usual.
Election politics makes it difficult for Mr. Bush to alter his China policy. The premise of that policy - that engagement with the West does more to promote reform than isolation - is sound. But new restrictions could force Beijing's leaders to improve their human rights record or lose the only thing hardliners and reformers agree about - money.
Last June Bush expected trade concessions from Beijing but didn't get them. Beijing said in August it would sign the Nuclear Nonproliferation Treaty, but has not. It told Washington it would not export high-tech weapons parts, but has done so. It says export-goods are not made with prison labor. This is a lie.
Last November Secretary of State James Baker was promised during his first trip to China since 1989 that dissidents could emigrate, a condition of the Jackson-Vanik amendment underpinning MFN. But of 20 people whose names Mr. Baker submitted, only two have been permitted to leave. One of those on the list, labor leader Han Dongfang, was imprisoned again last week.
The most distressing aspect to China is the phony peace that has taken hold due to constant lies and propaganda in state media. There is no controversy in China because none is allowed; the distortion of truth wears citizens out and eliminates space for free thinking and protest. Document No. 6, recently issued, punishes Chinese who worship outside official churches; 300 Protestant "home churches" have been shut.
Under these conditions, a carte blanche MFN is wrong. As we have argued for a year, middle ground must be found between the morally absolute position taken by Congress - that China must totally reform overnight - and the morally irresolute position of the White House, which says little about reform at all.
To that end, Congress is picking up an ingenious proposal by Washington-based Human Rights Watch that would impose tariffs selectively on China's state-run industry if basic rights are broken. Standard humanitarian goals must be met: International Red Cross teams must be allowed to inspect prisons, as they do throughout the world. Torture must stop, as must religious and political persecution.
The beauty of this proposal, which Trade Representative Carla Hills used effectively against Beijing in December on US patent and copyright infringements, is that it keeps engagement with China alive and does not penalize private business there.
Congress should amend MFN, and the White House agree.