Challenges in China

GWEN IFILL:

The growing economic power of China has collided with American politics this week. On Monday, the Bush administration moved toward limiting imports of Chinese clothing. The U.S. textile industry today agreed, and the Senate today also debated one bipartisan proposal to impose a new 27.5 percent tariff on Chinese goods headed for the United States. We're joined now by two members of Congress who recently traveled to Shanghai, Nanjing, Xian and Beijing: Arizona Republican Jim Kolbe; and New York Democrat Nita Lowey.

Jim Kolbe, I'd like to start with you, Senator, if could you give me a general impression of your visit there.

REP. JIM KOLBE:

Well, I certainly, this is my first visit in six years and I think the thing that impresses you the most is the scope and extent of the change which has taken place, it's really unrecognizable from my last visit six years ago; the construction that is just going on everywhere, the amount of infrastructure that is being built. This is an economic power and it's one that is really transforming itself and in the process it's transforming the region and the world.

GWEN IFILL:

I apologize for promoting you to senator there for a moment; I hope you enjoyed it.

REP. JIM KOLBE:

Some might think it's a demotion.

GWEN IFILL:

That's true. Congresswoman Lowey, your impressions?

REP. NITA LOWEY:

It's was like one big construction site. This was my first trip to China, and in visiting the large cities which were mentioned, Shanghai, Beijing, to see the number of tall skyscrapers, the number of parks that were instantly arising, millions of trees planted everywhere, it was a city and in fact a country of great contrast, because although we saw economic development, I visited a factory, I visited several schools, I visited a family planning clinic, we also heard about what was going on in the West, which I did not have an opportunity to visit, although they talk about creating two hundred to three hundred million jobs in these major cities, they understand that there are two hundred to three hundred million more people in the West that have to be moved into jobs and provided a good quality of life. So it really is a country of major contrast.

GWEN IFILL:

Congressman Kolbe, we hear so much about this booming economy in China, we also hear about the $162 billion trade deficit last year with the United States and all this discussion I was alluding to involving the Americans and colleagues of yours who would like to put some limits on that. What's your sense of that?

REP. JIM KOLBE:

Well, the trade deficit is a very complicated thing, as we found out in talking to some of the scholars that were with us over there. But I think the trade deficit is one that's as much a function of our own problems, our own private debt and public debt here in this country, which has to find a way of circulating the money around in a circle.

The trade deficit with China, while it's the largest that now exists in the world, you have to look at it as parts of a regional thing because the trade deficit with Taiwan and Korea and Hong Kong are down and are actually in surplus now so what you have is a lot of inputs coming from a lot of those countries to China, which is trans-shipped here, which now shows up as a trade deficit with us.

I'm not saying it's not large; it is too large, but I think it's a function of some of our own problems here, and I don't think the solution is simply to tackle China to go after China with punitive –.

GWEN IFILL:

So you don't necessarily think that what the Bush administration has been talking about this week, what members of Congress have been talking about this week about re-imposing tariffs and quotas on Chinese goods is the solution?

REP. JIM KOLBE:

I don't think it is. We knew that this was going to happen when the Textile Act, all the quotas came off of them — that this was going to be a tremendous shift of production to China. If we want to help the most poor countries in the world what we need to do is to give them some relief from tariffs so that they have a leg up in competing against China, not put punitive actions against China.

GWEN IFILL:

Congresswoman Lowey, your colleague, your senator from your home state was one of the co-sponsors of today's failed amendment to try to impose this 27 ½ percent tariff. He cited it as an example, businesses in New York State, which are suffering because they are barred from doing business with American companies which are based in China, hotels and that sort of thing. Did you see that as a problem? Did you discuss that with people you talked to in China?

REP. NITA LOWEY:

I thought what was very interesting as my colleague, Jim Kolbe, just said, from our discussions with economists such as Dr. Peter Bottelier of Johns Hopkins, we heard many points of view and it's clear that this is a very complicated issue. We saw what happened for example with the steel industry and the tariffs just were lifted because it wasn't working.

We understand that before some of these industries went to China, they went to Mexico, Honduras, Nicaragua. China is such a major power, and it will continue to be a force in that region and internationally that we need a thoughtful long-term strategy. We can't just shoot at the hips; we need to really figure out how we engage, how we keep that region prosperous, how we work together to develop fair trade, free trade, and this is a very complicated issue.

GWEN IFILL:

You talked about all the incredible economic boom that you saw while you were traveling in China. Do you think that any effort to impose these kinds of tariffs or quotas or whatever that that will throttle the Chinese economy in a way that would backfire in the United States? Is that part of what you're thinking?

REP. NITA LOWEY:

Well, it will not — based upon the information I received — just affect China and the United States. China is part of a region, and many of the products which Jim Kolbe mentioned that are exported are put together from imports from the other countries in the region.

So we have a problem in our country — not just with trousers and shirts; we have it with computers and chips, and a whole range of products. I think what we have to do is seriously look at our education policy. We have to make sure that our young people are being prepared for the next generation.

For example, we have to increase and encourage a study of Chinese here, beginning in the lower grades. We have to have more students exchange programs, and I do want to emphasize that where as Chinese students came in great numbers to the United States because of our visa issue, and we do have to be careful, but we have to look at our policy carefully, they're going to Great Britain, Australia and other countries.

So I think this is part of a policy that we have to look at. We need fair trade, we have to make sure that our workers are employed; we have to be sensitive to those industries that are not going just to China, but to India as well.

GWEN IFILL:

Congressman Kolbe, there is also running discontent between people in this country and people in China about the human rights issue there. This is something which Secretary Rice was forced to address while she was traveling there at roughly the same time you were. You met with the Chinese premiere; did you have an opportunity to raise those questions?

REP. JIM KOLBE:

The issue of human rights certainly was raised in our meeting with the premiere of China. And he gave a response, which I thought was interesting, not one that we of the United States would find very satisfying.

He kind of shrugged when one particular case was brought to his attention, he said look, there's 1.3 billion Chinese in this country; he said, you know, I can't be worried about every single one, and I don't know about the case you're talking about. I frankly don't know whether he did or not know about the particular case, but the idea — the concept of individual rights just isn't the same in China as it is here in the United States.

And I think that's one of the things we're all very grateful that we live in this country where individual rights – whether it's 300 million or 1.3 billion people — are respected and looked after.

GWEN IFILL:

Do you find that acceptable, Congressman, that there is a different concept of what individual rights are in China?

REP. JIM KOLBE:

Well, — you know, we would like to see much greater attention given to human rights. There are some improvements that are taking place and I don't think we should deny those. There are some changes that are taking place; the political system is opening up. The Communist Party is not about to give up their sole control over the political leverage of power in China. But they have some ways of letting off steam and they allow protests down below; they allow petitions, they allow people to protest it when they think they're not being treated fairly or they're paying bribes, and they have ways of controlling that, of making sure that people's complaints get dealt with — it's a way of making sure that it doesn't become a powder keg.

GWEN IFILL:

Congresswoman Lowey, how about that, were you satisfied with the answers you heard to the questions you all raised about human rights?

REP. NITA LOWEY:

Definitely not. I thought his intense focus on education and healthcare for the two hundred to three hundred million people in poor rural areas was important.

But he was looking at economic development, creation of jobs for the majority of the population, and it was very upsetting to me and the delegation that he really dismissed the discussion of individual cases; and I think after talking to many of the scholars it was clear that we as Americans who believe in individual rights and liberty have to continue to press these points that make it part of our discussion as we engage with China.

GWEN IFILL:

Okay. Congresswoman Nita Lowey and Congressman Jim Kolbe, thank you both very much.

REP. NITA LOWEY:

Thank you.

REP. JIM KOLBE:

Thank you.