Momentum is Building to Revoke China’s Normalized Trade Relations Status

By Elizabeth Brotherton-Bunch
Jan 30 2023 |
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And new poll data from AAM conducted by Morning Consult shows 57% of registered voters back doing just that.

Support is growing on Capitol Hill to revoke China’s permanent normal trade relations (PNTR) status, which would end two decades of unfettered trade with China that led to the loss of millions of U.S. manufacturing jobs and the closure of tens of thousands of factories.

Republican Sens. Tom Cotton (Ark.), Rick Scott (Fla.), Ted Budd (N.C.) and J.D. Vance (Ohio) introduced the China Trade Relations Act on Jan. 26, which would revoke PNTR and return China to a pre-2001 status quo, having to earn “Most Favored Nation” (MFN) status via a presidential decision.

But Congress would be able to override the president, and the legislation also would expand the list of human rights and trade abuses under the Jackson-Vanik Amendment that would outright prevent China from being granted MFN status, including the use of forced labor, the operating of concentration camps, forced sterilization or abortions, and the hindering of the exercise of free religion, all of which China currently stands accused of overseeing in the Xinjiang province.

Registered voters support revoking China’s PNTR status, according to a new poll from AAM conducted by Morning Consult. Conducted Jan. 25-26, the national poll found that 57% of registered voters supported ending PNTR for China, with 28% of respondents saying they “strongly support” doing so and 29% said they “somewhat support” it; just 6% said they’d “strongly oppose” such a move.

The Morning Consult poll isn’t the first to find Americans favor stripping China of its PNTR status, by the way. The Force Distance Times conducted a similar poll in September 2022 and found that a plurality of voters approved of doing so.

And while Republicans introduced the specific legislation last week, there is bipartisan backing for revoking China’s PNTR status. A bipartisan group of House Members introduced similar legislation last Congressional session, for example; the nonpartisan U.S.-China Economic and Security Review Commission also recommended revoking the status in its annual report released in November 2022.

Interestingly, a number of Members who initially voted against granting China PNTR status remain in Congress, including prominent Democrats like Sen. Sherrod Brown (D-Ohio) and former Speaker Nancy Pelosi (D-Calif.). Brown in particular continues to call for strong trade enforcement against China, including via his sponsorship of the Leveling the Playing Field Act 2.0.

And it’s worth pointing out that there is precedent for revoking PNTR, as Congress voted to strip Russia of that status following that country’s illegal and unjustified invasion of Ukraine. The Senate vote came in at 100-0, in fact.

The United States granted China PNTR status in 2000, paving the way for China to enter the World Trade Organization in 2001. While there were warnings that doing so would lead to the gutting of American manufacturing, the conventional wisdom at the time was that giving China PNTR would encourage China to become more open and democratic. Then-President Bill Clinton even declared that “China will open its markets to American products from wheat to cars to consulting services, and our companies will be far more able to sell goods without moving factories or investments there.”

That’s not what ended up happening, of course. The granting of PNTR led to the China Shock; more than 3.7 million U.S. jobs were lost because of the trade deficit with China between 2001 and 2018.

China’s PNTR status and subsequent entry into the WTO didn’t cause it to open up, either. China’s government took advantage of the trade system via the use of unfair trade tactics like state-owned enterprises, massive government subsidies, currency manipulation, and lax labor and environmental standards.

A 2022 report from the U.S. Trade Representative also found that China failed to live up to the promises it made when joining the WTO. “China has instead retained and expanded its state-led, non-market approach to the economy and trade,” USTR Katherine Tai said.

If you’ve made it this far in reading this blog post, it should come as no surprise to learn that our own Scott Paul is among the voices supporting revoking China’s PNTR status. Here’s what he wrote in The Hill in December:

Even with our politics as polarized as ever, there is a legitimate, aisle-crossing interest in confronting the Chinese state for failing to honor the obligations it made to the U.S. and the World Trade Organization. The Clintonian policy toward China, which was carried on by George W. Bush and to some extent Barack Obama, has ended. Donald Trump disrupted the relationship with tariffs and harsh rhetoric but did it without a plan. Joe Biden, in contrast, has such a plan and is busy implementing it by addressing domestic shortfalls and limiting Beijing’s ability to use Western technology in a manner that harms our economic and national security interests. And other steps are under consideration.

Voters are ready for them, and suspending normal trade relations is a logical step to take. We all are familiar with what deindustrialization looks like and what dependency on China for key supplies feels like, and now so is the government. Just days before the China commission’s report was released, another federal agency published its findings on the effects of trade on marginalized and minority communities in the United States, In sum, it has hurt: Offshoring and globalization have made consumer goods marginally cheaper here, but it hasn’t made the American economy more secure and the people on the bottom have suffered from it the most.

When Congress granted China PNTR status in 2000, it effectively gave the thumbs-up to allow for the offshoring of millions of factory jobs and critical production. Now, the United States is working to rebuild some of what was lost, including through new laws like the Inflation Reduction Act and CHIPS and Science Act. This new investment is hugely important, and U.S. policymakers should view the legislation passed in 2022 as the first step, not the last word, when it comes to investing in our own industrial capacity.

But we won’t be able to get the job done so long as unfettered trade with our chief geopolitical rival continues. China’s government has made it clear it aims to dominate global industries, and there’s no reason to believe it will cease any of the unfair trade practices (not to mention human rights abuses) it has deployed in the past.

Every day that PNTR remains in place, the United States gives China an unfair advantage at the expense of our own industries and workers and undermines our own efforts to strengthen U.S. production. The Morning Consult poll shows voters understand this; it’s time for Congress to act.