AAM Statement on the 20th Anniversary of China’s WTO Ascension

Washington, D.C. – Saturday marks the 20th anniversary of China’s official entry into the World Trade Organization (WTO). It’s an ominous anniversary for America’s working class, as the resulting “China shock” led to millions of lost jobs and tens of thousands of factory closures, devastating industrial communities nationwide.

But with the right policy, this anniversary can also mark a turning point.

Alliance for American Manufacturing President Scott Paul said:

“It’s pat nowadays to point out how badly America’s political elites got China’s entry into the WTO wrong. But it’s astounding to reflect on just how wrong they were.

“We were told that China would open its market to U.S. companies to sell their products. Instead, China has largely left its market closed, and those who are able to do business there must hand over their intellectual property in return.

“We were told that China would play by the rules of global trade. Instead, time and time again, China has broken those rules, largely without consequence, costing millions of American jobs.

“We were told that China would liberalize, moving from a planned economy and authoritarian state to a free market and a democracy. Instead, China has used central economic planning to dominate global industries and is now exporting its totalitarian model around the world. People are arguably less free in China now than they were 20 years ago, something that is certainly true in places like Hong Kong and Xinjiang, where China’s government is overseeing a genocide. 

“Yes, it was a mistake for the U.S. to vote to allow China to join the WTO. But, while we can’t go back to 2001, we can begin to right the wrongs of 20 years ago.

“Leaders in Washington, including President Biden and lawmakers on Capitol Hill, must now respond with a smart industrial policy to help the United States compete globally, especially in emerging sectors like clean energy and electric vehicles. Trade enforcement is also essential to address China’s government-driven market distorting policies.

“If the U.S. gets this right, 2021 will be remembered as a turning point, the year when the United States began to build back its working class and charted the course for an American-made future.”

Ten Key Facts About the U.S.-China Relationship Since 2001

  1. 3.7 million U.S. jobs were lost due to trade deficits with China between 2001-2018, with three-fourths in manufacturing. From 2001 to 2011, U.S. workers suffered a direct net wage loss of $37 billion per year due to trade with China. (Source: Economic Policy Institute
  2. Since joining the WTO, China has had 47 formal trade complaints filed against it. (Source: World Trade Organization).
  3. In 2018, the total U.S. trade deficit with China was $419.5 billion—$168.2 billion of which was in computer and electronic parts. (Source: Economic Policy Institute)
  4. China ranks 107th in the Heritage Foundation’s Economic Freedom Index, with a rating of “mostly unfree.” (Source: The Heritage Foundation).
  5. China is the world’s largest annual greenhouse gas emitter, a ranking it has held since 2006. China’s energy-related emissions increased by more than 80% between 2005 and 2019, while U.S. energy-related emissions fell by over 15% in comparison. (Source: U.S. State Department).
  6. 75% of new steel capacity has come from China since 2000. (Source: Duke Center on Globalization, Governance and Competitiveness).  
  7. One in five North American companies have been victims of intellectual property theft by Chinese firms. (Source: CNBC). 
  8. In 2017, 73% of China’s non-state-owned companies — or 1.9 million firms – were under the influence of a Chinese Communist Party (CCP) committee, compared to just 0.9% in 1998. (Source: U.S. China Economic and Security Review Commission).
  9. China is ranked as one of the worst countries for workers in the International Trade Union Confederation’s Global Rights Index, as workers have “no guarantee of rights” and are exposed to physical violence and murder. (Source: ITUC).  
  10. Over 1.5 million Uyghurs have been swept up in a cultural genocide perpetrated by China’s government in what some experts say is the largest persecution of an ethno-religious group since the Holocaust. (Source: NPR).