August 24, 1997

American Policy About China Is 'Powder On The Face'

This week's balance of trade figures by the U.S. Department of Commerce bring to light the reason why President Clinton and many members of Congress play footsie with China - money.

The sleeping dragon has awakened and claims head place at the table.

On a seasonally adjusted basis, the U.S. trade deficit showed a smidgen of improvement for June. But the pace forecasts a year-end deficit of $111.12 billion. This would be the worst trade performance since 1988.

Leading the charge against U.S. exports is China. Our deficit with that nation rose a whopping 14.5 percent in June. This translates to $4.3 billion more U.S. purchases than sales in that one month.

The trade gap with Japan, in contrast, rose $4 billion in June. Thus, our deficit with China surpassed that with Japan for only the fourth time in history.

Washington pols tip-toe around the China situation. A new cold war is threatened by scandals involving efforts to work out monetary deals satisfactory to both nations.

Tip of the ice-berg is laundered Chinese money for American election campaigns. Money poured in for politicians able to modify U.S. policies on most-favored-nation trade status, world bank loans and military expansion.

The lid is about to blow off with testimony by Johnny Chung, a Taiwan-born U.S. citizen and California businessman. He gave $435,000 solicited illegally by Hillary Clinton, Energy Secretary Hazel O'Leary and the Democratic National Committee for a laundry list of projects.

Chung made a handsome profit on his influence by selling White House VIP visits to some 50 Chinese and other Asian businessmen.

Senator Fred Thompson, chairman of the Government Oversight Committee, would like Chung to testify about the campaign shenanigans. However, Chung will not do so unless granted immunity from criminal prosecution.

Chung upped the ante Wednesday by exposing the illegalities in a remarkable interview with Tom Brokaw of NBC-TV news.

By confessing publicly - without an oath which would make him criminally liable - Chung put pressure on the Senate committee. A majority of members are tempted to let him off the hook in order to get his sworn statements about bigger fish.

Little Rock Friend-of-Bill Charlie Trie laundered official Chinese money for the White House, but he fled back to Shanghai to avoid prosecution. Committee aides traveled to China to depose Trie but could not find him.

The intrepid Brokaw then flew there with a camera crew and flushed out the reluctant witness who also confessed. Trie declared he was going to stay put - immunity or not.

Campaign finance hearings are juicy drama but small potatoes compared to Chinese high-stakes trade and military maneuvering.

The state-owned China Ocean Shipping Company is the largest shipper in the world. It has offered to lease the former U.S. naval base at Long Beach, Calif., for a dock and warehouse. The facility would distribute the mountain of cheap goods for the U.S. market.

The lease initially was approved locally and at Washington. However, COSCO was discovered to have unloaded thousands of illegal, Chinese-made assault rifles destined for West Coast street and drug gangs. The dock deal has been put on hold.

Other China companies have been moving quietly into Panama as the United States prepares to leave at midnight Dec. 31, 1999. American military bases will be closed, and management of the vital canal will be relinquished.

Only the Wall Street Journal last week reported secret negotiations that turned over management of the ports at each end of the canal to Hutchison Whampoa, Ltd. It is a Chinese conglomerate based at Hong Kong. China is the third largest canal customer, and soon will accord itself transit priority.

Normally there should be no concern over China's economic expansion. It is a global market today. Competition is the name of the game.

Yet, China is engaged in a massive naval ship-building and nuclear missile production program. This while the U.S. has reduced its navy from 350 fighting ships to 275, and while China claims its national boundaries encompass the entire China Sea. Watch out Taiwan!

In an Asian showdown, COSCO could offload at Long Beach a crated atom bomb primed to a secret radio signal. Chinese warships anchored at each end of the Panama Canal could prevent the U.S. from shifting its Atlantic fleet to counter a China Sea invasion.

A Pentagon analysis in April of China's military build up is worrisome: "As an emerging great power, China will probably build its military power to the point where it can engage and defeat any potential enemy within the region with its conventional forces - and can deter any global strategic threat."

It is preferred, of course, that the United States and China find detente. President Clinton seeks to do this while giving lip service to promoting human rights there.

We should not forget the quiet visit by Vice-president Gore to China last March to bless $2 billion of business deals. One involved the sale of five Boeing jetliners. The other was a joint China-General Motors factory to build Buicks.

These did little to diminish the U.S. trade deficit, improve Chinese human rights, or lower tension over Taiwan.

However, it's an earnest attempt to jump-start accommodation.

The Clinton policy toward China can be described by a Chinese expression Johnny Chung used to explain the White House method of making things look good: "They put powder on my face."

PARTING SHOTS

• An optimist is one who throws meat to a tiger in hope of turning the beast into a vegetarian.
  
• Johnny Chung ruefully told Tom Brokaw: "I should have listened to my Republican wife."
  
  Sadly, we grow too soon old and too late smart.
  
• Six high school teachers at Dallas, Texas, have been suspended for conducting a self-devised math test with street-wise kids.
  
  Sample: "Hector has knocked up six girls in his gang. There are 27 girls in the gang. What percentage of girls in the gang has Hector knocked up?
  
  Follow-up questions should have been: "How many subsequent babies grow up without fathers, how many of the unwed mothers went on welfare, and how many gang boys got shot?

By Lindsey Williams, columnist for Sun Coast Media Group newspapers