The Book of Ron Paul
1997 Ron Paul Chapter 65

Most Favored Nation Status for China

24 June 1997

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Congressional Record (Page H4278)   Cached

1997 Ron Paul 65:1
Mr. PAUL. Mr. Speaker, as a physician, I know that what, at first, might seem to be a cure for a particular ailment is, in actuality, not a cure at all. In fact, going with a gut reaction to prescribe a treatment can do more harm than the original ailment may have. The same can be true for matters of government. The initial reaction to a problem in society, or the world will often lead us to make a conclusion about a course of action. Unfortunately, that first reaction can be wrong, even though guided by the best of intentions.

1997 Ron Paul 65:2
We have such a case before us now. It is the dilemma of whether or not China should be granted the same trade relationship granted to almost every other nation of the world, a status misleadingly referred to as most favored nation, or MFN. We all know the charges: The Chinese Government violates basic human rights of its citizens, it is hostile towards Christianity, and its system of government runs contrary to our most fundamental beliefs, therefore MFN status should be denied. The initial reaction of our collective national psyche is to oppose MFN, to be tough, and say, “No way, no special deals for China.” But is this the proper solution?

1997 Ron Paul 65:3
To clear up a misconception, MFN is not a special status at all. In fact, MFN status granted to a country simply means that U.S. citizens can trade with citizens of that nation without erection of extraordinary government barriers to entering our marketplace. Free trade is not something to be lightly dismissed. And MFN is nothing more than an attempt, albeit imperfect, to move towards free trade by lowering tariffs.

1997 Ron Paul 65:4
Eliminating MFN status for China does not hurt the Chinese Government. But it does hurt Americans in two ways. First, by imposing what is essentially a tax on our people. It is a tax because it is the American consumer who will pay higher prices on goods coming from China. This means higher prices on many items and not just items which come directly from China. If the tariffs on Chinese goods increase, people will be forced to find replacement products. As the demand for those products increase, so will prices of those goods.

1997 Ron Paul 65:5
The second means by which eliminating MFN status hurts Americans can be found in the reciprocal barriers China will likely erect. It will become much more difficult for farmers and businessmen in the United States to sell their products in China. Nearly every farmer and every agricultural group I have heard from supports MFN status for China.

1997 Ron Paul 65:6
But the critics of MFN for China do not address the free-trade aspect of the debate, or the very real cost eliminating MFN would impose upon the American people. Instead, they focus on the real persecution of religious minorities’ often practiced by the government in China. And for that I defer to those who are on the ground in China: the missionaries.

1997 Ron Paul 65:7
According to Father Robert Sirico, a Paulist priest who recently discussed this topic on the Wall Street Journal’s opinion page, Americans in China working to help the Chinese people are very frightened of what ending MFN might do to their efforts and the people to whom they minister. After all, ending MFN will not bring about the freedoms we hope China may confer upon its people, nor will ending MFN mean more religious freedom or fewer human rights violations. In fact, those working in China to bring about positive change fear only the worst if MFN is withdrawn.

1997 Ron Paul 65:8
“As commercial networks develop, Chinese business people are able to travel freely, and Chinese believers have more disposable income with which to support evangelistic endeavors,”

1997 Ron Paul 65:9
Sirico writes. Even worse, the missionaries have been reporting that “such action would endanger their status there, and possibly lead China to revoke their visas. It would severely limit opportunities to bring in * * * religious materials. These missionaries understand that commercial relations are a wonderfully liberating force that allow not only mutually beneficial trade but also cultural and religious exchanges.”

1997 Ron Paul 65:10
And so the critical question remains: MFN, or no MFN? Idealogically, revoking MFN is a step in the wrong direction, a step away from free trade. It is equally clear that revoking MFN is harmful to our people, and likely to be harmful to the Chinese. The ones to suffer will be the very individuals we seek to help, not the powerful elite in Beijing.

1997 Ron Paul 65:11
I have long held that governments do not solve problems. Rather, governmental action often creates more problems than existed previously. It is the individual people who are able to bring about positive change in this world; it is individuals who solve problems. China’s government is indeed a concern: for us and its people. But it is a problem we can only resolve by changing the hearts of the Chinese leaders. And whether we like it or not, the way we can do that is through trade with China.

1997 Ron Paul 65:12
By rushing quickly for the “pills” of government-enforced sanctions, we may have the best of intentions to cure the Chinese Government of its persecution of human rights. But unfortunately, those pills will only harm the patient. We must swallow our pride and admit that perhaps the best remedy is not the first solution.

1997 Ron Paul 65:13
It is only through the open dialogue of individuals that the Chinese Government will ever be convinced it is wrong. By closing the door now, when we have the opportunity to allow to grow the seeds of change which have been so firmly planted in China, we will be damning that nation’s people to a return to their darker days.

1997 Ron Paul 65:14
We will lose the patient if we act hastily or imprudently and that cannot be the correct option. It is never an option when I have a patient on the operating table, and it cannot be an option when dealing with the situation in China.


1997 Ron Paul Chapter 65
The title of this chapter was editorially supplied by the webmaster.
The text of this chapter was instered into Congressional Record and was not spoken on the House floor.

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