Part 3 of a three part series on the Chinese Media Reciprocity Act & foreign journalists in China
(Click here for Part 1; click here for Part 2)

There is a chance that passage of the Chinese Media Reciprocity Act could result in China granting visas to U.S. government journalist, but that possibility is slim.  The effects of passage of the Act mentioned in Part 1 – the eradication of the Chinese press in the U.S., an all out visa war, and greater suppression of freedom of the press – are much more likely and not positive.  But the U.S. does not have to sit back and just watch the Chinese government harass and censor their journalists.  Below are some less extreme alternatives that the U.S. government can conduct to express its displeasure with the Chinese government and perhaps change the current situation.

Alternative #1: Raise the Issue When it Happens

The U.S government’s tepid response to Melissa Chan’s unlawful expulsion was a missed opportunity to underscore the U.S.’ commitment to freedom of the press to the Chinese government.  The Chinese Media Reciprocity Act is not necessary if the U.S. government publicly stresses that this is an important issue.  While some may argue that private diplomacy and comments work better with China, the current Administration has publicly censure China when its behavior bucks international human right standards.  As recently as last Tuesday, while on a trip to Mongolia, Secretary of State Hillary Clinton publicly criticized China for its lack of freedom for its own people.

Similarly, if freedom of the press means something, after Melissa Chan’s expulsion, the U.S. State Department should have issued an official statement from a high ranking official reprimanding China for unlawfully using the visa process to censor foreign journalist coverage.  Perhaps such a statement would have given Beijing pause and might cause it to change from its current course of conduct.  But a mere statement of “disappoint” permits Beijing to continue harassing foreign journalists and interfering with their coverage by threatening to deny visa renewals.  Rhetoric can make a difference or at the very least serve as a signaling device to Beijing that this is an important issue that the U.S. government is not going to take lightly.

Alternative #2: List the Harassment of U.S. Journalists on its Website

The Foreign Correspondent Club of China (“FCCC”) previously posted their members’ incidents reports and the yearly surveys on their website.  But since February 2011, the FCCC is no longer posting the reports or the surveys because of increasing pressure from the Chinese government.  As Peter Ford, president of the FCCC, told China Law & Policy, the FCCC removed mention of the incident reports because “the [Chinese] Foreign Ministry threatened the FCCC president and other officers with unspecified ‘serious consequences’ if the club continued to make public statements that the government regarded as political. To ensure the club’s continued existence we have since limited our public statements to particularly egregious violations of our journalistic rights and freedoms, such as physical injuries sustained by foreign reporters at police hands and Melissa Chan’s expulsion.”

The public availability of the incident reports provided an important look into the treatment of foreign journalists in China, including their visa issues.  But with the Chinese government’s censorship of the FCCC, that important information is no longer available and it becomes difficult to know the current situation in Beijing.

But the U.S. Embassy in Beijing can serve this function by posting U.S. journalists’ incident reports.  At the very least, they can list the issues that U.S. journalists are having with the visa process serving two purposes: informing its citizens about the j-visa process and highlighting to the Chinese government that this is a serious matter that the Embassy plans to monitor.  The U.S. Embassy in Beijing does something similar for air pollution; the Embassy has a page dedicated to listing air quality reports every hour.  This webpage has  irked the Chinese government since the Chinese Ministry of Environmental Protection hosts a similar webpage but usually with more positive air quality numbers, making apparent that someone is not telling the truth.  There is no reason why the same can’t be done with U.S. journalists in China.

Alternative #3: Deny a Visa

But another reason why the Chinese Media Reciprocity Act is not necessary – and another tool that can be used to protect our journalists in Beijing – is that the U.S. can deny visas under current law.  The Immigration and Nationality Act provides the executive branch with a list of circumstances, which at times are very vague, where the government can deny a visa.  Section 212(a)(3)(C) allows the State Department to deny a visa if there are adverse foreign policy concerns: “An alien whose entry or proposed activities in the United States the Secretary of State has reasonable ground to believe would have potentially serious adverse foreign policy consequences for the United States is inadmissible.”  Within the courts, the executive branch is given almost exclusive deference in immigration and visa decisions.  See Kleindienst v. Mandel, 408 U.S. 753 (1972).

If rhetoric does not work with the Chinese government, the U.S. government can threaten to deny a visa to a single Chinese reporter.  This might do the trick without damaging freedom of the press too much.  In “The Visa Dimension of Diplomacy,” Prof. Kevin D. Stringer analyzed the use of visas as a diplomatic tool.  Although Stringer is not keen on the denial of a visa as a sanctioning tool, he does note that on occasion it has produced positive results.  After India unexpectedly conducted nuclear tests in 1998, the U.S. denied a visa to Dr. R. Chidambaram, the Chairman of the Indian Atomic Energy Commission, who had come to the U.S. multiple times before.

The denial was symbolic but had a larger psychological impact on Indians on work visas or those who wanted to send their children to a U.S. college.; would their visas be denied as well?  How far would the U.S. go?

Similarly, the U.S. government could threaten to deny – or just not process – a visa to a key Chinese reporter.  In February 2012, to much fanfare in China, the Chinese government launched CCTV America, based in Washington, D.C.  A threat to deny a visa to one of their top reporters or directors could put the Chinese on notice that the U.S. is not going to stand for the harassment of U.S. reporters abroad.  Similar to the 1998 India situation, given the large number of political elites’ children who attend college in America, a single visa denial could have a similar psychological impact on influential elites in China.

The U.S. does not have to pass the Chinese Media Reciprocity Act, but it does need to communicate its displeasure with the way foreign correspondents are treated in China.  There are other avenues to do that but one thing is clear, the U.S. government must start raising this issue otherwise things will only continue to deteriorate as it has for the past three years.

To see Part 1, click here; to see Part 2, click here

More often than not, I am my friends’ go-to China person; something in the news pops up with China, I get the questions.  So I wasn’t surprised on Saturday when over some carrot cake at the Chelsea Market a friend of mine had questions about Chen Guangcheng: if he cared so much about human rights in China, why would he leave?  What is up with the Chinese government, keeping a blind man trapped in his own home?  How did things get so messy between the U.S. government and Chen?

It’s been almost a month since Chen fled the home that illegally became his prison. So what exactly is up with Chen’s escape and to answer some questions – what does it all mean?

Chen’s Escape Has Propelled Human Rights to the Top of the US-China Agenda

My friend’s question on Saturday caught me off guard – does Chen really care about human rights in China if he fled to the protection of the U.S. Embassy, ostensibly to seek asylum and leave China.

To ask a man with a wife and two children to be a martyr for his cause is asking too much.  As this blog has recounted previously, since Chen’s release from prison (oddly convicted of a traffic disturbance) did not result in freedom.  Instead, for the past year and a half, Chen and his family have been subjected to illegal house arrest and at times, physical torture by his captures.

It is true that by departing China, Chen’s ability to change China’s current system will be much reduced if not extinguished.  But his heroic flight has perhaps done more to highlight the Chinese government’s recent illegal oppression of dissent than anything else.  Over the past year and a half, this blog has increasingly written about the Chinese government’s crackdown on China’s nascent rights defending (weiquan) lawyers. Aside from people already interested in the issues, these posts – and the acts of repression which they have focused on – have received little attention.

Chen’s escape and his subsequent stay at the U.S. Embassy  altered this focus. With Hillary Clinton arriving for the Strategic and Economic

Dialogue (S&ED), the focus of U.S.-China relations shifted to human rights.  For one week, as the world watched, the U.S. and China’s relationship was thrown back to a 1980s-Cold War paradigm, when ideology played a more governing role.  For one week, the Western media’s attention finally focused on the repression of rights defending lawyers, and the lip service the Chinese government gives “rule of law” when it comes to civil rights and civil liberties.

It is amazing that a single man’s act, that one blind man’s heroic act, can still change the dialogue in U.S.-China relations.  It is a hopeful reminder that in this globalized world, individuals still matter; that one man’s quest for freedom is still “news.”  And don’t think Chen’s act was not a heroic one.  Not only was a blind man able to find his way to Beijing, but imagine if he wasn’t; imagine if he was caught.  Likely his fate would match that of Gao Zhisheng, a rights defending lawyer who, while in government custody, remains missing.

The U.S. Government’s Actions Supported Human Rights

Some have criticized the U.S. government – or more aptly, the Obama Administration – for its dealings with the Chinese government over Chen.  Initially, the U.S. Embassy worked out a deal with the Chinese government whereby Chen would stay in China, study law at a university in a coastal city away from the thugs of his hometown, and be left alone with his family.  This was what Chen initially wanted.

But once he left the safety of the embassy for a Beijing hospital, Chen began to reconsider his options.  As Prof. Jerome A. Cohen recounted to CNN, the promised U.S. Embassy official was unable to stay with Chen at the hospital and once he began speaking other rights defending lawyers – friends he hadn’t been able to speak to for a year – he began to more clearly understand the increased oppression of rights defending lawyers in China.  Chen was scared; Chen realized that without full information, he misjudged the situation.  That’s when he vocally requested that he be able to leave China for the United States.

Were some in the U.S. Embassy a touch too naive to rely on the Chinese government’s promises?  Most likely.  But being naive is not the same as turning one’s back to human rights.  It was Secretary of State Hillary Clinton’s decision to allow Chen into the U.S. Embassy in the first place.  Chinese citizens cannot just willy-nilly enter the U.S. Embassy; even American citizens are allowed limited access to their embassy (which resembles a high-security prison).  As the N.Y. Times has recounted, embassy officials were notified of Chen’s flight to Beijing and on April 25, Secretary Clinton gave the authorization to sneak Chen into the embassy compound.  Secretary Clinton knew full well that by providing that approval, a throw-down with the Chinese government on the issue of human rights was certain and the ultimate outcome unclear. It is unfortunate – although not all together shocking given the current acrimonious status of politics – that Washington D.C. cannot view this moment as a proud one for America and its ideals; that the web of support that both parties have built for a human rights network in China over the years enabled Chen to come to our door.   Instead, it appears that what could otherwise be a proud moment for Americans, is becoming a political tug-of-war.

Who is Driving the Bus? The Chinese Central Government’s Lack of Control

What is perhaps the most shocking of all from this whole situation is the Chinese central government’s lack of control of local governments. Chen’s persecution has largely been conducted by the local government in his hometown, with local government officials still seething after his attempt to bring a lawsuit against them for forced abortions.  But even when Chen fled to Beijing, his safety could not be guaranteed, hence his changed desire to leave for the United States.  Many of his relatives left in their villages are being persecuted by local officials.  It makes one wonder – who really drives the bus in China?

Imagine a United States where Governor George Wallace could ignore federal law, have his way and continue segregation in his home state of Alabama.  Likely you can’t.  It’s unfathomable to think that a national government is unable to enforce its own laws, and in the case of China, that a supposed authoritarian dictatorship cannot control lower level party members.

Chen’s case reflects a center weaker than anyone previously thought.  And that is what is most frightening and should give people pause.  Does China really have the power to become a rising superpower or will it revert to its warlord past, where each city is governed by its own power broker and the central government remains impotent?

While China’s weakness appears to manifest itself often in human rights issues, it should not be just a concern for human rights advocates.  Anyone working in or with China – business people, government officials – should be troubled.  A weak center, especially as China undergoes an important leadership transition this year, does not bode well for China.

Prof. Jerome Cohen – The Fixer

On a final note, I want to focus on Prof. Jerome Cohen and his role in all of this.  As a research fellow for two years, I had the privilege of working

with Prof. Cohen at NYU’s U.S.-Asia Law Institute.  In that time, I got to know a kind, brilliant man who never ceased to amaze me.  It was Prof. Cohen who first identified the ingenuity and necessity of Chen’s unschooled, “barefoot lawyer” approach in 2003 and deservedly catapulted him to the world stage.

While my two years with Prof. Cohen were filled with inspiring moments, I have never been more proud of him than I was with his handling of the Chen Guangcheng situation.  While this is all purely based on hearsay, it appears that it was Prof.  Cohen who got the U.S. and China out of what was becoming a crisis situation.  Prof. Cohen’s lifetime of experience with China, including high-level delegations soon after Nixon’s visit to China in 1972, allowed him to realize that all that was needed was a practical solution where everyone could save face: a scholarship for Chen to study law at NYU’s U.S.-Asia Law Institute and invitation for his wife and children to join him.

Now we wait and see.  The United States has approved Chen’s visa application and just yesterday he applied for his Chinese passport.  Although the Chinese government could renege on the deal, that looks increasingly less likely and ultimately not in their best interest.  It’s never a satisfying moment when one of your citizens essentially seeks protection from a foreign government for human rights abuses, but on some level, the Chinese government is likely happy that Chen, who has long been a rabble rouser and a cause célèbre for other Chinese rights defenders and foreign friends, is leaving the country.  Unfortunately for Chen and his family, he will likely never be able to return to his home country.

The Obama Administration has a new China policy, or at the very least has gotten better at articulating it. In preparation for President Hu Jintao’s January 19 State visit, key officials in the Obama Administration outlined their goals for the U.S.-China relationship through a series of speeches last week. 

While Secretaries Tim Geithner and Gary Locke each focused on specifics (currency, market access, intellectual property), Secretary of State Hilary Clinton’s speech on Friday (click here for speech transcript) provided a new framework by which to view the U.S.-China relationship. Rest assured this isn’t the same soft China policy that accompanied President Obama on his visit to China in November 2009. 

In her speech, Clinton acknowledged the importance of the U.S.-China relationship to each country and the world at large. But while it values its relationship with China, the United States still has choices and the U.S. would “firmly and decisively” address its differences with China. Friday’s speech, which was also the inaugural Richard C. Holbrooke Annual Lecture, in honor of former State Department official and an important peace envoy (key player in the Dayton Peace Accords and envoy to Afghanistan), has already received criticism from China’s leadership.  

Clinton Announces a New Paradigm By Which to View China’s Rise

Perhaps the greatest obstacles in the relationship – at least for the U.S. – have been China’s currency manipulation and China’s protection of domestic industries at the expense of international trade rules and norms.  What the U.S. asks of China – to stop pegging its currency to the U.S. dollar and to open its markets to foreign competition in accordance with international standards – inevitably means that in the short-term, Chinese domestic companies will suffer.  By allowing its currency to float, Chinese exports will become more expensive, hurting the manufacturing backbone of its economy.  Opening its markets to more competition from foreign companies and products – particularly the government procurement market – could impair the development of many of China’s nascent industries. 

Needless to say, it has been difficult to find a convincing argument to make Chian’s leaders willing suffer short-term hurt. In the past, U.S. officials have repeatedly discussed how in the long-run these changes will eventually better promote China’s economic growth and power. But this appear disingenuous since in the short-term, it is the U.S. that will most greatly benefit from changes to Beijing’s current policies.  Additionally, telling Beijing what’s good for it in the long-run is sort of like parents telling their kids what is best. 

But Clinton’s speech took on a decidedly different approach and offers a more convincing, even slightly threatening argument.  Clinton did not bother with a “what is best for China” argument to try to convince the Chinese government; instead Clinton provided an entire new way by which to view China’s rise.  Clinton acknowledged the hard work of China’s people and the far-sightedness of its leaders in creating the world’s second largest economy in just over 30 years.  But Clinton also stressed the important role the United States played in China’s rise; without the United States, which guaranteed military security in Asia and equitable rules to govern the global economy, China’s current success would have been impossible.  

By tying China’s rise to the stability the United States provided in the region for the past 30 years, Clinton makes a much stronger argument as to why China’s leaders should make some changes on currency and market access – basically, these are the rules of the game that allowed you to succeed and now you think you can just change them? 

No rest for Robert Gates

The United States Will Remain a Pacific Power

But if logic isn’t enough to better protect U.S.’ interests, Clinton put China on warning that it is not the only fish in the sea.  Repudiating any notion of a G-2 relationship, Clinton gave a shout out to the other countries in the region, stating that the United States intends to remain a Pacific military power, strengthen its bonds with its allies in the region (e.g. Japan, South Korea, Philippines) and deepen its ties with developing Asian countries (e.g. India, Vietnam, Indonesia).

On some level, this should not come as a surprise to China.  This past summer, the United States involved itself in a long-running dispute between China and Vietnam over the control of a group of rock islands, stating that the U.S. has a national interest in mediating the dispute.  Additionally, recent bellicose developments on the Korean peninsula and China’s ambivalent response to the North’s unprovoked attack on South Korea, makes it apparent that the United States must maintain a strong military presence in the region.  China’s response shows that it is not yet ready to take on the responsibility of maintaining peace in the Pacific region since its loyalties to North Korea still dominate. 

Finally, Clinton noted that China’s non-transparent military build-up leaves one wondering what exactly are China’s intentions.  Military-to-military ties between the

 United States and China are at all-time low, mostly at the fault of China.  China’s military continues to shroud itself in secrecy and the recent visit of Secretary Robert Gates to China was a complete debacle.  While Gates visited with President Hu Jintao in Beijing, the People’s Liberation Army (PLA) tested – in a very public way – its own stealth fighter jet.  Hu’s admission that he was unaware of the PLA’s planned test fight, is not particularly reassuring.  Not only does the PLA continue its secrative military build-up, but it’s even a secret to China’s own President, making one wonder, what power does Hu still have?  If history is a guide, whoever is in charge of the Chinese military is in charge of China.  If not Hu, then who?

Getting Serious About Human Rights

Clinton was surprisingly blunt when it came to China’s human rights record and didn’t just portray human rights as a peculiar aspect of the American culture (see President Obama’s talk to Shanghai students in November 2009 for this approach).  Instead, Clinton emphasized the universality of certain human rights and highlighted the fact that China is a signatory to many United Nations human rights treaties.  The United States is not interfering with China’s domestic politics; instead the United States is merely requesting that China fulfill its human rights obligations, obligations it voluntary agreed to. 

But Clinton went further and mentioned specific dissidents, including the recent Nobel Peace Prize winner, Liu Xiaobo who is currently languishing in a Chinese prison; rights defending attorney Chen Guangcheng who since his release from prison has been subject to repeat police harassment; and missing rights defending attorney Gao Zhisheng.   Clinton stressed that as long as people like these three continue to advocate peacefully within the confines of the law, China should not persecute them.  Clinton poetically commented that the empty seat for Liu Xiaobo at last month’s Nobel Peace Prize ceremony symbolizes China’s unrealized potential.  Clinton stressed that these human rights are necessary to China’s success; freedom of speech is essential to fostering free thought that leads to technological and scientific advancement and a vibrant civil society addresses social-economic problems that are currently one the regime’s biggest fears. 

The Obama Administration has a new policy on China – it’s tougher, more logical and stresses the importance of human rights.  The Chinese government has already responded.  President Hu Jintao, in an interview with the Washington Post, commented that the United States should not interfere with the internal affairs of China. 

Wednesday’s meeting between Presidents Hu and Obama should prove to be perhaps some of the most important conversations in the U.S.-China relationship since Kissinger secretly visited Beijing in 1971 in preparation for President Nixon’s visit.

I used to think I was the only one who noticed the huge, weird, angry sign “Trenton Makes the World Takes” plastered on the Delaware Bridge just outside the New Jersey city of Trenton.  So imagine my surprise when this slogan was featured in Commerce Secretary Gary Locke’s speech about U.S.-China relations before the U.S.-China Business Council (USCBC) on Thursday.  For Locke, the manufacturing center of Trenton during the early 20^th Century is China today; it’s China that now makes and the world takes.

But the status quo must change Locke argued.  While noting some successful U.S.-China commercial relations, Locke raised the issue of market access in China, particularly in light of China’s indigenous innovation policies and its lax protection of intellectual property (which makes one wonder why didn’t he continue to play with the Trenton theme and say “China makes AND takes”; that would have elicited laughs from the USCBC for sure),  Between Locke’s speech, reprinted below, and Treasury Secretary Tim Geithner’s speech Wednesday, there is some serious saber-rattling coming from the American delegation in preparation of President Hu Jintao’s State visit next week.

Commerce Secretary Gary Locke Delivers Policy Speech

on U.S.-China Commercial Relations

Thank you John, for that kind introduction.  And thank you for having me here today.

We are today less than a week away from an important State visit by Chinese President Hu Jintao.

More than two decades ago, on my first trip to mainland China, I could not imagine that the U.S.-China relationship would eventually become so consequential.

Nor could I have imagined a scene like we witnessed a few days ago: Defense Secretary Gates joining together with his Chinese counterpart to stress the need for stronger military ties between China and the United States.

In 1989, I came in from Shanghai’s airport on a rickety, Russian-made bus, and stepped into that city’s dimly lit streets into a world very different than the one I left in the U.S.

There were swarms of bicycles – young men with their dates balanced on handlebars, grandparents pedaling to the market, boys and girls with white-knuckle grips on their parents’ shoulders. Bikes everywhere.

Shanghai then was a gritty, industrial city filled with low-rise buildings.

There were no skyscrapers. Few cars.

There was little sign of what was to come.

Today, Shanghai’s skyline is dotted by more than 400 skyscrapers.  Go to the Shanghai World Financial Center – one of the tallest buildings in the world – and you can stay at a Park Hyatt Hotel with a lobby on the 79^th floor.

Those bike paths I saw on my first visit have been replaced by elevated freeways shuttling people and commerce at a frenetic pace.

To see it is to be awed, and I am every time I go back to China.

The explosive growth in places like Shanghai has helped lift almost 200 million people out of poverty.  In the years ahead, hundreds of millions more Chinese citizens will join the middle class.

The United States welcomes this growth, because it’s good for the people of China; it’s good for the global economy; and it’s important for U.S. companies who offer world-class products and service, products and services that can improve the quality of life for the Chinese, while providing jobs for American workers back home.

With the U.S.-China Business Council’s help, this has become perhaps the most important bilateral trading relationship in the world.

China is the top destination for American exports, behind just Canada and Mexico.  And America is the number one national market for Chinese exports.

In the past 20 years, U.S. exports to China have increased by a factor of 12; imports from China have increased more than 30-fold.

However, we are at a turning point in the U.S.-China economic partnership.  Last year, China became the second largest economy in the world.  And the policies and practices that have shaped our relations over the past few decades will not suffice over the next few decades.

So today, I’d like to talk a bit about how we can move forward and ensure that we can unlock the full potential of the U.S.-China commercial relationship in the early 21^st century.

The gross trade imbalances between our countries are a good place to start, because they have the potential to threaten global stability and prosperity.

And I think a great illustration of that can be found in, of all places, Trenton, New Jersey.

Many of you have likely taken Amtrak up to New York, and when you pass by the Delaware River in New Jersey, you see that famous sign: Trenton Makes and the World Takes.

Well, replace Trenton with China, and you have a simplistic, but pretty accurate description of the global economy over the last few decades.

China and the United States benefited tremendously from this arrangement in recent years.

American consumers got an impressive array of low-cost goods.  And in its transition into one of the world’s top exporters, China was able to lift millions of its citizens into a fast-growing middle class.

But it’s not sustainable.  The debt-fueled consumption binge in developed countries like America is over.

And countries like China are beginning to realize that there are limits to purely export-driven growth.

That’s why we need a more equitable commercial relationship.  And it is within our reach.

The United States is doing its part to facilitate global adjustments by increasing private savings and exports, as well as taking steps to bring down its long-term fiscal deficits to a sustainable level.

And the Chinese leadership is making the rebalancing of its economy one of the cornerstones of its forthcoming five-year plan.

China is aiming to promote domestic consumption through a variety of measures, such as boosting the minimum wage for its workers and building an improved social safety net. Changes like these will hasten the rise of a middle class that wants the same cars, appliances, fashion, medical care and other amenities that have long been enjoyed by consumers in the Western world.

The Chinese government is also putting an intensive focus on strategic emerging industries, with more high-value work in areas like healthcare, energy and high technology.

And the Chinese have signaled that they want foreign businesses to help develop these sectors by entering joint ventures and by conducting more research and development in China.

This is assistance that U.S. companies are eager to provide, so long as China deals meaningfully with concerns about intellectual property protection, as well as a variety of other issues I will talk about later.

Such cooperative projects can serve as the foundation for a stronger economic relationship between China and the U.S.

But China’s long-term success at addressing the concerns of international businesses will help determine whether it realizes its economic vision – a vision in which China is a leader in innovation and a producer of higher-value goods and services.

Here’s the good news: we are already seeing examples of just how this future could play out, as our businesses and our governments collaborate to tackle some of the world’s greatest challenges.

Just look at what’s happening with the new Energy Cooperation Program that Secretary Chu and I announced while in China in October 2009 to promote more collaboration between Chinese and American companies on energy issues.  One of the founding corporate members of the program, Boeing, is partnering with Air China and Petro China to research a new generation of aviation biofuels that don’t rely on food crops.

If this venture is successful, it could reduce the carbon footprint of airplane travel, and avoid the negative impact that other biofuels have on the global food supply.

Or look at what’s happening with Duke Energy, one of America’s leading utilities, which has signed an agreement for joint research with China’s largest energy company, Huaneng, and with the Chinese government’s Thermal Power Research Institute.

Today, there are scientists and researchers shuttling between the companies and the research institute, working to develop cutting-edge solutions for cleaner-burning coal and carbon sequestration.

The Chinese and American governments are also working together on a variety of transportation issues, including how to spur the deployment of more high-speed rail.  China has embraced high-speed rail and has developed its infrastructure at a tremendous rate.  Starting from scratch, China has constructed and put into service over 4,000 miles of high-speed routes in the last decade – making China’s the longest high-speed rail network in the world.

In meetings last year, officials and experts from the Department of Transportation and China’s Railway Ministry met in Cambridge, Massachusetts, to share information on the development of high-speed rail standards.  And at the state level, the Chinese government has signed cooperation agreements with the State of California on its high-speed rail project to link Anaheim and San Francisco.

There is, however, a sobering side to U.S.-China commercial relations: For every story like Duke Energy’s or Boeing’s, there are many more that are never written.

When I talk to business leaders across America, they continue to express significant concerns – shared by business around the world –about the commercial environment in China – especially China’s lax intellectual property protection and enforcement, lack of transparency in government decision-making and numerous indigenous innovation policies that often preclude foreign companies from vying for Chinese government contracts.  These policies mandate that products must be made, conceived and designed in China.

It’s important to note that since China formally joined the WTO nine years ago, it has made important progress opening its market.  Tariffs have come down, private property rights are steadily evolving and great strides have been made to free the flow of commerce across China’s borders.

On balance, the competitive playing field in China is fairer to foreign firms that it was a decade ago.  And we commend the Chinese for that.

It is also not lost on countries in the West that on our march towards industrialization, we sometimes protected native industries with policies that today would mobilize an army of WTO lawyers in opposition.

But those policies were folly then, and they are surely folly now.  After World War II, the United States and a growing community of nations painstakingly built a global trading system based on the freer flow of goods, ideas and services across borders.

And the creation of the World Trade Organization in 1995 ensured that countries would be held accountable for their commitments to open markets and lower barriers.

China has benefited tremendously from this international trading system, especially since it joined the WTO in 2001.  The United States and other foreign nations have every right to seek more meaningful commitment and progress from China in implementing the market-opening policies it agreed to when it joined the WTO.

From our experience, there are usually five things that need to happen to turn these promises into reality.

It starts with the easiest step: a statement of principle from Chinese officials that action will be taken to solve a market access issue.

Next, that agreement has to be codified into binding law or regulations.

Third, the law or regulation needs to be faithfully implemented by the central government.

And fourth, it needs to be implemented at the local and provincial levels.

Only after all these things have happened can you arrive at the fifth, final and most important step, which is where this new law or regulation becomes a norm – an accepted way of doing business in China’s commercial culture.

When it comes to indigenous innovation, intellectual property or a variety of other market-access issues, an enduring frustration is that in too many cases only the earliest steps are taken, but not all five.

Perhaps an agreement is made, but it never becomes binding.  Or perhaps there’s a well-written law or regulation at the national level, but there’s lax enforcement at the provincial or city level.

A few weeks ago, the Commerce Department and the office of the U.S. Trade Representative welcomed Vice Premier Wang Qishan and other leading Chinese officials for the 21st Joint Commission on Commerce and Trade, where we worked through a variety of specific trade issues.

It was a productive meeting.  Vice Premier Wang and his team were responsive to our concerns and they pledged action in a variety of areas critical to American businesses.

They agreed to remove administrative and regulatory barriers discriminating against American companies selling everything from industrial machinery and telecom devices; to those that restrict U.S. participation in the development of large-scale wind farms in China.

They also agreed to revise one of their major government procurement catalogues to ensure a level playing field for foreign suppliers and to reduce the use of counterfeit software in government offices and state-owned enterprises.

Additionally, Vice Premier Wang asked the Commerce Department and the U.S. Trade Representative to partner with him on a public campaign to reduce intellectual property rights violations in China, which he is leading.

The American government welcomes these commitments from China.

But to be clear, they are only a first step.  What was agreed to at the JCCT were important statements of principle and policy – but they must be turned into concrete action with results.

Take last year’s JCCT, when the Chinese agreed to remove a local content requirement for wind turbine suppliers – a positive step forward.

But soon after, China’s government employed a rule that required foreign businesses seeking to build large scale wind farms in China to have prior experience with such projects in China.  The rule might have been different than the local content requirement, but it had the same effect – making it tougher for foreign companies to compete with China’s domestic companies.

At this year’s JCCT, we persuaded the Chinese to modify that rule as well.

Or look at the issue of intellectual property. We have heard Chinese leaders condemn IP-theft in the strongest terms, and we’ve seen central government laws and regulations written or amended to reflect that sentiment.

But American and other foreign companies, in industries ranging from pharmaceuticals and biotechnology to entertainment, still lose billions of dollars from counterfeiting and IP-theft in China every year.

For example, in the United States, for every $1 in computer hardware sales there is about 88 cents in software sales.  But in China, for every dollar in hardware sales there is only eight cents in software sales.

According to the Business Software Alliance, that discrepancy is largely explained by the fact that nearly 80 percent of the software used on computers in China is counterfeit.

So America welcomes Vice Premier Wang’s pledge to accelerate China’s crackdown on intellectual property violations.  And China will have a very willing partner in this endeavor in the United States.  But we will be focused on meaningful outcomes.

I recognize I’m not the first foreign official to express concern over the commercial environment in China.  But it would be a mistake to portray this concern solely as U.S. self-interest masquerading as advice.

The Chinese economy is increasingly moving up the global economic value chain, where growth is created not just by the power of a country’s industrial might, but also by the power of its people’s ideas and their inventions.

In the long run, economies with poor intellectual property protections and inconsistent application of market access laws will lose out on generating great new ideas and technologies.  And they’ll lose out on the jobs that come with producing new products – jobs critical to an expanding middle class.

The damage won’t happen overnight.  I freely admit that companies and countries can gain short-term advantages from lax rules in the commercial space.

But over time, if innovators fear that their inventions or ideas will be stolen or discriminated against, one of two things will happen – they’ll either stop inventing, or they’ll decide to create or sell their inventions elsewhere.

Ultimately, all that the United States seeks is a level playing field for its companies, where the cost and quality of their products determines whether or not they win business.

That is the ideal we strive for in the United States.

And our commitment to open and competitive markets is a big reason why we remain the number one destination for foreign direct investment in the world.

We understand that China’s modernization and evolution towards a more market-oriented economy is a process that will take time.

China has 1.3 billion people.  Seven hundred million of them still live in rural areas; many with little electricity or running water.  It took the United States over 100 years to build the electrical transmission capacity it has today.

To meet the rising demands of its own consumers, China will have to build a similar amount of capacity in just 15 years.

These are enormous undertakings.  And it’s understandable if, in the past, China’s immediate development goals took precedence over other concerns.

With millions of Chinese coming in from the countryside looking for work, it isn’t necessarily an easy decision to close down a factory producing counterfeit goods, when that factory is providing badly needed jobs.

So what we’re discussing here are real and significant challenges. For market reforms to continue, it will take constant vigilance – not just from the United States, but from all countries and businesses around the world that benefit from rules-based trading.  And from Chinese business and government leaders, who themselves have a strong stake in ensuring that China is friendly to global innovation and international competition.

In front of us is the opportunity for China and the United States to lead the world economy in the early 21st century to create a new foundation for sustainable growth for years to come.

We can’t tell exactly what that future will look like.

But we can be certain that it will be a better future if the Chinese and American governments pursue cooperation over confrontation in the economic sphere.

Cooperation that will put millions of our people to work.

Cooperation that will develop technologies to solve the most pressing environmental, economic and social challenges facing the world today.

This is the great opportunity before China and the United States.  We just have to seize it.

Thank you.

###

Originally Posted on the Huffington Post.

Beijing, China – A certain excitement has lighted the streets of Beijing in anticipation of President Barack Obama’s maiden visit here this week.  Not only has the capital experienced two days of clear blue skies, a rarity in a city that is usually encased in a yellow, gritty smog during the cold winter months, but there is an electricity in the air as everyone discusses President Obama’s visit – from the formal news casters on TV analyzing the potential agenda to the famously earthy taxi drivers complaining about the potential traffic nightmare.

But like President Obama’s fan base back home, the young in China are especially keen on his visit.  And the President is acutely aware of this fact.  On Monday, his first day in China, President Obama will meet with a group of Chinese college and graduate students in Shanghai, to listen to their opinions and answer their questions.  What do these students think of President Obama?  What questions or recommendations will they have for the President?

In talking to a group of graduate students from the China University of Political Science and Law, one of Beijing’s most prestigious universities, President Obama’s rise to power has filled them with the hope that the impossible, or at least the improbable, is achievable.  “He gives young people encouragement.  If you work hard, you can obtain a high position….it’s the American Dream.” said Xie Jinbao (pronounced Syeh Gin-bao).    “For many, it is very dream-like” explained Liu Huisheng (pronounced Leo Hway-sheng), while cautioning that only those who care about politics have been paying attention.  “In general though my friends are neutral [about President Obama].”

In pinpointing the source of this hope, the Chinese students spoke more frankly than their American counterparts on

one subject in particular: President Obama’s race.  “He’s America’s first black president” Li Siming (pronounced Lee Tsi-ming) offered excitedly, “it makes young people very excited.”   “America was able to elect a black president, it shows that it has a certain openness” said Dong Jianjun (pronounced Dong Geeann-june).  The students also derived inspiration from the multicultural nature of the President’s cabinet, mentioning by name, at least their Chinese names, the appointment of Chinese-Americans including Commerce Secretary Gary Locke, Energy Secretary Steven Chu and Cabinet Secretary Chris Lu.  “In China, this could never happen; a foreigner could never work in the administration” said Xie Jinbao.

For the students, many who have little recognition of a world before President George W. Bush, President Obama represents a new approach to the global order, an approach that they eagerly look to be a part of.  “He is much better than Bush” Xie Jinbao said.  “Bush believed in unilateralism, but Obama supports multilateralism.”  At a time when many western observers question China’s commitment as a collaborator on the world stage, Li Siwei (pronounced Lee Tsi-way) seemed to imply her generation’s eagerness for greater responsibility: “Obama is willing to work with other countries, there will be more cooperation.”

But even though the term superstar was used repeatedly to describe President Obama and student Liang Xuanjing (pronounced Leeang Syuan-jing) was in awe of President Obama’s charisma, there were words of caution.  “Confucius had a saying ‘If a person is too perfect, we will have doubts’” Liu Huisheng said, noting that perhaps President Obama’s speeches are a bit “too perfect.”  Dong Jianjun echoed this sentiment: “Compared to presidents like Roosevelt or Kennedy, Obama has similarly great charisma…but we have yet to see if his [Obama’s] policies will be effective.”  Like many Americans, these Chinese students are looking for President Obama to follow through on the promises of his speeches.  In a relationship as close as the one between China and the U.S., President Obama’s actions, or lack of action, directly impact China and many of these Chinese students’ futures.

Not surprisingly though, many of the topics that the students would like Presidents Obama and Hu Jintao (pronounced Who Gin-tao) to discuss are the same as their U.S. contemporaries – international trade and the ever escalating tariff war topped the list for these students.  But so did the issue of climate change and energy efficiency as well as the economic recovery.

China’s youth are not that different from the young back home – they share the same hope that Presidents Obama and Hu can make the world a better place and they express an eagerness for a new world order where the U.S. and China can work through their issues.  But like their American brethren, if Presidents Obama and Hu cannot solve many of today’s problems, including the economic crisis, climate change, and an increasingly cantankerous trade relationship, it will be their generation that will be left holding the bag.

Last week, U.S. Secretary of Energy Steven Chu and U.S. Secretary of Commerce Gary Locke visited Beijing.  Much of their discussion with Chinese officials, as well as the focus of Secretary Chu’s speech at Tsinghua University, revolved around climate change and preparation for the U.N. Climate Change Conference in Copenhagen this December.  Both the NY Times and the Associated Press

reported on Chu and Locke’s visit.  During their visit, the U.S. and China agreed to jointly fund the Clean Energy Joint Research Center, with $15 million provided up front.

While the Clean Energy Joint Research Center is certainly a step in the right direction, especially in light of the technical capacity issues that China currently faces in curbing greenhouse gas emissions, talks between China and the U.S. on a potential agreement on climate change have still not progressed forward.  Copenhagen is less than five months away and it appears that the U.S. and China, the world’s two largest emitters of greenhouse gases, have made little progress in coming to any agreement.  China still continues to maintain trade barriers to U.S. clean energy companies, shielding their own nascent clean energy industry from global competition, and potentially hindering its own technological capacity.  However, with the new tariff provision in the House’s Clean Energy Bill, the U.S. has less standing to argue against China’s protectionist policies.

In similarly frustrating turn of events, Indian officials, in an unexpected statement to U.S. Secretary of State Hillary Clinton during her visit to India, announced today that they remain opposed to any binding requirements on developing nations to reduce their carbon dioxide emissions.

Have climate change talks stalled?