Are Economic Sanctions an Effective Tool for Realizing U.S. Interests in China?

Disappointment over China’s human rights record, concerns about the U.S. trade deficit, and speculation about the possible involvement of the Chinese government in campaign financing have intensified the debate over U.S.-China policy. An increasing number of critics from both the left and the right are clamoring for a tougher stance toward China, one that relies more on threats and sticks and less on constructive engagement and carrots. So far, economic threats, not military ones, have garnered the most favor with China critics, although the sensationalist title of a new book, The Coming Conflict with China, seems to suggest that a call for military threats might not be far behind.

On the economic front, two kinds of actions have been proposed. The first is the threat of imposing sharply higher tariffs on imports from China by revoking its most-favored-nation (MFN) trading status. This year, advocates of MFN revocation from the human rights community have been joined by those who would like to see higher tariffs on China as a means to cut the U.S. trade deficit and those who would like to condition renewal of MFN for China on its behavior toward Hong Kong. A second economic action favored by China critics is the threat of impeding China’s accession to the World Trade Organization (WTO) by imposing conditions or approval procedures for China that are tougher than those applied to other WTO members. In this instance, diehard opponents of the WTO have been joined by those who would like to postpone or block China’s membership altogether.