To the surprise of many, Business Week has long supported the legitimate role of organized labor in the economy. So it is with dismay that we say the labor movement's intense opposition to granting China a permanent normal trade relationship with the U.S. and its opposition to free trade in general appears increasingly selfish and shameful. In the guise of caring about the human rights and working conditions of Chinese people, unions are behaving with blatant protectionism. Of course, unions are entitled to lobby Congress however they see fit. But dressing up their protectionism in sanctimonious blather is too much to stomach.
The truth is that 20 years of open markets and foreign investment has transformed China, creating a large middle class, new entrepreneurs, and a society where people are free to move about. Compared to Mao's era, when the state controlled everything and everyone, the independence of average Chinese has increased immensely.
Only fools could fail to see that China remains a dictatorship. It suppresses democracy and discourages religion. With communism dead as an ideology, the ruling elite uses strident nationalism to generate support among China's masses. Its demand that Taiwan become part of China puts Beijing in direct opposition to the U.S., which is pledged to protect the vibrant market democracy from a military takeover.
Economic isolation is not the solution to these problems. Trade, investment, and free markets can only bolster the forces that historically have led to elections and true democracy, as they have in South Korea and Taiwan. Nor is protectionism the answer to organized labor's problems. Granting China permanent normal trade relations, paving the way for its entry to the World Trade Organization, would bolster growth and jobs in the U.S., even as less competitive industries suffer.
China has, in effect, already joined the WTO. What's left for the U.S. is to benefit from its lower tariffs and more open markets or leave that chance to Japanese and European rivals. If labor wants to protect its members' jobs at the expense of other workers at home or overseas, it should just drop the hypocrisy about human rights.
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