Moreover, the International Security Assistance and Arms Exports Control Act of 1976 gives Congress the right to determine whether the United States should reduce or end security assistance or arms sales to a country found to be seriously violating human rights. The law seems to apply to any future U.S. arms sales to the People's Republic of China-a policy proposed by some Americans. Thus, unless the law is amended, the status of human rights in the People's Republic of China will have a bearing on whether or not U.S. arms can be sold to the Peking Government. 4. Restrictions on possible U.S. aid and credits to the People's Republic of China In the wake of normalized United States-People's Republic of China diplomatic relations, legislation may be called for to ease current restrictions on the provision of U.S. aid and credits to the People's Republic of China. Thus, for example, provisions of Public Law 480 appear to prohibit assistance provided for in the law from being granted to Communist countries, including China. The Foreign Assistance Act of 1961 also limits the furnishing of almost every type of assistance provided for in the act to "friendly countries." However, the act does not explicitly define the term. There is a specific ban on furnishing any assistance covered by the act to any communist country unless the President issues a very narrowly defined waiver. Exempt from this ban is assistance for famine and disaster relief, and assistance to schools, libraries, or medical education and research hospitals sponsored by U.S. citizens. Also exempt, upon the President's waiver in the national interest, are programs administered by the Overseas Private Investment Corporation (OPIC), which provides investment guarantees to U.S. firms investing abroad. Such waivers were granted for Yugoslavia and Romania in March 1972. The Export-Import Bank Act of 1945 as amended, prohibits any credit transaction by the bank directly or indirectly involving a communist country, unless the President determines that such transaction is in the national interest. Moreover, Eximbank credits may not be granted to non-market countries which curb their citizens' right to emigrate. NORMALIZATION OF RELATIONS WITH THE PEOPLE'S REPUBLIC OF CHINA: PRACTICAL IMPLICATIONS Global Implications of Normalization SEPTEMBER 20, 1977 HOUSE OF REPRESENTATIVES, COMMITTEE ON INTERNATIONAL RELATIONS, Washington, D.C. The subcommittee met at 1:20 p.m. room 2212, Rayburn House Office Building, Hon. Lester L. Wolff (chairman of the subcommittee) presiding. Mr. WOLFF. The subcommittee will come to order. I am sorry that we are late in starting. My apologies to our panel and our guests here today. We did have a very important vote on the floor as to whether or not we should increase our office space. [Laughter.] It took precedence over whether or not we should have normalization of relations with the People's Republic of China. This is the opening hearing of a seven-part series of the Subcommittee on Asian and Pacific Affairs on the practical implications of normalization with the People's Republic of China. We intend in the coming weeks to examine the obstacles and possible solutions to the normalization dilemma as well as the anticipated effects on trade, foreign affairs, laws, treaties and other key questions of normalization with the PRC. The hearings are intended to serve as a followup to work done by the subcommittee and its predecessor, the Future Foreign Policy Subcommittee, which held a nine-part series in 1975-76 on the triangular relationship between the United States, the U.S.S.R., and the PRC. As in the public debate now going on, a key question in 1975-76 was whether or not to normalize with the PRC at the expense of breakingrelations with the Republic of China, Taiwan. While this vital question will no doubt be raised in context in the coming weeks, let me stress that this year's series of hearings will focus on a hard look at the practical implications of normalization, when and if it is attempted. The hearings are based on the premise that since the Shanghai Communique was signed in 1972, the official policy of the U.S. Government has been to pursue, if possible, normalization of relations with the People's Republic of China. The present series is particularly designed to examine the practical implications of normalization for the Congress and the executive branch, which would have to react to a number of changed circumstances in various treaty and trade relationships. It is the subcommittee's hope that these hearings will help the Congress prepare in advance for a possible policy occurrence, rather than see the Congress put in its all too familiar position of reacting to a policy after it has been announced, as is presently the case with the Panama Canal. The subcommittee is privileged to welcome today's panel of witnesses, distinguished scholars of Asian and world affairs, who have been invited to open the series by placing the normalization process into a global perspective. Subsequent hearings on particular details of normalization will, I am sure, benefit from the broad picture which we will paint today. Let me stress that I do not expect us to settle any of the major issues before us today. I do not think we have that magic wand with which to wave away all of the problems and bring in the solutions. Rather, this opening hearing will deliberately seek to identify the major themes raised by the issue of normalization, and to set the stage for the detailed hearings which will follow. I might say at this point that I am going to ask our colleagues Mr. Beilenson and Mrs. Meyner to sit in the Chair from time to time during these hearings, because I have been appointed by the President to serve as the congressional delegate to the General Assembly session in New York, therefore I will be dividing my time. I felt that it was important for me to be here today to chair this opening hearing on normalization of relations with China rather than to attend the ceremonial proceedings that also take place at the General Assembly today. In line with that, let me conclude my remarks by welcoming on behalf of the Asian Affairs Subcommittee, Doak Barnett of the Brookings Institution, Allen Whiting of the University of Michigan, Nathaniel Thayer of Johns Hopkins, and Robert Scalapino of the University of California at Berkeley. We are very happy that you gentlemen have taken the time out of a very busy schedule to come and join us in trying to push through this maze of information that pervades this question, and to try to sort out what is important, what is in the national interest, and what is in the world interest. I would ask Mr. Barnett to proceed first. STATEMENT OF A. DOAK BARNETT, SENIOR FELLOW, THE BIOGRAPHY A. Doak Barnett was born in Shanghai, China, in 1921, and spent his childhood there. He graduated from Yale University in 1942, Summa Cum Laude. He later received an M.A. from Yale. He returned to China in 1947 as a correspondent and has been a frequent visitor since then. During the 1950s, Barnett held a variety of governmental, scholarly, and journalistic positions in the United States and in East Asia. From 1961 to 1969 he was a professor of government at Columbia University, where he headed the University's Contemporary China Studies program. In 1969 he joined the staff of the Brookings Institution in Washington. He is the author of numerous books including "China After Mao," "A New U.S. Policy Toward China" and "Uncertain Passage: China's Transition to the PostMao Era". Mr. BARNETT. Mr. Chairman, let me express my appreciation for the opportunity to take part in these hearings. I think the United States faces some very important and difficult issues in China policy in the months immediately ahead, and it is extremely important that the public as well as the Congress be fully aware of what is at stake. I have submitted a fairly long written statement, but I am told that I can have about 10 minutes to highlight some of the main points. That is what I will do. Mr. WOLFF. Please proceed. Mr. BARNETT. In 1972, the United States and the People's Republic of China began the process of "normalizing" our ties. This process is far from completed, however. Our present relationship remains very limited, and unless it is consolidated it could easily retrogress. President Carter has affirmed his intention to improve United StatesChina relations, but he apparently feels he must delay action in large part for political reasons. This is understandable, but in many respects it raises disquieting questions. If the Carter administration postpones the key decisions on China policy over an extended period, the issues involved could again be caught up in domestic political controversy, either in the United States or in China or in both, thereby preventing full normalization of United States-China ties with Peking. My own judgment is that United States-China relations are now at an important turning point. The central issue we must face is whether or not we are willing to downgrade our ties with Taiwan, converting them from official to nonofficial links, and let our security treaty with the Nationalists lapse, to make possible the consolidation of our ties with Peking. In short, the choice we must make is which Chinese government we will recognize and deal with as the Government of China. The People's Republic of China on the mainland and the Republic of China on Taiwan do not today constitute two states, as many Americans appear to assume. They are competing governments, both of which still claim to be the government of all China. The Chinese civil war has not yet been formally ended. No matter how much Americans try to ignore the fact, the United States has been deeply involved in a civil war in China for roughly three decades, and the Chinese refuse to forget it. TWO CHINAS REJECTED To this day, neither Chinese regime has accepted the concept of two Chinas. Each has insisted that it is the only legitimate government and that no other country can maintain formal relations with both. Therefore, the necessity to choose which of the two regimes to recognize formally has been imposed on the United States, as on all other countries, by the Chinese themselves, including those in Taiwan as well as those in Peking. This is the background to Peking's insistence that if the United States wishes to establish full diplomatic relations with the People's Republic it must, like all other governments, sever formal diplomatic relations and our defense treaty-with the Nationalist regime. More than a hundred other nations, including all of our major allies. have already taken this step. There was a period in the fifties and sixties when, if the Nationalists had attempted to achieve recognition as a separate state it conceivably might have achieved this. Much of the international community could have supported the idea of two Chinas at that time. This disappeared as a realistic option, however, in 1971 when Peking was seated in the United Nations and the overwhelming majority of nations shifted recognition to the People's Republic of China. If we were now to opt for a two-China policy, we would be virtually alone and in effect would be choosing relations with Taiwan instead of relations with China. Some opponents of normalization argue that the Chinese Communist leaders must not take United States-China relations very seriously if they refuse to compromise further on Taiwan. The fact is that, from their perspective, they already have compromised substantially. They are not asking the United States to abandon Taiwan by cutting de facto ties with the island. They have made it clear that they are prepared to accept a continuation of the substance of U.S. economic and other nondiplomatic relations with Taiwan, as they have in the case of Japan. UNOFFICIAL TIES Shifting from official to unofficial ties in our dealings with Taiwan would in no sense constitute abandonment of the island and its people. It is clear that even after normalization of relations with Peking we not only can but must continue important economic relationships with Taiwan, and we must make it clear that, even without a formal treaty, we will still oppose the use of force in the Taiwan area and insure that Taiwan has access to the arms needed for its defense. There is every reason to believe that Taiwan will be able to survive and prosper after the shift in our formal relations. The Nationalist regime has a strong economy. Peking lacks the amphibious capability to seriously threaten the island. Moreover, the Chinese will be deterred from considering actual attack on Taiwan by many political as well as military factors. Because of all of these realities, Peking is prepared to be patient about working for actual reunification. It is not likely to be patient indefinitely, however, in waiting for Washington to transfer formal recognition. Chinese leaders believe that the United States committed itself, in the Shanghai Communique, to move to establish formal diplomatic relations with them and alter its relations with Taiwan. Teng Hsiaop'ing's recent comment on Vance's trip indicates they are still impatient. Because of the enormous symbolic significance of Taiwan's formal status in their eyes, they will almost certainly regard our willingness or unwillingness to complete the normalization process as a crucial indicator of how seriously the United States takes relations with China. The long-run future of the island will not be immediately solved by any proposed U.S. policy. There simply is no immediate solution. Shifting ties from Taiwan to Peking will not determine whether Taiwan will eventually be reassociated with China or will try over time to establish some sort of separate status. The island's future will take |