U.S. and Hong Kong (1999)

President Clinton's Press Conference, December 8

Following is the White House transcript:

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THE WHITE HOUSE
Office of the Press Secretary

December 8, 1999

PRESS CONFERENCE BY THE PRESIDENT
Dean Acheson Auditorium
The State Department
2:36 P.M. EST

[ ...Intervening Text... ]

Q: Mr. President, some of your critics have suggested that the reason that you pressed the issues of the environment and labor at the WTO meeting in Seattle is to benefit the Presidential candidacy of Vice President Gore, knowing that there might be a backlash from the developing nations. How do you respond to that?

THE PRESIDENT: That's wrong. And I would like to make two comments -- one on the WTO ministerial meeting, and secondly on that general issue.

The Uruguay Round was launched in 1986. The trade ministers started trying to launch it in 1982. It took them four years to get it off the ground. The fundamental reason a new round was not launched here had, in my judgment, very little to do with my philosophy of trade, which I'll talk about in a moment. There were -- the big blocks here were the Europeans and the Japanese, on the one hand -- the United States and the developing nations, we all had positions that couldn't be reconciled. The Europeans were not prepared at this time to change their common agricultural policy, which accounts for 85 percent of the export subsidies in the world. The Japanese have their own agricultural and other issues to deal with.

The United States was not prepared to change its policy on dumping, because -- and I think the recent Asian financial crisis justified that, I might add. Even though we did finally move under our dumping laws, and we had to move, to try to keep our steel industry, which took down 60 percent of its employment and modernized during the '80s and the early '90s, we still bought 10 times as much steel during that crisis as the Europeans did.

The recent WTO agreement we made with China protects us from surges and unfair dumping. We have the largest trade deficit in the world. Now, we get a lot of good out it -- we get low inflation, we get goods from all over the world. But there has to be some sense of fairness and balance here.

And the developing nations, for their part, felt that they had not yet gotten enough benefits from the last trade round and the entry into the WTO. They think that we and everybody else -- the Europeans, the Japanese, everybody -- they think we ought to have more open markets for agricultural products, which doesn't affect America so much, and for textiles, which does affect us. That's the big issue being negotiated still with the Caribbean Basin and the Africa Trade initiative.

So it's very important that you understand that there were real differences that we thought we could bridge, unrelated to labor and the environment, which we couldn't; and which I think would have been clearer, but for the backdrop of the demonstrations in Seattle over these other issues.

Now, to your second question. When I ran for President in 1992, and the big issue being debated was NAFTA, I said that I wanted to be for NAFTA, I would fight hard for it, but I felt strongly there ought to be provisions on labor and the environment in the agreement. And those provisions were included. I have always had what I guess you would call a third way position on trade. I think the position of Americans, including some in my party, that trade is bad for America and bad for the world, is just dead wrong.

I think that the world is more prosperous and I know America is more prosperous because of the continuing integration of the world's economy and the mutual interdependence of people, and people being able to produce what they produce best in a competitive environment -- including costs. And I think we benefit, not just from our exports, but from the imports. That's what I believe. I believe we will have both a more prosperous and a more peaceful world if we have more of the right kind of globalization.

I read -- one of the many, many articles that's been written in the last several days in the aftermath of Seattle pointed out that many of the world's most troubled places -- the Balkans, the Caucasus, Africa, to some extent the Middle East -- suffer because they have too little economic interconnection with the rest of the world.

I believe, even though I'm proud of the role that we've played and especially proud of the role George Mitchell played in the Irish peace settlement, I think it is unlikely that we would have done that if, also, Ireland didn't have the fastest-growing economy in Europe and Northern Ireland weren't growing and people didn't imagine that they could have a totally different life if they just let go of what they've been fighting over.

So the people who don't believe that trade is good, I just think they're wrong. Now, having said that, I think that as the world grows more interdependent, it is unrealistic to think that there will be an international economic policy with rules unrelated to an emerging international consensus on the environment, and an international consensus on labor. That does not mean that I would cut off our markets to India and Pakistan, for example, if they didn't raise their wages to American levels. I know that's what the sort of stated fear was. I never said that, I don't believe that.

But I think that -- let me give you an analogy. Several years ago, the Europeans did this, and I applaud them -- they were actually the impetus for protecting intellectual property more than the United States was -- and people debated that for years -- why, intellectual property has no place in trade bills. Who cares if people are pirating books and selling them for 60 cents apiece when they cost $20 somewhere else. And now, we just take it as a given.

And it's a good thing for the United States. You think about all the software we're exporting, all the CDs we're exporting, all the things -- intellectual property is a big deal to us now. It was just as alien a subject a few years ago to trade talks as questions of labor and the environment are today.

So I think I've got a good position here. It has nothing to do with this campaign. It's a position I've had for years. And I believe the world will slowly come to it. We do have to be sensitive to the developing countries. We cannot say that, you know, you're out of here because you can't have the same labor environment we do. But we also have to -- all we ask for was to start a dialogue within the WTO on trade issues. On the environment, all we ask is, is that the decision-making process not degrade the environment when countries have environmental policies and interests, and just blithely override them because there's an immediate, short-term economic benefit.

I think that's right. And I believe that 10 years from now, somebody Will be sitting here, and we'll all take it for granted that we've Come a long way in integrating trade and the environment -- I mean, Trade and labor. That's what I think, and that's what I believe.

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Q: You're ending a tumultuous year that began with impeachment and closed with tear gas in Seattle. Could you tell us what you're proudest of this year, and what events or accomplishments of yours that you're the least proud of?

THE PRESIDENT: Well, I'm very happy -- what I'm proudest of is that it turned out to be a very productive year. If you look at -- I'll just mention them again. I did before, but -- we wound up, after a year in which almost nothing was accomplished in the Congress, we wound up with a recommitment to the 100,000 teachers, to the 50,000 police. We passed the financial modernization bill. We passed an historic 60,000 -- housing vouchers to new people from welfare to work. We passed the bill to give disabled people the right to take health care into the workplace. We doubled after school funding. We passed this fund that I've been pushing hard for, for a long time, to help the states turn around or shut down failing schools. We had quite a lot of accomplishments.

On the foreign front, we had the China-WTO agreement; progress with the Middle East peace; the Northern Ireland peace agreement; Kosovo,

which I am very, very proud of. I still believe our country did the right thing there. And we've got talks starting on Cyprus now. We've got a Caspian pipeline agreement, which I believe 30 years from now you'll all look back on that as one of the most important things that happened this year.

We had the Conventional Forces in Europe agreement with Russia, which will result in the removal of their forces from Georgia and Muldova. We had the debt relief for the poorest countries in the world, something I'm immensely proud of and deeply committed to. We made a big dent in our U.N. arrears issue. And we have worked with North Korea to end their missile program. So I'm very proud of what happened this year.

What I'm most disappointed in is what still got left on the table. I'm terribly disappointed that we still haven't passed a patients' bill of rights; that we still haven't raised the minimum wage; that we still haven't passed hate crimes legislation; that we still didn't pass that common sense gun legislation, which was crying out for action after what happened at Columbine -- and we had another school incident this week.

I am disappointed that we didn't pass the school construction bill. I'm hoping will pass the New Markets Initiative next year. If we don't do something now to bring economic opportunity to the areas of this country which have been left behind, we will never forgive ourselves. And I'm profoundly disappointed that we still haven't done anything to take the life of Social Security out beyond the baby boom generation, and extend the life of Medicare and add a prescription drug benefit.

So my only disappointments are what we didn't get done. But I'm gratified by what was accomplished.

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Q: Mr. President, with China building a second short-range missile base, allowing them to take Taiwan with little or not warning, are you concerned about America's ability to defend that island, especially with a Chinese company taking over the Panama Canal's ports at the end of this month?

THE PRESIDENT: Well, let's talk about the Panama Canal and then I'll come back to Taiwan. And to be fair, I think I may have misstated this earlier. It's important for the American people to understand that the Canal, itself, will be operated and controlled entirely by the government of Panama, through the Panama Canal Authority. That is the locks, ingress and egress, access, openness -- the Canal is completely and totally within the control of the Panamanians.

Now, the Hong Kong company which got the concession to operate the ports will be responsible for loading and unloading ships. They also do this in three or four ports in Great Britain. It's one of the biggest companies in the world that does this. The managing director is British. Most of the employees will be Panamanian. So I feel comfortable that our commercial and security interests can be protected under this arrangement. That's the first question.

Now, the second question is, China is modernizing its military in a lot of ways. But our policy on China is crystal clear. We believe there is one China. We think it has to be resolved through cross-strait dialogue, and we oppose and would view with grave concern any kind of violent action. And that hasn't changed.

There has been a lot of buildup of tension on both sides that I think is unnecessary and counterproductive. If you look at the amount of Taiwanese investment in China, for example -- that goes back to my Irish example -- if you look at the Taiwanese investment in China, it's obvious that eventually they're going to get this worked out because they're too inter-connected by ties of family and, increasingly, by ties of the economy, and the politics of neither place should lead either side into doing something brash. And I hope that this will not happen. But our policy is clear and you know what I've done in the past. And I think that's all I should say about it right now.

[ ...Intervening Text... ]

Q: Mr. President, one of the things left on your plate for next year is pushing the historic trade agreement with China on Capitol Hill. China's labor standards are clearly not what you and the world community would wish for. And the question is, will it be difficult for you to sell that to members of your own party in Congress? And, more broadly, what do you think are the prospects for Congress approving the WTO accord with China?

THE PRESIDENT: Well, in our caucus some are for it, some are against it, and some have questions. We have a good deal of support for it and a good deal of opposition to it, and then some have questions. But I'm going to make an all-out effort to pass it. And I'll come back to your labor question in a minute.

I think it is plainly in America's interest. We gave up nothing, in terms of market access, to get this. It's very important that you understand that. What we gave in this was our assent to China's joining the WTO. What we got in return is much more market access on everything from farmers to people in the telecommunications industry. This is a huge economic benefit to the people of the United States. Plus, we have a big and growing trade deficit with China. We've got specific protections on dumping and anti-surge protections. So it is in the economic interest of the United States.

Secondly, it is in the strategic interest of the United States. One of the great questions of the next several decades, as China's economy grows to match the size of its population, is whether China and the United States will have a constructive relationship or be at odds. I believe that, just as we worked together in the United Nations, even though we sometimes disagree, we will work together in the WTO. I think having China in a rule-based system for the international economy is profoundly important. And I think it would be a terrible mistake not to do it.

Now, do I agree with all their labor standards? No. But we shouldn't impose conditions on membership on China that we don't impose on any other country to get into the WTO. What we should do, in my judgment, is to go back to the American position. We ought to begin a dialogue on these labor initiatives within the WTO -- that's all we ask for -- and then we ought to get everybody to ratify the International Convention on Child Labor and observe it, and deal with the other most egregious forms of labor abuses in the world. That is the right way to proceed here.

Last question.

[ ...Intervening Text... ]

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