The New York Times
HEADLINE: A.F.L.-C.I.O. To Press Bush For Penalties Against China
BYLINE: By STEVEN GREENHOUSEand ELIZABETH BECKER; Steven Greenhouse reported for
this article from New York and Elizabeth Becker from Washington.
DATELINE: WASHINGTON, March 15, 2004
The A.F.L.-C.I.O. will file an unusual trade complaint on Tuesday to press
President Bush to punish China, which it asserts has gained a commercial
advantage through violating workers' rights by suppressing strikes, banning
independent trade unions and not enforcing minimum wage laws.
Timed to maximize pressure on Mr. Bush as the presidential campaign heats up,
the complaint asserts that the United States has lost up to 727,000 factory jobs
because the labor violations it cites artificially lowered China's production
costs and unfairly undercut American companies.
The A.F.L.-C.I.O. argues that this illegal repression of workers' rights
translates into a 43 percent cost advantage on average for China.
"This will put the onus on the Bush administration to explain that China is
not repressing workers' rights, and to me that is an extraordinarily difficult
case to make," said James Mann, a China expert at the Center for Strategic and
International Studies. "The record going back for decades is that China has
intensely resisted independent trade unions, and I don't see how the
administration can pretend otherwise."
This is the first case ever brought under the Trade Act of 1974 that seeks
penalties over violations of workers' rights. Some trade experts said the
complaint could be vulnerable to challenge at the World Trade Organization
because global trade rules do not protect labor rights.
Concerned about the loss of nearly three million factory jobs since January
2001, the A.F.L.-C.I.O. is asking President Bush to impose punitive tariffs of
up to 77 percent on China or to elicit a pledge to halt all such violations.
Union leaders warned that rejecting the complaint would anger millions of
American workers, especially in Midwestern battleground states where factory
workers have been hit especially hard.
"American workers are suffering, they're losing their jobs, they're losing
hope," said Barbara Shailor, the A.F.L.-C.I.O.'s director of international
affairs. "At the same time, Chinese workers are suffering under repressive
conditions and are denied their most fundamental rights. Unless some action is
taken to remedy this, we will see a continued hemorrhaging of jobs in the United
The complaint comes as the Bush administration prepares for next month's
visit to Washington by China's vice premier, Wu Yi, who will discuss trade and
commercial conflicts between the two countries.
The A.F.L.-C.I.O., which represents 13 million American workers, plans to
file the complaint under Section 301 of the trade act, which makes it an unfair
trade practice for countries to violate internationally recognized workers'
President Bush will have 45 days to decide whether to let the complaint
proceed. If he lets it go forward, the International Trade Commission will have
a year to rule on it. Trade experts said China would undoubtedly be angered if
Mr. Bush allowed the complaint to go forward.
A spokesman in the office of Robert B. Zoellick, the United States trade
representative, declined to comment specifically on the complaint, saying it
would be inappropriate until the office had reviewed it. However, the spokesman
said in a statement, "The United States is a leader in promoting internationally
recognized labor standards and human rights globally, especially in countries
where those standards are not fully upheld."
To buttress its position, the A.F.L.-C.I.O. cited the State Department's
latest annual human rights report, which states that China "continued to deny
internationally recognized worker rights" and has slid backward on arresting
The Chinese Embassy in Washington did not respond to telephone inquiries.
G. Hamilton Loeb, a lawyer who often represents China, said the unions'
efforts would ultimately fail because global trade rules do not protect workers'
rights and also bar one country from unilaterally punishing another over an
issue not covered by those rules.
"China takes its World Trade Organization commitments very seriously, but the
W.T.O. standards do not extend into these labor issues," Mr. Loeb said.
Senator John Kerry of Massachusetts, the presumptive Democratic presidential
nominee, voiced sympathy with the unions' complaint, saying he would make
workers' rights here and abroad a fundamental part of American trade policy.
"The Bush administration has completely walked away from using trade policy
to raise living standards and improve the rights of workers at home and abroad,"
Mr. Kerry said in a statement. "While I'm not familiar with all the details of
this case, I believe that it marks an important challenge on behalf of American
workers and raises real concerns about China's treatment of its workers."
The 105-page complaint sketches a nightmarish picture of factory workers in
China. Citing reports by governments and human rights groups, the complaint says
that strike leaders are often arrested and tortured. At many factories,
independent labor unions are banned, and the only ones allowed are slavishly
attached to the Communist Party's official union.
Millions of peasants who migrate to urban factory jobs are frequently treated
like bonded laborers, often working 18-hour days for half the minimum wage, the
complaint asserts. They often live in prison-like dormitories, the complaint
says, and often are unable to leave their jobs because their supervisors take
their travel documents.
Asserting that labor violations depress China's wages by 47 percent to 86
percent, the complaint asserts that wages in China would increase twofold to
sevenfold if China allowed strikes and independent trade unions, enforced its
minimum wage law and granted full legal protections to migrant workers. The
complaint argued that without these artificially depressed wages and unfair
competition, the United States would not have lost nearly 323,000 apparel and
textile jobs the last two years.
"China's capacity is so vast and the labor repression so pervasive that
together they create incredible downward push on wages and production in the
rest of the world's economy," said Mark Levinson, chief economist for Unite, the
nation's largest apparel union.
The complaint asserts that the labor violations give China's producers an
improper cost advantage of 10 percent to 77 percent, depending on which economic
model is used. The A.F.L.-C.I.O. is requesting a punitive tariff of up to 77
percent and a pledge from China to comply with labor rights standards.
"The purpose of the trade remedies is not protectionist," the complaint says.
"They are, rather, intended to bring about positive change for China's workers
and to ensure that global competition is fair for workers everywhere."
The complaint's main author is Mark Barenberg, a Columbia University law
Robert A. Kapp, president of the U.S.-China Business Council, said he thought
China could not climb out of poverty while letting its hundreds of millions of
workers organize independent unions for higher wages. He asserted that the
American labor movement was making a "colossal mistake" by turning a complicated
trade and development issue into a campaign issue.
The complaint asserts that when China artificially depresses wages by
violating workers' rights, it not only reduces wages and jobs in the United
States but also hurts wages and jobs in Bangladesh, Indonesia and other
third-world countries that compete with China.
These artificially depressed wages have fueled China's amazing manufacturing
boom, the complaint contends, noting that China will add more factory jobs over
the next five years than the total number of factory jobs in the United States,
Europe and Japan.
"China's trade practices with regard to repressing their people, and
tolerating forced labor, child labor, no maximum hours, repressing people from
joining unions are all unreasonable trade practices," said James P. Hoffa,
president of the Teamsters, a union courted by the White House.
"What that means for the American worker is they accelerate the number of
jobs leaving the country."
CORRECTION-DATE: March 17, 2004, Wednesday
An article in Business Day yesterday about plans by the A.F.L.-C.I.O. to file
a trade complaint to press President Bush to punish China over workers' rights
paraphrased imprecisely from comments by Robert A. Kapp, president of the
U.S.-China Business Council. He said that because many poor people in China
would continue to seek work in modern factories, even a vast improvement in
labor rights would probably not raise wages high enough to eliminate an unfair
cost advantage. (He did not say China could not climb out of poverty while
letting its workers organize independent unions for higher wages.)