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Thursday, May 25, 2000

OK of China trade bill
is in U.S. interest

Bullet The issue: The House of Representatives narrowly approved permanent normal trade status for China.
Bullet Our view: Passage will benefit U.S. exports to China and could strengthen Washington's ability to influence Chinese policies.

AS repeatedly noted here, China's human rights record is deplorable, its occupation of Tibet is oppressive, its threats to invade Taiwan are menacing, its sales of high-technology weapons to rogue nations destabilizing. The brutal crackdown on dissent at Tiananmen Square in 1989 reverberated around the world.

Yet the wisest policy for the United States is to engage China more deeply in trade and diplomatic relations, in the hope that such engagement may help to moderate China's objectionable behavior.

The narrow approval by the House of Representatives of permanent normal trade status for China -- Senate approval is assured -- will go far toward stabilizing Sino-American relations. In narrow terms, it is the price America pays for sweeping trade concessions made by Beijing in negotiations that culminated last November in the signing of a new agreement. But the ramifications go well beyond that.

The vote means that no longer will a vote be taken annually in Congress, as it has for the last 20 years, on renewal of China's trade status (formerly known as most-favored nation status). That vote has been viewed as a means of applying pressure on China to improve its human rights record.

But it has proved to be a dull weapon at best. China's record hasn't improved perceptibly, yet Congress has never failed to renew normal status for another year. Most legislators recognized that such failure, rather than resulting in improved behavior, could precipitate a crisis.

President Clinton, who as a candidate in 1992 accused President Bush of appeasing China, changed his tune after his election and has since supported annual renewal of normal trade status. This agreement, by making that status permanent, could strengthen Washington's ability to influence Chinese policy and help free Chinese society through greater exposure to democracy.

The U.S. labor movement has been the prime force behind the opposition to this bill. Their ties to labor explain the misguided votes of Hawaii Reps. Abercrombie and Mink. Labor's concern is fundamentally about protecting American jobs although it also cites human rights.

But the jobs argument fails because the American market is already open to Chinese goods, with the result that there is a huge trade imbalance in China's favor. The trade pact at stake here would mean more jobs for Americans because it would eliminate barriers to American imports in the Chinese market.

China's leadership is shaky and the future of Chinese policy is difficult to foresee. Rejection of permanent normal trade status could have been interpreted in Beijing as an act of hostility that could strengthen the position of the hard-liners who reject liberalization and demand a takeover of Taiwan. By approving this deal, Congress may have encouraged adoption of more liberal policies in China.

Trust within
the trust

Bullet The issue: The chief operating officer of Kamehameha Schools has taken a temporary leave during an internal investigation that includes his past actions as the trust's chief legal officer.
Bullet Our view: While keeping their focus on the future, the estate's interim trustees need to review the actions of its employees.

GROWING criticism of the role played by Nathan Aipa, the Bishop Estate's former top legal officer, in abuses by the former trustees during their tenure has prompted him to take a leave of absence from his new job as the estate's chief operating officer.

The interim trustees have been willing since they took over a year ago to give estate employees the benefit of the doubt about their part in the Bishop Estate scandal. Their decision to scrutinize the record signals a welcome end to the grace period.

Randall Roth, principal author of the 1997 "Broken Trust" article in the Star-Bulletin that led to the ouster of the former trustees, complained in a letter to the editor earlier this month that "individuals who for years were at the epicenter of abuse are still on the payroll, well placed, some even promoted." The interim trustees of the estate, now called Kamehameha Schools, responded in a letter that they had chosen to refrain from firing people who "were employees at an unfortunate time...unless good reason exists."

However, the interim trustees also announced it would conduct an independent inquiry into whether employees and outside contractors took part in breaches of trust by the estate's former trustees. The board said it had decided to launch the inquiry because of complaints that it had not cleaned house, an obvious reference to Roth's letter.

Last week, Robert Richards, a court-appointed special master assigned to review the estate's legal and accounting bills, said much of the legal work done for the estate had been for the personal benefit of the former trustees and had included a costly "destroy the opposition" campaign that targeted state and federal judges, law enforcement agencies, the Star-Bulletin and the trust's own beneficiaries. The report noted that Aipa, head of the trust's legal division during that period, had supervised the work.

The interim trustees promoted Aipa in May 1999 to chief operating officer. Now Aipa has decided to take a temporary leave pending the outcome of the internal investigation. Aipa recognizes that his credibility has been shaken by the Richards report.

In focusing on the future of Kamehameha Schools, the interim trustees were overly magnanimous in their hands-off personnel policy. While they correctly maintained that an estate employee's mere presence during the abuses should not result in dismissal, allegations about an employee's role in furthering those abuses warrant a thorough review. Aipa has properly stepped aside while his past activities are examined.

Published by Liberty Newspapers Limited Partnership

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John M. Flanagan, Editor & Publisher

David Shapiro, Managing Editor

Diane Yukihiro Chang, Senior Editor & Editorial Page Editor

Frank Bridgewater & Michael Rovner, Assistant Managing Editors

A.A. Smyser, Contributing Editor

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