U.S., China are better off as friends than foes

As our state rolls out the red carpet today for Chinese President Hu Jintao at Paine Field, many of us may feel conflicted.

China’s shift away from Marxism to a market-based economy has benefited Washington, where an estimated one out of every three jobs is trade-related. Boeing sold some $13.4 billion worth of jets to China last year alone, and projects a $120 billion market there for jetliners over the next 20 years. Washington also exports plenty of software and agricultural goods, and billions in Chinese imports come through our ports. For our state, it’s an overwhelmingly positive economic relationship.

Yet despite economic freedom in China, political repression remains. How, many wonder, can we have a positive relationship with a government that jails its own people for speaking their mind?

And while selling goods to China clearly benefits our corner of the country, the United States’ overall trade deficit with China remains huge. Many in the other Washington complain that the Chinese government’s monetary policy gives it an unfair advantage, making Chinese products cheaper for U.S. consumers and American goods more expensive in China. Plus, China is infamous for failing to honor intellectual property rights – piracy of American software, movies and other products is rampant.

So what’s a Washingtonian to do? Cheer the growing economic and cultural ties between our state and China, or support calls to punish the Chinese government with trade tariffs and diplomatic isolation?

We say cheer, because a close, positive relationship is the surest path to mutual prosperity and, in time, a freer China. It’s a relationship to be nurtured.

The more large American firms like Boeing and Microsoft do business with China, the more influence they’re bound to have on how the Chinese conduct themselves. The more Chinese leaders see that the creativity and innovation is rooted in the freedoms we enjoy, the more they’re bound to want those benefits too.

Still, a trade deficit that hit a record $262 billion in 2004 isn’t sustainable. We must be careful, though, not to bring on a quick fix that could be even worse. If China suddenly allowed its currency to float freely, as the dollar does, its value would go up, causing U.S. inflation and interest rates to rise – perhaps dramatically. The U.S. should continue working with the rest of the world to pressure China to play fair, an effort that is beginning to pay dividends – China’s foreign exchange chief reaffirmed Monday that his government will push ahead with currency reforms.

The relationship between the United States and China will be challenging, complicated and important. It should be cultivated with patience and firmness, respect and frankness. Done well, it can benefit citizens on both sides of the Pacific.