WTO Negotiations, life inside State Department, and the peak of American unipolarity — with Susan Shirk
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Hello listeners, welcome to a new week of Peking Hotel. I'm your host Leo. Thanks to all of you for being awesome. We now have over 1,000 subscribers. Your support is definitely appreciated and every time I get an email notification of a new subscriber, I'm filled with a positive vibe and warm glow of dopamines that just gets me pumped for making another episode for you. Now this week, I bring you an excerpt from my conversation with Susan Sherk.

Susan is a research professor at the University of California, San Diego, the Director Emeritus of 21st Century China Center and the Director Emeritus of UC Institute on Global Conflict and Cooperation. She is one of the West's foremost thinkers on Chinese elite politics and political institutions and having traveled to China since the early 70s, she bears personal witness to China ever since the late Mao period.

and between 1997 and 2000, she served in the Clinton administration as the Deputy Assistant Secretary of State overseeing U.S. relations with China, Taiwan, Hong Kong and Mongolia.

I have a special fondness for her because her class on Chinese politics was the best class I attended at Schwarzman College. In this episode, we discuss her experience inside the Clinton administration from academia to human rights diplomacy with China and of course the WTO negotiations at the peak of American unipolarity and US-China engagement. With that, welcome to the show.

Hi, Susan. Welcome to the podcast. As a career academic, how did you first begin working for the State Department? The opportunity in beginning in about 1991 to become the director of the University of California Institute on Global Conflict and Cooperation, which is system-wide foreign policy and security research.

Institute based at San Diego and the guy who's the head of it John Ruggie since passed away he decided to go back to Columbia so they needed somebody for interim to run it and I just finished the political logic book I think and also this little book that I wrote on foreign trade and investment coming after that and

So, you know, people had always told me, oh, Susan, you'd be good at trying to run something. So why don't you give it a try? So I did that. So I got more involved in foreign policy, U.S.-China relations. That was a really interesting experience because Harold Brown, who, former defense secretary who

was at the time in the early 90s, he was the head of the Defense Policy Board of the Office of the Secretary of Defense. Bill Perry was Secretary of Defense. So I got invited to go on the Defense Policy Board and got clearances and started going to these meetings and looking at North Korea. That's when I really got interested in North Korea. And I

just started paying more attention to U.S.-China relations per se because you know I never took an international relations course. I'm a comparative politics person. For me it all comes inside out you know from domestic politics. Right and from Chinese high school. So

I thought that was really interesting and then I started paying more attention with the fall of the Soviet Union, pay more attention to the regional context in Asia. And of course my own life had started as an exchange student in Japan for one summer, which is what introduced Asia to me before I went to college. So

Anyway, I got interested in that and I started thinking about a concert of powers for Asia and I started going to more conferences and things about foreign policy. So I think that was what happened there and then in 1992

uh we had this conference and i started the northeast asia cooperation dialogue this track two security dialogue for northeast asia russia china japan the u.s north korea south korea and it's still going so um at that time talk about another piece of luck because i was head of

the UC Institute on Global Conflict and Cooperation, because I was on the Defense Policy Board, and because my husband, Sam Popkin, was the deputy pollster for Bill Clinton. My name got mentioned as possible assistant secretary of state for East Asia. I'd never served in government. And wow, that was amazing. It was in the Washington Post.

the Al Kamen column, gossip column where they mentioned that. So they mentioned my name as the only contender for assistant secretary. I was actually scared of the possibility. I mean, I was both on the one hand really intrigued, but also scared because I thought I couldn't do that. I don't know how to do that. So we went to the inaugural

for Bill Clinton. And while we were there in Washington, they announced that Winston Lord was going to be the assistant secretary. So I had a few minutes of feeling really disappointed. And then I was very relieved. And why did you feel the disappointment and relief? Did you think because Winston is there, you wouldn't be able to get the job? Well, no, I wouldn't. It was going to go to Winston.

I wouldn't get the job. So I felt sad I didn't get the job. Of course I felt sad. But on the other hand, I felt relieved because I didn't feel prepared. But what it meant was all over Asia, they'd read my name as a possible assistant secretary for East Asia. And Winston, who's the nicest man in the world, when he came in, he treated me

with great respect. And at the time, I was advocating more regional multilateral efforts in East Asia as a way of America reassuring our allies and other countries in Asia that we are there to stay. More as a supplement to what was called the hub and spokes

of America's relationship with Japan, South Korea, Australia, our longtime allies. Not to replace it, but to supplement it. So that was the premise of NISAD, the Northeast Asia Cooperation Dialogue. So anyway, the U.S. State Department supported it.

And I went to all these different countries, talked to the foreign ministries, got them to come. And, you know, I had the opportunity to do this track two for them. So then I got to know a lot of Chinese diplomats who I'd never had the chance to know before. The person who came to NISAD in the very earliest days was Fu Ying. So she and I are the two women.

And she was a junior diplomat, very smart. And she recognized that for China, participating more in these regional multilateral institutions would be a good way to reassure the United States and other countries that even as China grew stronger, its intentions were friendly, were benign. So she

Really got into it every night. We would plan what we do the next day together together and we sort of Informally collaborated she introduced me to Wang Yi who was the director general of the Asia Department at the time He also super smart he had a similar perspective that I

China needed to find a way to increase its status, its influence in East Asia, but in a way that would not be viewed as threatening to other countries. So this was a kind of reassurance policy. So anyway, I had the opportunity to work with people like that. And, you know, in a way we were...

Even though we worked for two different countries, we were sort of on the same team because I thought this was really good for America. It helped America sustain its presence in Asia, get along pretty well with China, and prevent China from becoming a security threat.

Then I had the opportunity to actually serve in government as the Deputy Assistant Secretary, which I was much more comfortable with because it was my job was all about China, not about the whole region. So in the second Clinton term, I got invited to become the Deputy Assistant Secretary. So I did that from 97 to 2000. Right.

And how did you get invited to join Clinton's second administration? I came into government just at a time right before the state visits were about to occur, because during 95-96, we had this Taiwan Strait crisis between Beijing and Washington. And I think both

You know, I sometimes think U.S.-China relations have to get really bad before they get better. So they got really bad at that time when Li Donghui, we allowed Li Donghui to come to Cornell. He was supposed to give a personal talk to his alma mater, Cornell, but he ended up making political remarks, which have got, you know, got Beijing all...

upset and then they launched these missile tests and exercises to show their disapproval and put a lot of pressure on Taiwan. So that was at the time I was on the Defense Policy Board during that Taiwan Strait crisis. And I remember very vividly we had a meeting in the Pentagon the day that

the US had to decide how to respond to these missile tests, which effectively closed down a number of ports in Taiwan. And Bill Perry, who I absolutely adored and respected greatly for his wisdom and humanity in every way, and he was sharing with us his

dilemma, his uncertainty about how the U.S. should respond, because there was a real risk of escalation at that time. And I have to say, I did not offer any valuable advice. I had no, I really didn't know. I was uncertain about how the U.S. should respond. I mean, I knew that we had to

show resolve, but I didn't know how much, how to do it. And he made the call of sending not just one, but two carrier battle groups. Two. And it wasn't into the Strait itself. It was the area around Taiwan. But it was a strong show of resolve. And he was agonizing over it.

He was really very anxious and fortunately it was exactly, it appears to have been a successful response because the Chinese de-escalated and that was the end of the crisis. And after that I'd say both sides recognized the danger of this sort of, kind of the risk of other crises like this occurring.

So they really made a major effort to try to stabilize the relationship. And that's when I went into government because they felt they needed some more external expertise. So they brought someone in from outside the government, political appointee. I don't know, you know, and I was lucky because my husband was kind of part of the Clinton team. And, um...

I was offered positions both in the NSC and in the State Department. I interviewed with both Sandy Berger and Madeleine Albright. I decided to go to the State Department rather than the National Security Council, which just shows you how little I understood about the policy process, because China policy is always made primarily by the White House.

not by the State Department. And if I really wanted to be in the middle of the action, I would have gone to the National Security Council. But when I went to interview with Sandy Berger, very nice guy, but Sandy Kristof was the senior director for the Asia group in the National Security Council.

She was a trade negotiator and a business trade person. And it was clear to me when I went in there and I was waiting for Sandy Berger to be done with this other meeting that she did not want me to come. That she thought having an academic come in and do China, because she was not a China person, that this was just going to make life difficult for her. I really don't think she wanted me to come.

So I said, tell me, you know, what does the China person actually do here? You know what? And at the time, Bob Suttinger was the China person. And she said, oh, well, right now, Bob Suttinger is writing a little memo on the translation of this phrase in Chinese to help people understand it.

He was just doing something that to me sounded very mundane and not the least bit interesting. And obviously in retrospect, she told me that in order to discourage me from coming there. Well, Sandy Berger was very nice. I remember we talked about Taiwan, of course, and my position on Taiwan arms sales.

was that we wanted to be very generous with our military support of Taiwan because we wanted to deter future aggression by the mainland. And also to reduce the risk that the U.S. would have to send our own military forces if we could. So, I mean, he seemed to find that point of view compatible. So I was offered that job.

But then I decided to take the State Department job instead. For one thing, Madeleine Albright had been an academic. She studied Eastern Europe and the Soviet Union. I felt she had a great sense of humor as well as a great strategic sense. And I felt really, really comfortable with her. And I thought, if I go to the State Department,

I'll have more chance to actually travel to China and negotiate with the Chinese side. Whereas the NSC, they pretty much stay in Washington. Do you still remember the first day in government when you entered the State Department? Oh, yes. I was really worried because what worried me was academics never have a boss.

Even when you're a beginning assistant professor, the department chair isn't really your boss. You have no boss. You're completely independent, really, which is one of the great things about being an academic. So I'd never had a boss. I'd never worked in a hierarchy. I thought, oh, how am I going to handle this? That was one thing I was worried about. Stanley Roth was the assistant secretary, and actually he was great. He had been a...

congressional staffer and he was not a China person. So he, the way he dealt with me as a political appointee was you do China, I'll do the rest of Asia. And so he kind of elevated me to go to meetings and things that normally the Deputy Assistant Secretary didn't go to.

So he treated me with a lot of respect and was very nice. So my immediate boss, I had no problems with. Actually, in the end, I had no problems with any of my bosses. Because one thing I learned being in government was, and somebody had told me, I got a lot of good advice from Mike Oxenberg, actually, among other people, Dick Solomon,

So I was advised that there's no limit to what you can accomplish in government if you don't care about claiming credit, which actually fit my personality well. I don't actually care about claiming credit that much. And so I learned that if I had an initiative, something I felt needed to get done, I would...

communicate with one of the undersecretaries in one of the divisions of the State Department and I would give them the idea. So why don't you convene a meeting on this? They were so happy to have these kinds of initiatives and they would step forward and they were two levels higher than I was. They would call the meeting and things would get done. I did that, for example,

about discussions with China on national missile defense. We had a lot of discussions underway with Russia on all of our national missile defense testing program. And I didn't quite understand why we weren't sharing that same information with China. And so I suggested to

the Under Secretary of State for Security, Arms Control, why don't you call a meeting on how we should talk about national missile defense with the Chinese? And so we organized that meeting. Similarly with climate change and stuff, I talked to the Under Secretary of State for Global, you know, so if you

pursue your initiatives through higher level people. You know, oftentimes you can get things done. I learned gradually how to be effective. One of the most challenging parts of being in government was the relationship between the State Department and the National Security Council and the Pentagon. And even when Jeff Bader, who is kind of my buddy,

was over in the National Security Council. The NSC hoarded information. They did not share it with us in the State Department. They treated the State Department, the East Asia Bureau, the China desk, the Taiwan desk, as we were their staff. So they would need material for a meeting or something. We were just supposed to produce it. But they didn't

really share information with us. And it was extremely frustrating. So finally, one day I was over in Jeff Bader's office at the NSA. The other problem was we had no classified communications channels, technologies. We had no classified internet then.

you had to take hard copies of things over and back. You did have a Stu phone, a classified phone, but the reception really bad. Nobody wanted to talk on the Stu phone between one another. So it was very difficult to communicate. And there was, you know, a lot of... Kurt Campbell was my counterpart in the Defense Department in the Pentagon.

he and I got along great, no problem. We traveled a lot. Of course, he'd been my student. Oh really? At UC San Diego, but I didn't, even though he was an exceptional student, he became a Marshall Scholar, went to Oxford. I had no memory of him, which we often joked about because even though he, I remember his girlfriend really well, Kathy Boone, but I

I didn't remember him. But anyway, we got along very well. I get along well with Jeff Bader. And Madeleine Albright and Sandy Berger communicated very well with one another. Despite all that, the White House, the National Security Council, hoarded information and kind of tried to marginalize the State Department people. Very frustrating. And you didn't want to complain about

to your bosses about it because they're so busy. You want to be a low-maintenance person. Right, and give them good news. Not necessarily good news, but not give them problems. My first day in government, Jeff Bader, I had lunch or something with him a few days before. He told me, he said, okay, once you enter the State Department at

eight o'clock in the morning or 730, you have no time to think. You're busy nonstop with meetings and stuff. So you have a policy issue. If something's going on, you need to figure out what you think should be done about it. You have to figure it out while you're in the shower before you get dressed. So spend that time in the shower. Oh, wow. Figuring out.

what you think is the right way to go on the number one problem of the day and then, you know, pursue it once you get to the office. So Jeff was great. You know, he just gave me a lot of very good advice like that. And what was your typical day like? Well, you come in, first thing you've got to deal with is press guidance.

because the spokesperson has to go brief the press at 10 o'clock. I think it's 10 o'clock, 9:30, 10 o'clock. So you've got to write the, you know, the press guidance needs to get done first thing. And then it's just one meeting after another. And then once a week I would have lunch with the DCM at the Chinese Embassy.

It actually was Liu Xiaoming, the DCM. Oh, the later ambassador to the UK. It was a fellow who wasn't actually the DCM. He was the political counsellor, He Yafei, who got in trouble later on with Yang Jiechi and he got sidelined. But he was very gifted, very smart, very flexible guy.

And so when he came to Washington, he started inviting me out to, I don't know, what's the name of that Chinese restaurant? Terrible Chinese restaurant like Mr. Chan's or something like that. The only meal. Oh, Chan Chan? No, the only meal that you can allow other people to pay for is with the embassy people. And so he was paying, he had to pay for it.

And this restaurant was terrible. So I convinced him, let's try another restaurant. So I got him to go to this great seafood restaurant that doesn't exist anymore, Kincaid's. And so every week we went and had lots of delicious oysters. Nice. And a nice seafood meal. And so, you know, I had...

spent a lot of time talking to the diplomats at the Chinese Embassy, and then to interagency meetings of various sorts on different subjects. Now, the China DAS, the job I had, was supposed to be responsible for all dimensions of relations with China. So I also went around and talked a lot to people in different agencies.

agriculture, treasury, commerce. So my job was to advise and coordinate with all of those folks. And of course when we had Chinese visitors, you know, then I would go be part of that. Like government delegations? Yeah. I mean senior people. What level? Like the Xiaoyang, the head of the Supreme Judicial Court.

Minister of Justice from China. I remember that very well because he was so impressive. Another person who's in jail, or maybe he already died in jail. You know, different senior officials. And then meetings, of course, every meeting involving the president or the secretary of state, you know, I would usually be part of.

What did you want to accomplish actually when you first went into the job? Did you have an expectation of things you wanted to do? Yeah, I wanted to improve relations between US and China and get China to change its foreign policy behavior more in line with the global order, with non-proliferation especially. The three main areas were

non-proliferation, human rights and trade. So we put a tremendous amount of effort on the non-proliferation side because China was selling nuclear and missile technology to all these other countries. Very dangerous. That worked so well. I mean, very successful. China, Chinese government, I think, came to realize that it would benefit

from cleaning up its act. Didn't really have an interest in all these other countries having these weapons of mass destruction. And human rights, you know, we'd have human rights dialogue. We'd talk about all these things. We set the bar pretty low. I remember that. Before I came into government, Jeff Bader and Bob Suttinger had been

to Beijing with Warren Christopher when he was Secretary of State to try to resume high-level exchange of visits between our leaders and we wanted to condition it on some improvement in human rights. So we asked for the release of a few dissidents, we asked for access

of the International Committee of the Red Cross to visit Chinese prisons, and one other thing. A pretty low bar. Things that we thought would be easy for China to say yes to. I mean, you weren't asking for the abolition of forced labor camps. Yeah, yeah. I mean, I was not part of it. I only heard about this after the case. After the fact, we didn't get it. They said no. And...

My experience with human rights is that by and large, nothing we did really worked. The one area that I felt was promising was promotion of rule of law in China because there was a big push inside China by people like Xiaoyang to increase the autonomy of the legal system. But, and we...

The Jiang Zemin visit, we initiated this rule of law cooperation. But, you know, we could never get Congress to appropriate money for it because Nancy Pelosi, who was head of the House Appropriations Subcommittee for the State Department, she was so hard over on China. She just vetoed it every time. So we never really got it.

the money that we promised the Chinese. So we had to, there were other ways of trying to raise private money for it. But it was infuriating to me that we couldn't get the money for it. But I still say it was, you know, we, there was substantial progress at the time. So

And that was a cooperative undertaking because there was really a demand for it internally in China. So what I learned from all of that experience was that improvement in human rights in China has to come from internal demand. Externally, I mean, we can shame them, we can criticize them, we can make ourselves feel good.

that we're articulating our values. We play to our domestic constituencies in the United States. But in the end, have we really achieved anything in China? Most of the time, no. So came away from my experience in government very discouraged about that effort. Trade, on the other hand, you know, we did manage to

make progress on trade because, again, there was internal demand in China to join the World Trade Organization to open up to foreign trade and investment. So when I came into government, Tom Pickering asked me to write a kind of big vision piece of what are we trying to achieve, which I did. And then they never did anything with it.

But basically, it was to try to improve, from our perspective, China's international behavior, especially on proliferation. And, you know, domestic liberalize the Chinese system, not...

Our expectations, you know, the engagement gets a bum rap that our expectations were unrealistically high. And it's true that with WTO, Clinton and everybody else in the administration kind of oversold the benefit of China's accession to WTO, the political transformation of China that

might occur as a result of the market reforms and opening through WTO. But that was very instrumental and everyone expected that political reform in China was occurring. It was happening, but it was happening very slowly and we were by no means confident

that China was going to, quote unquote, democratize. But we were encouraged by what we saw. You know, and I remember very well with the Clinton visit, big state visit to China, the most important thing, the most exciting thing that got President Clinton, the First Lady, Madeleine Albright, the most excited was when they allowed

the live television broadcast of the press conference between Jiang Zemin and Bill Clinton to be televised nationally in China. They talked about Tibet, the Dalai Lama. It was amazing. And they also allowed live broadcast of President Clinton's speech at Beidai.

So this was a period when there was a little, it was kind of a little hundred flowers blooming and contending period in China. And so what it meant to us working on China policy was that our policy was reinforcing the positive changes underway in China. We didn't think we were making it happen by our policy, but we felt good

that our policy was facilitating this progress. And you spent a lot of your academic life unboxing the black box of the Chinese politics. Can you help us unbox the American politics, especially on the China policy? Because I think Clinton went into government, went into his first term being quite hard on China.

wanted to link trade to human rights and thinking from Beijing to Baghdad all dictators must fall. When he exited his administration China became a strategic partner

How did the shift in the strategy happen? And how does it look like from the inside in terms of who makes the decision on China? What kinds of decisions are made by White House versus State Department? Stuff like that. Just be on the inside of China policy in the US. Well, when Bill Clinton was running for his first term,

I was a little bit involved in the foreign policy side of the campaign, which is always just a sideshow, not very important. But remember, Richard Bush and I wrote a memo to the campaign urging that we end this congressional circus every year on Most Favored Nation so that the White House would make the decision and then

it would be up to Congress to veto it or something like that if they wanted to, but that they would not have to debate it every year. But it was actually, looking back on it, a very stupid idea because it meant the president had to take the whole responsibility on him, political responsibility, which is terrible. They did it. And then once he had that responsibility, I think

he realized every year it was just, he ended up getting beat up over the policy. So President Clinton, that he just said, let's just give this up. Let's just end it. No more annual review of MFN. Because he said, look, look at Cuba. This is what I've heard, he said. He said, look at Cuba. All the years that we tried to get Cuba involved,

to improve their human rights situation. They're right here off the coast of Florida. China's over there, the other side of the world. How are we going to get China to change its human rights practices? This is never going to work. And I'm just getting beat up every year over it. So President Clinton personally made the decision to give that up. And then, of course, Congress still wanted to keep doing it.

But he gave it up. And the only way to get Congress to stop doing it was to go the WTO route, to go to, we stopped calling it most favored nation because it sounds like we're doing them a favor and just call it normal trade status for China. Normal, we changed the term.

because MFN just sounds like we're doing them a favor, but instead it was just normal trade status. And we had to do that by getting them into the WTO and then trying to get Congress to agree to that. That was tough. That was really tough to get Congress to agree to it because organized labor was completely opposed. And many Republicans were opposed too.

So it was a major effort on the part in domestic politics of the Clinton administration to do that. And there were a few big American companies that bankrolled the lobbying effort. Which one? Well, Boeing, the insurance companies, trying to remember which others. But what's interesting is big business, international business,

lobbied very strongly to get China normal trading status through Congress. And it was... And President Clinton had to promise members of Congress all sorts of side payments. It's like any trade agreement. Very difficult. So he promised them a bridge in this district, a tunnel in that district. I mean, really, you had to...

It was like retail effort. It took a tremendous effort, but we succeeded. Another big thing when you were in government was the WTO negotiation and China's entry into the WTO. Did the State Department play... What sort of role did the State Department play in the WTO negotiations? Because there's the trade representative, and then there's the State Department, and there's the White House, and there's everyone else. Well, the...

the trade representative leads the effort. But there is an interagency process behind it. So there's always a State Department person and of course, National Security Council person too. So in 1998, you know, we really start working hard. Actually, the whole time I was in government, '97, '98, '99,

pushing the Chinese to resume negotiations. And then I did not go to China. I wasn't sitting there and negotiating with USTR, but I was certainly following it very closely. And then when it was accomplished by Charlene Barshevsky, and we hoped to have Zhu Rongji

finalize it when he visited the United States. I went to accompany Zhu Rongji on that visit to the United States. So I was, you know, kind of the U.S. government representative. So then I hear the night, much to my amazement, that there was a cabinet meeting the day before Zhu Rongji and I are due to arrive in Washington.

that the president decided not to sign the deal. And I was totally shocked and furious and upset, really upset. And what happened is that the domestic policy advisors, political advisors to President Clinton said, "You can't sign the WTO deal with Premier Zhu Rongji when it comes to Washington because

That deal will effectively have to get approved by Congress to get normal trade relations through Congress. And if you sign the agreement when he comes, Congress and the public will assume that you rushed to do it in time for him to come and that you gave away too much. You made too many compromises. So what you have to do is wait.

few weeks a month to play a power game and then and then signed the deal Wow Clinton said well okay if you said meanwhile the foreign policy people Madeline Albright and Sandy Berger are saying you know if you don't do the deal now it may disappear because they have domestic politics too so the night so during G arrives he's told that

Well, he has dinner, informal dinner at the White House with President Clinton. President Clinton informs him that we're going to have to put it off a little bit to finalize the deal. This was going to be the achievement of Zhu Rongji's visit. And Jiang Zemin had really backed him up on this. So Zhu Rongji didn't try to talk him into it. He just said, really? Well, if that's the way it is, that's the way it is.

And then I traveled around the country with Juergen G. He must have been a happy man. So embarrassed. Sitting on the stage or whatever. Well, he told the audience, I was really disappointed that we weren't able to conclude the agreement. He did it in a dignified way. So Ken Lieberthal and I tried to... Actually, what happened is...

President Clinton realized almost immediately that this was a huge mistake. And so we tried to get the deal back on track. We arranged for President Clinton to call Zhu Rongji when he was in New York and say, "Let's finish it off right now." And I was in the room, you know, handing him the phone. And Zhu Rongji said, "You know, I'm sorry.

President Clinton, but I can't do that. I'm about to go to Canada. I'm negotiating with the Canadians. How would they feel if I'm finishing up the U.S. deal while I'm in Canada? I can't do that. It's impossible. So, and I'm on the plane, the Chinese plane, with all the Chinese officials, Long Yong-tu, the chief negotiator, you know, Wang Huning, all these people. And what was interesting was

They are reading the Hong Kong media to get a sense of what the public reaction is in China. In other words, their media doesn't tell them. No, of course not. So they're reading the Hong Kong press. I thought that was kind of interesting. Wait, how do you know? Did they tell you? I'm sitting there watching them read the newspaper. I'm sitting next to them.

in the plane. Which newspapers do you remember? South China Morning Post or? No, Chinese newspapers mostly. But anyway, and I'm sort of apologizing to them. Must have been quite difficult for you. So then we had to try to get things back on track. And of course, Zhu Rongxi went back to China. The deal almost collapsed.

because different industries found out for the first time what the deal... Oh, I know. Charlene said at this point, we weren't going to publicize the deal, but we decided we're going to put it out so people can see how good it is. So we put it out. And then when people in China saw that Zhu Rongji had kind of sold them out, of course, there were a lot of complaints about...

giving away too much. And then shortly after that visit, we had the Falun Gong Saran Zhongnanhai, the Belgrade Embassy bombing, accidental bombing. So getting the WTO negotiation back on track was really hard. But we finally did it. And on that last negotiation, I went with Charlene and so did Ken Lieberthal and so did Gene Sperling.

And the Chinese side tried to claw back a lot of concessions. Charlene had a really hard job because she couldn't just give up everything. But everything she gave up, she tried to get something new so that the deal remained, might be slightly different, but just as good.

And we was very involved and the Chinese side, the Moftec people, they treated our delegation so rudely, so abusively. One night, they just kind of left us in Moftec without any information about where we were, what was going to happen next. We're almost kind of locked in to the department. And finally we got out.

And so at that point, Gene Sperling, who'd been one of the domestic political advisors in the first go round and advised against signing the deal, he had been told by President Clinton, you get this deal done. Do not come back without a deal because he felt he'd made a huge mistake, that President Clinton felt he'd made a big mistake. And he had to

make it right. So meanwhile, Ken Lieberthal and I, the China people, we were alarmed at how abusively the Chinese side was treating our delegation. And so we said, you know what? We need to leave because if they treat us this way on this occasion, they're going to feel they can do with that in the future. So we can't, we can't tolerate this.

So it was like a role reversal. Of course. And so we said, and of course, by that time, our group is making decisions collectively, but calling back to Washington too. So we said, we got to pack our suitcases and leave. So we'll go in the next morning, but we'll have our suitcases. And this won't just be a charade or something. We're really going to leave if we don't,

make progress here. So we threatened to leave, which is the time you actually get stuff done is when if you're actually willing to walk away. We were willing to walk away. Gene Sperling was saying, "No, you can't. You can't walk away." But we said, "We got to walk away."

And Charlene agreed. So we're getting ready to leave. And then they called us back. And in the end, we got the deal done. Thanks again to Juring G. Wow. I mean, that's an amazing story. It was hairy. It was really hairy. But anyway, once it was done, we felt really quite good about that. And, you know, it was a fabulous deal.

Even though, I mean, obviously it could be complete market opening, but for what it was, it was amazing. And looking at the WTO process, do you have regrets about the WTO beyond supposed to sign a deal but didn't sign a deal? Because I think some today would attribute...

China's threats to America to global order today to the fact that they joined FWTO and then boosted up the economy or something. I mean what? Absolutely not. I just completely disagree with that. I mean, we opened up many more economic opportunities for the United States than for China. China already had access to our market. So we attracted, helped China, I guess, attract more foreign investment.

Is that a bad thing? I don't know. I don't think it's a bad thing. I mean, I don't think the goal of U.S. policy then or now should be to slow down China's growth and development. I think the goal should be to induce China to behave responsibly. But, you know, trying, I'm not in favor of a containment policy.

Do you have things that you wish you had done differently or that WTO had turned out a bit differently? I don't think we could have gotten a whole lot more than we got in terms of the actual deal. But it's interesting that the deal, some of the most notable limitations on market access are in the cultural domain. And it was pretty obvious to me, you know, sitting through all this,

that Chinese were very leery Western cultural influence. By which they probably meant like Wall Street Journal, New York Times, BBC, CNN, that kind of stuff. And movies. Limitation on the number of films from Hollywood and things like that. Do you think negotiators could have pushed harder and get... No. I mean, we worked hard on it.

And maybe it's because we knew we already had California. You know, I mean, this is the way Charlene thinks. You know, she's got agricultural interests. She's got... She thinks about the different states and the members of the Senate and Congress and having to get through approval. Right. So... Why did Clinton bother with all this domestic political bargaining for China? Well, because, I mean...

President Clinton paid a lot of attention to China policy, and he really felt a sense of responsibility to want to bring China into the world in a peaceful way that would be a good thing for America, reduce any security risk. You know, these two major powers could get along, you know, kind of post-Cold War kind

strategy for America which was and of course America was kind of at its unipolar peak at this time so we could kind of be generous in our policy toward China that's all for today thank you for listening and if you enjoy this one you may consider subscribing to our sub stack under the same name Peking Hotel with links in description and I'll talk to you next time