Human Rights Meets Profit
Terry H. Schwadron
Jan 1, 2022
It’s against U.S. law, to say nothing of policy, to knowingly import goods made with slave or coerced labor.
Last week, Joe Biden signed a bill Congress adopted nearly unanimously called the Uyghur Forced Labor Prevention Act to underscore the policy.
It does so in a way that shifts the burden of proof of compliance from customs officials to companies doing the importing. Essentially, the law now says that companies must actively prove that their factories and those of their suppliers do not use slavery or coerced workers.
American politicians across the board have made the repeated point that China needs to be held to account for how it treats its Uyghur minority, talking tough about economic sanctions, threatening Olympics boycotts of different sort and the like. You don’t generally see Chuck Schumer, Elizabeth Warren, Ted Cruz, and Jim Jordan standing on the same side of things.
The Biden administration has labeled the Chinese government’s actions to detain a million Uyghurs in the western Xinjiang province, to force conversions, sterilization, and deaths, to subject the ethnic minority work camps, as genocide.
Indeed, this year it has been hard to be anti-China enough. It is Republican sport to constantly call Biden weak on China policy, but here we are, with a spanking new punitive bill all seem to accept and promote.
Now comes the inevitable rub, of course.
It’s going to have a worsening economic effect on American companies importing from China, and the lobbyists are hard at work to limit the reach of the law.
Principle Meets Business
So, even as we’re hearing the official White House condemnation of China, there also are reports of trying to work out the implementation rules for the new law.
Based on interviews in the White House and Congress, The New York Times summarized that some members of the administration are arguing behind closed doors that the bill’s scope could overwhelm U.S. regulators and lead to further supply chain disruptions at a time when inflation is accelerating.
Moreover, there is concern that an aggressive ban on Chinese imports of needed raw materials and assemblies for solar panels, for example, could put the administration’s goals for fighting climate change at risk.
That area around Xinjiang is a key source for polysilicon needed for solar panels that the administration wants to tap to cut carbon emissions. The region is rich in coal and oil, crops, and a significant producer of electronics and clothing.
As The Times explains, if the law is enforced as written, it could force many companies to rework how they do business or risk having products blocked at the U.S. border. So, Washington is expecting a crush of lobbying by companies trying to ease the burden on their industries as the government writes its implementation guidelines.
Business groups including the U.S. Chamber of Commerce, and companies including Nike and Coca-Cola, worked hard to limit the scope of the passed bill.
The Political Battlefield
All the infighting will take place in the far-from-public-eyes bureaucracy, where the rules get written.
From the reporting to date, it seems that it is conservatives like Sen. Marco Rubio, R-Fla, who emerge as harder line on this issue, and former Sen. John Kerry, working as an international climate coordinator for the White House, who ends up talking a softer approach — a kind of strange bedfellows’ situation for who supports human rights over business values.
The questions turn on how much cooperation anyone thinks can be wrested from official Chinese policies on international trade, climate, even security issues for any softened implementation rules.
Of course, China wants the United States to butt out of its internal affairs altogether, and denies forced labor is used in Xinjiang.
Uyghur group advocates say that the current debate is setting off false choices, that it is possible to fight for human rights and climate at the same time, for example.
Meanwhile, it is difficult for many U.S. businesses to determine whether their products touched Xinjiang at any point in the supply chain. Either they don’t know who is beyond their direct suppliers or they lack leverage to get information from Chinese firms about who is providing raw materials and parts. The Chinese restrict foreigners from unfettered access to sites in Xinjiang.
As passed, the bill did include a mechanism to create lists of entities and products that use forced labor, something businesses had sought for more certainty.
For the rest of us, there’s a good lesson here that the politics that end in passage or defeat of a bill is only the beginning of whether we have an enforceable principle that goes beyond slogans.