Reprinted from the Weekly Standard, June 30, 1997

Constructive engagement, as the Clinton administration likes to call its policy toward China, is actually more a theory than a strategy. And it is a theory that demands perpetual optimism. It runs something like this: China has a clear set of interests -- in expanding its economic growth, in preserving an open door to international trade and investment, in maintaining tranquility at home and peace abroad. These interests, in turn, impose certain requirements on Chinese domestic and foreign policies. To compete effectively in the world?s economy requires that China's leaders learn to behave according to internationally established norms and rules, in both external and internal matters. They must sign and abide by international agreements; they must become responsible members of the international community; and, if China's economic prosperity is to continue, they must gradually loosen the controls on free expression and political organization in their country.

Since any other course is contrary to China's interests, as defined by proponents of the engagement theory, Chinese leaders can ultimately be counted on to do the right thing. Obstreperous international behavior or violent repression at home would only lead to China's isolation, which would strain vital trade ties with the rest of the world, retard economic growth, and produce a hostile encirclement of China by fearful but well-armed states. China's leaders cannot possibly want to pursue a course so damaging to their interests.

It is upon this theory that the Clinton administration's policy toward China is based. With all the forces of global economic integration leading the Chinese naturally toward the very goals we seek for them, goals that, happily, are compatible with our own interests, the task for the United States is merely to educate the Chinese to understand their interests better, to show them the fruits that await if they will only do what's right, and otherwise to make as little trouble for them as possible.

There could be no better test of this theory than the fate of Hong Kong -- a canary in the coal mine whose survival or demise will tell us much about the level of poisons in Chinese air. If Chinese leaders share our view of their interests, they have every reason to behave themselves as they assume control of the former British colony. As national security adviser Samuel Berger recently put it, "Living up to [its] pledge is as much in China's interest as it is in Hong Kong's." First of all, "a dynamic, prosperous, and free Hong Kong will continue to drive growth and progress in China." China, as it is so often said, will not want to kill the goose that lays such golden eggs. And Chinese leaders must recognize that preserving a significant measure of political freedom in Hong Kong is essential to keeping that incomparable international trading center vibrant and adaptable. If they don't seem quite to understand this, we can help explain it to them -- as treasury secretary Robert Rubin and his deputy, Lawrence Summers, have patiently tried to do on several occasions.

There are other sound reasons for China to apply a soft touch in Hong Kong. A China seeking the peaceful reintegration of Taiwan will not take over Hong Kong in such a heavy-handed way as to frighten the Taiwanese away from ever accepting union with the mainland. In addition, successful trading relationships with other nations require a reputation for adhering to international agreements, which gives the Chinese a powerful incentive to hew to the 1984 Sino-British Joint Declaration on Hong Kong, which established the terms of this month's transfer. As Berger recently put it, "the world is watching. A smooth reversion will promote China's international prestige -- but handled badly, the transition will tarnish China."

It all seems quite reasonable, in theory. So what do we make of the fact that, in reality, China has not been behaving itself in Hong Kong? That is a conundrum for which the advocates of engagement unfortunately have no answer -- and no policy.

The facts are plain enough. In the Sino-British Joint Declaration of 1984, China promised to respect Hong Kong's autonomy, to abide by a policy of "one country, two systems." This in turn meant that Hong Kong's residents could govern themselves as a Special Administrative Region of China with full freedom to act independently in all matters except foreign and defense policy. According to the specific terms of the declaration and its annexes, Beijing would appoint Hong Kong's chief executive, but that executive was to be accountable to a legislative council chosen in free elections by the people of Hong Kong. Hong Kong's British legal system was to remain unchanged, its magistrates allowed to interpret Hong Kong laws free from interference by the mainland. Criminal prosecutions and maintenance of public order were to be matters exclusively under the province of local leaders. The full range of individual liberties, from freedom of the press to the right of peaceful assembly, was guaranteed. In keeping with the provisions of the Joint Declaration, the British governor of Hong Kong, Chris Patten, called elections for the Legislative Council in 1995. The result was a sweeping victory by the Democratic party led by the prominent barrister Martin Lee.

The negotiations between Great Britain and China took place in a world very different from today's, of course. In the 1980s, China was still a strategic ally of the West against their common enemy, the Soviet Union. China itself was in the early stages of a dramatic economic opening to the West and in the full throes of a reform campaign led by Deng Xiaoping and his moderate, pro- Western lieutenant, Zhao Ziyang. The surprisingly favorable terms for Hong Kong negotiated by China seemed to fit well within Deng's overall strategy of greater cooperation with the West. When Britain's prime minister Margaret Thatcher agreed to the Joint Declaration, the prevailing assumption in London and in Washington was that Deng's China, not Chernenko's Soviet Union, would be the first Communist giant to shake off totalitarian rule and embrace democratic capitalism.

That world, and those assumptions, were exploded in 1989. The Berlin Wall came down, and with it the Soviet Empire. And just as reform was blossoming in Moscow, it was collapsing in Beijing. In June 1989 Chinese leaders sent troops and tanks into Tiananmen Square to crush the democracy movement which Deng's reforms had brought to life. Deng personally approved the use of force against Chinese students, and he subsequently purged Zhao Ziyang and made common cause with hard-liners in the Chinese politburo and military leadership. In the course of a single year, the strategic rationale for close cooperation between China and the West disappeared, and China's leaders began to view domestic pressures for political reform not as a tolerable byproduct of economic growth but as part of a Western plot to bring them down. In this new context, the idea of an autonomous, democratic Hong Kong incorporated into China looked to the Chinese leadership like a potentially deadly threat to the dictatorship they wished to maintain.

Soon after the Tiananmen Square massacre, therefore, the new harder-line Chinese leadership began to look for an escape from the terms of the Joint Declaration. And they found one. The British negotiators of the declaration, in the mood of careless optimism about Chinese intentions that prevailed in the early 1980s, had agreed to let Beijing, not Hong Kong, draft the Basic Law incorporating the terms of the declaration into Hong Kong law. In 1990 the Chinese government seized on the opportunity to use the Basic Law to transform the Declaration's original meaning.

The Basic Law approved by the National People's Congress in April 1990 eviscerated the Joint Declaration's commitment to allow Hong Kong a democratically elected Legislative Council. Beijing insisted that no more than half of the legislature's members could be chosen by direct election. The new Basic Law also gave final say over the interpretation of Hong Kong's laws to Beijing, thus undermining the independence of Hong Kong's courts. Article 23 of the Basic Law called for prohibitions on "any act of treason, secession, sedition, or subversion against the Central People's Government," which sounds reasonable enough unless one understands that, for the Beijing government, any criticism of the government falls under those categories.

It will come as no surprise that the Bush administration, which invented the current strategy of engagement with China, raised little objection to the way the Chinese had rewritten the Joint Declaration to impose their rule on the people of Hong Kong. Bush and Co. argued that it was not for the United States to interpret an agreement between two sovereign nations. And it will also surprise no one that the British government was too timid to protest, and that when it came to making good on its guarantees to the people of Hong Kong, Albion proved to be perfidious.

All of which brings us to the events of the past year. In December, a committee appointed by Beijing chose a new Provisional Legislature without any pretense of an election. In fact, 15 members of the new 60 person Provisional Legislature had lost in the free and fair 1995 elections. Even the queasy British government protested this clear violation of the Joint Declaration. Nevertheless, when Hong Kong falls into Chinese hands next week, the Beijing-backed Provisional Legislature will replace the popularly elected Legislative Council. Martin Lee's Democratic party, which won a plurality of seats in 1995, will be shut out.

Since the beginning of 1997, Beijing and the man it appointed to be Hong Kong's chief executive, C. H. Tung, have been rewriting Hong Kong's laws to put new restrictions on political activity and free speech. Tung has instituted changes that will severely curtail press freedoms and the ability of opposition political parties to function. According to the Economist, the new rules "would allow political groups and protests to be banned" under the catchall justification of "national security." One Hong Kong group that openly supports "patriotic democratic movements" in China has already been labeled "subversive" by the Chinese government and is unlikely to survive the transition. Even optimistic observers of the transition in Hong Kong acknowledge that the press has begun to censor itself in anticipation of China's takeover. Frank Ching of the Far Eastern Economic Review reports that such self-censorship is "already pervasive." And it will only get worse when news laws banning editorial stances that threaten "national security" go into effect. Meanwhile, the new rules will also prohibit political parties from receiving assistance from or maintaining contact with foreign entities. This means that after June 30 a visit by Martin Lee to the White House, like the one he made a few weeks ago, will be sufficient grounds for outlawing his Democratic party in Hong Kong.

Even though the "world is watching," as Berger says, China is already demonstrating an impetuous disregard for the rule of law and for its international commitments. Sympathetic analysts like Ching admit that "China is creating the impression that it thinks the law is whatever it says it is," and this attitude is "worrisome and dangerous."

But, of course, it is much more than that. The evidence in Hong Kong so far suggests that the American theory of engagement is deeply flawed. It has already proven to be a bad predictor of Chinese actions and a most unreliable guide to understanding Chinese behavior. And the flaws are apparent no matter which way you look at the situation in Hong Kong.

Some defenders of engagement, for instance, have pointed to the fact that in the midst of all these signs of impending political repression, Hong Kong's economy has been flourishing. The stock market has been healthy. Real- estate prices have been soaring. But the fact that Hong Kong's economy can flourish as political rights disappear is actually a refutation of the theory of engagement, not evidence of its accuracy. After all, proponents of engagement have always insisted that economic prosperity is supposed to create the space for political rights. It is supposed to force the Chinese government to accept political liberalization as the necessary price for economic dynamism. But if an economy controlled by China can flourish alongside declining political freedom in Hong Kong, why wouldn't this be true on the mainland as well? And if it is, then all the rosy predictions that China will become a democracy when its economic growth reaches a certain level are simply wrong. Apparently, those who point happily to the good economic performance in Hong Kong don't recognize this inconsistency in their argument.

More sober proponents of engagement, including those within the administration, stick to their thesis that Hong Kong's prosperity cannot long survive if political freedoms are curtailed, that the link between political and economic liberties really is indissoluble. But for them the experience of Hong Kong poses a different problem. For if their theory is tight, what does it mean that the Chinese leadership has clearly and consistently chosen politics and power over economics since Tiananmen?

It means that Chinese leaders do not view their interests in the same way as the proponents of engagement in the United States. Indeed, the differences could not be more fundamental. The lesson of Hong Kong, as China scholar Gerald Segal has written, "is that China will regain what it believes to be its own, regardless of the risks to its economic prosperity." China's leaders since Deng have sought to spur economic growth not as an end in itself but as a means of increasing power, for themselves and for their nation. They want a healthy economy, therefore, in both Hong Kong and on the mainland, but not if the requirements of a healthy economy conflict with the requirements of power. In Hong Kong, and indeed in the aggressive behavior they showed in the Straits of Taiwan last year, they have been willing to surrender not only economic growth but also international good will to the dictates of power. Dictatorship, after all, is their business, and they know no other. As Frank Ching wrote recently in Foreign Affairs, "Saying that [China] will not interfere in Hong Kong's affairs is a little like a left-handed person promising to use only his right hand. The intention may be good, but before he knows it, he will start using his left hand again."

China's persistent refutation of the engagement theory in Hong Kong has left the Clinton administration bereft of a policy. Administration officials have never said what they would do if China behaved badly in Hong Kong. When things have gone worse than expected, they have only clung more tenaciously to their theory, shutting their eyes to Chinese misdeeds of the present while directing our attention ever deeper into the future in the hope that the Chinese will eventually vindicate their faith. Earlier this month, Berger warned Americans not to "prejudge the outcome" of events in Hong Kong. As if nothing had happened these past few years to raise doubts about China's adherence to its agreement with Great Britain, Berger declared that the " international community has a right to expect . . . that China adheres to the letter and the spirit of the Joint Declaration." Without a word about the illegitimate, Beijing-appointed Provisional Legislature, Berger asked his audience to "look to see if elections for [a] new legislature are set soon and held freely." (At least Secretary of State Madeleine Albright has refused to be present at the sweating-in of the Provisional Legislature on July 1.) Without a hint that press freedoms and political rights have already begun to vanish in Hong Kong, Berger suggested that we watch carefully to see "if freedom of speech, press, religion and association are maintained."

The Hong Kong canary is already short of breath as the PRC coal mine closes in around it. By the time we wake up to find that political liberties have been extinguished, it will be too late. And what will the Clinton or Gore administration do when the death of Hong Kong becomes irrefutable? The answer, of course, is nothing. The failure of the administration's policy in Hong Kong reveals the fatal flaw at the heart of its entire approach to China. For the strategy of engagement simply has no answer to the question: What if you're wrong about China?

Indeed, administration officials and their supporters in Congress and academia dare not answer this question. Near the end of his speech on U.S.-China relations, Berger paused for a moment to warn about "the one development" that could possibly destroy Sino-American relations and "do grievous injury to the interests of the United States." Which one of the many possible dangers did Berger have in mind? you might ask. A crushing of civil liberties in Hong Kong? A Chinese invasion or blockade of Taiwan? Another Tiananmen Square massacre? Fresh evidence of a Chinese plot to subvert American elections? Well, no. Actually, Berger wasn't thinking about what China might do. The "one development" he feared was a vote by Congress to revoke China's most-favored-nation status. Nothing that China could do, it seems, could ever "destroy the dialogue" or "do grievous damage to the interests of the United States."

With such policies in Washington, it's hard to see why the Chinese should worry about living up to the world's high standards of behavior. They have nothing to fear from us.