Editorial: A world of concern

Monday, Nov. 19, 2007 | 7:06 a.m.

China's emergence as a world power is coming at a price to America. A congressional advisory committee reported last week that China has tipped the trade balance in its favor with its economic policies.

The report by the U.S.-China Economic and Security Review Commission found that small and midsize American manufacturers "face the full brunt of China's unfair trade practices, including currency manipulation and illegal subsidies for China."

The commission, created in 2000 to study issues between the countries, points to serious problems underscoring the tenuous relationship between the two countries.

The report notes that China continues to spy on American companies, trying to steal technology. It also raises concerns about China's military spending.

Chinese officials have denied any industrial espionage and said they want to maintain healthy relationships with other countries.

"China never does anything undermining the interests of other countries," Chinese Foreign Ministry spokesman Liu Jianchao said. "China and the U.S. have a fundamental common interest in promoting sound and rapid development."

That sounds good in theory, but it hasn't worked smoothly. The report said small and midsize American manufacturers are suffering because of China's manipulation of markets, which allows Chinese manufacturers to sell well below U.S. companies. And China has rebuffed many attempts to work with America, much less the rest of the world.

The commission noted the U.S. effort to pursue remedies through the World Trade Organization and recommended more aggressive action, while also encouraging a sustained diplomatic effort with China.

Both are needed. It is undoubtedly a difficult situation, as the relationship has proved over the past three decades. China is a superpower flexing its muscles and has a huge effect on America, from the economy to the recent rash of toy recalls. American leaders must make sure their counterparts in China understand that our future relationship needs to be based on fairness and safety.