While the public yawns, the United States Congress continues to spend thousands of man hours and millions of dollars of taxpayers' money on dishing dirt on China's alleged attempts to buy influence through political donations. This column has already discussed the illogicality and unlikely naivety of such tactics on the part of Beijing officials, and noted that those public yawns are emanating from the fact that citizens are well aware that so many other foreign states - from Taipei to London - do the Washington cash dance so much better. It now also needs to be said that the Chinagate probe is proving to be a massive red herring, deflecting members of Congress' attention away from a far more aggressive and efficient China lobby much closer to home: corporate America. Any China-watcher in Congress worth his salt - and it sometimes seems that there are pitifully few - knows that Beijing has never had any need to dip into its foreign exchange reserves to influence the outcome of votes on, to quote the best example, Most Favoured Nation status, because big American businesses, aided by the US-China Business Council and the Hong Kong Economic and Trade Office's army of lobbyists, have been happy to pay for the effort themselves. But now, almost without being noticed, the big corporations have once again managed to concentrate immense power into winning friends and influencing people on an important matter of Sino-US trade. This time, however, it is not merely a question of helping the administration convince Congress to maintain the status quo; it involves seducing the White House into a major - and politically risky - policy shift. The issue is whether President Bill Clinton should make a certification that China has stopped exporting sensitive nuclear technology to rogue states such as Iran, thereby allowing him to give the go-ahead to US power generation companies to make nuclear power deals with the mainland. Despite predictable State Department-speak that the US 'is not there yet' on giving Beijing this coveted blessing, it is by now clear that the agreement is all but a fait accompli, and that President Jiang Zemin will have it to take home with him from his American trip next month. Foreign Minister Qian Qichen, who yesterday was hammering out more details of the agreement with Madeleine Albright in New York, has been making public noises since the beginning of the year that the commencement of US-Sino nuclear energy co-operation was top of Beijing's wish-list, but it has only recently become clear why the White House felt so compelled to bring it to fruition. The answer is, of course, billions of dollars of business for firms like Westinghouse and General Electric, which have had to stand on the sidelines fuming at being shut out while companies from France and elsewhere go in and build nuclear plants with Chinese partners. Experts estimate there are at least 10 nuclear plants waiting to be built in the short-term, and maybe twice that in the long run. These companies have been doing years of groundwork on the mainland, setting up joint ventures in non-nuclear areas, but a 1985 law banning the sharing of nuclear knowledge without presidential approval has stymied their plans for winning the big prize. But the stakes are getting high enough for the White House to consider risking the wrath of the sizeable anti-China lobby in Congress to relax the rules. Indeed, Bob Newman, president of a nuclear engineering firm warned last week that if foreign firms won the current spate of contracts, they would set the design standards that would shut US competitors out of the China market for good. And with the US domestic nuclear power generation market all but exhausted, China becomes even more of a holy grail. For its own part, Beijing has reasons for wanting US firms to enter the market. First, the extra competition from having world leaders bidding for the contracts would drive costs down. More importantly, China is eager to get its hands on the best of American nuclear energy technology. This is the factor that most worries US legislators who fret at seeing much of Beijing's own technology passed on to Iran and the like; and administration officials are still puzzling over whether China's hastily-announced nuclear export controls mean what they say, or are mere window-dressing to give President Clinton enough cover to do the deal. At the back of many officials' minds is that on more than one occasion, Beijing has made agreements with Washington to halt co-operation with rogue states involving sensitive technology, which CIA intelligence suggests are routinely broken. Even assuming President Clinton certifies that Beijing has stopped selling nuclear equipment and know-how to Teheran, the administration is not blithely expecting that to be the end of the matter. The political issue is one of trading off the inevitable discord from Congress when transgressions occur with the need to help important American businesses get a foothold in the mainland market. One valuable propaganda benefit for both sides would be the inevitable drop in the US trade deficit with the mainland. It has always been convenient for Beijing to fend off Washington's complaints about the trade imbalance by politely suggesting that the US should drop its technology restrictions. From Washington's point of view, even a couple of billion dollars off the burgeoning deficit would be welcome political relief. A group of US experts is to travel to Beijing within the next few days to draw up final details of the co-operation agreement. Neither side can afford to come away empty-handed.
