Business as Usual in China

Steven Mosher makes two fatal flaws in his analysis of recent events in China ("The China Syndrome," Oct.). First, he ignores the critically important role that the opening up of business relations with the West played in creating the political atmosphere that encouraged the students to try for even more freedom. It was western businessmen who took in the computers, fax machines, and copiers that made possible the exchange of information so critical to what happened.

It's not surprising that some of the men who have taken power since Tiananmen are demanding that the doors to the West be again slammed and businessmen kept out. To deliberately impose economic sanctions and a trade embargo is to play into the hands of the enemies of more freedom in China. All we will get is another Cuba.

It takes a little bit of wealth to develop a demand for a little bit of freedom. The best we can do to help China is to sell them the hammers, nails, and technology they will buy to build a better economy, and will inevitably be used to build a free society, too.

Mosher's second flaw is to accept without question the idea that America has a moral responsibility to do something to help freedom in China. Like all other countries, the Chinese people must win their fight for freedom alone and on their own. The only way we can promote freedom is by the example we give. What China needs as help from us is a corps of American Lafayettes dressed in business suits and carrying order books, factory plans, sales techniques, and more fax machines and computers.

Mack Tanner
Moscow, ID

Mr. Mosher replies: My purpose was to explain not the origins of China's democracy movement but the response of the United States. But let me say that the demand for democratization is the product of more than just trade. In the Voice of America, the Chinese people have a reliable source of information about events in the rest of the world and, most importantly, in China itself. The VOA rendered the news blackout of the demonstrations by the official media completely ineffective. In students who have studied at American universities, they have a group that is personally familiar with advantages of democracy and disillusioned with Marxism. In the example of Taiwan, they have a Chinese province that has succeeded in not only modernizing, but democratizing. Hundreds of thousands of visitors from Taiwan have brought this point to the mainland in a very concrete way, by bestowing TVs, stereos, rice cookers, and other consumer items on their poor relations there. Finally, the private enterprise sector has seen explosive growth during the 1980s, expanding by more than 50 percent a year. It is no accident, as Marxists were once fond of saying, that most of the 1.5 million yuan collected by the demonstrators came from the private sector, which instinctively realizes that its interests lie in the direction of a more open, pluralistic, and democratic society.

No one in the Beijing leadership is demanding that U.S. businesssmen be kept out, or that the door to the West be shut tight. Rather, they are desperate that existing economic ties not be cut, and that foreign trade continue to grow. Only one day after the Tiananmen massacre, American businessmen started receiving fax transmissions from their Chinese counterparts offering them excellent terms if they would move quickly to close prospective deals. It is to take advantage of this desperation that I proposed, along with a host of noneconomic measures, that the United States consider limited sanctions for a limited purpose.

Beijing has not yet decided how wide the scope of its ongoing purge of activists will be, nor how the 10,000 to 20,000 people already arrested will be punished. If the United States does nothing, the most likely outcome is that detainees will be dealt with harshly, with many executions or lengthy prison terms. On the other hand, if the Bush administration makes clear that further arrests and executions will exact a heavy cost in terms of U.S.-Chinese relations, then lenient treatment becomes more likely. Release after six months to a year of labor or reeducation is perhaps the best outcome that can reasonably be hoped for.

In the long run the VOA, Taiwan, returned students, private enterprise in China, and international trade will all be important factors in China's democratization. Over the short term, however, perhaps the best way to promote the cause of liberty in China is to work to free its advocates.

AAA Ballet?

Virginia Postrel's editorial on the National Endowment for the Arts ("Sex, Religion and Art Politics," Oct.) has much to commend. But, unfortunately, she shows an ignorance of art and its contemporary problems.

Artists engaged in practical or popular arts do enjoy significant monetary rewards. But even popular artists suffer from the demand that every production be a megahit—or else. Rock music, for example, has been in decline for several years, because declining experimentation has led to a less interesting product. Some of the best rock music had its roots in small clubs long before it reached the big time. The Beatles played Liverpool and Germany before Ed Sullivan. The people who run our mass entertainment businesses all too often don't know how to nurture the very art they depend upon anymore.

Mass marketing art is a tremendously good idea. But where are new artists going to come from? Film the Bolshoi—or the New York Ballet—or the Royal Ballet. It's a great idea. But dancers and choreographers don't start out great. It takes years of work to build a great ballet company, and much labor in out of the way venues. Baseball has its minor leagues: Why not the arts?

An unfortunate lack of money also leads artists to seek government assistance. During the 1970s, according to the Wall Street Journal, artists' real incomes declined by 44 percent.

The irony is that the private sector could easily solve these problems and win the support of artists everywhere. The middle class and wealthy could become patrons of the arts—as in times past. We can seek out the new and the struggling—and help those we think worthy succeed. Businesspeople directly involved in show business could learn the art side of their business—and run their businesses with an eye toward artistic health as well as next quarter's profits. Finally, we all can stand up for personal freedom. Congress isn't going to send tanks into Greenwich Village—but too many people in our society would like to do just that.

Let's get rid of the NEA—but let's also replace it with decentralized, liberal, democratic support of healthy arts communities. Privatization, not simply abolition, is the answer.

Charles J. Divine
Trenton, NJ

Capital Improvements

Charles Oliver's otherwise excellent editorial on the capital gains tax ("A Capital Idea," Oct.) seriously understates the importance of inflation indexing of taxes on investment income. Even if the capital gains rate is lowered, without indexing for inflation the tax on illusory inflationary gains can be devastating. Furthermore, while a capital gains tax cut can (and probably will) be reversed, once indexing is passed it is likely to remain in the tax code forever.

Milton Friedman has argued that inflation indexing for all investment income—both interest and capital gains—should be the top priority for investment tax reform. As Oliver notes, indexing of capital gains is being considered in Washington; it is important that those considerations be widened to include interest income, so that the ordinary working American (who is more likely to earn interest than capital gains) will also be protected.

Inflation indexing is a substantial step toward both justice and economic efficiency that should be supported by all well-meaning Americans.

David H. Miller
Sacramento, CA

Only Spouses Need Apply

Anent "Georgia on My Mind" (Trends, Oct.), an update is in order. The Superior Court of DeKalb County, Georgia, has surprisingly ruled that Georgia's 156-year-old sodomy law cannot be applied to consenting married couples. In his decision, Judge Robert Castellani wrote: "Government has no business with a married couple's private consensual sexual practices.…This court believes the petitioner's right to marital and domestic privacy has been violated by the sodomy law as applied to him." James D. Moseley, who has already served 18 months of his two-year sentence, has been sprung.

Attorney General Michael Bowers has yet to decide if the state will appeal. However, he has publicly stated: "Insofar as the court holds as a matter of law that the sodomy statute can't be applied to a married couple, that…is exactly what we had said." Note that the law still applies to persons not married to one another. The decision, while a slight bow in the direction of common sense, hardly puts Georgia in the libertarian column.

Glenn D. Eberhardt
Warner Robins, GA