The U.S.-China Air Transport Services Agreement, a bilateral aviation agreement, which provides for air carrier services into the U.S. and China, was signed in 1980. At that time, Northwest and Pan Am were the designated U.S. airlines. United Airlines later replaced Pan Am when it purchased Pan Am’s Asian routes in the mid-1980s. Then in 1992, a new U.S. carrier (which had to be an all-cargo carrier) was allowed to enter the U.S.-China market. The U.S. selected Evergreen, which in 1995 sold its air rights to Federal Express.

On April 8, 1999, the U.S. and China signed a new Protocol that amends the Agreement to provide for the expansion, in two phases, of U.S. air services to China. Under the two phases, the three U.S. carriers now designated to serve China’s market (FedEx, Northwest, and United) can increase the number of round trips to China effective April 1, 2000. On April 1, 2001, the U.S. can designate a fourth U.S. carrier to serve China. United Parcel Service (UPS), American Airlines, Delta, and Polar have all applied to the Department of Transportation for this designation.

The Teamsters Union supports UPS’ application for this designation, but the Clinton Administration has criticized our support, claiming that it conflicts with our position against granting China Permanent Normal Trade Relations (PNTR) status. Nothing could be farther from the truth! The fact is that our support for UPS’ application proves that the Teamsters Union is not opposed to fair trade policies that provide guaranteed opportunities for the American workforce to grow and guaranteed benefits for U.S.-based companies.

The U.S.-China Bilateral Trade Agreement, however, does not provide those same guarantees. A quick review of our 21-year trading relationship with China will show that China has systematically broken trade commitments to the U.S. and other countries. China has only halted violations of trade – and other international commitments – when threatened with dire economic implications in the form of trade sanctions. Now China has negotiated another trade agreement with the U.S., which we have no reason to believe it will adhere to. And those who think that the WTO dispute resolution process is the answer should look to the U.S.-European Union WTO fights to know that dispute resolution for resolving trade violations takes too much time to complete and in the end relies on something entirely missing in China: commitment to the rule of law. The only way to guarantee that American workers and U.S. businesses benefit from the new agreement is to maintain our unilateral trade enforcement tools and review China’s trading status on an annual basis, at least until we have evidence that China will live up to the new agreement and follow WTO terms.

Separately, unlike the U.S.-China Bilateral Trade Agreement, granting UPS landing rights in China will create American jobs. In fact, the Teamsters Union has submitted to the Department of Transportation exhibits that demonstrate that thousands of Teamster jobs will be created from UPS’ new authority. International package delivery is the fastest growing segment of the package delivery industry. Indeed, every 40 packages that UPS ships overseas create a job, which will be a Teamster job. The Teamsters Union cannot sit idly by while FedEx, one of the most anti-union companies in the world, reaps the benefits of its monopoly position in China.

The U.S.-China Bilateral Trade Agreement, however, will result in massive U.S. job losses as our trade deficit with China balloons to an estimated $131 billion by 2010. On balance, 817,000 jobs will be eliminated by the growth in the trade deficit with China over the next decade. These losses are on top of the 880,000 jobs the U.S. has already lost due to its current trade deficit with China.

Finally, whether China is granted PNTR or not has no bearing on the continuation of the bilateral aviation agreement. A fourth U.S. carrier will be named to serve China, with or without PNTR, and with or without China’s accession to the WTO. It is clear that the Administration is just using this issue to distract Congress from the real question: Do we want to end annual NTR review and strip Congress of its main tool to guarantee that both American workers and American businesses benefit from the new trade agreement?