Absolutely correct. Boost income, mutually, for the US and China via Trade, with the hopes that China becomes more open to capitalism, democracy, ending atrocities, etc. The US knew exactly what might happen but the risk was worth it to avoid nuclear war with China and prevent a Chinese invasion of Taiwan.
In 2000 after near-war with China following the US attack on the China Embassy in Belgrade in 1999 and raw feelings still from Taiwan Strait crisis in 1996, Clinton says this about about favoring establishment of permanent normal trade relations between US-China (PNTR and leading up to bringing China into the WTO):
“the other point I would like to make is there is a SERIOUS National Security issue here - we do not know what China will choose to do in the future - and China will make that decision for itself - but we know that one decision will dramatically increase the chances of a constructive relationship with China in a stable Asia…and the other will increase the chances of a less happy outcome…” - President Clinton
US understood the risks of establishing PNTR with China and allowing them into the WTO – but the alternative was unthinkable. People need to remember how dire US-China relations were.
By interlocking with China economically, the US strategy at the time was that “we can keep them close, under watchful eye, and hopefully even make them depend on us through mutual economic benefits”. If US and China become dependent on each other, there is less chance of a terrible conflict. It’s the classic “keep your friends close, enemies closer” strategy.
Fast-forward — Now we know that China didn’t loosen up even with dependencies in place, and instead doubled down on knocking the US out economically, psychologically, and militarily. Again, US knew the risk, but deemed it worth it.
Between when Clinton was leaving and Bush’s first days in office, the situation with China was dire…
China was caught building military facilities inside Iraq. Major red flags were going up in UN Security Council and NATO. The US China Hawks deemed China in early 2001 to be the number one threat to humanity.
This quote from Pres Bush press conference Feb 2001:
Mr. President, on Iraq, what is your understanding of the Chinese presence in Iraq, especially with regard to constructing military facilities? And do you see anything that you see as a violation of U.N. sanctions? THE PRESIDENT: We’re concerned about the Chinese presence in Iraq, and we are, my administration is sending the appropriate response to the Chinese. Yes, it’s troubling that they’d be involved in helping Iraq develop a system that will endanger our pilots. REPORTER: “That is what they’re doing, sir?, you’re convinced that is - - THE PRESIDENT: “We are going to send a message to the Chinese” - President Bush
Pre-Gulf War 1 context:
From 1982 to 1989, China sold almost $5 billion worth of arms to Iraq, which represents 31.4 percent of all China’s arms sales during that period and over twice the value of Chinese arms sold to Iran in those years.
After the Iran-Iraq war Chinese arms to Iraq fell dramatically and then China completely lost Iraq as an arms customer at the onset of the Gulf War. Iraq’s poor performance during the Gulf War in the face of high-tech U.S. weapons further showed apprehensions about the quality of Chinese weapons systems in Iraq and the rest of the region.
US was alarmed that China would come in again after GW1 and start building military facilities inside Iraq. Anyways, US went back again in GW2.
US-China tensions soon escalated even further with the Hainan Island Incident. And then we all know what happened later that year. The US responded in kind - planting a Massive Army right on China’s doorstep (Afghanistan) while simultaneously opening WTO to China, plus the US went after China’s interests in Iraq. It was an incredible power move by the US when you think about it. Unfortunately China wiggled out of it and pivoted to militarizing the South China Sea while massively growing their global influence, supply chain, and trade. China turned the US response into its strength… Until 2018 when the tariff war started.
In summary, the US knocked out China’s Arms Customers one by one, sabotaged China’s oil development projects, and pushed China to become economically reliant on US consumers. Has it worked? We won’t know for a while as US-China war is ongoing.