It would be perverse not to see a connection between these events. For Mr Clinton, the argument about MFN status was another example of campaign talk coming home to roost. At stake for China was the privileged 8 per cent tariff on Chinese goods entering the United States, likely to rise to an average of 40 per cent without MFN. Though the balance of trade is heavily in China's favour, such a steep rise in tariffs could be expected to have repercussions in the form of retaliation against American exporters to China, whose trade has grown 25 per cent a year in the past two years.
On the campaign trail last year, candidate Clinton had berated President George Bush for 'coddling' China by refusing to concede Congress's desire to use trade as a lever on the Chinese government. But once in office, Mr Clinton found himself the target of a vigorous lobby by US businessmen who feared that they could lose their position in one of the world's fastest-growing markets.
The potential of that market has dazzled Western traders since the mid 19th century and is the first of three arguments made against too loud a complaint about China's human rights abuses. The second has been that the Chinese government is immune to economic pressure, regarding it as unwarranted interference in its internal affairs. Finally, there is the article of Western ideological faith which says that by helping through trade and investment to develop a more open, market economy within China, the West is necessarily encouraging the growth of the democracy that is a necessary condition of a market economy. (This latter is an argument, however, that is not deemed to apply to Cuba.)
Mr Clinton, in the event, settled for a distant threat: to renew MFN status this year, but to make further renewal conditional on as yet undefined human rights factors. This much watered down proposal provoked a high-pitched scream of indignation from Peking. But the release of Xu is a sign that the Chinese government is less indifferent to Western pressure than it likes to pretend.
There have been times in recent history when Peking has been impervious to outside disapproval. But Deng Xiaoping's economic policies have left China much more vulnerable than before to threats of a downturn in prosperity. Deng, unlike the Western opponents of human rights pressures, does not believe that an open economy needs an open political system. He has a fixed faith that the opposite is true: that it is possible to embrace the prosperity that economic modernisation brings without being infected by noxious Western political ideas. As Deng has put it to his own party hardliners, if you open the window you let in a few flies. Then you swat them. It is a small price to pay for the benefits of economic modernisation.
To keep the motor running, though, the economy must be open, and that makes it vulnerable to external pressures to a degree unimaginable in the early Eighties, when Xu Wenli was beginning his sentence. Back then, the West was rather less sensitive to Chinese human rights abuses. There had been no live television broadcasts of the Tiananmen Square repression in April 1976, when pro- Deng demonstrators were beaten and arrested. Nor did the suppression of Democracy Wall movement in 1979 - an earlier fly-swatting episode when Deng first showed his attitude to political reform - excite much outside indignation. That was when Xu was sentenced, after a farcical trial. When his account of his long years of suffering was smuggled to the West, the authorities responded by punishing him further.
There was no guarantee then that any of the Democracy Wall activists would be released, even when their prison terms had been served, let alone in advance. It took the live satellite news coverage of the Tiananmen Square repression - which came to a head four years ago this week - to sensitise Western public opinion to Chinese human rights abuses.
Despite the glare of international attention on the events of 1989, misunderstandings persist about exactly what happened then. A book published this week, Black Hands of Beijing, by Robin Munro and George Black (Wiley, pounds 15.95), points out that there are two 'official' histories of the events. In the version constructed by the Western media, the students were centre-stage, responsible for inspiring the leadership's fear and fury. In the Chinese government's version, it was not the students who were the problem, but the 'extremely small number of people (who) want to . . . negate the leadership of the Communist Party and to negate the socialist system'.
Above all, the book shows that it was ordinary citizens in the streets surrounding Tiananmen Square who died in the immediate violence, rather than the students. In the subsequent trials it was the alleged conspirators, the 'black hands', who went to jail. As George Black said last week, it was not so much the fireworks of the mass demonstrations and confrontation that were the threat but the slower-burning fire of peaceful, independent action and organisation by such men as the three heroes of his book, Chen Ziming, Wang Juntao and Han Dongfang.
Han now lives in the US after serving a jail term for his union activities. Wang and Chen, who worked closely in the cause of reform from the mid-Eighties, are still serving 13-year sentences.
Chen is perhaps the most remarkable of the three: he was first arrested at the end of the Cultural Revolution, was active in the 1976 Tiananmen incident and was a member of the editorial board of the independent journal Peking Spring during the Democracy Wall movement.
In the Eighties he created a network of private think-tanks, of which the most important was the Peking Social and Economic Sciences Research Institute. Because of his political independence, his work was never officially encouraged. The institute tried unsuccessfully to mediate between the students and the Communist Party in May 1989. Chen was a moderate reformer of independent spirit, an intellectual entrepreneur who had supported Deng's reforms in the early Eighties. In 1991, he was tried for sedition.
These men's crime was not what they said or did, but that they acted independently and by doing so challenged the right of the Communist Party to dictate the thoughts and actions of all of China's citizens. As the country's increasing economic interdependence hones the sensitivities of its political rulers, the fate of China's free thinkers becomes an important marker. When Mr Clinton comes to consider what human rights conditions to attach to next year's renewal of MFN, he would do well to remember the names of Chen Ziming and Wang Juntao.