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US-Asia Relations After the Crisis

Fall 2010 Features

US-Asia Relations After the Crisis

Avoiding a Dangerous Divide: US-Asia Relations after the CrisisThe rising continent, and the world at large, await sustained, sophisticated and sincere Asian engagement from Obama

In July of this year, 10 foreign ministers from the Association of South East Asian Nations (ASEAN) met in Hanoi. They hosted their counterparts from across the region, including US Secretary of State Hillary Clinton. ASEAN meetings are sometimes criticized as ‘talking shops,’ but this time dialogue and strategic leadership were needed immensely.

Ironically, the two leaders who most emphasized the need for leadership in Asia and across the Pacific recently left office. Japan’s former Prime Minister, Yukio Hatoyama, and Australia’s former Prime Minister, Kevin Rudd (now foreign minister), both championed regionalism early on in their short time in office. And though they are gone, the issue of regional leadership remains. Indeed, it is growing more important by the day.

The security issues facing the region, from the Korean peninsula to the outcome of the upcoming elections in Myanmar (Burma) this autumn, have grown more pressing – perhaps all the more so in view of reports that North Korea is assisting Myanmar’s ruling generals to develop nuclear capabilities. Moreover, the role and attitude of a rising China must be assessed on a regional basis, particularly given that the long-standing dispute over islets in the South China Sea may be entering a new phase. Recent Chinese statements held that the islands constitute a “core interest” – terms usually reserved for Taiwan and Tibet.

All of these issues test the region’s ability to manage peace and mitigate tensions between its main powers, and thus underscore the concern that Hatoyama and Rudd raised. Hatoyama called for an East Asian Community, emphasizing ties with China and South Korea, while questioning the continuing presence of US military bases on the island of Okinawa – the issue that eventually triggered his resignation. Rudd, by contrast, raised the idea of an Asia-Pacific Community with strong ties to the US.

These leaders’ departure from office reflected their countries’ internal politics, and their successors will focus more on declining support at home than on regional ambitions. But the questions that Hatoyama and Rudd raised – who is in Asia, and who gets to lead regional cooperation – await a satisfying answer.

As Australian and Japanese initiatives fade, attention now turns to ASEAN, which has put in place norms for peace that all major powers affirm. The ASEAN Regional Forum (ARF) is a long-standing grouping that brings together foreign ministers, and that is benefitting from renewed attention on the part of US Secretary of State Clinton, who is making her second appearance – a perfect attendance record since coming into office, and a marked improvement on the record of her predecessor, Condoleezza Rice.

But more may be needed. Asia’s major economies continue to grow and integrate, whereas the US economy remains soft, and its leaders’ attention is increasingly focussed on America’s domestic challenges. A shift of relative strategic influence and strength is discernible, especially given the rise of India and China. But old and unresolved rivalries within Asia are finding new expression as political ambitions and military budgets expand.

New fora are emerging. Building on the ASEAN defence ministers’ meeting, a formal dialogue between the defence ministers of eight key countries – China, Japan, South Korea, India, Australia, New Zealand, Russia and the US – will run in parallel with the ARF. Secretary of State Clinton has said that the US will join the East Asia Summit, an important annual initiative that brings together India and China, with ASEAN as host. Such a leaders’ meeting for substantive engagement makes sense. After all, there is already APEC for economic issues, as well as the US-ASEAN Summit, inaugurated last year.

However, the ongoing economic crisis and urgent domestic matters will continue to command much of President Obama’s attention. Indeed, he has scheduled and then postponed visits to Indonesia three times already. To be sure, each time there were extenuating circumstances – a jobs summit, the final vote on the US health care bill, and the environmental disaster in the Gulf of Mexico. However, taken together, these cancellations make clear that even a US administration that wants to engage more with Asia may still find itself preoccupied with domestic priorities – especially this year, as mid-term elections approach.

Yet, while the extenuating circumstances may be accepted – including by the Indonesians, who had looked forward to welcoming Mr. Obama to the land where he spent part of his youth – they are neither insignificant nor without consequence. This goes beyond the symbolism of the Chinese Premier deciding to visit Indonesia before Mr. Obama was to arrive in June. It points to deeper questions about America’s future in Asia. And it also touches upon the different visions of the regional architecture that have been put forward by Australia, Japan and ASEAN.

The Obama administration began with considerable ambitions in Asia. It showed its commitment in the first US-ASEAN Summit, with the President personally declaring himself the first Pacific President. But at the end of last year, when Mr. Obama journeyed to Singapore for the APEC summit, he was pilloried at home. The well-known financial analysis paper, Barron’s Report, summarized it as: “He came, he saw, he conked out.” John Bolton, the former Bush representative to the UN, was disdainful: “On economics, the president displayed the Democratic Party’s ambivalence toward free trade […] motivated by fear of labor-union opposition. On environmental and climate change issues […] Obama had to concede […] that the entire effort to craft a binding, post-Kyoto international agreement in Copenhagen had come to a complete halt.”

Bolton cited an unflattering comparison between the Obama presidency and that of John F. Kennedy. This comparison came from CNN analyst David Gergen, a former adviser to Presidents Clinton, Reagan, Ford and Nixon, who saw a parallel between Obama’s China meetings and Kennedy’s disastrous 1961 encounter with Soviet leader Nikita Khrushchev in Vienna. Gergen summarized that situation in these terms: “Kennedy, the idealist, thought that his charm and his appeals to reason would win over the Soviet leader. Instead, Khrushchev bullied him unmercifully and the men were unable to agree on anything of substance […]. Khrushchev concluded that he could push Kennedy around and started causing mischief from Berlin to Cuba.”

Gergen then compared this to Obama’s meetings with President Hu of China: “Obama went into those sessions like Kennedy: with great hope that his charm and appeal to reason – qualities so admired in the US – would work well with Hu. [But Hu] rejected arguments about Chinese human rights and currency behavior while scolding the US for its trade policies, and […] stage-managed the visit so that Obama – unlike Clinton and Bush before him – was unable to reach a large Chinese audience through television […]. This was not at all the kind of summit that an American administration would want – and it does bear some ominous similarities to the Kennedy-Khrushchev talks in Vienna.”

While both Gergen and Bolton criticized Obama, there was an important difference between the two that illustrates expectations about future dealings with China and the rest of Asia. To Gergen, the visit to Beijing and the Asian trip as a whole were taken to signal the changing power balance in the post-American world: “Even though China is still a relatively weak country […] it is rising rapidly, and people around the globe are wondering if China represents the future – and the US the past. We need to wake up […]. Unless we do pull together as a great people, we will find that our whole country – not just our President – will be in for a very rough ride. Downhill.” Bolton, on the other hand, assigned blame to Obama personally: “It was much more Mr. Obama’s submissiveness and much less a new Chinese assertiveness that made the difference. Mr. Obama simply seems unable or unwilling to defend US interests strongly and effectively, either because he feels them unworthy of defense, or because he is untroubled by their diminution.”

Bolton might be dismissed as just another anti-Obama conservative. But the criticisms echoed. Progressives who had backed Obama also complained, although on different grounds – in particular, compromises offered on health care and the lack of progress on closing Guantanamo. The institutionalized American satire, Saturday Night Live, turned viciously on Obama’s press conference with President Hu. By late November of last year, with American frustration about job levels festering, the President’s approval ratings fell below 50 percent for the first time.

The US economy remains fragile now, and domestic issues continue to take precedence over international ones. The consequence may well be drift in America’s relations with East Asia. Consider trade: When President Obama attended the APEC summit, he won kudos for showing interest in the Trans-Pacific Partnership. However, the truth is that a number of free trade agreements that the US has already negotiated – with South Korea, for instance – remain mired in Congress, unratified. Trade experts estimate that, on balance, the Korean agreement is more favourable to the US. However, the public mood in the US against trade and globalization muddies the perception. Unless the economic conditions turn and the politics improves, the FTA may never pass through Congress.

Note, too, that the largest number of anti-dumping cases in the WTO in 2009 are brought against imports from China, and the many complaints against goods from China because of doubts over safety and public health. In 2007, contaminated Chinese pet food was suspected of killing hundreds of US pets, while toymaker Mattel recalled millions of mainland-made products over lead paint concerns. These concerns, substantiated in some cases, point to a larger fear of China and Asia outcompeting America by unfair means. Protectionism has not come down like an iron wall across the world. But globalization and free trade have been knocked back more than once and from more than one source. Rather than a big bang, the ideal of freer trade and the belief that all benefit from interdependence are being killed by a thousand smaller wounds. In this crisis, the negative impression of globalization is gaining ground in the US. To these Americans, the face of this unkind and unfair globalization looks Asian.

When American attention does turn to Asia, its agenda can be worrying. It is now filled with complaints about China, including its undervalued currency, with the Obama administration and Treasury Secretary Tim Geithner pushing for the yuan’s appreciation. China’s statement in June of this year that it would move to a managed floating exchange rate regime will help keep relations on an even keel, going forward.

Still, stabilizing US-China ties will take more than statements. Many US lawmakers and commentators remain skeptical about how far China will go. When China managed the float between 2005 and 2008, there was only a marginal appreciation. Unless China is seen to do more, American attitudes will harden. Take Democrat Senator Charles Schumer: the senator has pushed to restrict Chinese imports, and was quoted as believing that “only strong legislation will get the Chinese to change.”

Despite China’s shift, the issue will continue to simmer. Facing mid-term elections this November, many American politicians will be tempted to bring the issue to a boil to gain votes by hitting out at China. That can hurt not just China but the rest of Asia, since the regional production network hubs are around China. Unless China and others in the region move on their currencies, pressure will grow in the US for action against imports from across the Pacific. This signals a growing belief among Americans that trade with Asia is not always to their benefit. Given this mood, it is possible that the US will either be largely absent from Asia, or engage with it acrimoniously.

In the past, Asians would have sought to accommodate America’s demands. Not so now. China, for one, sees no need to bend to US pressure. Even Japan is openly debating the value of US military bases in the country. Asians are growing more confident and self-assertive, and not without justification.

Still, Asian triumphalism must be avoided. So too must the belief that Asians can go it alone, without America. There are security threats and rivalries in the region that continue to require US involvement. Moreover, the US is still by far the largest world economy, and a critical market for Asia.

Instead of simply waiting for Mr. Obama, Asians should seek to engage America in new and more sustainable ways. One forum could be APEC. But APEC is focussed on economics, and its membership goes beyond just Asia and the US. Another forum could be the summit that Mr. Obama began with ASEAN. This is important as a complement to the active ties that ASEAN has with China, Japan, India and other key players.

Another initiative by Asians may be useful – hence the recent proliferation of proposals, including the expansion of the East Asia Summit, which looks likely. While these proposals vary, some key principles can be aligned. First, any new arrangement should aim to ensure a regular dialogue among strategic partners, especially the US. However, we must accept that these dialogues cannot occur too often. The political reality is that, while America continues to be important to Asia, its leadership may not always be present.

Second, any new arrangement cannot be seen as trumping intra-Asian frameworks, in which ASEAN has been central. No major power, including the US, can be allowed to dominate these arrangements. Third, any new arrangement should be inclusive, and based on principles of equality. Asia cannot be run by a small directorate of major powers. Medium- and small-sized states must be included.

The relationship between the US and Asia is changing, and must necessarily change. Leaders, policy-makers, companies and citizens on both sides must help to bridge the divide that would otherwise emerge in order to find a new balance. This new balance of relationships between the US and Asia will shape, for better or worse, the coming years not only for Asians and Americans but, in tandem, for the post-crisis world.


Simon Tay is the author of Asia Alone: The Dangerous Post-Crisis Divide from America and Chairman of the Singapore Institute of International Affairs.

(Illustration: Blair Drawson)

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