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Danger in Asia

by Michael Auslin

A strategy for the incoming administration

Sixteen years after 9/11, much of the world seems to be teetering on the brink of disorder. Much of it, that is, except the Indo-Pacific region. Amid apocalyptic devastation in Syria, ongoing Russian aggression in Ukraine, and the specter of a nuclear-capable Iran, a global observer may be forgiven for assuming that there is no equivalent challenge to America in Asia.

Could Asia, however, turn out to be the center of global crisis during the Trump administration?

In many circles, to ask the question is to be considered a fantasist, an alarmist, or an ignoramus. After all, China is America’s second-largest trading partner, after Canada, while the rest of Asia has steadily modernized and globalized over the past half century. There has not been a region-wide war fought in Asia since 1945, and for all the decades following Hiroshima and Nagasaki, the United States has held unchallenged military superiority. In doing so, we have maintained a unique alliance structure with five Asian nations and participated in most of the region’s major multilateral initiatives, such as the East Asia Summit.

By any ordinary measure, Asia appears to be the world’s most energetic region, with economic opportunity, stable governments, and a collective global importance perhaps second only to that of America’s. More than half of the world’s population lives in a circle encompassing India, China, the Korean peninsula, Japan, and Southeast Asia. Approximately 40 percent of global economic output comes from this broad Indo-Pacific region. It contains some of the world’s most populous countries, its largest democracy, and its second- and third-largest economies.

But there is another side to Asia’s modern story: one of deepening regional rivalries, intensifying territorial disputes, economic weakness, and domestic political tension. Taken together, these risks threaten what many had thought would be the “Asian century.” Recognizing these challenges and developing policies to mitigate their effects should be a primary foreign-policy goal of the Trump administration.

While only Asian nations can solve Asian problems, America remains the most important external player in the region’s destiny. Whether with our friends, our potential partners, or even our competitors, we have a role to play in managing risk and attempting to preserve Asia’s prosperity and stability for another generation. For Trump’s national-security team, having a plan in place to address these concerns is vital. Even the most experienced of statesmen would be taxed if caught by surprise by an Asian crisis.

Avoiding just such a surprise means questioning the three main assumptions that U.S. policymakers have held for decades about Asia and our relationship to it: that Asia will inexorably continue to rise economically, that our network of alliances will endure unchanged, and that the likelihood of a shooting war will remain low.

Start with economics, the one area where nearly everyone has assumed that Asia remains largely bulletproof. There may be sluggards, such as Japan, but overall, the presumption that Asia will remain the world’s most dynamic growth region continues to guide the thinking of investors, traders, and U.S. officials. The reality is different, as China glides toward stagnation, Japan’s reform plans fail to revitalize its economy, and Southeast Asia lags because of poor planning and inefficiencies.

Trump can’t change bad macroeconomic policy on the part of Asian leaders, but he should be prepared for sluggish economic performance throughout the Pacific Rim, which will affect the global economy. He may have decided that the Trans-Pacific Partnership trade agreement was not a good deal for American workers, but Asia needs more free trade to keep growing, not less. China has already moved to fill the free-trade gap by aggressively pushing its Regional Comprehensive Economic Partnership and using its new Asian Infrastructure Investment Bank to cement closer ties with the Philippines and other countries.

Unless he is prepared to lose more economic ground in Asia, Trump should make the expansion of trade ties a priority. Beginning with a U.S.–Japan bilateral free-trade deal, Trump should encourage Asian investment in the United States and work to open export markets for U.S. agricultural products and high-end services such as finance and telecommunications. He should also shift U.S. foreign-aid policy to focus on developing Asia’s infrastructure, which is where China and Japan have put most of their efforts. We need to start seriously competing again for trade and investment.

As for China, the economic ties between our two countries are important enough that Trump should concentrate not merely on ensuring that China plays by the rules when it comes to intellectual-property protection and fair play for U.S. business in China; he should also focus on having a sustained dialogue with China about economic reform, bluntly stressing the dangers Beijing presents to its own fortunes if it does not mend its ways. Meaningful reform that reduces overproduction, corrects widespread malinvestment, and tackles the looming debt crisis, among other policies, is badly needed. An economically weak China — let alone a collapsing one — would not benefit the United States.

The second assumption about America’s Asia policy that needs reexamining relates to our allies. Since the 1950s, Washington has maintained formal alliances with five Asia-Pacific nations: Australia (1951), the Philippines (1951), South Korea (1953), Thailand (1954), and Japan (1960). This “hub and spoke” model forms the foundation for a host of other relationships and allows the United States to maintain forward-deployed military forces, especially in Japan.

During the campaign, Trump questioned the value of our global alliances, including those in Asia. In musing about whether to ask Japan and South Korea to pay more for hosting U.S. troops or whether to let them develop their own nuclear capabilities, he raised doubts about America’s longstanding commitments in the region. In the weeks after his election, however, Trump spoke with the leaders of Australia, the Philippines, and South Korea and met with Japan’s prime minister in New York.

By the end of Trump’s first year in office, he may discover just how important these alliances are. In fact, the Trump national-security team may find they have only one fully reliable ally in Asia, Japan.

Just weeks after speaking with Trump, South Korea’s president, Park Geun-hye, was impeached over a bribery scandal. She is almost certain to be removed from office and it is highly likely that the country’s left-wing parties will win the next election. Their policies are likely to be antithetical to Washington and may include reducing alliance cooperation (such as by canceling the new missile-defense system negotiated by the Obama administration) and moving closer to both China and North Korea.

As for the Philippines, President Rodrigo Duterte has dramatically shifted his country toward China, receiving military and domestic aid from Beijing, and has already put the alliance with Washington in a holding pattern. With the junta still firmly in control in Thailand, there are limits to how much cooperation the U.S. government can undertake with Bangkok. And even Australia, long our closest ally ideologically in the region, is increasingly influenced by Chinese economic ties and has announced that it will not undertake freedom-of-navigation operations in the South China Sea.

The Obama administration’s legacy, therefore, is one of negotiating more extensive relationships with allies and a few other partners in Asia only to have those relationships undermined by their domestic politics and Chinese influence-buying.

The Trump team will find it difficult to act in Asia without allies. It is not merely a matter of basing rights and access for U.S. military forces, important as those are. It is a larger question of forming a community of liberal interests to ensure that no power is strong enough to dominate the region and impose its own set of rules. Moreover, in times of crisis, as will inevitably occur at some point with North Korea and possibly in the South China Sea, Washington’s entire security strategy is predicated on working with allies to ensure that war does not break out.

Maintaining trustworthy, credible, and effective relations with allies therefore should be a priority for the Trump administration. While President Trump does not need a Bush-style freedom agenda for Asia, we should care about the political balance in the region and should encourage the stability of democratic nations and the spread of liberal values. In concert with allies, we are more able to influence Asian nations to adopt or further develop civil society, the rule of law, gender and ethnic equality, education, and other pillars of a liberal order. On the other hand, if illiberalism spreads, perhaps even among our allies, our influence will be diminished, correspondingly reducing our ability to protect our own interests or to be seen as acting in the best interests of the region as a whole.

Presuppositions about the unlikelihood of armed conflict in Asia are the third factor that Trump’s administration should question. During the campaign, Trump voiced the doubts of many Americans about whether we should remain committed to ensuring stability throughout the Indo-Pacific. It is a costly commitment, requiring tens of thousands of U.S. military personnel be based halfway around the world.

Yet the economically dynamic, largely peaceful Asia that we take for granted today is a direct product of Washington’s decades-long military presence. No one knows how the region would have developed without the stability provided by U.S. forces. And given Asia’s central role in the global economy — from providing raw materials to producing goods and containing the world’s most critical trade routes — any major armed conflict would have untold effects on the global economy and could potentially cause catastrophic destruction.

Far from resolving their myriad disputes, however, Asian nations have maneuvered ever closer to a clash. Whether in the South or East China Seas, on the Indo–Chinese border, or on the Korean peninsula, territorial disputes have resulted in an arms race throughout the region and raised the specter of conflict. Alternatively, countries such as the Philippines have largely surrendered their territorial claims in the face of Chinese pressure and belligerence.

With challenges ranging from a North Korea that is approaching the capability to put a nuclear warhead on a long-range ballistic missile to China’s rapidly expanding military, the balance of power in Asia is shifting away from the United States and its allies. As these nations — especially China — further develop their capabilities, it becomes ever less likely that disputes will be resolved through honest, open negotiations. Rather, intimidation and threat, if not the actual use of force, may become the norm of Asian geopolitics.

In such an environment, American commitments become even more important. The Trump administration could decide to experiment with a dramatic reduction in U.S. presence and credibility. It would certainly be cheaper in the short run to do so. Such a strategy may even reveal that Beijing has no long-term aggressive designs but simply seeks to be recognized as the region’s unchallenged great power.

But that would be a risky bet. China has shown little inclination to compromise on its claims and it is already strong enough to deter all Asian nations but Japan. Even attempting to undertake a reduction in U.S. security activities in Asia would introduce such huge uncertainty that everything from insurance rates to national-defense plans would be dramatically affected.

Instead, President Trump should endevour to regain American credibility in Asian security matters. Maintaining stability in Asia requires a firm U.S. commitment to allies and partners and an unambiguous willingness to underwrite the open trade routes and the free flow of goods and people that are so vital to our own economic well-being. Announcing a buildup of the U.S. Navy is a good first step, but the Trump administration should also make clear that it will not ignore China’s intimidation of other countries or the undermining of their freedom of action. More freedom-of-navigation operations in tense areas, the willingness to provide more defense equipment to smaller nations, and the sharing of intelligence are all ways to make sure the playing field remains level.

If these sound like old ideas, it’s because they are. They have been tried and tested over decades as the best ways to ensure prosperity and stability. They are being undermined by an assertive China, but also by American failure to continue to set the pace on trade and political leadership. Expending the time and resources to ensure that Asia remains at peace and economically healthy is in the long run the wisest investment we can make.

– Mr. Auslin, a resident scholar at the American Enterprise Institute, is the author of The End of the Asian Century: War, Stagnation, and the Risks to the World’s Most Dynamic Region.

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