China Eye January 2016 Issue 9 by China Energy Fund Committee

China Energy Fund Committee (CEFC) is a non-governmental, non-profit civil society organization. It also serves as a high-end strategic think tank engaged in energy strategy research, energy and public diplomacy, as well as global energy cooperation and cultural exchanges. CEFC is dedicated to fostering international dialogue and understanding of cultural values, regional cooperation, energy security, and issues relating to China’s emerging place in the world. We aim to promote international cooperation and mutual respect through public diplomacy. We believe an enhanced understanding of one another’s historic legacy and cultural values would lead to a more accurate interpretation of our respective actions. The Committee is supported by a special private grant fully sponsored by China Energy Fund Co., Ltd. The Committee is an NGO with Special Consultative Status, the United Nations Economic and Social Council (UN ECOSOC). Registered in Hong Kong, the Committee obtains tax exemption under Section 88 of the Inland Revenue Ordinance as a charitable organization. Also registered in Virginia, the United States, the Committee obtains tax exemption under Section 501(c)(3) of the Internal Revenue Code as a public charity.

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Editorial Board (編輯委員會) Chairman: YE Jianming (葉簡明) Vice Chairman: CHAN Chau To (陳秋途) Member: HO Chi Ping Patrick (何志平) Member: LO Cheung On (路祥安) Member: ZHANG Ya (張雅) Editor-in-Chief (主編) HO Chi Ping Patrick (何志平) Deputy Editor (副主編) LO Cheung On (路祥安) Executive Editor (執行編輯) ZHANG Ya (張雅) Editorial Assistants (編輯助理) Daniyal NASIR (黎庭耀) ZHOU Yu (周宇) ZOU Qiqi (鄒琪琪) --------------------------------Published by China Energy Fund Committee 34/F, Convention Plaza Office Tower, 1 Harbour Road, Wanchai, Hong Kong , China Visit our website at www.cefc-ngo.co --------------------------------For enquiries of distribution in the United States, Please contact CEFC U.S. Office 25/F, 1100 Wilson Boulevard, Arlington, VA 22209, U.S. --------------------------------Editor’s Note The authors whose original contributions were written in Chinese have given their permission for the articles to be translated into English, although not necessarily having vetted the English translation. -------------------------------All rights reserved. No part of this publication may be reproduced in any form or by any means without the written permission of the publisher. ISSN 2311-2506

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Editor’s Note

Assessing the Sino-US Relationship: Dilemmas and Solutions (中美關係評測：困境與對策) The Sino-US relationship is the most important bilateral relationship in the world, impacting the well-being of billions of people and the stability of the global economy. Despite the importance of this relationship, a failure to communicate and understand is pervasive. This situation must be addressed. Since the signing of the Shanghai Communiqué 39 years ago, China and the United States have proclaimed, on numerous occasions, a shared commitment to a positive and cooperative relationship. The countries’ two leaders have both publicly spoken of their commitment to developing a stable and prosperous relationship. Both sides have worked closely to implement a relationship that is based on mutual respect and mutually beneficial cooperation. These reiterations have not, however, resulted in a calm diplomatic environment. President Obama’s “Pivot to Asia” is widely perceived as provocative in China, as is the “China bashing” that has become a regular feature of US presidential elections. Many in China are convinced that the United States’ ultimate goal is to maintain global hegemony by all means necessary. They interpret Washington’s recent postures as evidence of an “anti-access and area denial” policy against China. On the other hand, some strategists in the United States profess that China is plotting to displace the United States as the preeminent power in the western Pacific, or even globally. Each side is entrenched in a position that is easily misunderstood by the other. It is with this background that China Energy Fund Committee (CEFC) has adopted “Beyond the Current Distrust” as the theme of this Colloquium. We hope that advancing mutual understanding, engendering trust and encouraging empathy can break the current stalemate. In order to create this more constructive future for the Sino-US relationship, it is necessary to ascertain the root causes of the current mutual distrust. We must therefore ask:

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． What are the fundamental causes of the mistrust between China and the United States? ． How do China and the United States perceive each other? Does the US view China as partner or competitor? Friend, or foe? ． Do differences in values and systems of governance set the stage for an inevitable clash of civilizations? Or is conflict attributable to more practical matters? ． How can the tragedy of great power political and military confrontations be avoided? What can China do to convince the United States that it has no legacy, no interest and no intention to dominate global affairs? Or to use military means to resolve what are essentially diplomatic issues? What can the United States do to convince China that Washington will not adopt a hard-power-based containment strategy against it? THREE CAUSES OF MISTRUST What are the origins of the current mistrust between China and the United States? Is it ideologically inherited from different political traditions, value systems and cultures? Is it a result of insufficient comprehension and respect for each other’s policymaking processes? Or is it an unavoidable need, demanded by the domestic politics of either country? I posit that (i) cultural differences, (ii) the fear of American decline, coupled with China’s rapid rise, and (iii) more concrete territorial disputes are the primary dilemmas that must be overcome. Resolving these dilemmas, which each present a different facet of the relationship, is essential to securing a more trustful and cooperative relationship. Cultural Differences Cultural differences play a fundamental role. China is the last remaining cultural and ethnic empire, a political entity held together by continuous history and common language. The United States, on the other hand, is a new multiracial empire held together by a set of political values. The historical circumstances of the two countries are vastly different. These differences are not the kind that can be resolved overnight, but in time they can be tackled. Value issues can be discussed, managed and controlled through diplomacy and continuous dialogue. Both China and the United States can make efforts to acquire a correct and clear understanding of the other’s core values, culture, and historical circumstances. This understanding can help work out other issues in the relationship. It will be essential for both sides to find common ground where it exists, as well as compromise and accept their differences as much as possible.

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Fear of American Decline and China’s Rapid Rise After the 2008 global financial crisis, it was fashionable to compare the United States’ predicaments to the decline of the United Kingdom a century ago. Of course, all discussions of American decline are nonsense. The United States is still the world’s largest economy, and its economic influence is global. It has the world’s most powerful military – measured to be ahead of China’s by at least 20 years – and the world’s largest sources of soft power. China may be the world’s second-largest economy by virtue of its overall GDP, but its per capita GDP, and comprehensive national power still trails the United States by a large margin. Nevertheless, the fear of American decline has affected how some perceive the relationship between China and the United States. The Obama administration’s “Pivot to Asia” can be seen as a rhetorical response to the idea of declining American influence. Former Secretary of Defense Leon Panetta explained the attitude best when he said, “We were there then, we are here now, and we will be here for the future.” Former Secretary of State Hillary Clinton once described the coming years as “America’s Pacific Century,” showcasing continued confidence in American strength. This showcasing of confidence, however, is not without repercussions. The “Pivot to Asia” has drawn considerable attention in China. Some observers view it as a “Cold War 2.0” strategy, where the United States commits to maintaining its global preeminence while snubbing China’s growth. China’s fast development does not help to assuage fears of a decline in US dominance. The theory of the “Thucydides Trap”, in fact, posits that such a rapid rise is almost guaranteed to produce conflict. This theory explains that rising powers begin to expect more respect and greater say. Being conscious of past grievances, such powers are also likely to be determined to revise previous arrangements and practices, so as to mirror new realities. At the other end, the existing power feels increasingly insecure, and becomes more susceptible to fantasies that promise to restore their rightful place. This situation leads to mutual fear and distrust. The ensuing posturing and provocation then lead to conflict. The “Thycudides Trap” is itself problematic. Belief that a rising China will undoubtedly threaten US security could become a self-fulfilling prophecy. It may encourage China to engage in adventurous policies, or the United States to overreact out of fear. This would put the Sino-US relationship into a downward spiral.

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If Washington fails to understand that China’s growing military capabilities do not threaten vital US interests, it may adopt a competitive military and foreign policy. This, in turn, would signal to China that the United States has malign motives. Should China then feel threatened and less secure, it would itself be more likely to adopt more competitive policies that the United States would again see as more threatening. The tragedy of this vicious cycle is that the two countries do not react to the international situation they actually face, but rather to an exaggerated fear of one another. This is the fundamental security dilemma we have to address today, and overcome tomorrow. Territorial Disputes Territorial disputes are often mentioned as having the potential to trigger conflicts between China and its neighbors. Indeed, some observers often argue that China is no longer maintaining its decades long approach of Tao Guang Yang Hui (韜光養晦) – “to not to show off one’s capability but to keep a low profile”. Instead, they say, China has adopted a more assertive foreign policy, demonstrated by its behavior in recent territorial disputes. Is China likely to resort to force over territory, as many have argued? According to Taylor Fravel, the short answer is that Beijing has always exhibited a preference for peacefully resolving territorial disputes through negotiations. In fact, since 1949, China negotiated compromises in 17 of 23 territorial disputes, often agreeing to accept less than half of the territory being disputed. In 15 disputes, the compromise created conditions for a final territorial settlement through bilateral agreement. Fears that China’s rise will lead to territorial conflicts are unsupported by its historical record. THE SOLUTION OF TRUST Zi Gong, one of Confucius’ early students, asked his teacher about the essential elements of good government. Confucius answered: “Food, arms and trust (Xin).” In modern terms, one could compare arms to military defense, and food to the economy. Trust, on the other hand, can be seen as the values and behaviors that bind all people, both in domestic and global society. Zi Gong asked Confucious, “If you had to remove one of these elements, which would you remove first?” Confucius answered: “Arms.” Zi Gong then asked, “If you had to remove a second, which would it be?” “Give up food,” Confucius responds. “Death has been with us since the beginning of time, but when there is no trust, people will have nothing to stand on.”

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The most important factor in international relations is “Xin”, trust. Without trust, there would be no basis for international understanding and peace, and talk of “cooperation” and “transparency” would be just empty words. Without trust, misinterpretation, miscalculation and misjudgment stemming from suspicion, erroneous assumption, and misreading of intention would result in catastrophic consequences. Trust is, for better or worse, the hardest thing to build up and the easiest thing to lose. It is also the solution to the dilemmas present in the current Sino-US relationship. Building trust must become a primary objective of all parties involved. The Sino-US relationship is not only a bilateral relationship. It is a global one, affecting the whole world. The challenges are overwhelming, and may not be addressed or solved overnight. There are no guarantees that China and the United States will transcend the operation of great power rivalry. But as Dr. Kissinger has said, we owe it to ourselves, and the world, to make an effort to do so.

Editor-in-Chief Dr. HO Chi Ping Patrick (何志平) Deputy Chairman and Secretary-General China Energy Fund Committee

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CONTENTS Editor’s Note Assessing the Sino-US Relationship: Dilemmas and Solutions

(中美關係評測：困境與對策)

HO Chi Ping Patrick (何志平)

Sino-US Relations The Thucydides Trap and the “Inevitability” of Conflict

(論修昔底德陷阱及“必然性”)

ALLISON, Graham

What we Should Learn From the Shanghai Communiqué

(論上海公報及其啟示)

PAN Zhenqiang (潘振強)

Avoiding the “Thucydides Trap” in the Indo-Pacific

(提防印太地區“修昔底德陷阱”)

FREEMAN Jr., Charles W.

Breaking the Impasse and Continuing on the Road of Peaceful Development

(破局之路：堅持和平發展道路不動搖)

WANG Xuexian (王學賢)

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Overcoming Sino-US Rivalry with Unconventional Behavior

(中美對抗及非傳統方式化解)

ROY, Stapleton

Creating a Stable Buffer Zone in the Western Pacific

(“穩定的戰略平衡”：創建西太平洋戰略緩衝區)

SWAINE, Michael D.

Towards a Stable Balance of Power in the Western Pacific

(走向穩固的西太平洋權力均衡)

ZHANG Tuosheng (張沱生)

Building the Foundation for a Reasonable Sino-US Balance

(構建中美關係合理平衡基礎)

LAMPTON, David

The Role of Third Parties in the Sino-US Strategic Equation

(中美戰略平衡中的第三方角色)

MOCHIZUKI, Mike

Creating a New Conception of Sino-US Relations – A Rebalancing of Mindsets

(樹立中美關係新史觀：心態再平衡)

NIU Jun (牛軍)

The Changing Economic Relations Between China and the US

(變動中的中美經濟關係)

MA Xiaoye (馬曉野)

The Influence of Public Expectations on the Sino-US Economic Relationship

(公眾期望對中美經濟關係的影響)

DICKSON, Bruce J.

Managing the Transition in Global Economic Leadership (應對全球經濟領導力轉型)

SCHELL, Orville

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Choices the US has to Make in Face of China’s Rise

(中國崛起下美國應如何抉擇)

WHITE, Hugh

New Dimensions in the Sino-US Relationship

(中美關係中的新層面)

JIN Canrong (金燦榮)

Eliminating the “Milan” in the Sino-US Relationship

(消除中美關係零和博弈)

ETZIONI, Amitai

Beyond the Current Distrust

(消弭互疑)

HO C. P. Patrick (何志平)

70 Years after the End of World War II The War that Remapped East Asia

(二戰：東亞版圖再繪製)

PEMPEL, T. J.

China’s War of Resistance with Japan on the Scale of Global Wars

(中國抗日戰爭：全球規模性戰爭)

LEVINE, Steven I.

Pearl Harbor Revisited

(重溫珍珠港事變之啟示)

SPECTOR, Ronald H.

The Non-Strategic Thinking of Japan’s Decision Makers for World War II

(日本決策者發動二戰的非戰略學考慮)

SMETHURST, Richard J.

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The San Francisco Peace Treaty and Its After Effects

(《舊金山和平條約》及其后果)

HARA, Kimie

“Chinese Peace Treaties with Japan”: ROC/Taiwan 1952; and PRC 1978

(《中日和平友好條約》：臺灣1952年；中華人民共和國1978年)

WANG Wei-cheng, Vincent (王維正)

The US and the “Altering” of Japan

101

(戰后美國對日本之重塑再造)

SCHALLER, Michael

Examining the Diaoyutai/Senkaku Islands Territorial Dispute Through Japanese and Chinese Government Archives

107

(從中國和日本政府檔案中審視釣魚島領土爭議)

SHAW Han-yi (邵漢儀)

Remembering China’s Bitter Victory

112

(艱苦卓絕的勝利：中國勿忘)

HSIUNG, James C. (熊玠)

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The Thucydides Trap and the “Inevitability” of Conflict ALLISON, Graham

The Thucydides Trap and the “Inevitability” of Conflict (論修昔底德陷阱及“必然性”) ALLISON, Graham Douglas Dillon Professor of Government, John F. Kennedy School of Government, Harvard University; Director, Belfer Center for Science and International Affairs, Harvard University; Former Assistant Secretary of Defense for Policy and Plans under President Clinton; Former Special Advisor to the Secretary of Defense under President Reagan

irst, I applaud President Xi Jinping for raising, during his visit to the US in September 2015, the issue much more fundamental than the disputes over trade and cyber security, climate and currencies, but for digging deeper by remembering an ancient Greek historian – Thucydides. I think that by doing this, he began a conversation about deeper fundamentals of the relationship that I hope will engage more of the governments and the society. In particular, in September 2015, when Xi Jinping arrived at Seattle and gave his only public speech during the visit, he said, “There is no such thing as the so-called Thucydides Trap in the world,” but then he warned, “Should major countries time and again make the mistakes of strategic miscalculation, they may create such traps for themselves.” By the time he got to Washington, in my view, he had become a little more precise in his articulation. At the state lunch that Vice President Biden and Secretary of State Kerry hosted, he said “I believe we can escape Thucydides Trap,” which seems to be closer to the mark, in my opinion. And then President Obama picked up this issue in their one-on-one, in their bilateral, and here’s what President Obama said: “I don’t agree with the interpretation of Thucydides Trap, that an established power must have a

conflict with an emerging power. Major powers like China and the US must prevent conflicts as much as possible. I believe the two countries are capable of managing these disagreements.” Again, I would say that is even closer to my understanding. Point 2, Thucydides Trap, I believe, is the best lens available for illuminating what’s happening in the relationship between the U.S. and China today and for the next generation. If you compare any other concept or conceptualization about this relationship, I argue that this is the best lens available for illuminating what is happening in the relationship between China and the US. I coined this metaphor several years ago, but the insight of course was Thucydides, who, observing the Peloponnesian War in ancient Greece, said famously, “it was the rise of Athens and the fear that this instilled in Sparta that made the war inevitable.” However, historians and interpreters have had an argument for a long time about what he meant by “inevitable”. In my interpretation, I believe this was hyperbole for Thucydides, and is exaggeration for the point of emphasis. He was saying, not a hundred percent inevitable, just very likely, if given business as usual. What is inevitable about the rise of a power that threatens to displace a ruling power is

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The Thucydides Trap and the “Inevitability” of Conflict ALLISON, Graham

severe structural stress. When a rising power threatens to disrupt a ruling power, expect trouble. There will be severe structural stress, almost as a rule of international politics. Now, I could imagine the the ruling power as, perhaps, Mother Theresa, but we haven’t seen one of those in History. And I could imagine that the rising power was Mother Theresa, but we haven’t seen that either. So, I would say the insight about severe structural stress being a condition of the relationship is correct. What is not inevitable, in my view, and in my analysis of Thucydides, is that these underlying conditions, which are inevitably stressful, inevitably lead to war. I have been making a study of this over the last several years. It has taken longer than I would like, but we’ve put up, on the Belfer Center’s Harvard website, the Thucydides Trap’s case file (Table 1). In what is now 16 cases over the last 500 years in which a rising power threatened to displace a ruling power, the outcome was war in 12 of the 16 cases; In four, not so. Table 1: Overview of major historical cases

No.

Period

Ruling Power

Rising Power

Result

First half of 16th century

France

Hapsburgs

War

16th - 17th centuries

Hapsburgs

Ottoman Empire

War

17th century

Hapsburgs

Sweden

War

17th century

Dutch Republic

England

War

Late 17th early 18th centuries

France

Great Britain

War

Late 18th early 19th centuries

United Kingdom

France

War

Mid-19th century

United Kingdom, France

Russia

War

19th century

France

Germany

War

Late 19th early 20th centuries

Russia, China

Japan

War

Early 20th century

United Kingdom

United States

Not War

Early 20th century

Russia, UK, France

Germany

War

Mid-20th century

Soviet Union, UK, France

Germany

War

Mid-20th century

United States

Japan

War

1970s-1980s

Soviet Union

Japan

Not War

1940s-1980s

United States

Soviet Union

Not War

1990s-present

United Kingdom, France

Germany

Not War

Source: Belfer Center for Science and International Affairs

The purpose of this exercise is not a statistical study. This is not an effort of a political scientist to try to find some way to put some numbers on something, for the purpose of satisfying current practices in political science. This is meant to be a practical inquiry from a policy perspective of the phenomenon of what happens with rising and ruling powers. We are very interested in additional cases, and in debate about these cases. And I wouldn’t feel terrible if we knocked two off and got four more, I’m interested in what happens more as natural consequences of rise versus rule. But I will say again, it is inescapable that a rising power, I believe, who becomes more powerful, believes that its interests deserve more weight. It believes that it deserves more say and sway in the resolution of conflicts. It is also virtually inevitable that a ruling power will find the pressure, the assertiveness and aggressiveness of a rising power, threatening, especially to the status-quo that the ruling power has created, which were the conditions in which the rising power rose. And for Americans, who usually have trouble with this idea, I ask them to consider what would happen if China were “just like us”. Americans love to give lectures to Chinese and everybody else, about why Chinese should behave like we

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The Thucydides Trap and the “Inevitability” of Conflict ALLISON, Graham

ALLISON, Graham at “Sino-US Colloquium (VIII) – Beyond the Current Distrust”

did. But if you look back at the story of the rise of the US to rival Britain 100 years ago about now, the personification of that rise was, one of my heroes, Teddy Roosevelt. And Teddy Roosevelt’s view was that, as long as, Spain, in the first instance, and Britain in the second instance, and third, any other Europeans, were in our hemisphere, there would never be what Chinese would call harmony. He proceeded, in the course of a few decades, to first, build up the US navy and take advantage of an opportunity to have a Spanish-American war. When the US defeated Spain, Spain was out of Cuba, Puerto Rico, and, indeed, Guam. He then threatened war with both Britain and Germany over territorial disputes in Venezuela, sponsored a coup in Honduras and created a new country called Panama, which gave the US a contract for the Panama Canal. Indeed, he threatened war with Britain over a territorial dispute in Canada, which became the fat-tail of Alaska, if you look at the five hundred miles that separates Canada from the Sea.

Now, I would say, if China behaved “just like us”, this relationship will turn out very, very badly. So the importance I believe of looking at Thucydides Trap, is as Santayana told us, that only those who fail to study history are condemned to repeat it. I think if we examine the history, we can get many clues and suggestions that this generation of leadership in the China and the US may succeed in bending the arc of history.

* This article is excerpted from the author’s speech at “Sino-US Colloquium (VIII) – Beyond the Current Distrust” held by the China Energy Fund Committee on October 5, 2015, at George Washington University, Washington D.C.

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What we Should Learn From the Shanghai Communiqué PAN Zhenqiang (潘振強)

What we Should Learn From the Shanghai Communiqué (論上海公報及其啟示) PAN Zhenqiang (潘振強) Former Director, Institute for Strategic Studies; National Defense University, PLA, China

orty-four years ago, I was still a young junior officer at the General Staff Department of the People’s Liberation Army (PLA). One summer day, I was summoned to my boss’s office, and was informed that I would have a new assignment, watching American affairs. At his office the very day we heard the radio announcement that Dr. Henry Kissinger had just completed his secret visit to China, paving the way for President Nixon’s visit next year. I immediately joined the preparation for that visit, and was on the spot as a member of the team to welcome President Nixon when he made the trip to China in February 1972. I was a witness to the historical event of the beginning of thawing of relations between our two great nations, and saw how the state leaders of the older generations of the two countries charted a course of cooperation, while fully aware that fundamental differences remained. During the negotiations, while recognizing differences, they did not start quarrels and were not bogged down by the numerous disputes over details. Instead, they focused on exchanging in-depth views, sharing their perceptions of the world situation, defining challenges both countries were faced with and the common grounds they had for their best interests. The Shanghai Communiqué faithfully recorded the strategic insight and political wisdom of our elders to develop cooperation between the two countries – an almost impossible task to the average people at the

time. In that unique document, they reached consensus that common interests far outweigh the differences between the two countries. Based on this perception, they agreed to develop a set of guidelines, indeed, a conceptual framework, for future China-US relations. These principles include, among others: First, regardless of their social systems, the two countries agreed to conduct their relations on the principles of peaceful co-existence, including respect for the sovereignty and territorial integrity of all states, non-aggression against other states, non-interference in the internal affairs of other states, equality and mutual benefit. Second, they agreed to settle disputes peacefully, without resorting to the use or threat of force. Third, they agreed that neither should seek hegemony in the Asia-Pacific and each is opposed to efforts by any other country or group of countries to establish such hegemony. Last but not the least, the US does not challenge the position that there is but one China and that Taiwan is a part of China. Thanks to the adherence to these common understandings by both sides, China-US relations kicked off a flying start, and have been progressing steadily on the whole despite sporadic frictions emerging from time to time. The Shanghai Communiqué served as the political bedrock for the development of ChinaUS relations.

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What we Should Learn From the Shanghai Communiqué PAN Zhenqiang (潘振強)

PAN Zhenqiang at “Sino-US Colloquium (VIII) – Beyond the Current Distrust”

Admittedly, the Shanghai Communiqué also had a limitation, that is, cooperation developed between the two sides had more or less taken on an ad hoc and expediency nature: to cope with their common threat from the former Soviet Union. The real nature of this bilateral relationship, that is, how they really should look at each other, was skilfully bypassed or shelved. When the Soviet Union disappeared, the two countries soon seemed at a loss as to how to sustain their cooperation. Globalization became a new driving force for the two countries to continue expanding their economic ties, which have physically benefited both countries, and locked each other into solid interdependence. But economic interdependence alone did not solve the problem of the nature of the bilateral relationship. Thus the irony is the more the two countries are increasingly tied up economically, the more apart they seemed to be in the political and security fields. The question of whether China and the United States are friends or enemies,

or both, has once again emerged, and seemed to be increasingly acute in Washington as China progressively developed into the world’s second largest economy with rising political and military influence. President Obama’s pivot to Asia clearly has an intention to hedge the rise of China. But hedging in the eyes of the other side is often taken as provocative, thus becoming the source of mistrust, and invites excessive reactions. We see a vicious cycle of actions vis-à-vis reactions occurring between the two countries in the name of hedging in recent years. In Washington, the anxiety over the implications of China’s rise on US interests has been grossly inflated. We hear the view that America should take China as the top threat, and calls for greater efforts to be ramped up to meet the new threat before it is too late. The theory of the so-called Thucydides Trap has been popular in the US research community, media, and probably in decisionmaking circles like the Pentagon or Congress, that China’s rise would invariably be at the

CHINA EYE‧Issue 9

What we Should Learn From the Shanghai Communiqué PAN Zhenqiang (潘振強)

expense of the US, leading the two countries onto a confrontational path. Particularly in the election campaign, demonizing China or China bashing has become an apple-pie-andmotherhood issue. In China, people are less pessimistic. The general perception is that China’s development is more an opportunity than a threat to the United States; that the two countries stand an even better chance to expand their cooperation in the future. China does not believe that the Thucydides Trap is unavoidable in future China-US relations. The reasons: First of all, China has not been an expansionist power historically, and today, China is basically an inward-looking country. This is determined by China’s national conditions. For all its remarkable economic development over the past three decades, China is still a developing country. The overall national situation typical of a developing country has not fundamentally changed in China. Today, China’s GDP per capita is 5,414 dollars, about one third of Russia’s, and ranked 89th worldwide. One of the basic realities about China is its huge population. China’s impoverished population still amounts to 128 million, close to Russia’s total population. Every year, China needs to create 25 million jobs, roughly five times the population of Denmark. As many as 6.8 million university graduates will enter the job market this year alone, and that’s about the population of Switzerland. There are 83 million disabled people in China, the same as the population of Germany. One can imagine what enormous pressure the Chinese government is under to make sure that the 1.4 billion people can lead a good life. To the government, nothing is more important than this. Everything else must serve this central task. To that end, China desperately wishes to have a lasting peaceful and stable international environment, and in particular, neighbourhood. To suggest that China is bound to be an expansionist power when it becomes rich and strong is simply out of ignorance of China’s actual conditions. Secondly, China’s rise has to rely on broad

international cooperation. Gone are the days when countries like the Western rising powers and existing powers fought with each other for resources, labour forces and markets several centuries ago. The collapse of the Soviet Union also taught China lessons that to compete for a world power status through military build-up is a dead-end. What China has chosen is a path of peaceful development via reform and openingup and integrating itself into the international community. To that end, China has become a proactive player and staunch supporter of the current international system and order, which, incidentally, was created and led by the United States. China is now party to almost all intergovernmental organizations and has acceded to over 400 international multilateral treaties. In doing so, China has been the great beneficiary of that cooperative approach, including cooperation with the United States. In the meantime, China also hopes that its own development has given other countries benefits. If this cooperative approach characterized by mutual benefits proves to be highly effective, why should China change its course in the future? To suggest that a rising China would inevitably be a revisionist power at the expense of the United States is simply a myth. Thirdly, China is not an irredentist country with regard to territorial disputes. China shares its border with 14 countries on land, and another 6 with its maritime neighbours across the East and South China Seas. It had territorial or maritime disputes with almost all of them when the People’s Republic was founded in 1949. All were left behind by history. None were created after 1949. Since then, Beijing has made tremendous efforts to resolve these disputes through peaceful and friendly bilateral negotiations. The records are a telling witness to China’s good will and sincerity. China has now resolved all the territorial disputes on land except with India and Bhutan. But even with India and Bhutan, the disputed areas have been kept in peace and tranquillity since 1962 thanks to the strenuous efforts of the countries

CHINA EYE‧Issue 9

What we Should Learn From the Shanghai Communiqué PAN Zhenqiang (潘振強)

concerned. China even succeeded in achieving an agreement with Vietnam on the maritime boundary delimitation in the Tonkin Gulf. All these settlements were achieved through bilateral negotiations in the spirit of equality, mutual respect, mutual accommodation, and without the interference of third parties. The success of resolving Tonkin Gulf is a particularly illustrating case in point. After strenuous negotiations for years, the two countries finally came up with an agreement on the Delimitation of the Territorial Seas, Exclusive Economic Zones and Continental Shelves in the Gulf of Tonkin on December 25, 2000. This is not a result of the big bullying the small. On the contrary, for the stabilization and promotion of the overall relationship with Vietnam, China made more concessions in order to clinch the deal. Vietnam obtained 53.23% and China 46.77% of the waters respectively, which means China, lost approximately 8,000 square kilometres because of the concession after the treaty went into force. The government had to make tremendous efforts to deal with the effect of this compromise at home. Traditionally, there were up to 800,000 Chinese fishermen whose living depended on the resources in the Tonkin Gulf. As a result of the delimitation agreement, fishing grounds in Hainan Province alone have decreased more than one third. About 12,000 fishermen had to abandon fishing and find other livelihoods. Still, Beijing thinks the deal is worthwhile. China hopes that the treaty will help diminish tensions in the South China Sea. It may also help trust building between China and Vietnam. More importantly, China hopes that it sets an illustrating example to show that if the Tonkin Gulf dispute is resolvable through earnest bilateral talks, so should the other maritime disputes. China also proposed that, pending the resolution of the disputes, the parties concerned could launch joint explorations to reap benefits for all. Unfortunately, subsequent developments were not in the direction Beijing had desired. Instead, backed by outside powers, and taking advantage of China’s goodwill

and self-restraint, other claimants became increasingly unscrupulous to take unilateral measures to extract gas and oil in the disputed areas, and sped up military build-up to strengthen control over the illegally occupied islands, in the hope that China would back off and accept the changed status quo. China has to respond to safeguard its sovereignty and territorial integrity. The aim of China’s recent actions, including the infrastructure building on its islands is to develop a new status-quo so as to create more propitious conditions for the peaceful settlement of the disputes. These steps are by no means aimed at the United States, nor are they covert tactics by China’s to make military gains at the expense of the United States, or to drive the US out of Asia. On the contrary, China believes that, for all the seemingly conflicting threat perceptions in the East and South China seas, China and the United States share a major responsibility of jointly preserving maritime safety and regional peace and stability, including ensuring safe freedom of navigation and overflight, and peaceful resolution of disputes. To conclude, China and the United States are not predestined to head toward confrontation. The Thucydides Trap theory is a false theme in the case of China-US relations. It may even backfire by becoming a self-fulfilling prophesy, for if you take the other side as your enemy, it will become your enemy in the end. So, what is the way out when China and the United States are facing an extremely delicate and complex situation today, in which so many misperceptions and misjudgements are taking upper hand over sober-minded reasoning? To me, it is all the more significant today to revisit the Shanghai Communiqué. The situation today is very different from that when the Communiqué was reached in 1972. However, as far as China-US relations are concerned, 2015 bears one resemblance with 1972 as our two countries once again stand at a crucial cross-road. Perhaps we could draw inspiration from the way our elders such as Mao Zedong, Zhou Enlai, and President Nixon, took steps

CHINA EYE‧Issue 9

What we Should Learn From the Shanghai Communiqué PAN Zhenqiang (潘振強)

to end the long-term hostility between our two countries, opened up a new chapter in the China-US bilateral relationship, and virtually changed the world by their decision to start cooperation. What really matters is a change of our perceptions. Today, more than ever, the two countries need state leaders, from both sides, who are free of ideological bias and the yoke of old thinking, and no longer regard state-to-state relations as a zero-sum game. They should be quick to define and grasp the opportunity to act in a hazy and confusing situation with strategic vision, political wisdom, diplomatic skills, and extraordinary courage. They could even do better than our elders, because cooperation between our two countries today has far greater inherent incentives than merely the need of coping with a specific external threat. If China and the United States really take each other as stakeholders and strategic partners, the world stands a better chance for peace, stability, and prosperity. Both countries will have enormous benefits from working together for a better world. It is in this context that the principles contained in the Shanghai Communiqué to guide the cooperation between our two countries seem all the more relevant. I believe that the proposal of building the China-US relationship into a New Type of Major Country’s Relationship is a major effort by China in that direction. I am glad that agreements at the Xi JinpingObama summit in September 2015 seem to echo exactly these aspirations. Both presidents rejected the notion of the Thucydides Trap, and vowed to endeavour to build a new type of the China-US relationship, characterized by non-conflict, non-confrontation, and winwin cooperation. To me, that is no less than an upgraded version of the Shanghai Communiqué. We all have a commitment to work hard to translate this vision into reality.

CHINA EYE‧Issue 9

Avoiding the “Thucydides Trap” in the Indo-Pacific FREEMAN Jr., Charles W.

Avoiding the “Thucydides Trap” in the Indo-Pacific (提防印太地區“修昔底德陷阱”) FREEMAN Jr., Charles W. Former Assistant Secretary of Defense for International Security Affairs under President Clinton; Career Diplomat (retired); Former US Ambassador to Saudi Arabia; Former Principal Deputy Assistant Secretary of State for African Affairs

he Indo-Pacific has emerged as the global center of economic gravity, and so refocusing American attention to it makes sense. But, even though the region’s increased influence at the global level is not political and is only marginally military, the “rebalance” is almost entirely military. Its economic element – TPP – looks like an after-thought premised on denial of the entrenched centrality of China in the regional supply-chain economy, and the so-called “pivot” or “rebalance” to Asia lacks a coherent diplomatic component. A focus on Asia makes sense but the way US attention is being shifted there does not. The “rebalance” will not work. Far from avoiding the “Thucydides trap,” it walks right into it. It is likely to be seen in retrospect as an historic blunder that did not so much deter war as lay the basis for it. First, a “rebalance” aimed at sustaining American dominance in Asia is military fantasy. It posits a perpetual American upper hand in a contest with China to control areas adjacent to it and very far away from America. This is a contest in which China enjoys the inherently decisive advantages of proximity and a defensive mission. The United States can no more continue to control the near seas of a modernized, powerful China than China or any other foreign nation can hope to control the seas

offshore the United States. Already, US forces are being forced back to firing positions outside the so-called “first island chain.” Second, China’s neighbors want American help to hedge against Chinese power even as they strive to reach an accommodation to it. But the “rebalance” does not enlist these neighbors in a coherent effort to either balance or engage China, and it doesn’t aggregate their strength to that of the United States to either end. If the United States is prepared to take on the task of balancing China’s military power by itself, why should China’s smaller neighbors make much effort to do so? If America is prepared to go to war with China over disputes these smaller neighbors espouse but are themselves unprepared to address militarily, why should they seek to settle these disputes or exercise caution in their quarrels with China? If reliance on US deterrent power leaves these neighbors with no perceived need to do anything but hang tough on territorial claims, what alternative to coercive measures is available to China? The most egregious instance of this moral hazard is the Philippines but it is apparent in Japan and Korea as well. Today’s intra-Asian disputes are a pointed reminder that the war Thucydides wrote about was catalyzed by the quarrels of allies of Sparta and Athens (Megara

CHINA EYE‧Issue 9

Avoiding the “Thucydides Trap” in the Indo-Pacific FREEMAN Jr., Charles W.

FREEMAN Jr., Charles W. at “Sino-US Colloquium (VIII) – Beyond the Current Distrust”

and Corinth), not by disputes directly between those two great powers. Perhaps it’s also relevant that the less risk averse and more belligerent of the two was Athens, the democracy, not Sparta, the autocracy. Third, the military antagonism inherent in the “rebalance” and the inevitable Chinese counters to it skew the overall Sino-American relationship toward zero-sum competition. This entails major opportunity costs. For example, rather than focusing on building frameworks to serve common interests like the protection of commercial shipping in the heavily trafficked South China Sea, the rebalance promotes the planning of naval maneuvers, blockades, and other forms of warfare there. Rather than facilitating the peaceful resolution of territorial disputes by the claimants, it embeds these disputes in Sino-American rivalry and promotes their militarization. Rather than working together to reform or replace

outmoded international financial institutions and practices, it presumes that China and America are at cross purposes. Some degree of military wariness between the United States and China is both natural and prudent but active antagonism is unnecessary and damaging to both. The US and Chinese armed forces each have a mission to sustain a peaceful order in the space between us. We need to focus on how to build and buttress stability in the Indo-Pacific region based on the independence and territorial integrity of its smaller states, rather than the hegemony of the United States, China, or both. Stability requires a balance in the region grounded in its smaller states’ prosperity and power of self-defense, supplemented – not replaced – by the power of the United States and/or others, including China and Japan. It demands an emphasis on the resolution of disputes rather than efforts to freeze them,

CHINA EYE‧Issue 9

Avoiding the “Thucydides Trap” in the Indo-Pacific FREEMAN Jr., Charles W.

unresolved and ever ready to explode, through military deterrence. And it necessitates the parallel pursuit of common interests and opportunities by the United States and China, not just efforts by each side separately to mitigate misperceptions and avoid potential conflicts. * This article is excerpted from the author’s speech at “Sino-US Colloquium (VIII) – Beyond the Current Distrust” held by the China Energy Fund Committee on October 5, 2015, at George Washington University, Washington D.C.

CHINA EYE‧Issue 9

Breaking the Impasse and Continuing on the Road of Peaceful Development WANG Xuexian (王學賢)

Breaking the Impasse and Continuing on the Road of Peaceful Development (破局之路：堅持和平發展道路不動搖) WANG Xuexian (王學賢) Career diplomat (retired); First Chinese Ambassador to South Africa; Former Consul-General (ambassador rank) in Los Angeles

have been thinking about the Thucydides Trap for quite some time. Why our fellow human beings, 2,500 years ago, had the wisdom to innovate or to create this so-called “Trap theory”, and today, we have the same human fellow beings who don’t have the wisdom to get away from that Trap. I think we should be clever enough, or intelligent enough, not to fall into that trap. So I am going to talk about this idea that this theory does not apply to China. Some people may say this is propaganda. This is not so. The great majority of the people I know, the common folk in China, simply do not believe in such a theory. First, we think that the world is big enough, not like in ancient times, with Athens and Sparta, two small city states. Today, we have the whole world for countries to live together. Secondly, the Chinese people have chosen a road of peaceful development. This is not imposed on us by anybody, but chosen by our own people. We believe that only by peaceful development can the now 1.4 billion Chinese people enjoy a better life. So nobody will be able to change the will of the Chinese people to stick to that road. I know that if not forced, nobody would wish to deviate from that road. And I believe that the adherence by the 1.4 billion Chinese people to that road would be a great contribution to prevent both China and other countries from falling into this Trap. The other thing I want to emphasize is

that in today’s political landscape, there is not just China. There is a simultaneous rising of a group of countries. Even if a country tries to contain one country today, it will have to try to contain another tomorrow. Even with the superior might of United States, if you try to contain everyone, by the end, you yourself will be exhausted. And you won’t need anyone to pull you down from the top of the world, you will do it yourself. Nevertheless, I am quite optimistic about the relationship between China and the United States. Although today, when you read or listen to what is coming from both shores of the Pacific, you may feel uneasy. I feel that the relationship between our two countries is strait jacketed, like something in the old law, from the old wood city, Kansas, which means when two trains approach and cross, they all must come to a full stop, and none should start up before the other has gone. I see the same kind of dilemma in the relationship between China and United States as to who should start first before the other has gone. I only hope the strait jacket over the relationship between these two countries could be removed, and I hope this old mode of thinking could be cast away. What we need is a new kind of thinking about the relationship. Containment is not a solution. Confrontation is not either. The only solution is to accommodate. I feel Mr. Xi Jinping and Mr.Obama have a good chance at progressing

CHINA EYE‧Issue 9

Breaking the Impasse and Continuing on the Road of Peaceful Development WANG Xuexian (王學賢)

WANG Xuexian at “Sino-US Colloquium (VIII) – Beyond the Current Distrust”

in the right direction, that is, to have in-depth candid and constructive dialogues, talks. And if not both of them should reach a consensus or results on 49 issues or items plus 20 sub items. This is the way forward. Another way forward is we should learn lessons from the history of our two countries over the past 66 years. In the first 22 years, one side was busy in trying to contain the other; the other side was busy in “down with imperialism”. In the end, neither side was happy and both suffered. Before the establishment of diplomatic relations between the two countries, trade between the two countries in those first 22 years was zero. In the 7 years after the ice-breaking journey by President Nixon, the trade between the two countries reached one billion. But what happened in the last 36 years? Bilateral trade, there was about 555 billion US dollars. In 2014, there were about 4.3 million people across mutual visits. But before 1979, there were only thousands.

In the last year, there was almost half a million Chinese students studying in this country and about 100,000 US students studying in China. In terms of investments, last year accumulated investments amounted to about 120 billion US dollars. Studies show that by the year of 2020, investment from China and US would be something between 100 billion to 200 billion US dollars, creating 400,000 to 600,000 jobs. These figures show what we were able to achieve despite our differences in the past 36 years. This gives us an idea of the way we should do things. Finally I would like to make a few comments about the Nansha Islands. I feel I have to put the facts where they are, and clear the distorted picture. First, I want my American friends to remember, that the warship provided to the then Chinese government to recover this island was provided by the United States, and some of the islands are named after the Chinese captains of these ships.

CHINA EYE‧Issue 9

Breaking the Impasse and Continuing on the Road of Peaceful Development WANG Xuexian (王學賢)

Second, when the then Nationalist government in 1947 had a dotted line as the boundary for that area, not a single country raised a protest about this until the 1970s, when there were reports saying there was oil or gas in that area. The Prime Minister of the country that grabbed most of the islands – in Nansha there are more than 50 islands or reefs – wrote to Premier Zhou Enlai, saying that his country recognized the dotted boundary as the national boundary of Chinese territory. That was in black and white on paper. But later on, when that country heard that there was oil, they jumped to grab the islands. They have occupied 29 islands and reefs. The Philippines occupy 9. Another country occupied another 9. What is left for China? No one had a problem before 1970. We have about 7 islands and reefs, yet everybody sees China as being the aggressor and assertive. It is unreasonable and unjust. For the Philippines, there are three laws delimitating the boundaries of the Philippines: The Paris Treaty of 1898, the Washington Treaty of 1900 and the British and American Treaty of 1930. All these Treaties delimitated the western boundary of the Philippines to the east longitude of 118 degrees. But now, the islands claimed by Philippines to be theirs, are islands all to the west of this 118 longitude. So friends, let the facts speak for themselves.

CHINA EYE‧Issue 9

Overcoming Sino-US Rivalry with Unconventional Behavior ROY, Stapleton

Overcoming Sino-US Rivalry with Unconventional Behavior (中美對抗及非傳統方式化解) ROY, Stapleton Career diplomat, retired with the rank of Career Ambassador, the highest of the Service; Former Assistant Secretary for Intelligence and Research, State Department; Distinguished Scholar and Founding Director Emeritus, Kissinger Institute on China and the United States, Woodrow Wilson International Center for Scholars; Former Head of Kissinger Institute

ery briefly, I agree with Professor Graham Allison. I think the Thucydides trap is real, and is rooted in the fact that human nature drives human behavior. There is a natural pattern of action and reaction when you have the fear or concern that a rising power generates. Conventionally, Professor Alison’s research suggests that it is a 75 per cent chance that you end up in conflict. And the exceptions are worth studying, as well as the examples which he cites in its behavior. A good example of this is that China develops what we call Anti-Access/Area Denial Capability and where we come up with an Air-Sea Battle concept designed to deal with that. Or as the Chinese say “你有政策，我有對策”. In other words, “You have a policy, I have a counter policy”, that’s the natural pattern. That’s the way humans behave and it creates the Thucydides Trap. So the question is how do you break out of it? Is unconventional behavior possible? Of course. We would never have gotten to turn around in the Cold War through the breakthrough in US-China relations back in 1971 and 1972, through conventional behavior. And because it was unconventional behavior by both China and the United States, nobody foresaw it coming. And yet it happened and it worked. Another example you could argue is the formation of the European Union. It is

very unconventional behavior for countries to actually give up important aspects of sovereignty in order to create a union, which has certainly been far from perfect, but has helped to stabilize Europe and avoid constant conflict. And I also cite Den Xiaoping’s statement that China and Japan should set aside territorial disputes and focus on joint development. It is very unusual for a national leader to say: let’s set aside a territorial dispute, it’s too complicated for us to solve in this generation. And yet it opened up 25 years of rapid expansion of Chinese-Japanese relations. So unconventional behavior can work, but humans by their nature tend to think conventionally. And so therefore I think we need to understand that. There are some other thoughts I will put out: First, both sides should steer clear of worstcase assumptions about the others military strategy. It will be self-defeating for China to persist in a strategy that alienates it from its neighbors, and gives incentives to them to strengthen security ties with outside powers such as the United States. And it will be equally self-defeating for the United States to try to pursue a containment strategy against China, because China’s neighbors want to cooperate with China. They don’t want to be a big part

CHINA EYE‧Issue 9

Overcoming Sino-US Rivalry with Unconventional Behavior ROY, Stapleton

ROY, Stapleton at “Sino-US Colloquium (VIII) – Beyond the Current Distrust”

of a containment strategy. Therefore, both sides need to stop thinking that the other’s goal is somehow to take worst-case actions against them. Secondly, we should not assume that China can somehow dominate East Asia. We are now not in an imperial period where you can have a central power and tributary relationships. We live in a Westphalian world in East Asia, where countries are deeply committed to protecting their sovereignty and territorial integrity. Not only do all of the major powers around China not believe it is in their interests to see East Asia dominated by one power - China, but the identities of Korea, Vietnam, Myanmar have been formed precisely because they were resistant to being absorbed in to a Chinese entity. So therefore, thinking of our strategy as necessary to prevent domination of East Asia by China, strikes me as unrealistic. Third, I think we have to bear in mind the probabilities of hot war scenarios with China are low. Professor Allison referred to the fact that

we are nevertheless going to spend billions of dollars getting ready for hot war scenarios. The same factors that inhibited the United States and the Soviet Union from engaging in hot war with each other, apply in the case of China. We each can inflict unacceptable damage on the homelands of the others, and we can’t control escalation, if you start down that road. If China takes out a US carrier group using its missiles, it loses cities on the mainland; we lose some cities on our mainland. That’s the sort of path that you can’t go down. And so therefore, let’s think of the realistic scenario, which can be proxy wars, minor clashes, things of this sort. These are the issues that we really need to stabilize. Fourth, the United States should not think that we have to deal with the Security Challenges of East Asia on our own. I frequently see Americans act and talk about security as though Japan doesn’t exist. Japan has enormous air and naval capabilities, and as long as Japan feels threatened in the same way the United States

CHINA EYE‧Issue 9

Overcoming Sino-US Rivalry with Unconventional Behavior ROY, Stapleton

feels threatened, the United States has to factor that into our defense planning. But it is much broader than that, because all of the countries in East Asia are, in some way or another, part of this equation. And each country, China and the United States, needs to find the best way to try to capture that dynamic. At the moment, in my judgment, the dynamic works in the US’ favor, because countries around China want to cooperate when China behaves responsibly, and they turn to the US when they think China is behaving irresponsibly. And that is a dynamic that the US’ diplomacy in East Asia can capture. It will help to encourage responsible behavior by China, which will help steer us away from the Thucydides Trap. Fifth, we need to integrate more tightly our defense and diplomatic strategies for East Asia. That applies to China and it applies to the United States. For example, President Xi Jinping in a speech not long ago, openly talked about the security dilemma. In his words, we cannot have security for one country and insecurity for other countries. We cannot have security for one group of countries and insecurity for another group of countries. In other words, he was specifically addressing the security dilemma, which is: if you are totally secure, other countries are insecure. And yet, if you look at the Chinese White Paper on military strategy issued in May 2015, you don’t find any reflection of that understanding. And if you read US defense documents, they talk about the United States needing to maintain air and sea dominance. That amounts to ignoring the security dilemma. To get a stable US-PRC balance in East Asia, we have to have less dominance, and China has to have limits on how to far it wants to push its ability to defend itself. At the moment, in my judgement, neither country is integrating their diplomatic and military strategies. And that is a major flaw in our approaches. Six, we need to give greater attention to organizational arrangements. In my judgement, Europe made a fundamental strategic error, with the United States being part of that error,

by failing in the goal of trying to integrate Russia into Western European organizational structures. They gave them a place at the table as an outsider, and they pursued a strategy that observers, at the time and subsequently, predicted with great accuracy, was leading to confrontation with Russia. They also predicted with great accuracy that we’d blame the confrontation on Russia. And yet the root of the problem was our pursuing policies which Russia saw as unacceptable. Pick up your newspaper and Putin is the devil. That was exactly what George Kennan and many others, over 20 years ago, predicted was going to happen, and yet we see it happen. In East Asia, there are not so many organizational structures in which China is embedded in an institutional arrangement that will inhibit irresponsible behavior. President Xi Jinping has talked about creating new security cooperation architecture in Asia and the Asia-Pacific. Is there some type of regional architecture that would help to stabilize strategic rivalry in East Asia, on top of existing alliance relationships? The only existing organization for security cooperation is in Europe. In conclusion, I think the Thucydides Trap is real. Our leaders are paying lip service to the concept of dealing with it, but in practice they are not addressing the underlying sources of the rivalry. I think that we all need to increase the understanding of the policymakers on how to deal with that problem.

CHINA EYE‧Issue 9

Creating a Stable Buffer Zone in the Western Pacific SWAINE, Michael D.

Creating a Stable Buffer Zone in the Western Pacific (“穩定的戰略平衡”：創建西太平洋戰略緩衝區) SWAINE, Michael D. Senior Associate, Carnegie Endowment for International Peace; Former Senior Policy Analyst, RAND

irstly, I’d like to point out that the US-China strategic issue is not essentially a global problem, because China is not to become the kind of global superpower that would rival the US in decades. Beijing and Washington hold fundamentally different notions about the best means of preserving stability and prosperity in the Asia Pacific over the long term. The US favors the view that peace and prosperity in Asia is best served by sustaining its position as a predominant maritime power in the Western Pacific, and I emphasize maritime, not continental. However, Beijing favors a more genuine balance of power in the Western Pacific, in which China enjoys a secure region along its maritime periphery, and is able to resist any efforts to threaten its vital interests. China has no current intention to replace the US as the predominant power in the Western Pacific, and it is not necessarily inevitable that China will be driven to seek that objective, not for a long time, until China acquires the interests and outlook of a maritime power in the region and the capability to protect those interests. Nowadays, there are a growing number of analysts in the US and China who argue for more assertive military and political efforts to counter the perceived intension of the other side. Nonetheless, these extreme views do not yet drive national policies in both countries, though their influence is increasing. Those who

call for continuous American predominance, or a more assertive China, are basing their arguments on faulty theoretical and historical factors, or misreading current evidence. Despite the Thucydides Trap, rising powers are not destined to seek power dominance at all cost, and China is not necessarily historically predisposed to dominate the Asia Pacific. In my view, however, the notion that unequivocal American predominance in the Western Pacific forms the only basis for long-term regional stability and prosperity is increasingly a dangerous concept. It is far from clear that US military predominance within the first and second island chains out to 1,500 nautical miles from the Chinese coast can be sustained on a consistent basis over the long term; just as it virtually impossible that China could establish its predominance in that area. Changing relative economic capabilities, military capital stocks, and advances in military technologies all call these into question. We did two studies at Carnegie, and RAND has just come up with a bigger, more detailed study, and the conclusions are that the US cannot sustain its current position of predominance over the next 20 years. Of course, a Chinese economic collapse would make moot what I’ve just said. But such a collapse is unlikely. Delaying any policy adjustments in anticipation of such a collapse will only make it more difficult to do so in the future. Most analysts do believe that China is

CHINA EYE‧Issue 9

Creating a Stable Buffer Zone in the Western Pacific SWAINE, Michael D.

confronting very serious problems, and that it needs to make structural reform changes, and if it doesn’t do that its growth rate could decline in ways that could be very taxing for the Chinese leadership. But this would still not result in an economic meltdown. Even in that kind of a decline, China could still garner enough resources for defense spending at significant levels. Recent studies predict that the US defense budget is unlikely to go much above $550 billion in the long term, globally speaking. Whereas China, with even a lower percentage of growth, over the next 20 years or so, could achieve a level of defense spending that would be at least half of that, possibly larger, and would be focused on the Western Pacific. Given all of these, I regard the optimal outcome for both nations as a stable balance of power in the Western Pacific, in which the most vital interests of both sides are protected and neither side enjoys the clear capacity to dominate the other militarily, within at least the first and second island chains. What you have to do is to reduce the tendency for either side to test resolve. You have to reduce the propensity for certain issues to serve as triggers for that testing, issues like the Korean Peninsula, Taiwan, maritime territorial disputes, military exercises and intelligence, surveillance and reconnaissance activities. What I’m talking about here is the creation of a stable buffer zone in the Western Pacific along China’s maritime periphery that involves, essentially, its neutralization. Over time such a buffer zone will require certain types of outcomes: One, a unified, loosely-aligned Korean Peninsula; Second, a demilitarized Taiwan Strait environment; Third, a more predictable set of understandings regarding the East and South China Sea maritime territorial situation; Fourth, a mutual denial force structure and operational concept. This is actually advocated by the RAND study and others, which is a military deployment and a force posturing which two sides have the capacity to deny the other. This is not based

upon an offensive-oriented, war-winning strategy. It’s based upon denial. On the nuclear front, we’ll need stronger mutual-deterrent types of agreements, including a recognition by the US that stability could only be preserved by having a mutual vulnerability of both US and China, one to the other. But there are also a lot of obstacles to this. One is refusal for the US to seriously contemplate an alternative to predominance, for historical, bureaucratic and conceptual reasons. Second obstacle, US decision makers also resist any real change in the security environment involving Korea, Taiwan and maritime disputes, fearing destabilizing allied reactions to a change in policies in these areas. That’s a difficult problem but not absolutely insurmountable. A third obstacle, the PRC regime is vulnerable to ultra-nationalist pressures, and it is disinclined to contemplate self-imposed limits on its sovereignty rights and its rising capabilities, especially in Asia. That’s the problem of a rising power. The Chinese government does not do a good job of channeling these nationalist sentiments. It uses them to advance its interests and it does so in ways that can be very dangerous, particularly in the future context, and China needs to reflect on this a lot more. The above problems really don’t suggest that a grand bargain is possible. It’s unlikely that the US and China will sit down and make agreements along the lines of a stable balance in which both sides make certain commitments at one goal. This would have to be a gradual process; it would have to begin from a belief that the current status quo is unsustainable, and that is the most significant hurdle. But after that, it would have to proceed incrementally on the basis of certain types of initiatives. It would involve a good deal of testing of commitment over time, and it would involve very committed leaders in both countries and among other Western Pacific countries. While some argue that we can muddle through with mini deals, I don’t think that comes to grips with the problem, because muddling

CHINA EYE‧Issue 9

Creating a Stable Buffer Zone in the Western Pacific SWAINE, Michael D.

through can become another name from the US side retaining its position. On the Chinese side, similarly, you have to really talk about this as an integrated process that you are trying to develop over time, with a lot of trial and error involved but a certain objective ultimately in mind. It wouldn’t be easy; it’s probably more likely that you are going to have muddling through. And muddling through is not going to avoid the kind of problem we do have in the Western Pacific. I’m sorry to be pessimistic. I’m not predicting war between the US and China. As I said, I don’t think the interests there are fundamentally so at odds that war would be regarded as a viable alternative. But I think crisis management is very important here. After all, it is crises that lead to inter-state wars if mishandled and misperceived. How to better manage these crises has been and will be the point that we have to work hard on. Part of the key is there, but the larger problem is reducing the propensity of those issues I’ve talked about to serve as the catalyst for crises.

CHINA EYE‧Issue 9

Towards a Stable Balance of Power in the Western Pacific ZHANG Tuosheng (張沱生)

Towards a Stable Balance of Power in the Western Pacific (走向穩固的西太平洋權力均衡) ZHANG Tuosheng (張沱生) Chairman of Academic Committee and Director of the Center for Foreign Policy Studies, China Foundation for International and Strategic Studies; Former Defense Attaché, PRC Embassy in UK (early 1990s); Former Research Fellow, Institute of Strategic Studies, PLA National Defense University

or many years, the US has been in a favorable position in the US-China balance of power in the Western Pacific, as well as the entire Asia Pacific region. Since the beginning of the new century, and particularly in recent years, the gap between them has been narrowing. The US is still in the dominant position worldwide. However, in East Asia and the Western Pacific, a certain balance is emerging. Furthermore, neither country has adapted well to this change, leading to increased frictions and worsened strategic suspicion between them in the Asia Pacific, East Asia and the Western Pacific in particular. What is the significance of building a stable US-China balance of power in the Western Pacific? How can the two sides develop a balance of power in the Western Pacific that is favorable to the development of their relations? I’d like to share with you some of my observations. First of all, I think it’s possible for the two countries to develop a new balance of power in the Western Pacific in the coming decade or two. And in the long term, this new balance of power will be conducive to the development of their relationship. As pointed out by many experts and scholars in both countries, after the end of the Cold War, on the basis of China having a strong land power advantage and the US having a strong sea power advantage, the two countries have

begun to establish a certain strategic balance in the Western Pacific along the line of the Chinese border or territorial sea. However, as China’s comprehensive strength continues to grow and especially as its defense capabilities continue to increase, the original balance of power is being broken. In the coming decade or two, if there is no fundamental change in the current trend, the line of balance between their military strengths and strategies may shift to the first island chain in the Western Pacific. By then, China will have strategic advantage in its surrounding waters and the US will maintain its strategic advantage and dominance in the vast sea outside of the first island chain. In this process, there will be fierce games between China and the US. But so long as these games are not out of control, as the new balance of power emerges, frictions between the two countries in the Western Pacific will gradually weaken. That will have a positive influence on the long-term development of their relations. As known to all, for a long time, security frictions between China and the US have occurred mainly within the first island chain. Chinese efforts to safeguard its territorial, sovereign and maritime rights and interests on the questions of Taiwan, the East China Sea and the South China Sea, are under incessant US interference. The formation of a new balance of power will mark an enhanced capacity for

CHINA EYE‧Issue 9

Towards a Stable Balance of Power in the Western Pacific ZHANG Tuosheng (張沱生)

ZHANG Tuosheng at “Sino-US Colloquium (VIII) – Beyond the Current Distrust”

China to safeguard its territory and sovereignty, and correspondingly weakened US interference on the Taiwan question and maritime disputes between China and its neighbors. This is beneficial not only to stability across the Taiwan Strait and development of cross-strait relations, but also to independent and peaceful resolution of territorial and maritime disputes. The result will be a significant decrease in China-US security frictions. When the new China-US balance of power in the Western Pacific is formed, Chinese power may still develop beyond the first island chain. However, judging from such variables as technologies, geopolitics and reliability of military systems that may alter the balance of power, the first island chain continues to be the line along which their powers balance. This will increase the stability of their bilateral relationship and is conducive to its future development. However, the process towards this new balance of power will also be a process in

which status-quo balances are broken. For some time, destabilizing factors will markedly increase. If these are not handled well, China and the US may enter into vicious competition or even confrontation in the Western Pacific, in the military field in particular. This is worrying. In recent years, frictions in East Asia and the Western Pacific have rapidly increased. For example, the US has been implementing a rebalancing strategy by strengthening bilateral military alliances, increasing its military presence in the Asia Pacific and intensifying efforts to guard against and tie down China, leading to serious concerns and rising demands for counter-measures in China. For another example, the US has in recent years changed its policy of neutrality and increasingly intervened in maritime disputes between China and its neighbors, leading to greater risks of US-China conflict due to third-party factors. For yet another example, as China becomes increasingly capable of opposing external military intervention (the American

CHINA EYE‧Issue 9

Towards a Stable Balance of Power in the Western Pacific ZHANG Tuosheng (張沱生)

jargon is “A2/AD” – Anti-Access/Area Denial), the US is deliberating on such concepts and strategies as Air-Sea Battle, Offshore Control and Deterrence by Denial, so as to maintain its capability of access and intervention in East Asia. The concept of Air-Sea Battle appeared first and has developed the fastest. It is now part of a Department of Defense (DOD) document, targeting mainly China. These new operational or strategic concepts have caused serious concerns in China. As a matter of fact, even many American scholars believe that the implementation of these strategic concepts will harbor enormous risks, with limited possibility of success. In particular, the Air-Sea Battle may rapidly escalate into war, leading to severe consequences. Furthermore, economic competition between the two countries is also intensifying. China is actively advancing 10+3 and the Regional Comprehensive Economic Partnership (RCEP), while the US is promoting the Trans-Pacific Partnership (TPP) to maintain its dominant position in the process of growth of trade and economic cooperation in the Asia Pacific. Although this competition is less tense as the one in military field, bilateral relations may also be undermined if it is protracted. How, therefore, can we ensure a relatively steady process towards this new balance of power, avoid vicious competition, conflict or confrontation, and improve our bilateral relationship? This will require both parties to have an objective and correct judgment of the situation in the Western Pacific, the changing powers of the two countries and the other party’s strategic intention, and, on that basis, make far-sighted strategic decisions and adopt pragmatic policies and actions. To be specific, I think the two sides should make efforts in the following areas: First, the two sides should strive to achieve, at an early date, a common understanding on the prospective balance of power between them in the Western Pacific. Given the shifts in power in the Western Pacific, China hopes to effectively maintain its national sovereignty

and territorial integrity and have a greater say and role in regional affairs (including in regional multilateral dialogue and cooperation mechanisms). At the same time, its policy of striving for peaceful reunification and peaceful resolution of maritime disputes will not change, yet neither does China have the intention to demand US withdrawal from East Asia or challenge the US’ global leadership. China welcomes America playing a constructive role in the region and wishes to have better cooperation with the US at the global level. If the US can accept as a fact China’s rise in international status and influence, cease the attempts to counter or suppress China to maintain its hegemony in the Western Pacific, and transform its long-standing policy of diplomatic and military intervention into one of supporting China to achieve full national reunification and resolution of its maritime disputes through peaceful negotiations, it will be very constructive for China-US relations. It is by no means easy for the two countries to achieve such a common understanding. But we have to make efforts in this direction. Second, the two sides should endeavor to maintain a balanced hedging policy. Since the end of the Cold War, the US has implemented a hedging policy towards China with cooperation and engagement on the one hand, and counterbalancing and preventive measures on the other. China has responded with a similar two-handed policy. In recent years, with the changing balance of power, mutual strategic suspicion has increased, leading to more frictions (mainly in the Western Pacific, East Asia and some new strategic domains). Both countries, the two militaries in particular, have started to regard each other as potential adversaries and are preparing for worst case scenarios. To avoid serious consequences on bilateral relations, the two countries and the two militaries should endeavor to cooperate with each other in areas of common interests so as to maintain balance in their policies and bilateral relations, rather than allow conflicts

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Towards a Stable Balance of Power in the Western Pacific ZHANG Tuosheng (張沱生)

of interest to dominate their relationship. Besides cooperation in global governance, developing Asia Pacific economic cooperation and strengthening non-traditional security cooperation in the Western Pacific (especially on the denuclearization, peace and stability of the Korean Peninsula) will be crucial to containing and mitigating differences or frictions in the Western Pacific. Third, the two sides must significantly improve management of differences and crises. The most salient issue now is their geopolitical differences in the Western Pacific and East Asia. These differences have had a serious and adverse impact on their relationship on the question of Sea Lines of Communication (SLOCs) and in other strategic fields such as nuclear, cyberspace and outer space. Both China and the US should regard non-conflict and non-confrontation as the bottom line that must be protected, focusing on avoiding crises and preventing crises from getting out of control, while remaining vigilant against any crisis or conflict between them instigated by third-party factors. On the basis of strategic agreement between the leaders of the two countries on strengthening the management of differences and crises, diplomatic and defense services should further improve relevant security dialogue and crisis management mechanisms, and redouble efforts to strengthen security confidence-building measures. This includes strengthening the crisis management function of bilateral hotlines, further enriching the nascent mutual notification mechanism for major military operations and the code of conduct on military encounters in the air and at sea, engaging in discussions on signing a bilateral no-firstuse of nuclear weapons agreement, as well as refraining from conducting attacks on outerspace assets or cyber-attacks against each other. In short, the two sides should be fully aware that their relationship is, in nature, different from that between the US and former USSR. Although many differences remain, China and the US are not enemies. The extensive

economic cooperation and degree of security cooperation between them did not exist between the US and former USSR. Our two countries should be more confident in managing our differences and crises. Fourth, the two sides should endeavor to strengthen coordination and cooperation in the various multilateral security dialogue and cooperation mechanisms in East Asia and the Asia Pacific. They of course have differences and competition in these mechanisms, however, in multilateral arenas, it is the countries’ common interests that are discussed and sought. The possibility of constructive competition between China and the US is greater than that of vicious competition. The two sides should create conditions for 10+3, RECP, Asia-Pacific Economic Cooperation (APEC) and TPP to be mutually accommodating, inclusive and complementary. In the future, as regional cooperation develops, East Asian and Asian economic integration should be open to the US, and the TPP should welcome China. Positive interaction between the two countries in such multilateral dialogue and cooperation mechanisms will help mitigate frictions and turbulences caused by the changing balance of power in the Western Pacific, thus stabilizing China-US relations. In the near future, if China is able to make progress in properly settling territorial and maritime disputes with Japan and certain Southeast Asian neighbors – such as by agreeing on a code of conduct for maintaining maritime stability, making breakthroughs on joint development and conducting sustained bilateral negotiations – this will also play an important role in facilitating a stable China-US balance of power in the Western Pacific. * This article is excerpted from the author’s speech at “Sino-US Colloquium (VIII) – Beyond the Current Distrust” held by the China Energy Fund Committee on October 5, 2015, at George Washington University, Washington D.C.

CHINA EYE‧Issue 9

Building the Foundation for a Reasonable Sino-US Balance LAMPTON, David M

Building the Foundation for a Reasonable Sino-US Balance (構建中美關係合理平衡基礎) LAMPTON, David M. Hyman Professor and Director of SAIS-China and China Studies, School of Advanced International Studies, Johns Hopkins University; Former President of the National Committee on United States-China Relations

n October 2015, China won the first Science Nobel Prize for work performed in China. I would like to take this opportunity to remind us that there is a whole other dimension to the Sino-US relationship we are generally not talking about. The positive sum from scientific, educational, and all the other dimensions of our cooperation certainly have to be cranked in as a way to create balance. Certainly one of my messages is that at the same time as we are trying to create a balance in the coercive sphere, we have to create other zones of interdependence that can help weigh these scales. There is a positive sum dimension in the economic and other spheres that I think can weigh heavily. I want to make three points. One is I don’t think either side are managing the attempt to move towards balance very well. We talked a lot about the Thucydides Trap. There is another theorist, Charles Doran, who talks about power cycle, and he makes two important points about a rising power and a status-quo power. One is that the rising power has to be patient, that is his basic point. I don’t think China is being very patient. China wants voice and action more rapidly than I think is comfortable for either China’s neighbors or us to deal with. So I’d say to China: throttle back on some of this nationalism and public opinion. No, it’s not very easy, and there is historical basis for it, but

I think we have to throttle back here. On the other hand, the United States, frankly, on the part of accommodating China, has to become better at making room for China in the post World War II structure. And I point to the International Monetary Fund (IMF) as an area where Congress wouldn’t dream, apparently, of appropriating money that’s necessary for that. Our security treaties, by definition, almost exclude China. Basically, the whole notion of primacy and leadership has to come in for US leadership. So I would say China has to be patient, we have to make room, and we’ve both done a lousy job. Point two, I don’t think either of us have very good strategies. I think the United States does not have a hierarchy of threats and priorities by which to allocate its attention. If you read the new military 2015 strategy, basically all threats are equally important and we have to mobilize resources to take them all on simultaneously. I don’t think that is realistic, whether I look at congress, whether I look at the patience of the American people to supply the resources, or whether I look at sequestration. The job of a leader is to match resources and challenges. We have not prioritized our strategy. You read in the press one day that it is ISIL or Al-Qaeda, the next day you hear from the new Chairman of the Joint Chiefs that it is Russia that is an existential threat, and the next day it is China

CHINA EYE‧Issue 9

Building the Foundation for a Reasonable Sino-US Balance LAMPTON, David M

LAMPTON, David M. at “Sino-US Colloquium (VIII) – Beyond the Current Distrust”

that is the long-term problem. I can believe any of them, but I cannot believe you have a policy just by asserting there are a bunch of problems out there. What is the hierarchy? I don’t think China is the biggest problem on the list. Now, we can debate about that, but we ought to have a priority list. As for China, I don’t think its strategy is very sensible either. Basically, what China is doing by not being patient, is driving the periphery of china into the arms of the United States. Therefore, China must find a way to be reassuring here. That is China’s problem. I think that whatever the “pivot” is, it would have less attraction if people didn’t perceive China was threatening their interest in certain ways. Point three, what is to be done? I don’t have all the answers, but I think we’ve heard pieces of them in the preceding presentations. We need joint economic and security structures of some sort in this region. I understand and I am not opposed to building Trans-Pacific Partnership

(TPP) and Regional Comprehensive Economic Partnership (RCEP) and all those things, but they’re not joint economic structures. In fact, they are in some sense competitive in the way they have been done. I think we need to move on that. Secondly, I think Michael Swaine had a good point. There’s not going to be stability in Asia as long as the US is talking about primacy. Maybe you can have one, but you can’t have both. So I think that is the cause for some examination. And then we have to emphasize more interdependency. What bothered me about Blackwell and Telis was that, among the many dimensions that were available, there was the call for export controls and beginning to shut down the economic, technological, and educational exchange between the two countries. That is going to be weakening the support base for a reasonable balance. And finally, don’t forget Taiwan. We’ve had eight years of relative tranquility, for lack of a

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Building the Foundation for a Reasonable Sino-US Balance LAMPTON, David M

better word, but things are changing in Taiwan, and frankly it seems as Xi Jinping has a slightly different attitude on Taiwan than Hu Jintao, his predecessor. So the long and the short of it is I don’t think either side is managing this very well. We have to “up our game” and I think it is quite clear how you could do this. * This article is excerpted from the author’s speech at “Sino-US Colloquium (VIII) – Beyond the Current Distrust” held by the China Energy Fund Committee on October 5, 2015, at George Washington University, Washington D.C.

CHINA EYE‧Issue 9

The Role of Third Parties in the Sino-US Strategic Equation MOCHIZUKI, Mike

The Role of Third Parties in the Sino-US Strategic Equation (中美戰略平衡中的第三方角色) MOCHIZUKI, Mike Japan-U.S. Relations Chair, Elliott School of International Affairs, George Washington University; Former Director of the Sigur Center for Asian Studies, George Washington University; Former Senior Fellow, Brookings Institution; Former Co-Director, Center for Asia-Pacific Policy, RAND

here are three points I want to make. First, on what I think is inevitable, secondly, what I think is not inevitable, and finally, a few words about mistrust. What I think is inevitable is that third parties, especially Japan, has to be factored into the strategic equation between the United States and China. But I think there has been a limited reading of Thucydides and much focus on the dictum that appears in the first part of Thucydides, which is about the rise of Athens and the fear that Sparta felt towards it, making war inevitable. Well, when one looks at the rest of the book, it is a much more nuanced and rich account, and one key part of this is the role of third parties. It was not inevitable that Sparta responded to Athens in the way it did, and one needs to read the debates that went on, and the role that one of the allies of Sparta, the Corinthians, played to persuade Sparta to stand up to Athens. So this is where the Japan factor comes in. Whether you accept the double-down strategy of Telis and Blackwell, or the mutual denial strategy of RAND or Michael Swaine, inevitably Japan will be a factor. When we talk about buffer zones, or mutual vulnerability, the interests of Japan are affected, and even under a mutual denial strategy, it is impossible for

the United States to sustain such a balance of power without the access to the US military bases on Japan. Japan would naturally fear the rise of China, and it is only natural that Japan will develop its defense capabilities to defend itself, which will then have major strategy ramifications. And so you cannot talk about the US-China strategic equation, at least in East Asia, without bringing in another major country, like Japan. Now the problem is, the Sino-Japanese relationship has become intensely problematic, and it’s quite possible that some kind of spark over uninhabited islands could draw two nuclear powers into a conflict. So, inevitably, Japan is part of the strategic equation. Secondly, I do not believe a Sino-Japanese collision is inevitable. Right now, we may think that it’s inevitable, but just go back to the period of 2006 to 2010, a very problematic period for Sino-Japanese relations. Yet, after the retirement of Prime Minister Koizumi and Japanese Prime Ministers stopped going to Yasukuni, there was a steady improvement in Sino-Japanese relations. So much so, that in 2008, the two sides agreed to a set of principles for joint development. On top of that, if you look at the public opinion polls in China, gradually, the views of Chinese towards Japan had begun

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The Role of Third Parties in the Sino-US Strategic Equation MOCHIZUKI, Mike

MOCHIZUKI, Mike at “Sino-US Colloquium (VIII) – Beyond the Current Distrust”

to improve. Now another counterfactual: imagine if on May 2009, the Japanese public prosecutor’s office did not put Mr. Ozawa under investigation, and he, instead of Mr. Hatoyama, had become the prime minister of Japan. Of course, there are many things problematic with Mr. Ozawa, but I can probably argue that it’s quite possible that we would have a very different state of Sino-Japanese relations today. I think we are now at a point where the Sino-Japanese relationships has hopefully bottomed out and there is a real opportunity for what someone like Goldstein has called a cooperative spiral. But one of the key things I think is there should not be an inflation of the threat on both China and Japan. Unfortunately, I see that today, some Chinese commentators view the changes in Japan’s security policy the way some Japanese commentators view the development of gas development rigs in the East China Sea. So I think there is a vicious cycle that can be developed.

Now, finally, it’s about mistrust. Here, it is not the mistrust between United States and China, but the mistrust between allies, particularly between the United States and Japan. One wonders when there is a tightening of the US-Japan relationship, why there is mistrust. Well, there is mistrust, because when Prime Minister Hatoyama and a large part of the Japanese mainstream thought an East Asian community was the sort of vision that Japan should push forward, following in the footsteps of Europe, the United States was very distrustful, to an extent of over-sensitivity, that somehow this would mean that Japan would exclude the United States, which was nothing in the mind of Mr. Hatoyama. And now there is discussion about the New Type of Major Country Relationship. The Japanese are mistrustful, that some kind of compromise between the United States and China would undermine Japanese interests. So there is of course a problem of mistrust between the United States and China,

CHINA EYE‧Issue 9

The Role of Third Parties in the Sino-US Strategic Equation MOCHIZUKI, Mike

but one also needs to be aware of some of the deep mistrusts between the United States and Japan, which need to be rectified before you have the kind of stable balance that we’ve been talking about. * This article is excerpted from the author’s speech at “Sino-US Colloquium (VIII) – Beyond the Current Distrust” held by the China Energy Fund Committee on October 5, 2015, at George Washington University, Washington D.C.

CHINA EYE‧Issue 9

Creating a New Conception of Sino-US Relations – A Rebalancing of Mindsets NIU Jun (牛軍)

Creating a New Conception of Sino-US Relations – A Rebalancing of Mindsets (樹立中美關係新史觀：心態再平衡) NIU Jun (牛軍) Professor, School of International Studies, Peking University; Former Senior Fellow and Chief, Division of American Diplomacy, Institute of American Studies, CASS

olicy does play a key role in contemporary Sino-US relations. But today I would like to share with you some thoughts on studying this relationship from a conceptual perspective, and talk about the rebalancing of mindsets. The first balance should be set between history and current reality. Our discussions today seem to be confined to an historical context, such as references to Thucydides, the “balance of power” in the 19th century, and words such as “Cold War” and “containment” – words that date back to 1950s. Our way of thinking today should balance history and the modern age, and we should describe Sino-US relations today in a way that more accurately reflects the present situation. In this regard, I propose that we should come up with new and more imaginative conceptions. The second balance is between our descriptions of each other. The impression I often get is that scholars from both sides tend to portray the other side as psychologically “unhealthy”. In China, scholars say that the US, in face of a rising power, is psychologically unsettled. In the US, scholars say that China is apprehensive regarding the US. However, it seems to me that the societies of both countries do have a fairly unbiased understanding of Sino-US affairs. I hope that both sides are able to do a better job at this, in readjusting their

mindsets, lest we get bogged down by illogical discussions. The third balance pertains to the lens through which we view Sino-US affairs, and, in particular, prominent security issues. One of my students graduated from West Point and has served in the US army. He says that although he likes his kind-hearted neighbors in Chia, it troubles him that he has had to explain to almost all of them that the US is not attempting to contain China. I cannot help but wonder how much public support either side will be able to garner, should they choose to adopt confrontational policies against a backdrop of such frequent bilateral exchange. Therefore, I believe that on security policy and related issues we should first take public opinion on board, in order to prevent overreaction and anxiety. The Sino-US relationship today involves more than simply relations between the two countries. It has ramifications on the entire East Asian order, in which many tensions still exist. Judging from history, the direction in which these issues in East Asia are heading is very dangerous. But in reality, these are all peripheral issues that are manageable. Today’s East Asian Order was formed during 1978 to 1979, with Sino-US strategic cooperation at its core. The framework that emerged was supported by this relationship, together with the US’ military

CHINA EYE‧Issue 9

Creating a New Conception of Sino-US Relations– A Rebalancing of Mindsets NIU Jun (牛軍)

NIU Jun at “Sino-US Colloquium (VIII) – Beyond the Current Distrust”

alliances, which have maintained this order in East Asia and the Asia Pacific. Forty years of peace and stability have led to forty years of regional development and prosperity, creating the fundamental external conditions for China’s rise. Therefore, no matter what the grievances of the countries may be, decision-makers should bear in mind the importance of this hard-won peace and prosperity to their future well-being, and be more cautious in their actions. After all, many issues are negotiable, and there is the possibility of change in the future, just as tensions between China and the US deescalated during the Cold War. After the end of the Cold War, East Asia has gone through two profound changes, namely, the collapse of the Soviet Union and the rise of China. While there have been frictions between China and certain countries, generally speaking, the fundamental structure of this order has remained unchanged.

I hope that China can continue on the road of modernization, that regional prosperity is maintained, and I believe that the future prospects are bright for East Asia.

* This article is translated from an excerpt of the author’s speech at “Sino-US Colloquium (VIII) – Beyond the Current Distrust” held by the China Energy Fund Committee on October 5, 2015, at George Washington University, Washington D.C.

CHINA EYE‧Issue 9

The Changing Economic Relations Between China and the US MA Xiaoye (馬曉野)

The Changing Economic Relations Between China and the US (變動中的中美經濟關係) MA Xiaoye (馬曉野) Former negotiator, Customs General Administration and the Ministry of Foreign Trade and Economic Cooperation, PRC; Former Research Fellow, Center for China Social and Development Studies, Peking University

e should address the economic aspect of Sino-US bilateral relations from two aspects: First, through the legal, institutional and administrative aspect of existing bilateral and multilateral arrangements; second, through the economic development of both countries and their endogenous need to connect with the outside world and each other. History helps us understand certain changes, such as the changes and challenges that arose from the establishment of diplomatic relations and the signing of the bilateral economic agreements in 1979 and 1980. On the economic and trade level, China has no legal obligation in the world trading system except the Most Favoured Nation (MFN) clause in the bilateral economic agreement with the US. The then US president defined China as friendly. Though the unconstrained export of textiles from China was in small quantities, it was fast growing and therefore impacted the textiles import quota system, which was carefully balanced among US and other textile exporting countries and derived from years of negotiation. The would-be trade war was sparking by dual exchange rate practices in China. China was accused of overall government subsidies to export using a dual exchange rate system. Were the accusations justified as alleged, a heavy countervail duty would have severely

undermined US-China trade. Finally, the crisis was settled and the resolutions were: the US textile industry withdrew the case in exchange for China joining the Multi-Fibre Arrangement (MFA)— the worst part of the multilateral trading system under the General Agreement on Tariffs and Trade (GATT). China refrained from retaliation against US farmers and continued to honour the long term grain purchase arrangement. China also reiterated its willingness to adhere to the principles of the world free trade system. Further, China committed to end isolation and embrace the existing world economic regimes to which the US was, and still is, the leader. After withdrawing from the Council for Mutual Economic Assistance (CMEA), China was almost the only country in the world with no rights and obligations to any international trading regime. The by-product of the first USChina trade friction was: China, for the first time, stepped into the “free” trading system by joining the anti-free trade MFA under GATT—the predecessor of the World Trade Organization (WTO). At that time, China had already restored its membership in the World Bank and International Monetary Fund (IMF). In 1984, China began the reform of its urban economy. The political consensus in China was to conditionally open its economy to the outside world. Meanwhile, Hong Kong, under the

CHINA EYE‧Issue 9

The Changing Economic Relations Between China and the US MA Xiaoye (馬曉野)

MA Xiaoye at “Sino-US Colloquium (VIII) – Beyond the Current Distrust”

arrangement of the United Kingdom, became an independent contracting party of GATT with full rights and obligations on customs, trade and economic policy. China actively engaged in the negotiation on its membership with GATT, but the negotiations on China’s side was difficult beyond imagination. On the bilateral front, after a ten-year economic honeymoon period since the signing of the trade agreement, the definition Reagan’s administration had in terms of US-China relations as mentioned above began to change. During the same period, bilateral trade volume increased greatly. The 1989 incident is what triggered the process of change. Some think tanks commented that the second ten-year period was the period in which the US took the leading role. In 1989, the US government exercised all sanctions against China except trade sanctions. Years of veto exercise on China’s MFN status on trade between executive and legislative sides made China consider a multilateral trading

system which might serve as a stabilizer for both sides. While bilateral political relations were down to freezing point, trade and economic exchanges increased vigorously. The legal arrangements between the two countries at that time, the MFN clause in trade agreement and a set of textiles quotas, were not sufficient to address the fast growing bilateral economic and trade relations. The US markets demonstrated its attractiveness to China and took a leading role in framing bilateral economic relations. The US started bilateral trade negotiations with China on market access, intellectual property rights and prison labour export. These bilateral negotiations also fed into the multilateral negotiations of GATT/WTO. Negotiators from The Office of the United States Trade Representative (USTR) rightly foresaw that China would become a trading giant sometime during the 21st century. The trade negotiations were designed to build a framework to regulate China’s trading behaviour in the 21st century.

CHINA EYE‧Issue 9

The Changing Economic Relations Between China and the US MA Xiaoye (馬曉野)

There were many difficulties for both sides in the second ten years. Trade volumes increased drastically with surplus in favour of China. Let us look at the obligations after the second ten years. The US successfully signed several trade agreements with China and negotiated a huge volume of articles on China’s membership under the WTO. Legally speaking, China’s membership in multilateral trading systems and MFN treatment were separately prescribed. The reason given for doing so was that China’s economic system was “unique”. The assertion for singling-out China among other WTO members was to make sure that the WTO system would protect against the possible negative influence due to China’s accession. The third period of bilateral economic relations, after China joined the WTO, lasted for some fifteen years. During this period, the world economy kept changing. Environmental and climate began to play a more important role in the world economy. One important topic was the competition for economic leadership between the US and China. Existing mechanisms like Strategic and Economic Dialogue (SED), Joint Commission on Commerce and Trade (JCCT), The USChina Joint Economic Committee (JEC), Bilateral Investment Treaty (BIT) etc. cover all issues between the two economies. Business circles followed these arrangements carefully and kept giving input to both governments for improvements. Furthermore, there are always opportunities available in the multilateral diplomacy arena to address related issues between the two economies. For example, IMF, the Group of Twenty (G20), and Asia-Pacific Economic Cooperation (APEC), just to name a few. China is mainly a tangible goods manufacturer and trader, but it has yet to develop its abilities in the leading roles of an international financial market. Below are some fundamentals about the Chinese economy: In GDP terms, China contributes 30% or

less of world GDP, yet China’s per capita GDP is still very low. Even if the Chinese economy is slowing down from 10% down to 7% in GDP growth, the GDP increase on the existing bases means a USD0.7 trillion actual increase. If that amount was not realized, the biggest economy, the USA, could fill the vacancy with a 4% increase on 2014 GDP basis, or a 15% increase for Japan on a 2014 GDP basis. In other words, we cannot afford China’s economic collapse. The International labour Organization (ILO) reported that in 2014 the labour wages of USA was USD 3,236, while China’s was USD 656. China’s talent wage level also rose quickly. That means that China will remain as a low cost competitor for a while. China is one of the largest open economies in the world, judging from its trade dependency rate, foreign exchange reserves and the external effect of its domestic economy. China’s “tariff peaks” and “trade facilitation” is still in the process of further change. Some years ago, the biggest economies in the world had the luxury not to care about China’s economic policy implications, because China’s economy was emerging and only had a marginal influence on the US economy in terms of jobs. At that time, bilateral policy discussions could be done in a “one way” mode. Now, we need to understand that it is irresponsible to analyse economic externality without examining the economic reality of China. Any reasonable deliberation must start with understanding the economic fundamentals of China, only then are we in a position to evaluate external effect and consequences. Chinese media has reported on hostile US attitudes towards the “Belt and Road” Initiative and Asian Infrastructure Investment Bank (AIIB) to “contain” China, that the US would do everything possible to prevent China from taking the lead in forming a new bloc. In fact, the US government is taking counter action to this initiative. The Chinese government though, never said it had an external economic strategy.

CHINA EYE‧Issue 9

The Changing Economic Relations Between China and the US MA Xiaoye (馬曉野)

Rather, these are inclusive initiatives, based not on modesty, but reality. One of the underlying economic reasons for the “Belt and Road” Initiative and the AIIB is that China’s economic development model has created some challenges for its economy. Accumulated overcapacity in certain sectors forced the Chinese government to find an outlet through international coordination. The Chinese economy is investmentled, and overcapacity in the manufacturing sector and infrastructure-related sectors is tremendous. Macroeconomic figures showed that investment return is decreasing quickly. IMF research indicated that the return on investment in China is similar to a mature economy, not an emerging economy. From the Chinese perspective, it is better to find a way to allow this overcapacity to operate marginally or even run negative in revenue terms for a while, rather than becoming bankrupt and starting over again. This is especially the case for State-Owned Enterprises (SOEs). International financing is a necessary condition to make potential overseas projects sellable. The AIIB, which covers the One Belt and One Road, may help China channel this overcapacity. The Chinese government has also commenced international coordination of production capacities with over a dozen countries. Is the world infrastructure sector a field for tense competition between major economies? Is the US unhappy about China’s infrastructure contributions outside of China? A World Bank report estimated that by the year 2030 the need for infrastructure input in developing countries would be beyond affordable. Furthermore, China Development Bank is no longer smaller than the World Bank in operation scale, which means complimentary efforts in capacity building to fight hunger worldwide, is necessary. Considering China’s economic reality, the Belt and Road and AIIB are born out of internal needs for getting rid of overcapacity and making better use of currency reserves. The external effects of these initiatives match

well with the needs of those areas and are conducive for the formation of a platform for other economic players, including the US and Japan, to chase opportunities there as well. The cream on top of the milk is not in infrastructure development, but for follow up activities. It benefits those who are actively involved and have a competitive edge, not necessarily China. Another issue which is much talked about is the Renminbi (RMB) and the Special Drawing Rights (SDR) basket. The IMF has two considerations in determining the SDR basket of currencies: an acceptable exchange regime and the usable amount of money. Further, it is likely that the SDR basket needs the RMB, and not the other way around. We observed that the IMF has wisely postponed its decision to the end of 2016, waiting for the dust in the Chinese stock market and exchange rate fluctuations to settle. The SDR basket has some face value but is not worthy of a real battle between China and the US. Both sides, as two leading economies, have many substantive issues other than this to face, to argue, or to compete on. After WWII, the US, the largest market, generously took the lead in shaping the GATT/ WTO trading framework for many years. With the US economy continually upgrading to a services-oriented economy, the US lost its home court advantage in the WTO. Past experiences have revealed that the ability to lead the world trading regime comes from domestic market potential, not export capability. The conditions that caused US leadership to phase out from the global tangible goods trading framework are: The US has already become the largest open market with the least restrictions to trade. In another words, the US has run out of chips to lure trading partners on board for further reduction of trade barriers. The US has also almost exhausted its usable munitions/chips in the WTO Uruguay round of cross-sector negotiations on Trade-Related Aspects of Intellectual Property Rights (TRIPS), Trade Related Investment Measures (TRIMS) and services, as well in the following Doha round.

CHINA EYE‧Issue 9

The Changing Economic Relations Between China and the US MA Xiaoye (馬曉野)

China still holds huge potential for imports due to its untapped domestic consumption. It should be in a position and has the responsibility to take the lead in new, freer trade initiatives. One thing which positioned China ahead of India is that India’s economy is in the process of capacity building while China has overcapacity in all sectors. So, it is less painful for China to contribute reduction packages than it is for India. The price has to be paid either way. As the WTO become too big, it became very inclusive in encompassing members’ different development stages, and reaching “consensus” in the decision-making mechanism became extremely difficult. As a “rich man’s club” before the 70’s, GATT was more efficient in promoting free trade. After the world trading framework expanded to include the “poor man’s family” in the Tokyo round of negotiations, the WTO was forced to be more ambitious in goals-setting and, therefore, was easily paralyzed by its hardly achievable ambitions in the game of balancing. It is logical from my understanding that US needs to set up a platform to address its own concerns together with partners with similarly prioritized agendas. The US economy has 80% more GDP contribution from the service sector, and therefore must have different needs from external economic regimes, especially developing countries. As long as the US’ change of home court to the Trans-Pacific Partnership (TPP) is aimed at exchanging more concessions which may not be possible with a bigger group, as long as it does not go in the other direction by erecting barriers in negotiated topics, and as long as transparency and access for late comers is maintained, it should not be accused of being “regionalism”, “protectionism” or whatever. Over the past 35 years, both China and the US benefited from bilateral economic relations. I once heard someone describe this important economic relationship as a marriage: The first 10 years of approaching and flirting; the following ten years of serious quarrelling, and then more quarrelling closer to wedding. Finally, after 15 years of marriage, some couples may want a divorce. Would a quarrel over leadership in the

family destroy this marriage? Have the marital disputes changed in nature – From seeking coexistence, to seeking the upper hand, or even calculating the damage of devoice? I believe both the US and China have the wisdom to understand this reasoning and have detached it from non-economic considerations, because both governments have the ultimate mission to improve the welfare of their people. Major economies, which have much influence over world markets, have the responsibility to think twice about the responses of markets before taking action. Take the 11 August, 2015 exchange rate fluctuations for example. This is not a point for criticizing China, because we all have a learning curve to climb. The Chinese government unfortunately overreacted to an unexpected market response to a change in the exchange rate regime. When the dust settled, we were back to the beginning. The takeaway here is: The externalities of big economies may backfire and offset good intensions; those who take action should weigh the risks of early release and a market overreaction, and decide which is more conducive to policy objectives; and finally, markets and stakeholders should be informed about what, when, how and the expected magnitude of economic policies of big economies, because it is the obligation of those with influence to manage market expectation. Although the Chinese economy has become bigger, my view is that out of structural problems, the economy is not that strong, but somewhat obese. China has many economic challenges to solve and some are very difficult. Leadership, or rather the accompanying obligations, is not that appealing from China’s perspective. There is no doubt that the US and China have differences or even problems in their relationship. In the past 35 years, the US and China have successfully detached other noneconomic factors or disputes, and empowered the economic potential of both sides to deliver welfare to the people of the two countries as well as to other beneficiaries in the world economic community as well. The new situation

CHINA EYE‧Issue 9

The Changing Economic Relations Between China and the US MA Xiaoye (馬曉野)

we are facing now is troublesome from my observation. What I dislike most is that the size of China’s economy on paper casts a shadow two or three times bigger than what it really is. There are some people from the two sides, who are ideologically driven, who always wear ideology-correction lenses and voice opinion of political correctness in economic relations. This vocal minority may slowly and effectively shape peoples mindsets if these leadership games and other non-economic considerations are always at the back of people’s minds. If the two countries are unable to face the economic issues squarely or if economic issues are subjected to cross-sector tradeoffs, we will have less bright a future.

CHINA EYE‧Issue 9

The Influence of Public Expectations on the Sino-US Economic Relationship DICKSON, Bruce J.

The Influence of Public Expectations on the Sino-US Economic Relationship (公眾期望對中美經濟關係的影響) DICKSON, Bruce J. Professor of Political Science and International Affairs, Elliott School of International Affairs, George Washington University; Director, Sigur Center for Asian Studies, George Washington University

want to talk about two trends that I see in the US-China economic relationship, and that is, at least on the American side, the support for increased trade between the US and China was largely driven by the expectation that: One, it would lead to greater trust between the two countries; and, second, that it would lead to political change. Neither one of those things has happened. Distrust has always been the word used to describe the relationship between the US and China. If you look back at any period of time, that is the word that comes up over and over again. It’s not a new issue. it’s sort of the nature of the relationship. The hope is that greater trade and cooperation would help build trust between the two countries, that support for trade, support for economic reform, would then be the basis for cooperation in other areas. But in fact, that hasn’t happened, in part because, as the Chinese economy has reformed, it is open to the outside world, but it is not that open to outside international competition from foreign firms – something many of those firms and the countries that they were from expected. Especially since the international financial crisis, American and European foreign firms have year-after-year reported that the business climate is getting worse and worse in the country. There is the expectation that this

would really be an area where American and European firms would really thrive. But in fact, that hasn’t happened at all. In a separate way, because of the larger national security concerns, this also inhibited greater economic and trade ties between the two countries. There have been several famous episodes where a Chinese firm tried to buy all or part of an American company, but then, for national security reasons, that bid was rejected. Or, for example, there have been efforts by companies like Huawei to get into the United States’ market, especially the government market, which have ended up failing because of the national security concerns. Even private companies are often suspected of being fronts for the Chinese government, or the Chinese military, and the fear is that by having them be more active in United States, it presents an opportunity for the Chinese government to get directly involved in ways that the US government wants to prevent. The recent episodes of hacking from either Chinese companies, individuals, or perhaps the government or military-related individuals, also create suspicion not just of espionage, but of the theft of certain companies’ trade secrets. This has also created more tensions and distrust between the two countries, as opposed to a sense of greater cooperation between the two.

CHINA EYE‧Issue 9

The Influence of Public Expectations on the Sino-US Economic Relationship DICKSON, Bruce J.

DICKSON, Bruce J. at “Sino-US Colloquium (VIII) – Beyond the Current Distrust”

The second issue has to do with the expectation, at least in the American side, that trade and economic growth would lead to political change in the country. Most foreign observers, whether academics or policymakers, expect that at some point, economic growth in the country and modernization would lead to political change, influenced primarily by the well-known modernization theory. And therefore there has been an encouragement of growth, expecting it would lead to a change of regime there. In contrast, the Communist Party sees economic issues as a key source of its legitimacy; that as the economy grows and modernizes, as standards of living increase, this will, in fact, create support for the Party, and not undermine it. What we see in recent years from survey data from China is similar to why Americans vote. We know that economic conditions influence whether people vote and how they vote, but there is often the debate within the US between whether it is because of aggregate

economic conditions (overall rate of growth, unemployment and so on), or if it is sociotropic conditions that influence voting (i.e. It doesn’t matter so much what rate the economy is growing at. What matters is whether you have a job or if your wages or salary was increasing). There is a similar dynamic within China as well. The overall rate of growth does not seem to have that much of a bearing on people’s attitude or how satisfied they are with the status quo. What really matters is whether the individual’s personal income survives. As long as people see themselves getting ahead, they are more inclined to support the status quo. This presents a big challenge to the Party as the economy begins to slow and the economic model is shifting from, as Dr. Ma Xiaoye described, an emphasis on infrastructure and exporting towards consumption. At a time when economic and GDP growth is beginning to slow, will they still be able to have the individual’s income rise? Will people still see their individual standards of living increase,

CHINA EYE‧Issue 9

The Influence of Public Expectations on the Sino-US Economic Relationship DICKSON, Bruce J.

even if the economy is beginning to slow down? The fact that President Xi and the Party more generally seem very nervous about public opinion in these areas, suggests that they themselves are concerned about what the future may hold as the economy begins to slow down. It’s worth knowing that President Obama is the first American president who has not linked trade and economic issues with regime change in China. He promotes economic relationship on its own merits, not as a means to another end. Nevertheless, journalists still look at it, it is a preoccupation for many China-watchers, and it’s likely to be one of the only foreign policy questions that are really relevant or emphasized during the upcoming presidential elections, given the sensitivity of it in a variety of ways. So, in short, the United States and China are increasingly interdependent economically, but it seems the leaders of neither country are happy about that. They each think the other side is not living up to their agreements or their expectations, and therefore feel frustrated. The fact that we now have two new economic institutions in Asia – the Trans-Pacific Partnership (TPP), and the Asian Infrastructure Investment Bank (AIIB), and yet the US is not a member of one and China is not a member of the other, indicates the lack of trust and the difficulty in moving ahead. These new organizations have similar but competing goals, and the leading membership of the two groups is quite different.

CHINA EYE‧Issue 9

Managing the Transition in Global Economic Leadership SCHELL, Orville

Managing the Transition in Global Economic Leadership (應對全球經濟領導力轉型) SCHELL, Orville Arthur Ross Director of the Center on U.S.-China Relations, the Asia Society; Former Professor and Dean, Berkeley Graduate School of Journalism, University of California

ny of us who have watched China for many decades, I think, had a tendency in the 1980s, after Deng Xiaoping came back to power, to think that somehow the whole experience of the Chinese Communist Revolution had been put back into the history. That is it was over, and we had this new era of reform and opening up. I remember being very skeptical of that. Having been in China during the Cultural Revolution, it didn’t seem possible to me that a revolution that had so many decades of purges on the Chinese people could vanish so quickly. And I think we now see there are ways in which a certain kind of thinking, a way of looking at the world and approaching problems does endure. It wasn’t so simple that one dynasty ends and another begins, and a whole new way of thinking, a whole new toolkit becomes available. I raise this simply because as I look at China’s heroic efforts at this point to jump into the next phase of economic reform, where the market will have a more predominant effect on the allocation of recourses, as President Xi said, I see the drag of an old kind of decision making process, almost an automatic, autonomic response when crises hit. And that is the great contradiction between central economy or command economy, and an open economy, a marketized economy. Or, simply put, between control, and letting things go. When there are

crises and tensions within the Chinese economy and society, there is an almost irresistible tendency to want to control it. We saw this very graphically in the stock market. You will recall what happened in 2015. There was a tremendous run and people were just pouring money into the stock market. Even the Chinese Communist Party’s organs of propaganda were encouraging this, saying that it was a bull market that was just beginning. The market got driven way up, price to earnings ratios were way out of proportion compared to what they were across the border in Hong Kong and the rest of world, and then it collapsed. That was the moment of truth. What was the government going to do? And what happened, I think, was that older – whether it’s Confucian, whether it’s Leninist, whether it’s Maoist, who knows – tendency to say, we can’t just let things go on their own, we have to try to control it, which kicked in. And the government and the Party, in essence, came in with hundreds of millions of dollars, and basically bought the market. I think we saw in that how difficult it is for economic reform to really push forward in a steadfast manner. You are invariably going to run into problems, and when problems arise, if your tendency is to do one thing historically speaking, you’ll probably do that thing again. That’s what’s comfortable, that’s what feels safe. So I think this is a real problem as China tries to both

CHINA EYE‧Issue 9

Managing the Transition in Global Economic Leadership SCHELL, Orville

SCHELL, Orville at “Sino-US Colloquium (VIII) – Beyond the Current Distrust”

marketize more, and make the transition from an export economy to a consumer economy. As it tries to slowly diminish the control and the influence of the state on enterprises and emphasize the privately owned corporations, as well as all of the transitions that China is trying to make now, this central question of what happens when problems occur is going to arise again and again. And it’s a decision that will have to be made each time. But I think in this case – the stock market circumstance – it could either be a good learning lesson, or it could be a kind of indicator of what will follow. I raise that because I think it lies at the key, as you look in from the outside, on China’s ability to actually make this very critical next stage of economic reform. In a way, President Xi has staked his whole tenure on it. I would say that is somewhat of an ambiguous kind of analysis, in terms of China’s future. There are areas though that I think are somewhat more hopeful. The agreement between the US and China on climate change,

for example, was made despite all of these other tensions that exist. And I do believe that tensions have grown much more extreme in the last few years. There is more dividing us now than I think at any time since 1989. And yet I believe in December 2015, when COP 21, the global climate conference, happens in Paris, I think that President Xi and President Obama will arrive, and I fully expect they will further elaborate this partnership. What’s so interesting about this was that in my view, if you look at US-China relations in 1972, when we ganged up together against the Soviet Union, it was very easy as neither side liked the Soviet Union. In 1979, When Deng Xiaoping came to Washington at Jimmy Carter’s invitation and we established diplomatic relations, we began the next great episode of US-China relations, and that was based on the supposition – often unstated, but nonetheless, deeply believed and felt – that the US and China were headed in the same kind of historical, teleological direction of political

CHINA EYE‧Issue 9

Managing the Transition in Global Economic Leadership SCHELL, Orville

reform, that China was going to become more open and experimenting. “Not now, give us time, but we’ll get there.” Even Wen Jiabao said this when he was Prime Minister. But of course that idea largely ended in 1989, and it cut the US-China relationship loose from any common purpose, any common interest. I think we haven’t fully realized the degree to which this is the common interest of all common interests. Climate change threatens every generation from here on end in human history. If you compare the threat of climate change to the threat of the Soviet Union, the Soviet Union appears like a small piece of punctuation at the end of a very short sentence. So in effect we have arrived at a whole new sort of geopolitical assessment of what is important, and here we have a common interest that is looming very large. I think our leaders have begun to recognize this, but only begun. Whether it’s going to trump issues like the South China Sea, Human rights, Tibet, Xinjiang, Japan-China relations, etc., I don’t know. But we made a start. It’s worth watching. The second thing I think is quite hopeful is the degree to which Chinese have started to invest abroad, including in the US. In my view, this is a very welcomed thing. The US is the most open economy in the world. There have been a few exceptional cases, but if you actually look at the record of The Committee on Foreign Investment in the United States (CFIUS) – and remember there is only one single way in which a foreign investment can be disallowed, and that is national security – there have been very few cases disallowed. And so we shouldn’t lose sight of some of the other ways that the US and China can get together. It’s not simply a military question, there are other ways: culture, education, economic. I think this is something that we should not only notice, encourage, but should also be something we are somewhat inspired by, because it does represent a sign of real convergence. To conclude, what I really fear, and what I hear much talk about from all of my colleagues at various conferences, is misunderstanding and mistrust. It is often said that if we could

only understand each other more, we’d get along better. However, it does occur to me, and we must not discount this, that if we understand each other better, perhaps we will like each other less, because we have extremely different political systems. It’s not a question of culture; it’s a question of political system and political value. Americans are very unique in this regard. They used to be missionaries for the Lord, now they are more missionaries for democracy. And how we square that problem, I do not know. This divides us. It will continue to divide us, and I’m not sure that we will find a way to set such difference aside, to move on with things like nuclear proliferation, endemics, and climate change. I’m not even sure whether we should. But I think that one can begin to make a case for that. And the last time we really did that in a meaningful way was with the Soviet Union on Strategic Arms Reduction Treaties, nuclear disarmament, that sort of thing. There are some examples of it in the world, which we should study. I think we’re heading into a very uncertain time in the relationship. But these last two things I’ve suggested are just two of the kinds of more positive, constructive examples where there is a fabric of common interest – a new kind of common interest – that is growing out of the old fabric, which doesn’t work anymore. It doesn’t sustain us, things have changed. China is more powerful, Russia can make a lot of trouble, but this is not the way for the future. How we deal with this is, I think, the question we have to answer.

CHINA EYE‧Issue 9

Choices the US has to Make in Face of China’s Rise WHITE, Hugh.

Choices the US has to Make in Face of China’s Rise (中國崛起下美國應如何抉擇) WHITE, Hugh Professor, Strategic Studies, Australian National University; Former Deputy Secretary for Strategy and Intelligence (1995-2000), Department of Defense, Australia; Former Senior Adviser on the staffs of Defense Minister Kim Beazley and Prime Minister Bob Hawke

am neither American nor Chinese. I am Australian. And if you are Australian, you destiny is to be squeezed between America and China in some way or other. I’m going to talk about America’s decisions. The decisions or choices it seems to me that America has to make about its future relationship with China. I believe that there isn’t a Thucydides Trap, but the only reason is because we have choices. That is, we can make choices to avoid the pressures which Graham Allison so clearly described. But in order to avoid the Trap, we have to make choices, and we have to recognize the decisions that confront us. We have to make those decisions well and get them right. So we can’t relax. The fact that there’s no Thucydides Trap is not a reason just to say there’s no problem, because if we don’t get the decisions right, then the Trap is there, and the statistics say that in 12 of the 16 cases, the outcome is very bad if it goes wrong. So the good news is that escalating strategic rivalry between the US and China can be avoided. The bad news is that it must be avoided by clear, intelligent choices. A point to note is that we won’t get those choices right unless we recognize the scale and the nature of the problem. One of the bits of good news, it seems to me, is this seems to be much better understood in Washington and the US than

I think it has been for some time. For a long time I have seen this tendency to be rather complacent. That is, to think that the US China relationship is basically very strong. There are lots of good things going on, lots of good mechanisms to manage it, and a few problems at the margins which certainly need to be tidied up. I think that moment has passed, and I think it is very clear from the sorts of discussions we’ve heard today that people do realize that there are very deep structural problems in the US-China relationship which must be addressed. It is important to recognize that it is not just a lack of trust or a misunderstanding. What separates America and China today, what drives escalating strategic rivalry between them, is a fundamental difference of difference in views between their respective roles in the Asian order, and the nature of their own relationship with one another. To put it bluntly, I think the difference is as simple as this – the US wants to remain the primary power in Asia, and to preserve the status-quo which has been based on US primacy. And China wants a new order, which is not based on US primacy. Whether or not it is based on Chinese primacy is a separate point and I’ll touch on that later, but it certainly does not want an order based on US primacy. So, as in the anecdote provided by Prof. Amitai Etzioni at today’s conference, this is

CHINA EYE‧Issue 9

Choices the US has to Make in Face of China’s Rise WHITE, Hugh.

WHITE, Hugh at“Sino-US Colloquium (VIII) – Beyond the Current Distrust”

their “Milan”, this is what it is they both want. They both have a vision of the Asian order, and they both want “theirs”. Those visions are not necessarily irreconcilable, but they have to be reconciled and they are not reconciled yet. And, they are very deeply held, because one of the great enduring characteristics of international relations is that citizens and states value their role in the international order very deeply. They see it as essential to their security, their prosperity, and their identity, or their values. And that is why the worst wars in history tend to be fought over precisely this issue. So when we look at what is happening between the US and China today – issues in the South China Sea, issues in the East China Sea, issues over Taiwan, issues over cyber, these are symptoms not causes. The US and China are not strategic rivals because they have differences over what is happening in the South China Sea. They have differences over what is happening in the South China Sea because they are strategic rivals. And to get decisions on this

rivalry we have to focus on those causes, and not on the symptoms. With that prologue, I am going to suggest that the US faces five decisions, or rather, 5 sets of decisions. The first is, it has to start to take China’s challenge to the US in Asia seriously. And I say that because I think, of the two, the predominant position in the US and in Australia has been to assume that China in the end will accept the status-quo, will accept US primacy as the foundation for the Asian order, indefinitely into the future, because China lacks the power and/or the will to change it. I think that expectation that China isn’t really serious about a challenge and will back off has underpinned, for example, the “pivot”, which represented a mere expression of the US’ “desire”, rather than a genuine gesture of strategic policy. Therefore, for the US to get its decisions right, I think it’s terribly important to first of all recognize how China’s power has grown. It’s a kind of a given, but we don’t really focus on it

CHINA EYE‧Issue 9

Choices the US has to Make in Face of China’s Rise WHITE, Hugh.

enough. The rise of China is the biggest shift in distribution of wealth and power in human history. Even if China’s economy flat-lined today, which it won’t, it’s already far bigger relative to the US than the Soviet Union ever was at the height of its power. And it will, in all probability, grow to overtake the US economy, not just in PPP (Purchasing Power Parity) terms, which it already has, but in market exchange rate terms. This is a really fundamental shift, yet people in the United States and also in Australia don’t say this. You don’t say it out loud, the reality that China’s economy has grown so far and so fast. Neither do we acknowledge the distribution in military power. Of course, China’s military is not as strong as America’s, but it doesn’t need to be. As I think the RAND study released in September 2015 demonstrated perfectly, China has developed enough capabilities of the right kind to raise the cost of the US undertaking precisely those kinds of military operations, which has always been fundamental to the military basis of its strategic primacy in Asia. The US no longer has anything resembling escalation dominance in Western Pacific contingencies, conventional or nuclear. Therefore, there are no easy military options for the US anymore, the way there used to be. Thirdly, the US has to recognize China’s growing diplomatic weight. China really matters, to every country in the Western Pacific, despite the strength of US soft power, despite the fear that China’s rise naturally engenders. To every country in the Western Pacific, including Australia, China has real diplomatic weight, and America simply cannot presume on their support in anything but the most desperate situation. Fourthly, the US has to acknowledge China’s resolve. China doesn’t want a conflict, but it believes, I think, that it can engineer a significant change in the regional order, significantly reduce the scale of US leadership and significantly expand its own, without running into the risk, the costs of a conflict.

Of course, that depends how far it pushes it. I’m not sure what China wants. I’m not sure that it wants primacy, I’m not sure that it wants to replace the US as the primary power. And I take Michael Swaine’s point, that there is no reason to presume that is what they want. But I cut the issue a little bit differently from Michael. I can’t see why China wouldn’t go for primacy if nobody stops them. In the end, that would mean them just doing what we did. I’m not quite sure why China wouldn’t aim to have what America’s had, if it can do so cheaply. So I think whether it actually ends up being ambitious enough to go for primacy depends to some degree on how hard anybody pushes back against it, whether it’s the US or Japan or India or whoever. What I am sure of is it won’t settle for the status-quo, that China is extremely determined to change the status-quo. When Xi Jinping keeps using the phrase, which I prefer to translate as “a New Model of Great Power Relations”, he means he wants a new model of great power relations. It means he doesn’t like the old one. And fifthly, power politics is back. This is a different kind of international relations, a kind we haven’t had to deal with in Asia since before 1972, and globally since the end of the Cold War. We do again now. What that means is that when we are dealing with these big issues about the nature of the international order and the respective roles of different players in it, we are talking about issues in which there is a possibility of conflict, where the risk of war hovers over the choices we make. That has to very much focus the way we think about it. So that’s the first big decision for America – does it really take China’s challenge seriously? Does it take China’s power and resolve seriously? The second challenge is that the US needs to decide what it wants. How serious is it about primacy in Asia? Obviously, the idea of being a primary power in Asia is very deeply embedded in America’s ideas of its global role, ideas of its interests – economic, strategic – and of course, its own identity. But it is not an inevitable

CHINA EYE‧Issue 9

Choices the US has to Make in Face of China’s Rise WHITE, Hugh.

posture for the US. There are plenty of other options. A model of US engagement in Asia, in which it played a lessor role – not primacy, not leadership, but something more like an equal share and a shared regional order – could well be enough to support America’s key security interests, to support its key economic interests. It probably wouldn’t be enough though, to support its alliances as they are presently conceived. I think Mike Mochizuki made the point in the earlier session, that if the US and China do a deal which significantly reduces their strategic tensions, then Japan will be less confident in US support. Likewise, I’m not saying that it’s consistent with the way Americans now conceive their undertakings to Taiwan under the TRA (Taiwan Relations Act). And so, stepping back from primacy would have some real costs for the United States. Does the US see its alliances in Asia as interests in their own right, or only as a means to an end? If they are interest in their own right, then is America really prepared to hang on to them, at the price of escalating strategic rivalry with a more formidable country than it’s ever confronted before? These are very big questions. So, the US has really got to debate with itself, what it really wants in Asia, why it is there. And thirdly, and as part of the same process, is the US needs to decide what price it is willing to pay. If it no longer assumes that China will back off, then it has to decide how hard it is prepared to push to preserve primacy, or to define any other intermediate position. International order is defined, I think, ultimately, by what great powers in the system are willing to go to war over. Or rather, it is defined by what they can convince the other side they are willing to go to war over. So, to reframe that question about Asia today, the international order we will have in Asia will be defined, more than anything else, by what the US and China and convince one another that they are prepared to go to war over. So, America has to ask, what it is in Asia that matters so much to the US, which it is willing to

go to war with China - the China of today and tomorrow, not the China of the 1970s. Or, rather what can it convince China that it is willing to go to war over? That will define the new order. And if you look to the hardest case, I think it is worth honing in on Taiwan. For generations, perhaps since 1949, America’s commitment to defend Taiwan, expressed either under the Treaty or under the TRA, had been at the heart of how America has defined its role in Asia. But Americans really have to ask themselves, and ask themselves quite soon, because there is an election coming up in Taiwan, whether or not it really is serious about going to war with China to preserve the status-quo, bearing in mind that this war is one in which the US will have nothing resembling dominance at the conventional or nuclear level. I think this is a very important issue. For Americans to simply presume that they have usable military options at a cost and risk they are prepared to bear, in order to fulfill the obligations and commitments they have been making to Taiwan all these decades, would be a very irresponsible thing to do. That is the third choice. The fourth choice is to think more carefully about what the alternatives are. What is the alternative to China maintaining primacy? Well, to view it geometrically, there are really only two. One is to withdraw from Asia. This is not something that’s talked about very much. However, when you look at the situation from the other side of the Pacific, the possibility that, one way the US could respond to the rise of China is as it is today is to cease to play any substantial role in the Asian strategic order, is perfectly valid. Just because people have predicted it in the past and it hasn’t happened, does not mean it cannot happen in the future. That’s the point about the “Cry Wolf” story. The point about the “Cry Wolf” story is not that the boy continually incorrectly predicted the emergence of the wolf, but that the wolf eventually comes. So, at some stage, something could happen, which would persuade the US that maintaining a strong strategic role in Asia

CHINA EYE‧Issue 9

Choices the US has to Make in Face of China’s Rise WHITE, Hugh.

was no longer worth its while. And if the rise of China as it is today is as revolutionary an element in the international order as I think it is, then there is no particular reason why that shouldn’t be the issue. So, I think the Americans need to think carefully about the fact that this is a possibility for them. However, it is not one I would encourage the Americans to take. Accommodation, preserving the strongest possible American role in Asia consistent with a stable relationship with China, consistent with avoiding the Thucydides Trap, is by far and away the best outcome for those of us on our side of the Pacific, that is, Australia. I would also say it is a better outcome for America. To focus, first of all, on a possibility of withdrawal, and secondly, to think about what accommodation – that third option – would look like, is really important. And of course, one of the really bits of good news is how this idea of accommodation with China is now being discussed in and around Washington with a clarity and a vigor and a rigor that we have not seen before. Michael’s Swaine’s work, Charles Glaser’s work, Lyle Goldstein’s, Orville Schell’s, and of course, our own dear Kevin Rudd’s, have all been in this, and I think it is a very interesting pattern of ideas that have emerged. Here are a couple of generic points about the particular proposals that are put on the table. The first is I’m not sure any of these explorations of the idea of an accommodation with China quite get the scale of what would be required to build a stable relationship which will avoid the Thucydides Trap. That is, how much the US would have to give up, how different the US role in Asia would be? If I’m right to say that China won’t settle for anything less than, broadly speaking, a relationship of equality, for example, for the reasons I mentioned above, then I don’t think a sustainable accommodation with China is consistent with maintaining the US-Japan Strategic Alliance. And, therefore, it is not consistent with Japan’s present strategic posture. More broadly, the kind of

accommodation that I think is necessary to avoid the Thucydides Trap is going to mean that the US surrenders the kind of primacy which has been central not just to the way it’s thought of its role in Asia, but to the way it’s thought of its role globally. The nature of the deal that the US and China might do has to be negotiated, it cannot be decided in advance, but it will look like no relationship the US has ever had with any country before, because the US has never dealt with a country as an equal before. It has dealt with countries as rivals and adversaries, but not as equals. Fifthly, the US has to decide to start the process of negotiation if it wants to avoid the Thucydides Trap. And the very first thing to do is to acknowledge a willingness to negotiate. The easiest thing in the world is for two sides to miss the opportunity to negotiate, and drift or surge into escalating strategic rivalry, because neither side really acknowledges to the other that they are willing to start doing a deal. I think there is a real risk of that at the moment. Acknowledging that you are willing to negotiate, is one of the hardest things of negotiation, because you always feel you are giving a great deal away before the negotiation has actually begun. So, a government, a leader, who is prepared to acknowledge that willingness at the beginning, has to act, as Stapleton Roy said in an earlier session, unconventionally. It would require exceptional leadership. It would require leadership of the kind that we saw from the US in 1972, when the opening with China took place. It needs, in other words, a big speech from a very courageous president. And I don’t think any US administration could start the process of negotiating specific issues until a US president has stood up and given a speech which talked honestly about China’s rise, that acknowledged the shift in the distribution of power, that recognized that the US would have to have a different kind of relationship in the future, and which plainly expressed a willingness to negotiate such a relationship. That would be an

CHINA EYE‧Issue 9

Choices the US has to Make in Face of China’s Rise WHITE, Hugh.

incredibly hard thing to do politically. Perhaps too hard. However, the only reason I think it is possible is that the risks on the other side are so great – the risk of adding another data point on Graham Allison’s Thucydides Trap matrix, but with nuclear weapons attached. That alone makes me cautiously optimistic that we might move in that direction.

CHINA EYE‧Issue 9

New Dimensions in the Sino-US Relationship JIN Canrong (金燦榮)

New Dimensions in the Sino-US Relationship (中美關係中的新層面) JIN Canrong (金燦榮) Associate Dean and Professor, School of International Studies, Renmin University of China

do agree with Professor Graham Allison, and I believe that the US-China relationship now faces the Thucydides Trap. Second, I believe it’s our responsibility to escape from this Trap. And third, I agree with Stapleton Roy that we need to adopt unconventional thinking and practice. My research tells me that it is possible to escape from this Trap and I will list three kinds of new possibilities. The first is “old game, new player”. The game is old, very old, several thousand years old. But the two players, China and the US, are very new. I tried to compare them with previous players in modern history, and I found five prominent features that make China and the US different from all previous players. The first point is size. China’s geographical size is equal to Europe as a whole, and according to our official data by the end of last year the population on the Mainland reached 1.37 billion. If we include Taiwan, Hong Kong and Macau, then it comes to over 1.4 billion. However, according to calculations by experts in food consumption at the Chinese Academy of Agricultural Sciences, the actual population, based on food consumption only in the Mainland, should surpass 1.45 billion – higher than the official number. So what does this mean? Western Europe’s population is 500 million, and Russia and Eastern Europe combined is 700 million. That means in terms of population, one China is

equal to two Europes combined with Russia. With the United States, it is the same. Geopolitically speaking, in North America, you have two Anglo-Saxon countries, Canada and United States. But geo-economically speaking, the US is combined with Canada, so your size is close to 20 million square kilometers. Two years ago, I participated in the third Berlin Security Forum. On that occasion, the Defense Secretary of Germany told the European audience that compared to China and United States, Europe is composed of two kinds of countries: small countries, and countries who do not know they are small countries. Second, both the US and China are civilizational states, different from nation states in Europe. Nation states are based on ethnicity and blood ties, but civilizational countries are based on identification of the civilization. It is more inclusive and less exclusive. The third new feature is that both US and China share quite a lot of social and cultural commonalities, but we tend to neglect them. Both countries have never been hijacked by religion. We are very secular societies, materialistic societies. The real belief for common people on both sides is to earn more money. We will never be a country like India, they have too many Gods; and we will never be like the Middle Eastern countries, they are too loyal to their only god. In addition to pragmatism, both countries appreciate the value of individualism. The US recognizes

CHINA EYE‧Issue 9

New Dimensions in the Sino-US Relationship JIN Canrong (金燦榮)

JIN Canrong at “Sino-US Colloquium (VIII) – Beyond the Current Distrust”

individualism, and in Chinese people’s daily lives they are very individualistic. Unlike Japan, where they are very collectivism-oriented and accept hierarchy, both China and the United States hate hierarchy. In this regard, the US and China are very similar to each other. The US and Japan however, are very similar to each other in terms of man-made political arrangements, but different to each other in terms of the nature of their societies. Natural born similarities should be respected. Both the US and China appreciate the value of soft power. We will argue at length over disputes in order to mobilize our own society before we go into war. This is also quite different from the nature of Russia. Finally, a new feature in our game is that the US likes to “box” with other countries but China likes to play “Tai Chi”. We need something new so that we can innovate our strategic planning, in order to escape from this old tragedy, this old game. Another new dimension in this relationship

is “old game, new era.” Firstly, both China and the US possess very strong nuclear capabilities. According to my knowledge, two years ago, in 2013, the US gave up its last hydrogen bomb. One year earlier, in 2012, Russia also gave up its hydrogen bomb, so the only remaining hydrogen bomb is in China. Both countries are very strong in terms of nuclear capabilities. During the Cold War years, nuclear weapons played a key role in stopping the immediate fight between the two super powers. The same logic applies between China and the United States Second, globalization. Now China and the US have integrated with each other. Third, civil society. The US and China own very strong civil societies. I noticed that during the speech by President Xi in Seattle in September 2015, he said that China now has a 300 million-strong middle class – that’s our civil society. What makes things more complicated is that our middle class is combined with the one-child policy. The middle class itself is a society with

CHINA EYE‧Issue 9

New Dimensions in the Sino-US Relationship JIN Canrong (金燦榮)

very strong anti-war sentiments. The hero of the middle class is Warren Buffett, Bill Gates, not the military Generals. No teenager today wants to be a military General. This is also the case in China, they want to be Jack Ma, they don’t want to fight, especially those who were born in the one-child policy generation. The forth new feature relating to the new age is that now we have the United Nations (UN), a universal international organization created by the United States. China is an enthusiastic supporter of the UN. This is a rather ironic scenario. The United States created the UN, but in the mind of the United States, they consider the UN a tool and don’t really appreciate the UN. If it’s useful, they use it, if it’s a problem, they just cast it away. On the contrary, China is now very loyal to and values the UN. A hundred years ago, there was no UN-like international organization. Finally, a feature relating to the new age is the philosophy of John Locke, which now dominates international relations. According to Alexander Wendt, the constructivist in United States, international relations can be roughly divided into three stages, Hobbesian, Lockean and Kantian. Hobbesian philosophy existed before the 20th century, when Europeans were running international relations. The basic logic is jungle politics. Any country who tries to be a rising country needed to occupy colonies. Then came the age of United States, and the US reshaped international relations with Lockean philosophy. The US has a worldwide market. Any country that wants to rise does not need to occupy colonies but instead needs to have a percentage of the world market. You can get more money by occupying the market than by occupying colonies. That explains why Japan rose in a different way. Before the Second World War Japan followed the track of Europe, they tried to emerge by occupying neighborhoods. But after the Second World War, they reemerged by occupying world markets. In the past three and half decades, China followed the same track. We tried to expand our share of the

world market so as to gain more capital. That’s the contribution of the United States. The third category of new possibilities is the heritage of the US-China relationship since Nixon’s trip in 1972. In the past 43 years, through efforts from both sides, we have an established heritage of economic interdependence. Second, we have wide social and personal connections. Third, we have a lot of cooperation. We have something to inherit. We have already come together to successfully resolve many issues. The next point is that Deng Xiaoping made the decision that China will emerge within the international regime led by the United States, which is still the philosophy in China. After decades of efforts between China and the United States, we now have many dialogue mechanisms. According to the latest data, we have 98 dialogue mechanisms from the deputy minister level and up. So if we can make full use of this heritage, I think it is very possible that we will be able to escape from this tragic Trap. Finally, I would like to suggest something called “co-evolution”. Two years ago, Dr. Henry Kissinger published his book On China, and in the very last chapter, he suggested that China and the US should adopt an attitude of “co-evolution.” The original idea of this socalled “co-evolution” comes from Mr. Halper, the author of The Beijing Consensus. This is a challenge for the United States because people in the US believe they are chosen by God, that they have many destinies, that they are exceptional, so they are not ready to treat any other country as an equal. If any other country asks for equal treatment, it is not only a mistake, but a crime. However, when you face countries as great as China, you have to treat China as an equal partner. So you need to change your mentality, escape from Americentrism and collaborate with each other. That is co-evolution. Second, China, from now on, should share more responsibilities, take on more responsibilities and contribute more to the

CHINA EYE‧Issue 9

New Dimensions in the Sino-US Relationship JIN Canrong (金燦榮)

public good. The US should consider sharing power with China. We should definitely do our best to escape what is the worst case scenario, the tragedy of great powers, the Thucydides Trap. I suggest we do not seek extreme scenarios. We should seek something in between, and my suggestion is that what we can achieve a so-called “functional” partnership. This is different from an institutionalized partnership, which is the relationship between the US and Japan. China and the US will never reach that point or that level, but we can reach the level of a functional partnership. The key to functional partnership is twofold. First, we should keep the differences under control. Second, we should find a mechanism to explore opportunities, the more the better. We should have issue-driven cooperation, while keeping differences under control. This is functional partnership. To make it easier for our American friends to accept this concept, I will use another term to describe this functional partnership – “P2”. In 1815, after the Napoleonic Wars, there was the Vienna Congress, which resulted in the so-called Metternich system. Some historians described this Metternich system as the Concert of Europe. The five major powers in Europe, France, the Austro-Hungarian Empire, Prussia, Russia, and UK worked together to maintain the order in Europe, despite their domestic politics being quite different from each other. Despite constitutionalism in the UK, a Republic in France later on, and monarchies in the other countries, they were still able work together. Today, I think we may see the concert of “P2”.

CHINA EYE‧Issue 9

Eliminating the “Milan” in the Sino-US Relationship ETZIONI, Amitai

Eliminating the “Milan” in the Sino-US Relationship (消除中美關係零和博弈) ETZIONI, Amitai University Professor and Professor of International Affairs, George Washington University; Director, Institute for Communitarian Policy Studies, Elliott School of International Affairs, George Washington University

bove all, we are here together to see if we can have a dialogue across civilizations, across nations and find ways of reducing tensions so that we can resolve our differences in a peaceful manner. Some of my colleagues believe with a full force of conviction and a scholarship that when a new power arises, and an old power does not yield fast enough, war is inevitable. Some of my more optimistic colleagues say that since 1500, there have been 15 incidents in which a new power arose and the old power resisted, and only in 11 of them have war occurred. In 4 of them, they were able to adapt peacefully. Now if you listen to this statistics, its not very optimistic. The most optimistic scenario is 4 out of 15. There is cause for worry. And that’s really in the end what our agenda is about. One way for me to start this discussion is by an extremely short anecdote, that at one point the King of Spain said he completely agrees with the King of Austria and have exactly the same interest. We both want Milan. That meant there was no room for compromise because they both wanted the same thing. So I started by looking at US-China relationship to see if I can find a Milan, if I can find any important interest in which the countries have conflict, certainly as compared to the weight of those in which their differences are not difficult to renegotiate. In anticipation, I found only one on the list which could turn

into Milan, and in all the others, it seemed to me that reasonable people could settle them without having to worry about war. For somebody who has been in combat, I am not a pacifist but I am painfully aware that wars tend to impose huge costs on all sides. So if you look at what happened to Japan, it thought it was going to defeat United States; if you look at what happened in Natzi Germany, which first devastated much of Europe, the Soviet Union, and then devastated itself; if you see what’s happening in Syria, in Libya and Iraq, whoever wins in the end, the suffering on all sides is huge. Again I want to emphasize there are clearly conditions in which, if its people, values or existence gets threatened, it will go to war but we have obviously a very strong compelling reason to check all our other options before moving in that direction. So here is my list. Clearly, most nations have nuclear weapons and therefore, any mentioning of war immediately has to take into account the devastating consequences that they are going to inflict on both nations. Even conventional war, as we’ve known from history, caused a lot of mutual destruction. Remember what happened in World War I where there were huge amounts of casualties on all side. Nuclear weapons add a whole other dimension to that concern. Any notion that somebody is going to strike a blow and it’ll be over is indeed a dangerous fantasy.

CHINA EYE‧Issue 9

Eliminating the “Milan” in the Sino-US Relationship ETZIONI, Amitai

ETZIONI, Amitai at “Sino-US Colloquium (VIII) – Beyond the Current Distrust”

Next, both China and the United States have a strong interest in preventing the spread of nuclear weapons to other nations, the proliferation of nuclear weapons. What is equally important but maybe less often discussed, is there is a tendency on both sides to keep a finger on the trigger to third parties. That happens when, for instance, the United States makes various military arrangements with the Philippines, and the Philippines tend to misunderstand them as the United States irrevocable commitment to engage in war with the Philippines, get into blows with China. And, again on the other side, China’s relationship with North Korea has that kind of dynamic. As more and more nations build military alliances with either China or the United States, especially when we extended our commitment to Japan, to these tiny islands and we decided we are going to defend them as if it were a commitment to Japan. These are all things which take us in the direction where we allow other country to, not start war, but have a finger

on the trigger. I think both sides need to be much more cautious of avoiding that trap. Finally, a particularly compelling point for me is that, at best, when we only prepare for war yet never go to war, both countries spend hundreds and billions of dollars on arms which will never be used. In a situation where both nations and, increasingly, China too, need those hundreds and billions of dollars for domestic purposes, it’s really a gun or butter issue here. There is clearly a scarcity of public funds. We need to think about this as we build more aircraft carriers and destroyers and other highly expensive items. We are taking away from infrastructure and from promoting equality. What particularly concerns me here, is that in other situations, when you get to war, you may be able to avoid it. But once you go down the road of an arms race, you’re already in a trap because you’re already, at best, never going to use these weapons but keep building them up. So perhaps we could impose a cap on military developments. I don’t mean complete

CHINA EYE‧Issue 9

Eliminating the “Milan” in the Sino-US Relationship ETZIONI, Amitai

symmetry. There are all kinds of complicated questions that arise. But if you can get off this escalator we would have resources which we both desperately need for domestic purposes. Among the other things in which we have a natural complementarity is everything concerning the environment and climate. This is not a small matter as we all know. We obviously have strong and important complimentary economic interests. We both need to avoid special interests in each of our countries pushing us in this direction of escalation or leading to conflict and war. Now, to my last item on the list, the one which concerns me. It may seem to some of you, especially to realists, an odd item to be on the list. But I am concerned about both sides getting engaged in symbolic psychological issues around the build up of nationalism, which will get us into conflict not because of some real unresolved issues, but because we turn things into symbols and then we have to fight because we invested in these symbols into an enormous power, which in turn locks the population of those countries into commitments. These commitments have very little reality but we turn them into such emotional public issues that we cannot step back. We are aware that taking a stick and putting a piece of cloth on it is going to be junk. But if you call it a flag, people will suddenly be willing to die for it. That’s the same issue here. You can take a pile of rocks. If I allow you to use them, then what about my sovereignty, I’ll die for those pile of rocks. The others can say if I allow you to have those rocks, it would show weakness or appeasement. We both get excited about things which are sub-trivial. Why? Because we invested in the symbolism. Then we can turn anything, somebody who did or did not visit the shrine, made the wrong or right apology – I’m all in favour of Japan going to Germany and learning how to deal with its past –but what I’m trying to highlight is really we should look at how many weapons we have, how much oil, or how much

economy in the scuff of theses “psychological issues”. The reason they have such an unduly profound effect is because we are involved now in public and foreign policy. In the good old days, foreign policy could be made by some cliques or by some elites. Today the public is very much involved as you see in our elections, as you see in China. So we should stop revving up the public and investing in such a way that any concession is seen as appeasement or sign of weakness. All these issues are really quite resolvable. There is no Milan, but we get ourselves into a psychological Milan. A group of us, both Chinese and Americans, came up with something we called Mutually Assured Restraint, in which we argued that each side should take steps to reduce these face saving positions, to reduce tension, in order to open the way to more negotiations, at least to move in that direction. For those of you who think this is a fancy or professorial exercise, let me remind you of what happened in the Kennedy era. The tension between the United States and the Soviet Union were much higher than we have today with China. Kennedy went to the American University and gave his famous speech: A Strategy of Peace and the Soviet Union responded within twenty-four hours. It led to a series of unilateral gestures. It is unilateral because it didn’t require meetings, negotiations or lawyers, and so the Soviet Union suddenly stopped jamming American broadcasts and we promised to move some old weapons we didn’t need anyhow. So I have every reason to believe if it could be done in the Kennedy era, in a much higher level of tension, that if we engage in similar mutually assuring tension reduction that we could move away from this one issue which may block our progress to peaceful resolutions. It is essential to allow for verification because just speeches and hollow promises will not do it. It has to be things that are visible. So if we say for instance, that both sides should stop demonizing each other, that is something

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Eliminating the “Milan” in the Sino-US Relationship ETZIONI, Amitai

which can be verified. There are many such examples which all aim to reduce psychological nationalistic tensions in order for us to be able to face the real tensions which can quite readily be resolved in a peaceful, constructive and honorable manner.

CHINA EYE‧Issue 9

Beyond the Current Distrust HO C. P. Patrick (何志平)

Beyond the Current Distrust (消弭互疑) HO C. P. Patrick (何志平) Deputy Chairman and Secretary General, China Energy Fund Committee

estern critics declare that China is partly to blame for the growing acceptance of the “China Threat” theory. According to them, after the incidents in the East and South China Seas, China acted aggressively, assertively and belligerently, which only served to create disquiet and fear amongst China’s neighbors. To them, China needs to change parts of its attitude if it is to continue the trend of a harmonious entry onto the international stage. However, the emergence of the “China Threat” theory may also be due to the supposed novelty and perceived abruptness of China’s rise. To outside observers, China represents something “new,” something “alien”. Its culture is ancient; its values are different; its history is complicated; its intentions seem mysterious, and its position sometimes ambiguous. And for China, the outside world is different than what it was like the last time China rose to preeminence. China’s rise was hardly a recent prediction. Li Siguang (李四光), a renowned Chinese geologist, suggested over a half-century ago that Chinese history is distinguished by an eight-hundred year-cycle of rise and fall. Every eight hundred years, China grows from weakness to a position of renowned strength, before declining again. China’s first rise occurred in 1042-996 B.C. (the Zhou Dynasty); the second rise took place in 180-141 B.C. (the Han Dynasty) with the famous Zhang Qian embarking on the Silk Road; the third in 627649 A.D. (the Tang Dynasty); and the fourth in 1403-1435 A.D. (the Ming Dynasty) with Zheng He leading the Chinese fleets on seven South

China Sea expeditions. Dynasties came and went and China rose and fell, and if this pattern continues, we shall see China’s fifth rise fully realized by around 2200. Interestingly, at the rate China has been developing over the last 30 years, such a bold prediction may not be too far off the mark. In other words, if you are amazed by the China Rise today, “you haven’t seen nothing yet”. However, for the last 200 years since the Opium Wars, when China was brought to its knees at gunpoint by the invading western powers, the entire country has been obsessed with only one goal in mind: the modernization of the nation. In the long road that it has travelled with twists and turns, fumbles and tumbles, it has finally arrived at a revelation that there is no better way to bring better lives to its people than through economic and market development. Deng Xiaoping was able to lead the country and motivate the whole population to devote the entire national attention to making that happen. And behold, in a short span of thirty some years, China’s GDP skyrocketed in leaps and bounds to become the world’s second largest economy today. This rapid rise of China’s wealth was shocking and took the world by surprise. It prompted suspicion and malignant accusations that China, on this track of rapid development, would threaten the security of the region and the world. China may be the world’s second-largest economy, by virtue of its overall GDP, but when we look back in history, 200 years ago, during the Opium wars, China’s GDP was estimated

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Beyond the Current Distrust HO C. P. Patrick (何志平)

Dr. HO C.P. Patrick at “Sino-US Colloquium (VIII) – Beyond the Current Distrust”

to be a third of that of the world, and yet it was defeated by Britain. We learned then that a big GDP is not necessarily an indication of a strong country. When smart and soft power is taken into account, China’s comprehensive national power still trails the United States by a large margin. Disarming the China Threat is one thing, but building a meaningful major country relationship is another. It involves constant communication, cooperation and partnership, which can only be brought about through goodwill and built upon a foundation of mutual trust. But how do we go from communicating, to understanding, to achieving mutual trust? Both Beijing and Washington have realized that engagement is important. They have established more than sixty annual governmentto-government dialogues between agencies in the two countries. As one observer wittily stated, between the US and China, there have been numerous

meetings, many engagements of dialogue, but too little understanding, scarce empathy, dwindling mutual trust and respect, a deficit of goodwill, and practically no cooperation. Dialogue is indispensable in mitigating and resolving conflicts. Dialogue can reduce misperceptions, enhance communication, and provide venues for personal relationships among government officials, military officers, and stakeholders. Just bringing the two sides to meet might be the first step to break the ice. But dialogue is meaningful only when both sides, besides stating their respective positions, also listen to the other’s position so that an understanding of one another’s rights and difficulties can be achieved. China is a modest nation which has not been familiar with expressing herself openly in the past. Perhaps we need to do some self-reflection, to actively engage with others in dialogues, to let ourselves be understood, and tell a China story in ways that are easily received. But a relationship can only be successful if

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Beyond the Current Distrust HO C. P. Patrick (何志平)

it is humanized. Understanding with empathy can place us in the other’s shoes and help us realize why and how the other side acted in the way it did, and took the decisions it made. Only with this humanizing touch and empathy can the relationship be endowed with respect. Trust must be built on respect, mutual respect of one another’s plight and of one another’s struggle and mission. We can only trust the people we respect, and respect the people whom we trust. With trust and respect, cooperation arrives easily and automatically. In my previous capacity as the Secretary for Home Affairs of the Hong Kong Special Administrative Region Government, I have come to learn that mutual trust and respect are the prerequisites to conflict management and resolution. Mutual trust and respect come from a better understanding of each other’s history, culture and social norms, which is why, CEFC, apart from addressing energy issues, takes an intense interest in promoting Chinese culture and values. Our undertaking to organize the Sino-US Colloquiums speaks volumes of our desire to facilitate the building of a new type of relationship between our governments, peoples, and nations. We hope that such effort would provide lofty inspirations that acknowledge the importance of diversity, cultivate inclusive societies and thereby spark a new kind of pluralism that engenders peace and fosters harmony. We make friends easily, but friendship is best maintained by having a common experience. Indeed, one of the ways, and perhaps the best way we believe, to alleviate international tensions and resolve political conflicts, is for the parties to enter into joint projects and business ventures with one another so that they can be busy making profits, and not wars! And dare I say that the more joint international projects are initiated, and not just in the business and energy fields, but also in the academic, social, and military sectors, the more solid our bilateral relations will become and less subject to the vagaries of political expediencies.

Friendship, derived from working closely together for aligned interests, is our primary and common concern. After all, the best achievements are shared achievements. When China and the world go into partnership with one another, we come together for a better future and a new tomorrow; a new beginning in which we rebuild the channels of communication, renew our bond, and restore our confidence in one another. Sino-US relations can evolve in one of two ways: through geopolitics of a unipolar system built on asymmetric military relations, which is a model of a zero sum game; or through geo-economics of a multipolar system built on stability, harmony and peace, which is a multifaceted, multidimensional model from which everyone stands to benefit. The Major Country Relationship which President Xi espoused can only be made possible through geo-economic cooperation in which all sides stand to profit. Every one of us, young and old, rich and poor, yellow and white, Chinese and American, from the cloister in the Forbidden City and the house on the Capitol Hill, has a role to play in building a new harmonious relationship between China and the US. From Major Country Relations to a peaceful world order, the common denominator is respect: respect of man’s own spiritual needs, respect of nature’s needs, respect of our fellowmen’s needs, and respect of our future generations’ needs. Ladies and gentlemen, we are truly living in historic times, and the opportunity for building new confidence and trust is one of the greatest challenges facing the Sino-US relationship. I am confident that our peoples will have the wisdom and courage to truly grasp this moment and begin to build a better world in the years ahead. Although we sometimes have different views on specific issues, I believe one voice stood out - that the people of both countries expect their leaders to demonstrate goodwill to one another to achieve greater harmony in

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Beyond the Current Distrust HO C. P. Patrick (何志平)

this bilateral relationship. I am sure this hope will be heard by our two governments and can be translated into constructive decisions and positive actions that can be implemented in the future. Through an earnest exchange of views and feelings, we might discover that we all have more in common that we have differences. Yes, we have different pasts, but we do have a common future to face! In the face of our common dangers, in this winter of our hardship, let us remember these timeless words. With hope and virtue, let us brave once more the icy currents, and endure what storms may come. Let us promote a new spirit of cooperation. Let learn from others that which we do not know, listen to different voices which we have not heard, and open up our minds to perspectives which are still foreign to us. Only then can we begin to share insights, to discover common goals, and to overcome obstacles leading to a better world for generations to come. Lastly, my friends, with regards to the Sino-US relationship, I will echo what David Lampton said, that the strategic justification for this bilateral relationship is simple and compelling: neither the world nor our two countries can afford to have the US and China as adversaries. Forty years ago, we were friends then, we are friends now, and we will be friends for the future.

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The War that Remapped East Asia PEMPEL, T. J.

The War that Remapped East Asia (二戰：東亞版圖再繪製) PEMPEL, T. J. Jack M. Forcey Professor of Political Science, University of California, Berkeley

took my mission to take a look back at the way in which the East Asian order has been reshaped by World War II, and that is basically what I would like to talk about. I think the starting point is simply to say that WWII reshaped the territorial order in East Asia, moving it from an arena in which the territory was mapped primarily by the empires of the British, the French, the Dutch, the Americans, and of course, the Japanese, for very long periods of time. Replacing that order was an order predicated on the sovereignty of national states, and we saw the selective and successful national revolutions against colonialism in much of Southeast Asia, across the rest of Asia and the establishment of independent national states that mapped the region in a very firm way. In essence, the colonial order was replaced by an order of national states and national independence. Efforts to establish independent nation states were pushed back by a number of colonial powers’ efforts to reestablish their former empires. But the victory of the Vietnamese in Dien Bien Phu in 1954, marked the end of the efforts by western powers to reconnect and reestablish their empires, and in the period following, we saw the successful establishment of nation states across East Asia. Also marking the end of the War, slightly later than 1945, which is usually seen as the official end to the war, was the victory of the Communist Party in consolidating control over the mainland of China and the establishment of a unified China on the landmass of China, bringing an end to about 100 years under

which China was sliced by various Western powers, and of course, by the Japanese. But the national consolidation and the map of China were complicated by the incomplete nature of communist control and the establishment of the Kuomintang (KMT) regime on Taiwan. Similarly, the Korean Peninsula was divided, as was Vietnam, until it was unified in 1975. In addition to these unresolved territorial issues, there were a number of maritime territories, and all of these irresolutions of the geographic map continue today, I think, to complicate regional relations among various countries, and it is to that I think the history leaves a very important lesson in terms of territorial establishment in the international order that was put in place. Equally important, I think, at the end of the war, was the second threat that emerged, one that complicated that nationalist trend and order, and that continues in some respects to be implicated in the story today, and that is the emergence of the Cold War and the bipolarity it engendered. Cold War competition, in my view, advanced along two separate tracks, the first of these, security, and the second, economic. In the security arena, the major powers, the Soviet Union and the United States did their utmost to assure the security allegiance of virtually all of the other countries in East Asia, by providing military assistance, economic aid and guarantees of protection from the erstwhile enemies presented by the other side in the Cold War. Quite frequently, of course, this military effort was oriented not only against foreign

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The War that Remapped East Asia PEMPEL, T. J.

PEMPEL, T.J. at “70 Years After the End of WWII in Asia: Lessons from History and Peace in the Balance”

enemies, but also against potential domestic threats to the regime. But the second dimension along which the Cold War proceeded was, I think, equally important, and that was along the economic dimension. Basically, we saw the play out of competing strategies about the merits of capitalist/pro-American/pro-Western economics versus pro-Communist state planning and the like. Essentially, it was very important for regional developments that the two spheres of economics and security, essentially overlapped close to a hundred percent. That is to say, countries traded with other members of their ideological block but rarely across the bipolar divide. As a consequence, any map of pro-Communist and pro-US countries in the region during the 1960s or 1970s, would have shown very few countries in the region that were not aligned with one or another of these opposing camps. And simultaneously important for today, any map of commercial transportation, travel or economic interactions in the region would have been similarly skewed

to reflect that bipolarity. Important for today’s East Asia, a number of the territorial issues that remained unresolved during World War II continue to plague today’s regional relations. Most of today’s current disputes are the result of divisions or ambiguities that were frozen in time in either 1945 or 1949 and/or were further exacerbated by the Cold War. So we have the bifurcated Korean Peninsula, the division across the Taiwan straits, along with a host of maritime islands, rocks, reefs etc. that continue to be subject to competing claims. All these are rooted in the irresolution of the final re-mapping of the region in the immediate aftermath of World War II. On the other hand, while the territorial map of East Asia’s nation states have remained largely intact, if not completely without controversy, since they were established in the late 40s or early 50s, any map showing today’s commercial ties, communication linkages, transportation webs or institutional networks, which show a much less nationalistic map,

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The War that Remapped East Asia PEMPEL, T. J.

show the massive alterations that have taken place over the last four decades. On any of these dimensions, it seems to me East Asia has become vastly more integrated, meshed and interdependent. So remapping along these lines, I think, can be traced to a host of changes, but the unmistakable starting point for me, was the success of Japan’s economy, Japan’s move away from its reliance on military force to a reliance and a predisposition to economic development – a success that was subsequently followed by the economies of Korea, Taiwan, and then of course as we know, Malaysia, Thailand and Indonesia. And of course, China and Vietnam in many respects abandoned the fundamental principles of Marxism, Maoism, Leninism on economics, and moved heavily toward the embrace and welcoming of foreign direct investment, foreign aid, western technology, and as both of those countries have talked about it, they have embraced capitalism with a socialist face or communism with a capitalist face, depending on your point of view. But clearly, the end result of all of this is that virtually all of the leaders of East Asia, with the conspicuous exception of North Korea and Myanmar at opposite ends of the regional spectrum, essentially began to pivot their legitimacy not on nationalist and military expansion abroad, and success in a zero sum game vis-à-vis one’s neighbors, but rather a positive-sum game that was predicated on economic interaction with the rest of the region, and also, the delivery of better benefits and better living standards for its citizens. The end result of this has been the creation of the East Asian economic miracle that saw the overall economies of East Asia expand rapidly and successfully over the course of 20 to 30 years. This economic success bringing the countries of Asia together was paralleled in some respects by a change in what you might think of as the institutional map of the region. This started of course with the agreement by five and subsequently six Southeast Asian nations to form the Association of Southeast

Asian Nations (ASEAN) and this was an effort to ward off the interposition of the great powers in their domestic, national politics. But ASEAN has gone on to forty plus years of success, peace among those now 10 countries of Southeast Asia, and the regional message of ASEAN has since then been picked up by other regional actors and the establishment of other regional institutions. Whether you’re talking about AsiaPacific Economic Cooperation (APEC), the ASEAN regional forum, the ASEAN+3, the East Asia Summit, the Shanghai Cooperation Organization, the trilateral summit among Korea, China and Japan, the Chang Mai Initiative – there are a whole series of alphabet soups, and one could even point to the relative success for a period of time of the 6 party talks designed to deal with the North Korean nuclear issue, in which 6 countries, 5 of them major powers, were able to cooperate with one another in an effort to try and deal with the common problem posed by the potential expansion of North Korea’s nuclear program. That did not achieve total success, but I think it indicated the possibilities for cooperation in a very tough security area. My point here would be that for most of the 1990s, well into the early 2000s, it seems to me the fundamental story of the regional order in East Asia, was a story that was basically one which is oriented towards common economic development, mutual economic interdependence, a rise in commercial linkages, the development of regional development networks, that saw goods and services moving across lines and an increase in cultural ties across the region. Essentially, this involved a very strong deepening of multilateralization and a reduction in military clashes across the entire region. Threat levels fell, but these trends towards multilateralization and regionalism and economic interdependence have failed to obliterate the driving forces of nationalism, and many residues of the Cold War continue to exert an influence from the 1945/1950 period onto the present. As a

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The War that Remapped East Asia PEMPEL, T. J.

consequence of this, today’s Northeast Asia, in particular, remains characterized by widening economic interdependence and closer regional institutionalization on the one hand, but on the other hand, it is also the home of a rising an often virulent nationalism, along with friendships and allegiances that still remain rooted in Cold War ideology. Today’s reemerging nationalism is oriented primarily towards changing security and territorial sensitivities tied, in particular, to unresolved territorial settlements that were set in the period right at the end of World War II. But World War II continues to exert a legacy insofar as there are still continuing debates among the major countries, particularly in Northeast Asia, about the sources of the War, the meaning of the War and the legacy of the War for the present, and who was most heavily victimized by that war. So In Northeast Asia today we see a region that seems to be pulled on the one hand into ever closer and more interdependent ties, particularly in commercial and cultural spheres, yet those ties fail to obliterate the national animosities, the national memories, the national narratives that were anchored in World War II and its immediate aftermath. In this regard, World War II has not completely ended in Northeast Asia. As we often say in the United States, the Civil War ended in 1865, but for many, the civil war goes on in terms of the politics that is played out oriented toward that. Of course, it remains to be seen how this set of competing tensions will play out, but I think understanding their roots and their subsequent transmogrifications makes it easier to understand why Northeast Asia today remains so much more fraught with security tensions, particularly in contrast with the less virulent interactions of nation states in Southeast Asia. The more complex maps of multidimensional regional interdependence provide some hope that the worst extremes of nationalism during the last few years can be offset by the integrative powers of economic interdependence and institutional interactions.

* This article is excerpted from the author’s speech at “70 Years After the End of WWII in Asia: Lessons from History and Peace in the Balance” held by the China Energy Fund Committee on October 2-3, 2015, at George Washington University, Washington D.C.

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China’s War of Resistance with Japan, on the Scale of Global Wars LEVINE, Steven I.

China’s War of Resistance with Japan, on the Scale of Global Wars (中國抗日戰爭：全球規模性戰爭) LEVINE, Steven I. Research Faculty Associate, Department of History, the University of Montana

his is an occasion for contemplation and for reflection rather than celebration. The 70th anniversary of the end of World War II in Asia is a time when we can reconceptualise what we know about this period. It is a time for national and international introspection, rather than for vituperation or for military displays. It is in this spirit of introspection that I offer my thoughts. There are two different narratives of how one could understand the War of Resistance. The first narrative, the “heroic-patriotic” narrative, focuses on the international significance of the word of “Resistance.” It entails the degree to which China played a significant and decisive role in the outcome of World War II, globally as well as in the Asia-Pacific region. The heroic-patriotic narrative looks at the eight-year long Sino-Japanese War, from which China emerged victorious, as an epic of heroic resistance, unbelievable sacrifice, tribulation and struggle. It posits that China fought victoriously virtually alone for four years, with the exception of the Soviet aid, until the War of Resistance merged with the Pacific War and World War II. By holding out against the imperial Japanese army, China prevented Tokyo from establishing a new regional order in Asia in concert with the European axis powers. China’s armies tied down millions of Japanese troops and provided to western allies – the United States in particular, but others as well – the breathing space to mobilise and deploy its forces for victory. Had China surrendered – which seemed

perhaps the logical thing for China to do during the early stages of the war – Japan might have been able to succeed in its plans for a quick and decisive victory over the western colonial powers in Asia. Battered and bloodied, but victorious, China emerged from the SinoJapanese War and World War II in the AsiaPacific as one of the five major post-war powers. This is a familiar story, and it has a great deal of truth to it. Among other things, it looks at China’s role in terms of international politics and the restructuring of the international system after World War II. The alternate view, which I call the “alternative-tragic” narrative, refocuses our attention on China itself rather than on the international system. It also suggests a different chronological way of looking at the period of the eight-year war. The most significant development for China during the eight year long War of Resistance was the transformation of the Chinese Communist Party (CCP) from a marginalised, peripheral military political force into a major contender for power on a national scale. Up until that point, the CCP had had a succession of heroic failures. It was not until the Sino-Japanese War, the War of Resistance, that the CCP finally become something that one could take seriously – both inside and outside China – as a party as a movement that could actually take power on a grand scale. Without this eight-year heroic struggle in China, the CCP most probably

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China’s War of Resistance with Japan, on the Scale of Global Wars LEVINE, Steven I.

LEVINE, Steven I. at “70 Years After the End of WWII in Asia: Lessons from History and Peace in the Balance”

would not have come to power at all. The war had a significant effect on China itself and on Chinese history. Both in the late 1920s and the late 1930s, in its base areas in the Jiangxi Soviet period and later on in the northwest of China, the CCP had a great deal of tough-going. It did not have enormous populous support. Even after the war, in Dongbei, the northeast of China, the CCP had a very difficult time establishing itself in the context of a region where it had no support, and where there was a great deal of resistance to it. The alternate narrative thus sees the War of Resistance as a component of Chinese domestic history. Instead of looking at an eight-year War of Resistance, this narrative consider a 50 year war, beginning in 1927 with the initial attempts of the CCP, through the Autumn Harvest Uprisings and the so called Canton Communes, to seizing power during a revolutionary period, continuing into the 1930s, and finally ending with the death of Chairman Mao Zedong in September 1976.

Historians like to periodize things. This 50 year war can be broken up into four distinct, but interconnected, phases: the first civil war, 1927-1936, the eight-year period of the War of Resistance, the second civil war, 1946-1949, and the 27-year era of Maoist rule within China. During the first two civil wars, the CCP tried to seize power from the Chinese national government. It was unsuccessful in the first attempt, successful in the second. The intervening period of the War of Resistance spelled the difference between success and failure. During the War of Resistance, while sporadically fighting the Japanese under the rubric of a second united front, the CCP – in parallel with, not in alliance with, the national government – fought a war to extend its own territory and the population that it controlled. By the end of the war, it controlled a population of about 95 million people and had armed forces estimated, at least by American intelligences sources, at about a million people.

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China’s War of Resistance with Japan, on the Scale of Global Wars LEVINE, Steven I.

The point is that by 1945, the CCP was a real, powerful political force. That transformation occurred during the period of the War of Resistance. Originally, there was a formal united front between the Chinese national government, headed by Chiang Kai-shek, and the Chinese communist regime in Yan’an, headed by Mao Zedong. In fact we know that by 1941, that united front was virtually destroyed. What there was, unwittingly perhaps, was a kind of de facto or operational united front between the Chinese communist movement and the imperial Japanese army, both of which were trying to occupy Chinese territory at the expense of the Chinese national government. The Japanese effort involved horrific military aggression. They tried to create puppet governments like the Nanjing regime, headed by Wang Jingwei. The communist effort, on the other hand, involved expanding their so called liberated areas. These included territories scattered mostly throughout northern China, but some other places as well, in which the communist established their own government and maintained these governments with their own military forces. The communists took advantage of Japanese external aggression, which created circumstances where the national government, which bore the brunt of the fighting against Japan, became fatally weakened for a variety of reasons. In other words, as the Chinese national government was weakening, the CCP took advantage of the situation to expand its control over a weakened Chinese body politic. Then in 1946-1949, the CCP, in the civil war of that period, rode to victory through a series of major military campaigns, and subsequently seized control of the state apparatus. Probably the most problematic of the four phases is the period of 1949-1976. How does that fit into a 50-year war? It seems to me that once the CCP seized power and established the People’s Republic on October 1st 1949, what it did was use the power of the Chinese state to carry out, for the rest of the period, up until 1976, a prolonged war of the state against

Chinese society, in the name of revolutionary transformation. This war, like other wars, employed largescale, state-directed and state-instigated violence, through an endless series of campaigns, battles and skirmishes, against so called class enemies – landlords, rich peasants, the bourgeoisie, intellectuals, religious believers, sectarians, non-Han peoples, most foreigners except for the Russians, and the catch-all category of “counter-revolutionary elements” into which any unfortunate person could be stuck in at the convenience of whoever was carrying out this war. The targets of this war, the longest of my phases, included the Chinese family system, which was the foundation of Chinese society for thousands of years, China’s rich cultural traditions, the moral ethical foundations of Chinese civilisation embodied in the work of its greatest thinkers, and China’ religious traditions, both native as well as ones brought in from abroad. In the process of promoting the new socialist man and woman, cogs in the machine of state power, the party-state attacked the integrity and personality of what it meant to be a Chinese person. Violence, intimidation, manipulation, psychological and physical torture and mass hysteria were among the weapons of mass destruction deployed in this war of the state against society. We know that the human toll of China’s War of Resistance against Japanese aggression was enormous, and the atrocities that were perpetrated by Japanese troops during that period can never be forgiven, and can never be forgotten. But the human toll of the Chinese state’s war against Chinese society was even greater. The figures are problematic, but according to some estimates, if one totals up the numbers killed during land reform, agricultural collectivisation, the Hundreds Flowers Movement, the Anti-Rightist Movement, the Great Leap Famine, the victims of the Cultural Revolution, and those who died in forced labour camps and other campaigns, the figures

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China’s War of Resistance with Japan, on the Scale of Global Wars LEVINE, Steven I.

add up to, perhaps conservatively estimated, 40 to 60 million Chinese. As horrific as the Japanese invasion and aggression against China was, this is an even larger toll, at least twice as great. With the exception of the An Lu Shan Rebellion during the Tang Dynasty, this is perhaps the greatest human tragedy in all of Chinese history. Over the past two decades, international scholars have looked at this period in much greater detail, but much more historical study and reflection needs to be done in order for us to understand the historical meaning and contemporary significance of the SinoJapanese War, both under the conventional and alternative narrative. In the aftermath of that war, a defeated Japan recovered in the context of the Cold War. It became and still remains a democratic, prosperous, and peaceful country, notwithstanding the resurgence of the Japanese right wing. China, a victorious power, or at least a survivor in the Sino-Japanese war, the country on the winning side of history, quickly slid back into civil war. What we call the War of Resistance turned out to be a bloody, eight-year intermission. In the three decades that followed, the rise of a new state, the People’s Republic of China, proclaimed with great enthusiasm to the crowds below in Tiananmen Square on October 1st 1949, did not bring democracy, which the CCP had promised, did not bring civil peace, and did not bring prosperity. The party-state flourished, while the people wilted. That era is over, but the structures of power and the habits of rule from that time persist even today in China, as China has assumed its rightful place in the world as a great power, and the Chinese people as a whole have grown wealthier, something we can all appreciate and congratulate.

In conclusion: it is easy to castigate others and it is difficult and painful to engage in national introspection. It is no less true of Americans than it is for Chinese and any other people. The United States has not done that in terms of Vietnam or other more recent American wars. Yet as we mark, not celebrate, the 70th anniversary of the end of World War II in Asia, it is our responsibility to make that effort of reflection, as individuals and as nations.

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Pearl Harbor Revisited SPECTOR, Ronald H.

Pearl Harbor Revisited (重溫珍珠港事變之啟示) SPECTOR, Ronald H. Professor of History and International Affairs, George Washington University

t eleven o’clock on the evening of December 7, 1941, US Treasury Secretary Henry Morgenthau returned from a meeting at the White House to brief his senior assistants. “It’s just unbelievable,” he said, “It is much worse than anyone realizes. Secretary of Navy Knox feels something terrible; Secretary of War Stimson kept mumbling that all the planes were in one place, that they have the whole fleet in one place, the whole fleet in this little Pearl Harbor base. They will never be able to explain it, never.” Over the course of the next 50 years, Morgenthau’s words would prove to be true. In the United States, the search for explanations and meanings concerning the disaster of Pearl Harbor were to become intertwined with party politics, national security policy, personal vendettas and patriotic symbolism. The immediate reaction in the United States was one of shock, anger and desire for revenge. Thousands rushed to enlist. President Roosevelt famously called it “a date which will live in infamy” and Vice Admiral William F. Halsey declared, “By the time we finish, the Japanese language will be spoken only in hell.” The search for someone to blame began immediately. The first culprits detected were Admiral Husband E. Kimmel, General Walter Short, the navy and army commanders at Pearl Harbor who were relieved of their command and subsequently retired. Between 1942 and 1945, there were a total of seven separate administrative inquiries into the Pearl Harbor attack. And finally, an exhaustive congressional investigation produced 39 volumes of testimony

and documents. However, nobody was satisfied with all these investigations, and they were followed by approximately 300 different books on Pearl Harbor. If you go to the library of Congress catalogue you can find several hundred of them. The various investigations demonstrated that Washington leaders, including the President’s top civilian and military advisors, shared some responsibility for the disaster, and not simply Admiral Kimmel and General Short. The Pearl Harbor commanders lacked the capability to decipher and read the Japanese diplomatic code as army and navy intelligence analysts were doing in Washington, and these Washington analysts sometimes failed to pass on important information to Pearl Harbor. Nevertheless it is hard to understand how Kimmel and Short failed to react to the numerous warnings they were receiving from Washington. For example, on November 24, the chief of naval operations warned Pacific commanders that, “a surprise and aggressive move by Japan in any direction is a possibility”. Three days later, he dispatched what he termed a war warning, alerting them to the fact that US-Japanese negotiations had ceased, and an aggressive move by Japan is expected in the next few days. One day later, the War Department announced that hostile action was possible at any moment. While it is now clear that Pacific commanders did recognize that war was imminent, they simply failed to believe that it could begin in Pearl Harbor. The fact that the fleet were still following a normal Sunday

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Pearl Harbor Revisited SPECTOR, Ronald H.

SPECTOR Ronald H. at “70 Years After the End of WWII in Asia: Lessons from History and Peace in the Balance”

routine, and the fact that even the report of the sinking of a submarine immediately outside the harbor failed to alert the command, testified to the state of mind in Hawaii at the time. The congressional investigations however, went far beyond finding reasons for the surprise of Pearl Harbor. Republican opponents of Franklin Roosevelt, some of them former isolationists, quickly brought forward the view that the President and his advisors were not simply negligent or incompetent in the matter of Pearl Harbor, but that they had actually conspired to bring it about. In this view, President Roosevelt, desperate to bring the US into the war on the allied side, had pressured Japan into the war with impossible demands and economic sanctions. Since the US was reading Japan’s diplomatic code, the argument goes that the President must have known in advance about the planned attack but he took no action in order to ensure that the Japanese would be blamed for firing the

first shot. It is sufficient to say that no credible evidence to support the various conspiracy theories or the Back Door to War idea has ever been found. This is one of the classic books blaming Roosevelt for bringing about the war and, as I mentioned, that argument hasn’t held up very well over the years. Nevertheless, many members of the wartime generation, especially haters of Roosevelt and the New Deal, continued to devoutly believe that Washington knew in advance about the Japanese attacks. Just as contemporary conspiracy theorists in the United States still argue that the 911 attacks were actually the work of the CIA or the Israelis. If Pearl Harbor lent itself easily to fingerpointing, it also proved useful for many other purposes. During the Second World War, it served as a symbol to rally a nation that had included strong isolationist elements and to rally Americans who were generally indifferent to international affairs to the cause of total war. This was particularly true against the Japanese who were invariably depicted as treacherous,

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Pearl Harbor Revisited SPECTOR, Ronald H.

fanatical, cruel and bloodthirsty. During the Cold War, with the emergence of a strong US-Japanese alliance, and at the same time, US-Chinese hostilities during the Korean War, these stereotypes were conveniently transferred to the Chinese. During the Cold War, the Japanese were depicted as democratic minded, peace loving and progressive. Pearl Harbor also appeared to hold other lessons for the Cold War. The need for constant preparedness against the threat of a surprised attack had a special resonance in the era of Soviet-American strategic arms competition. A nuclear Pearl Harbor, it was argued, in the nuclear atomic age, could prove far more catastrophic than the original Pearl Harbor. President Dwight Eisenhower explained the reason for the U2 flights over the Soviet Union as “necessary to prevent another Pearl Harbor”. Albert J. Wohlstetter’s enormously influential 1958 article, The Delicate Balance of Terror, took this analogy a step further. Wohlstetter argued that it was not sufficient simply to strive to prevent a surprised attack, but it was necessary to have a force that could survive such an attack and still strike back against the attacker. The result was the formation of a multi-billion dollar triad composed of strategic bombers, ballistic missiles, hardened silos and Polaris submarines that could launch their intercontinental missiles while still submerged and invisible. Those were some of the lessons for the Cold War that the Americans derived from Pearl Harbor. The Americans also took satisfaction in Japan’s emergence as a democratic state with a pacifist constitution. Most Americans also believed that the benevolent US occupation of Japan was responsible for this result. But when US-Japan trade tensions increased during the 1980s, these helped to produce a new set of Pearl Harbor images and metaphors. As Japan captured more and more of the world market, including the American consumer market, for electronics, automobiles and textiles, and the US trade deficit grew, some politicians and commentators in the US had

declared that Japan had subjected the US to an “economic Pearl Harbor”. A few commentators observed that though the Japanese had never been able to conquer Hawaii during World War II, in the 1980s, they had been able to virtually buy it. Michael Crichton best-selling novel and later movie called “Rising Sun” depicted the Japanese as far more efficient, determined and clear-minded than Americans who had been lulled into complacency and ineffectiveness during years of American prosperity. Although many of the Japanese characters in the novel were depicted in a negative light, the clear message of the novel is that the Japanese were formidable rivals who had their act together. Indeed the American hero is only able to prevail in the end because he had spent years in Japan and understood Japanese methods. The methods that were advocated by various American experts to recover from this second Pearl Harbor attack varied widely. Some suggested imitating Japanese industrial and business practices, some suggested tariffs to protect American jobs; and some suggested trying to force Japanese companies to play fair (by the American definition) in international competition. Ironically, by the time Crichton’s “Rising Sun” was published, Japan’s economy was already entering a period of economic difficulty and decline from which it is still not fully recovered. The 911 attacks of 2001 swiftly produced a new flood of Pearl Harbor images and analogies. Politicians and newscasters rushed to point out the similarities. President George Bush noted that the 911 attacks were the Pearl Harbor of the 21st century. Once again, an unsuspecting America had been treacherously attacked by a murderous and diabolical enemy. Once again, an infamous attack had united the nation as never before. Like the Japanese, the Islamic terrorists were said to have aroused a sleeping giant, determined to be avenged. Even though the rhetoric and public mood in the US after 911 were similar to those of 1941, President Bush’s actions were far different. Bush

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Pearl Harbor Revisited SPECTOR, Ronald H.

declared a global war on terror of indefinite duration. Yet taxes were not raised and the armed forces were still manned entirely by volunteers. The belief widespread in 1941 that military service in wartime was an obligation on citizenship appeared to have been entirely forgotten by 2001. Instead, those who did serve in the armed forces in whatever manner were now designated heroes and thanked for their service, most effusively by those who felt no inclination to join them. Like Roosevelt, Bush was acutely aware of the public need for symbolic displays of determination and revenge. Just as Roosevelt approved and publicized the daring Doolittle Raid on Tokyo in April of 1942, which did no significant damage; And just as Roosevelt promoted General Douglas MacArthur to “military genius” status to cover up the debacle of his loss in the Philippines, Bush also struck at the Taliban in Afghanistan and claimed victory over Al Qaeda. Roosevelt and his military advisors, however, were not taken in by their own public relations. American strategists had been planning and discussing war with Japan for almost a quarter of a century before Pearl Harbor. They had a clear idea of how to proceed and of what was important and what was not. The Bush team, as it turned out, hadn’t a clue, as they graphically demonstrated over the next eight years.

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The Non-Strategic Thinking of Japan’s Decision Makers for World War II SMETHURST, Richard J.

The Non-Strategic Thinking of Japan’s Decision Makers for World War II (日本決策者發動二戰的非戰略學考慮) SMETHURST, Richard J. Professor Emeritus of History and UCIS Research Professor, University of Pittsburgh

apan undertook a war in 1937-1945 that it had no chance of winning. Why do I say Japan could not win? In 1937, when Japan began its aggression, China had a population of seven times Japan’s and was a continentalsize country. Japan did not have the troops or resources to pacify a country the size of China, in which the citizens did not want to be pacified. Moreover, China’s economy in 1937 was two and a half times larger than Japan’s based on Angus Matherson’s figures. That is to say, the difference between the size of the Chinese economy in 1937 is the same as it is today, visà-vis Japan, although both were much smaller than they are today. When the China war was not won, Japan went to war with the Soviet Union in the summer of 1939, and then the United States and United Kingdom in 1941. The Red Army’s planes, tanks and artillery trounced the Japanese at Nomonhan in September 1939, demonstrating the power of technology over “spirit”. Then, lessons unlearned, three years later, Japan attacked United States at Pearl Harbour and the Philippines, and the British in Malaysia, Singapore and Burma. These attacks, in my mind, were a twopronged blunder. First, the United States had an economy five times Japan’s and the United Kingdom almost double; The US had an industrial capacity nine times Japan’s and the UK two and a half times. Not only was Japan out-classed industrially, but the Soviet Union, the United States and the United Kingdom outproduced the three Axis countries even if you

include occupied France, by three to one. Japan lost the War for two reasons. One was the amazing resistance of the Chinese, who tied down 20% of the Japanese army for 8 years, and inflicted heavy casualties on the Japanese. Half a million Japanese soldiers died in china, almost half of them before December 7th, 1941. The other was that the Japanese could not come close to matching American industrial capacity. Between 1940 and 1945, the United States produced 346 million tonnes of steel compared to Japan’s 29 million. We out-produced Japan in steel by about 12 times. The United States mined 2.15 billion tonnes of coal compared to Japan’s 185 million tonnes, though I am including Manchuria in Japan’s figures. The US produced 325,000 airplanes, and Japan, 760,00. The US produced almost 1200 warships to Japan’s 157. Most importantly, the United States produced 34 million tonnes of merchant ships to Japan’s 4.2 million tonnes. We out-produced Japan in merchant ships by 8 times. To me, one of the most important and most overlooked parts of war is logistics. Getting food, supplies, construction materials, weapons, ammunition and soldiers to where they are needed speedily and efficiently is crucial to winning wars. The science and technology that designs and produces the goods and weapons is crucial too. Japan could not keep up with the US in the development of and production of, or in the moving of goods in World War II. Next I want to mention Japan’s second blunder in going to war with the US and UK. I

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The Non-Strategic Thinking of Japan’s Decision Makers for World War II SMETHURST, Richard J.

SMETHURST, Richard J. at “70 Years After the End of WWII in Asia: Lessons from History and Peace in the Balance”

was given, by a colleague at the University of Pittsburgh, a paper from May 1939 written by a man named Hu Tun Yuan. He was a member of the Chinese Council for Economic Research and he worked in Washington DC in the late 1930s. The title of the paper was “Japan’s Problem of Procurement of Strategic War Materials”, and the point of the paper was Japan depended on the United States, the British and Dutch empires for its raw materials. Professor Hu pointed out that the US in 1938 provided 57.1 % of Japan’s imported raw materials. The British along with its Southeast Asia Empire, Canada and Australia, 20.7%, and the Dutch and Dutch Indies, 8.6%. That is, almost 90% of Japan’s imported raw materials came from countries that a few years later would be its enemies. Japan depended on oil from Texas, Oklahoma and California to fight its war in China, and to power the ships and planes that attacked Pearl Harbour. Japan not only received raw materials from the US and UK but also high-tech machines and technology.

American technology was essential to building Japan’s monstrous World War II battleships. I have a photograph that shows a very lavish table set at a club in Pittsburgh, Pennsylvania, called the Duquesne Club, which shows a man by the name of George T. Lad, Chairman of the United Engineering Foundation (UEF) Company, entertaining Colonel Atsumi, a colonel in the Japanese imperial army, and his party. As it turned out by chance, the date of this was December 7th, 1939. UEF had built a factory to produce steel rolling mill machinery in Japan in 1938. The Japanese later argued that they invaded Southeast Asia in 1941 to cut off US and British aid to China. The truth is just the opposite. Japan received far more help from the British and the Americans than China did during the first three and a half years of Japan’s war in China. Japan, by going to war with United States and Great Britain, cut itself off not only from raw materials but also from technology that it needed to fight the war it wasn’t winning

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The Non-Strategic Thinking of Japan’s Decision Makers for World War II SMETHURST, Richard J.

in China. Some Japanese have argued, and some still argue, that the US, by embargoing the export of oil to Japan in July 1941, forced Japan to move into China to get oil to replace what it could not get from the US. There are several flaws to this argument. First, the US did not freeze Japanese assets for no reason at all. The US reacted to Japan’s moving into the southern half of French Indochina, that is, South Vietnam. Why? Because South Vietnam was close to Malaysia, Singapore and Indonesia, which by 1941 was controlled by the British. That is to say, FDR was committed to supporting the British in the war against the Nazis and therefore when the Japanese threatened the British supply of raw materials in Southeast Asia. This forced Franklin Roosevelt’s hand. My point here is that the Japanese should have known this would happen. They had military attaches in Washington, and should have known that Roosevelt was committed to defending the British. Second of all, Indonesia, or the Dutch East Indies, could not come close to providing the amount of petroleum that Japan had imported from the United States. Third of all, not only that, but the Japanese bought oil from the United States which had already been refined and could be used in airplanes. They were certainly capable of setting up refineries, but this was expensive and Japan was an overextended economy. On top of that, they had to ship this oil 4000 miles or so from Indonesia to Japan. This required a lot of merchant ships and the Japanese didn’t produce many. Also, American submarines were lurking in between. By the end of the war, I should say by 1944, the US submarines sunk an average of 50 Japanese merchant ships per month. By 1945, mines dropped in Japan’s internal waters or around the Japanese islands sank an equal number of merchant ships. By the end of the war, it was impossible to get anything in or out of japan. By 1945, the end of the war, Japanese per capita caloric intake, or food, was 25% lower than it had been 1937. The US called this campaign

“Operation Starvation”. We were starving the Japanese into surrender. The campaign to bomb Japan, which began in the fall of 1944, required the Americans to produce long-range bombers of a size, range and speed unknown in any previous airplane. Navy Seabees built five 8000-foot runways on the island of Tinian in the Mariana Islands in 3 months. They were on shore before the island was actually taken by the Americans. They went on shore with the marines and began building airfields almost immediately. Merchant vessels brought men, bombs, fuel, food, medicine and maintenance equipment by the tons. By the end of 1945, the science, technology, logistics and planning of what we had done were on a scale that Japan could not come close to matching, neither monetarily nor technologically nor organisationally. The authoritarian Axis regime did not have a command structure as strong as that its democratic enemies had. One reason the Japanese stated the war, is that the Japanese, in many levels of society, not just the military, overrated Japan’s position in the world. They had defeated the former Central Kingdom, that is China, in a war in 1895; defeated a European country, Russia in 1905. They were, at least in their own minds, the leading power in East Asia during World War I. They became one of the permanent members of the League of Nations. They were recognised as the third leading naval power in the world in 1921-22, and again in 1930. Between the two World Wars, Japan in terms of the size of its economy, was Italy. But it thought it was the United States and acted as if it was the United States. Second, many Japanese, especially in the army, believed that spirit could win wars. These people believed that the Japanese soul “Yamato-damashii” could overcome superior fire power. According to these people, Japan won the war against Russia in 1904-1905 because of General Nogi’s fixed bayonet charges against well-fortified and wellarmed positions. Charges that cost the Japanese 70,000 lives in a very short war. I believe that the real reason they won were British ships

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The Non-Strategic Thinking of Japan’s Decision Makers for World War II SMETHURST, Richard J.

and Anglo-American money. New York and London financiers put up 47% of the cost of Japan’s war against Russia in 1904-1905, and insipient revolution in European Russia. That is to say, the Russians decided they would rather keep the monarchy than continue the war. General Araki, in 1933, said “three million Japanese people armed with bamboo spears can defeat any army”. In January 1941, when Japan was fighting only in china, Army Minister Tojo sent out a directive telling soldiers “rather than surrendering and live with the shame of becoming a prisoner, one should die and not dishonour his name.” He called on soldiers to fight to the death. In August 1941, General Tojo and Prime Minister Konoe received a report form the Total War Research Institute, a group of military and civilian planners, that informed them that Japan could not win a protracted war against the United States and its allies. Tojo sloughed it off by stating that Japan had won the Russo-Japanese war when no one had expected it to win, overlooking that Japan won not because of Nogi’s bloody charges but because of British and US support. In September of the same year, two months before the attack on Pearl Harbour, Tojo told Prime Minister Konoe, “at some point during a man’s lifetime, he may find it necessary, with eyes closed, to jump from the veranda of Kiyomizu temple into the ravine below”. One assumes that he thought this hypothetical man would live because the Yamato Gods were on his side. Third, Japan had a powerful bureaucracy, both civil and military, that inculcated orthodox and suppressed dissident views in the first half of the 20th century. The bureaucrats thought of themselves as an elite that knew what was best for Japan and they put in place an Emperorcentric quality that required obedience to stateapproved values. Thy imposed these views to the school system in a variety of centrally directed grassroots groups such as the reserves association and youth and women’s national defence associations. They also arrested and imprisoned people who challenged this

orthodox. If you were a Marxist, the chances of you being in jail in the 1930s in Japan were very high. With respect to censorship, I have seen one case where words of a sitting finance minister had been censored so that it couldn’t appear in the press. Fourth, under the Japanese Constitution of 1889, military organisations reported directly to the Emperor, not to the Prime Minister. And related to that, army and navy ministers had to be Generals or Admirals. They couldn’t be civilians. Fifth, terrorism. In the 1930s, three or five prime ministers were assassinated. Two or three finance ministers were also assassinated. Takahashi Korekiyo, a finance minister in the 1930s, was asked on the floor of the Parliament in 1935, by one of the members of the Parliament, why he didn’t stop the army. So Takahashi said, “why don’t you help me?” The man replied, “pistols are scary.” Resisting the road to war, therefore, had its costs. Takahashi was a man, I believe, who in some ways was committing suicide. In 1915, he opposed the 21 demands to China on the grounds that they were an insult to China. In 1919, he opposed the dispatch of Japanese troops to Siberia after World War I. In 1927, as sitting finance minister, he opposed the decision by his Prime Minister, General Tanaka, to send Japanese troops to china, and in fact he resigned form the cabinet the very day the troops were sent. In the same decade, he called for the abolition of the army’s and navy’s general staffs, and for peaceful nonintervention and cooperative policies with a unified China. He was for the unification of China, not for the breaking up of China. He called for civilian military ministers, for limits on defence spending, for democratic government, for decentralised education, and of course cooperation with the British and the Americans. Even though he recognised that the United States and the United Kingdom often treated Japan badly, which they did. The 1925 anti-immigration law was not exactly a compliment.

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The Non-Strategic Thinking of Japan’s Decision Makers for World War II SMETHURST, Richard J.

Nevertheless, Takahashi said it was not in Japan’s interest to go to war with the United States and Great Britain, because if they lost they would be cut off from their resources. In February 26, 1936, he was assassinated by army officers. Finally, and most tragically to me, after the War began, the Japanese military attacked again and again when it should have retreated or looked for a way to end the War. The Japanese kept half a million men on the border between Siberia and Manchuria throughout the war, because even though they had a neutrality pact with the Russians, they didn’t trust them. Therefore, they had 10% of their army on the Siberian border. They certainly must have known, by 1943-1944, that the war was lost. What is upsetting to me, as a former soldier, was what the Japanese did when they were losing the War. They used this “spirit” idea – the idea that it was better to die than to surrender. Yuko Tojo is the grand-daughter of General Tojo. An interview with her was recorded in the Japan Times on 11 July, 2007, in which she said that her grandfather undertook a war of self-defence in 1941 to liberate Asia from western imperialism. She went on to say that if her grandfather was to blame, it is not because he started the war, but because they lost. The conclusion to my paper is this: Guilty as charged.

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The San Francisco Peace Treaty and Its After Effects HARA, Kimie

The San Francisco Peace Treaty and Its After Effects (《舊金山和平條約》及其后果) HARA, Kimie Renison Research Professor in East Asian Studies, University of Waterloo

eventy years ago, in 1945, Japan accepted the Potsdam Declaration in August and in September signed the instrument of surrender, but it was 6 years later in 1951 when Japan actually concluded a post-War peace treaty with the allied countries. This treaty, the socalled San Francisco Peace Treaty, came into effect in 1952, on April 28th. With this post-War arrangement, Japan returned to the international community, but as a member of the western block. The international situation had drastically changed since the Japanese surrender, that is, a Cold War emerged and escalated, and this also affected the contents of the Japanese Peace Treaty which was drafted and finalized under the United States’ initiative. It was originally meant to be a punitive measure and designed to achieve peace, but as Japan’s strategic importance increased in the US’ Asia strategy, the peace terms with Japan became quite generous and also ambiguous. This generous Peace Treaty helped Japan achieve its post-war recovery and economic development. The Treaty also left negative legacies, or so-called unresolved problems, with Japan’s neighbors, namely Korea, China and Russia (formerly the Soviet Union). Today, countries and people in East Asia are still divided by history, politics and unsettled border disputes, even though they have become much closer in their economic culture and other relations. Contentious issues left behind include territorial disputes between Japan and Russia, Japan and Korea, Japan and China, between

China and its neighbors in the South China Sea, cross-Taiwan Strait problems, a divided Korea, and other problems. There is still no diplomatic relations between North Korea and Japan. There is the issue of the US military base in Okinawa, and there are also significant issues of war responsibility, compensation and the interpretation of history. The gaps between the neighbors are still quite significant. These so called unresolved problems are in a way all related to the end of the Cold War. If the post-War settlements had been clearly made in the Peace Treaty, the situation here would have been quite different. Territories formerly under Japanese control and the Peace Treaty left several significant problems. Vast territories from the Kuril Islands all the way down to Antarctica, and also from Micronesia to the Spratlys were disposed in the Treaty. The problem with the San Francisco Peace Treaty is that it has no final destination or ownership, no clear borders of these territories specified in the territorial clause. They are all left vague or ambiguous. I have been looking at these territorial or frontier issues for some time and researched how the Peace Treaty was drafted and finalized using archival materials in the US and some other countries. It was quite a complex process but as a whole, earlier US drafts like those of the 1940s were very long and detailed, with clear boarder demarcations, specifically to make sure that there would be no territorial conflicts left in the future. However, as the Cold War escalated,

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The San Francisco Peace Treaty and Its After Effects HARA, Kimie

HARA, Kimie at “70 Years After the End of WWII in Asia: Lessons from History and Peace in the Balance”

especially after the Korean War broke out in June 1950, Treaty drafts became short and simple, leaving various questions unresolved. For example, for the Korea clause, in an earlier draft, Takeshima or Liancourt Rocks (Dokdo) in Korea were specified as Korean territories, but later, ownership was changed to Japan and then it disappeared from the text. For Taiwan, China was specified as its recipient, but this later disappeared. For the Kuril Islands, the Soviet Union was specified first, but it also disappeared. The Treaty also deals with Okinawa. The dispute between Japan and China was originally Okinawa or Ryukyu. In the earlier post-War years, Chiang Kai Shek’s nationalist government, which was representing China at the United Nations, was demanding the islands’ recovery or return to China. The US military also wanted to annex Okinawa as part of US territory, but the State Department did not like the idea of annexation. Trusteeship specified in the article was a transitional arrangement and not the final

disposition. So the Treaty in itself left the question of future sovereignty of ownership of the whole area, including the Senkaku/ Diaoyu islands, unresolved. What I can tell from this study is that this way of leaving the final settlement of the territorial ownership or sovereignty unresolved was arranged not by mistake, but after very careful deliberation instead of omissions. Against the background of the escalating Cold War in Asia, China in particular came to occupy the center of the US Cold War strategy in Asia, to ensure that Japan and the Philippines – important countries for the US’ Asia strategy – were kept separate from the communist sphere of influence. This was at a time when US leadership thought that South Korea and Taiwan might be lost to the communists, but of course it is possible they wanted to keep these areas in the West. So by making the Peace Treaty ambiguous or vague, sources of conflict were left among regional neighbors. Let me point out again

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The San Francisco Peace Treaty and Its After Effects HARA, Kimie

the location of these frontier provinces. These territories, Takeshima/Dokdo, Senkaku/ Diaoyu islands and Spratlys, line up along the so called Acheson line – a defense line in the Western Pacific announced in January 1950. While Korea and Taiwan were excluded from this Acheson line, these lines, the northsouth division of Korea, and the Taiwan Strait, became frontiers. These unresolved problems, derived from the post-World War II disposition of Japan and particularly the San Francisco Peace Treaty, were by-products of the Cold War and the regional Cold War frontiers. These territorial dispositions of Japan were not necessarily made individually or separately. They were also related to or linked to other territorial dispositions or political issues that existed when they were neighbors. Various linkages were recognized in US government studies and several negotiations with the other allies preceding the San Francisco Peace Conference. For example, the Kuril Islands were used as a bargaining chip to place the southern half of the Korean Peninsula under US occupation. They were also used to gain US trusteeship of Micronesia as well as to gain US control of Okinawa. There were differences between the US and the Britain over their China policies. Britain recognized the PRC Government in Beijing whereas the US supported Chiang Kai Shek’s Republic of China, and this in many ways affected the Japanese peace settlement, including the disposition of Taiwan. This accordingly affected others, as the Treaty does not say to which states or governments Japan renounced these territories. The San Francisco Peace Treaty is a multilateral international agreement signed by 49 countries but not by China, Korea nor the Soviet Union. So it was quite important but also a problematic Treaty. The San Francisco Peace Treaty significantly shaped the PostWorld War II international order in the region. With its associated security arrangements with the United States known as the “San Francisco Alliance System”, the Treaty made the

foundation of the regional Cold War structure of confrontation, and ensured a dominant US presence and influence in the Asia Pacific. Now I would like to touch upon the development of the San Francisco Treaty. During the so-called Cold War era, there were periods when East-West tensions relaxed, in the 1950s and the détente of the 1970s. During these periods, there were some shifts in some of those conflicts in the region. For example, Japan began to focus on the so called “four islands” of the Northern Territories in the mid-1950s, and the focus of the Japan-China territorial dispute shifted to the Senkaku or Diaoyu islands in the early 1970s. These areas were disputed earlier and there were reasons why these specific areas came to be focused on. I particularly noted that the United States was deeply involved in leading these specific conflicts. In the mid-1950s, there was the socalled Dulles’ Warning; there was intervention in Japan-Soviet negotiations, preventing Japan from accepting the Soviet offer of the two islands, and a Peace Treaty was signed. In the early 1970s, the US returned Okinawa together with the Senkaku/Diaoyu islands to Japan, but it returned only the administrative rights and did not take a position on sovereignty, leaving a dispute between Japan and China. There are of course other factors such as resources in the surrounding seas, introduction of the UN Convention of the Law of the Sea, associated exclusive economic zone issues, strategic value and so on. However, I argue that those periods were after all, periods of détente, and not the end of the Cold War. Leaving differences between the regional countries was seen as beneficial for the US Cold War strategy in Asia. Now, 70 years after the end of World War II, and over 60 years since the San Francisco Peace Treaty, most of the major problems derived from that Treaty still continue to exist. In today’s regional frontier problems, I continue to see the fundamental structure of the regional Cold War and the San Francisco System remain in East Asia. In terms of political system,

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The San Francisco Peace Treaty and Its After Effects HARA, Kimie

unlike Europe, with the exception of the Soviet Union, communist regimes did not collapse in this region, and are still seen a threat by the US and its major allies in East Asia. The US’ Cold War security arrangements with its regional allies, the so-called San Francisco Alliance System also continue and there is no indication that this alliance would embrace China or North Korea. Unlike Europe, NATO lost its anti-communist nature and accepted formerly communist Eastern European countries. It is true that the global waves of so-called post-Cold War international relations such as globalization, regionalism or other new changes, had reached and affected regional international relations. However, these changes have not necessarily eliminated the residual structure of Cold War confrontation. The end of the Cold War is not merely history but something still yet to come in this region. In fact, I see what happened in the region in the late 1980s and early 1990s, with the end of the Cold War, as rather similar to the 1970s détente in Europe, where tensions relaxed but the Cold War structure essentially remained. There is, however, one major difference regarding post-World War II borders. During the détente in Europe in the 1970s, the post-World War II status quo or de facto borders were recognized by the Helsinki Accord in 1975. But in East Asia, we still see these disputes over where post-World War II borders should have been. As long as these sources of conflict remain unresolved, no matter how neighboring relations are improved, possibilities for resurgence of conflicts continue to exist. Relations between Japan and neighboring China, South Korea, and Russia have significantly deteriorated since around 10 years ago around in 2005, during the 60th anniversary year of the end of World War II, over territorial and history problems. These occur in a viscous circle. This year, 2015, the 70th anniversary of the end of World War II, is another reminder year of the negative past and unresolved problems. So, the question here

is: Is it really possible to resolve these long lingering issues and end this vicious circle. I have been involved in several projects to explore ideas with colleagues in various countries for the last several years, and I have been proposing a multilateral approach that reflects the past and present. While none of the bilateral negotiations worked to solve these disputes for such a long time, multilateral framework provides a wider variety of options and a more creative approach. This would also help avoid a win-lose situation and international loss of face, as well as domestic criticisms, which politicians are most afraid of. These disputes have multilateral origins. The San Francisco Peace Treaty was prepared and signed multilaterally. Multilateral agreements tend to be more durable and multilateral problem solving would contribute to regional community building and also the removal of political barriers for integration. I have also explored several frameworks including the International Court of Justice (ICJ), where I suggest multilateral cases like the Northern Territories of Takeshima/Dokdo and Senkaku/Diaoyu islands, may be altogether, but not individually returned to the post World War II borders of Japan. Other frameworks include three, four and six party talks: Japan, China, Korea, with the addition of Russia (i.e. Japan and its dispute counterparts who did not participate in the San Francisco Peace Treaty), together with the US and North Korea. What was also considered was an ASEAN-based framework and also a broader Asia-Pacific framework. I also questioned whether US involvement would work negatively or positively for settling the regional conflicts. Historically speaking, the United States was deeply involved in creating these problems, and there is still an aspect that preserving these conflicts may be beneficial for the US strategy as long as they are manageable and don’t escalate into a large-scale war. This manageable instability would help justify continued US presence and accordingly influence in the region.

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The San Francisco Peace Treaty and Its After Effects HARA, Kimie

On the other hand, a reduction of military presence would largely contribute to cutting US defense spending, which has been burdening its national budget. Therefore it may be beneficial for the US to be actively involved. What I mean is more than just paying lip service but to play a constructive role to settle these disputes and bring peace and stability to the region. I expect a workable settlement formula to be mutual concessions and collective gains. That is, everyone would give up something but gain more than what they would give up if you look at the region as a whole. What I have been suggesting is basically status quo recognition, like in Europe with the Helsinki Accord (except for the Russo-Japanese border, where there is an agreement for the transfer of two islands in a 1956 joint declaration). Moreover, without waging wars again, it is extremely difficult or almost impossible to change existing borders. The United Nations does not favor wars and the people in Europe had also realized this. The Helsinki Declaration was released in 1975, the era of the 30th anniversary of the end of World War II, but Europe by then had a long history of wars and conflict. Having consensus or common acknowledgement about their status quo or existing borders also contributes to regional peace and stability. The European community, the EU of the Cold War era, later developed into the European Union, where regional identity has grown while the relative importance of national borders has decreased. As often pointed out, Asia is different from Europe, and is still behind in dealing with the past. The European model may not be perfect. We still see challenges. But the concept of a sovereign state, national border, and the framework for modern international relations spread from Europe. The wisdom to overcome their challenges may be learnt or applied in Asia as well. In any case, after seeing no success in bilateral negotiations for such a long time, it seems worth considering these ideas further, instead of judging from the current situation

alone and saying that there is no way. The complex swirls of international relations cannot be easily disentangled. There are clues by mobilizing wisdom and conscience, and solutions to problems should never be impossible.

CHINA EYE‧Issue 9

“Chinese Peace Treaties with Japan”: ROC/Taiwan 1952; and PRC 1978 WANG Wei-cheng, Vincent (王維正)

“Chinese Peace Treaties with Japan”: ROC/Taiwan 1952; and PRC 1978 (《中日和平友好條約》：臺灣1952年；中華人民共和國1978年) WANG Wei-cheng, Vincent (王維正) Professor of Political Science, Associate Dean of the School of Arts and Sciences, University of Richmond

irst of all, we can’t understand the Chinese peace treaty with Japan without understanding its relationship with the San Francisco Treaty. Secondly, in studying this question, we need to pay attention to both the text and the context i.e. the text of the treaty itself, but also the context of when the treaty took place – mainly in the early 1950s. Thirdly, when we read the text, we need to pay attention to not just the letter, but also the spirit of the treaty, in order to gain a better understanding. Finally, although the San Francisco Treaty resolved some problems, it also left a lot of ambiguity and on-going problems. Nonetheless, the countries or the parties involved – mainly Japan, Taiwan and the People’s Republic of China (PRC) – have managed to conduct their relations in a pragmatic manner, notwithstanding all the legal ambiguities. First of all, why was there a separate peace treaty between China and Japan? Well this is because although 48 allied countries signed the peace treaty with Japan in San Francisco, one of the allied powers, namely China at that time, the Republic of China (ROC), was not invited. By this time, the United States was ready to end the military occupation of Japan, return sovereignty to Japan, and to incorporate Japan into the Cold War system. By this time, Chiang Kai-shek’s forces had lost the Chinese Civil War and moved to Taiwan. There were essentially two Chinas.

The international community had controversies over which regime should represent China in this Peace Treaty so the compromise was that neither party was invited, neither ROC nor PRC. Technically speaking, the state of war had not ended between China and Japan, so there was a need to sign a separate peace treaty. For the most part, I can cite two areas in which the so-called Sino-Japanese Treaty, also known as Taipei Treaty, resembles the San Francisco Treaty. First, in two places the treaty made direct reference to the San Francisco Treaty. The first is that Japan has renounced rights, titles and so on, to Taiwan/Formosa, Penghu/Pescadores, and the Spratlys and Parcels. This is in Article 2(b) and (f) and is repeated in the Treaty of Taipei. Second was the issue of compensation, that the ROC government in an act of magnanimity, “unilaterally waived the compensation request on Japan”. That is one area that the Taipei Treaty resembles the San Francisco Treaty. In fact, it should be seen as an extension. Another area we have to see in this context is that the Taipei Treaty was signed on April 28, 1952, the same day that the San Francisco Treaty came into effect. Furthermore, the San Francisco Treaty itself was signed on the same day as the US-Japan Security Treaty. So all this should be seen as a package deal, as they are all inter-connected. As mentioned earlier, the San Francisco

CHINA EYE‧Issue 9

“Chinese Peace Treaties with Japan”: ROC/Taiwan 1952; and PRC 1978 WANG Wei-cheng, Vincent (王維正)

WANG Wei-cheng, Vincent at “70 Years After the End of WWII in Asia: Lessons from History and Peace in the Balance”

Treaty, and by extension, the Taipei Treaty, resolved some problems but also introduced some ambiguities. Of course this left open the issue about the legal status of Taiwan. In the end the Treaty draft was short, simple, but also ambiguous, and there has been a never-ending debate about the issue of Taiwan. Those who support the ROC position and those who support the Taiwanese independence position both cite the letter and the spirit of the Taipei Treaty. For example, those who support the ROC position argue that, yes, although the treaty did not mention specifically to whom Japan should renounce these rights, it is also clear that in the Taipei Treaty, they mention only 2(b) and 2(f), not any of the other territories. So why would Japan sign a treaty with a country with which it has no intention of returning the property to? Therefore, even if it was not explicit, it was implicit. I should further point out Article 3, regarding the disposition of Japanese property, as well as Article 10 regarding the nationality

of Taiwanese residents, i.e. whether the socalled nationality laws of the ROC apply. In other words, after the Japanese surrendered and returned to Japan, what happens to the people in Taiwan? Are they henceforth stateless? Or, are they citizens of the ROC? Supporters argue that, both in letter and in spirit, even though it was not explicitly mentioned that it was returned to China, it was, in fact, returned to China. As such, residents in Taiwan are, henceforth, as a result of the Japanese surrender, Chinese citizens once again. They further cited the Cairo Declaration in 1943, which mandated that Japan “return all the territories stolen from China”. This of course refers to the 1895 Treaty of Shimonoseki, and the Potsdam Proclamation of 1945, signed on the eve of Japanese surrender, which maintained that the terms of the Cairo Declaration must be faithfully implemented, as well as the Japanese Instrument of Surrender. There is some debate as to whether these documents are “intentions”, “declarations” or

CHINA EYE‧Issue 9

“Chinese Peace Treaties with Japan”: ROC/Taiwan 1952; and PRC 1978 WANG Wei-cheng, Vincent (王維正)

“treaties”. Nonetheless, these are the documents used to support the ROC position. However, the supporters of an independent Taiwan beg to differ. They said the treaty did not make it clear to which Japan renounced these titles. Furthermore, they stress there is a difference between the Treaty of San Francisco and the Treaty of Taipei. In the Treaty of San Francisco, Japan simply renounces all rights and titles and so on. But it has renounced these before in 1951 and in 1952. Japan felt that it was necessary to sign a separate treaty with the ROC, which at that time was supported by the United States. It used the words, “it has renounced the titles and the rights”, which means that since it has already renounced these in 1951, it is no longer in the position to renounce them again. It has no right to say anything about Taiwan or Penghu. This line was further continued in later documents Japan signed with the PRC in 1972. The supporters of both the ROC and PRC, saw themselves, and perhaps still see themselves, as the successor state to the Chinese state. For example, the ROC saw itself as the successor state to the Qing Empire in 1895. Under the Treaty of Shimonoseki, the Qing Empire ceded Taiwan in perpetuity, along with all rights and titles, to Japan. So, as a result of the Treaty of Taipei, Article 4 talked about how Japan should renounce all special rights signed before 1951. From the ROC’s standpoint, the Treaty of Shimonoseki is void and null. The PRC sees itself as the successor state to the ROC. Therefore, the PRC is a natural successor state to anything that the ROC was able to gain internationally. It is interesting that in 1972, when the PRC and Japan normalized relations, Chinese Premier Zhou Enlai was asked about what to do about compensation. He said that the nationalist Chiang Kai-shek had already unilaterally waived the compensation issue to the Japanese, so we communists cannot be less generous than the nationalists. He basically continued that line. But this raises an interesting question. We know that the PRC’s standard position was not to recognize

the ROC, but in this regard, interesting enough, the PRC actually recognized a decision made by the nationalists. Another interesting question is that the treaty of Taipei talked about the Japanese renunciation of the Parcels and the Spratlys. It is also interesting why Japan specifically mentioned the Spratlys and Parcels in the Treaty of Taipei. Of course the Parcels now are under the effective control of the PRC, but in the Spratlys, the ROC still maintains control of its largest island, Taiping Island. Therefore, one argument is that you could use the Treaty of Taipei to bolster Taipei’s legal position in the South China Sea. The 1972 Joint Communiqué between the PRC and Japan was signed on the same day the Japanese abrogated the 1952 Taipei Treaty. In the Joint Communiqué, the Japanese government simply said that, “The Government of the People’s Republic of China reiterates that Taiwan is an inalienable part of the territory of the People’s Republic of China. The Government of Japan fully understands and respects the stance of the Government of the People’s Republic of China, and it firmly maintains its stance under Article 8 of the Potsdam Proclamation.” Article 8 of the Potsdam Proclamation simply says, “The terms of the Cairo Declaration shall be carried out and Japanese sovereignty shall be limited to the islands of Honshu, Hokkaido, Kyushu, Shikoku and such minor islands as we determine.” Basically the Japanese reiterated what they had already said before. In 1978, when the PRC and Japan signed a Treaty of Peace and Friendship, which went into effect at the same time PRC vice Premier Deng Xiaoping visited Japan, it basically talked about the peaceful relationship between the two countries. Article 5, in particular, sounds like the Five Principles of Peaceful Coexistence, emphasizing the need to settle all disputes by peaceful means, and that neither party should seek hegemony. The language is interesting, because if the outbreak of the Korea War in 1950 and the

CHINA EYE‧Issue 9

“Chinese Peace Treaties with Japan”: ROC/Taiwan 1952; and PRC 1978 WANG Wei-cheng, Vincent (王維正)

Chinese Civil War in 1949 was the context for the signing of the Treaty of Taipei in 1952, then the geopolitical change in 1971, beginning with Kissinger’s secret visit to the PRC followed by Nixon’s visit, came to Japan as a “Nixon Shock”. The 1972 treaty talked about this. Now the tide had changed. The PRC-Japan treaty was vehemently opposed by the Soviet Union. This is evident in the language of Article 4, namely that “This Treaty shall not affect the relations either Contracting Party maintains with third countries.” I believe this is actually implicitly referring to the Soviet Union. It is curious that the 1978 PRC-Japan Peace Treaty said nothing about Taiwan. From the PRC position, this probably was not necessary because the ROC had done all the work and in 1972 the Japanese government simply transferred diplomatic recognition. Despite all legal ambiguity and continued controversy as I mentioned above, these three parties have still found ways to pragmatically conduct their relationship. Even today, the people of Japan and Taiwan maintain very cordial and friendly relations, and Japan and the PRC are still continuing to find ways to cooperate based on their official diplomatic relationships.

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CHINA EYE‧Issue 9

The US and the “Altering” of Japan SCHALLER, Michael

The US and the “Altering” of Japan (戰后美國對日本之重塑再造) SCHALLER, Michael Regents Professor of History, University of Arizona

ust weeks after the Japanese surrender in September of 1945, one of the very first American diplomats to arrive in Tokyo, John Emerson, arrived at his new office, which had been requisitioned from the Mitsui Corporation. As he entered the office, he was greeted by a junior executive, who pointed to a map on the wall depicting Japan’s now defunct Greater East Asia Co-Prosperity Sphere. “There it is,” he said, smiling, “we tried it, see what you can do with it”. At that moment, Emerson recalled in his memoirs, the whole burden of American foreign policy in Asia hit him in the stomach. This exchange between John Emerson and the Mitsui executive seemed surreal in some ways. The embers of burning Japanese cities could still be smelled in September of 1945. But less than five years later, senior American diplomats ranging from George Kennan to Dean Acheson routinely spoke of creating a new empire to the South, as they called it, for Japan. They dubbed it “the great crescent”, a security and economic zone that stretched from Hokkaido to Pakistan and mirrored the old CoProsperity Sphere, minus China. Americans have perceived many different Japans since 1945. The implacable enemy of the wartime years, the “child-tutor” as Douglas MacArthur put it, in democracy during the occupation, the industrious Cold War ally of the 1950s and 60s, the Asian pillar of containment. In 1941, Henry Luce’s Time magazine tried to explain to Americans how to differentiate between the Japanese and Chinese. In a pictorial essay, Time described how to tell your Chinese friends from the enemy “Japs”.

For example, Chinese wore wire frame glasses, unlike the horn-rimmed style favoured by Japanese. Chinese had a friendly, open facial expression, in contrast to the arrogant Japanese scowl. Chinese walked with an easy gait, while Japanese slinked and laughed at the wrong times. But just a decade later, during the Korean War, Time more or less re-printed the same essay, but reversed the roles. The Japanese now laughed at the right times, and the Chinese at the wrong times. By the 1970s, many Americans had come to see Japan as a predatory economic rival, wielding Toyotas, Nikons and Seikos like weapons. Theodore White, the American journalist who had done much to humanise Chinese suffering during the Second World War, now warned Americans that Japan had launched a brilliant commercial offensive aimed at dismantling American industry and reversing the allied victory of 1945. Instead of the imperial army, the offensive now utilized the guided missiles of trade, this time to conquer the whole world. When the Soviet Union collapsed in 1991, some US politicians extended this theme by lamenting that the good news was the Cold War was over, the bad news was that Germany and Japan had won. Since 1945, relations between the US and Japan evolved in mostly unforeseen ways. Just a few months after Japan’s defeat, Japan’s post war leader, Prime Minister Yoshida Shigeru, remarked that history provided many examples of winning by diplomacy after losing a war.

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The US and the “Altering” of Japan SCHALLER, Michael

SCHALLER, Michael at “70 Years After the End of WWII in Asia: Lessons from History and Peace in the Balance”

Yoshida later ridiculed as oafs those Japanese who didn’t recognise the value of the postwar constitution. It restricted military action, thus deflecting American pressure to help fight America’s wars, like those in Korea and Vietnam. During 1947-1948, even more quickly than Yoshida had predicted, American officials became more worried about Japan’s weakness and vulnerability than its past strength. Having lost its empire with “China going red”, as American officials put it, US officials feared that Japan could fall prey to Chinese economic blackmail unless a way was found to get Japan back into the Co-Prosperity Sphere. Some two decades late, in 1971, President Richard Nixon – reacting to Japan’s phenomenal economic growth and the impact on the US economy – complained to British Prime Minister Edward Heath that the biggest reason for the US ever getting involved in Vietnam and staying there for so long was for Japan, and its need for reassurance. But now, like before

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1945, as Nixon put it, “the Japanese are all over Asia like a bunch of lice”. The arc of the post World War II USJapan relationship is remarkable, given the extraordinarily hostile and violent finale of the Pacific War. Massive B29 raids, which devastated Tokyo in the spring of 1945, destroyed 40% of urban Japan and killed half a million civilians long before the atomic bombs were used. Bloody battles to retake pacific redoubts like Iwo Jima and Okinawa killed tens and thousands of US military personnel and many times more Japanese. Official and unofficial propaganda in both countries demonised the other. American popular songs during the war included such titles as To Be Specific, It’s Our Pacific, We’re Going to Find a Fellow Who Is Yellow and Beat Him Red, White and Blue and one song was titled When Those Little Yellow Bellies Meet the Cohens and the Kellys. We saw the US Army’s official film the other day, Why We Fight, which of course

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The US and the “Altering” of Japan SCHALLER, Michael

depicted the Japanese in some ways as savage warrior ants. A Gallup poll taken in 1944 revealed that 13% of Americans favoured the extermination of all Japanese. A third of respondents in June of 1945 called for the summary execution of the Japanese Emperor. Influential public figures routinely called for collective punishment against Japanese civilians. Senator Lister Hill of Alabama urged gutting the heart of Japan with fire. One advisor to the State Department proposed bombing civilians specifically to ensure the almost total elimination of the Japanese as a race. President Roosevelt’s son Elliot told Congress Secretary Henry Wallace that he favoured continuing the war until “we have destroyed about half the Japanese population”. Senator Theodore Bilbo of Mississippi, a notorious racist, urged an occupation policy that involved “sterilizing every damn one of them Japanese so in a generation there will be no more Japs”. Remarkably, however, within six years of Japan’s defeat, Japan’s industrial production achieved pre-war levels. The United States had offered a generous peace treaty restoring Japanese sovereignty, and Washington had signed a security pact that made Japan America’s chief ally in the Pacific. On December 7th, 1951, the tenth anniversary of the Pearl Harbour attack, a leading Japanese newspaper editorialised, without apparent irony, that the new US- Japan security pact made Japan “Pearl Harbour-proof”. Beginning in 1938, American policy in East Asia had focused on assisting nationalist China against Japan, and President Roosevelt had spoken often and in detail about a post-war system in which Japan would be reduced to a minor power while a powerful pro-American China presided over a new order in decolonized East Asia. Well, despite growing wartime and early post-war doubts about whether China could become one of the four policemen, until 1947 at least, American policy in Japan remained centred on implementing what was often called a “controlled revolution”: demilitarisation,

democratization, decartelization. In interesting ways, as many historians have noted, Tokyo remained the last redoubt of New Deal Liberalism in the world after 1945. But the onset of the Cold War – and the fear of an economic vacuum in Japan as well as Western Europe – transformed American policy and priorities. Key strategists in the Truman administration, such as State Department policy planner George Kennan, Secretary of Defense James Forrestal, Under-Secretary of the Army William Draper, and others, argued that Soviet power in Europe, coupled with China’s likely fall to communism, left Japan vulnerable to what they now call the “socialisation attack”, which was their term for the occupation agenda in Japan. Under-Secretary of State, and later Secretary of State, Dean Acheson unveiled a new policy. In May of 1947, in a speech that prefigured the Marshall Plan, Acheson explained that the greatest threat to peace stemmed from the “grim facts of life”, as he put it, that the two great workshops of Europe and Asia, Germany and Japan, remained idle. In private, Defense Secretary Forrestal told Truman that containing communism required putting Japan, Germany and the other affiliates of the axis back to work. The very survival of the free world, Forrestal insisted, depended on rebuilding the two countries we’d just destroyed. This switch in emphasis or reverse course shaped American policies toward Japan and East and Southeast Asia during the next 25 years. Washington’s fear that an economically fragile Japan that lacked strong ideological ties to the West might drift toward an accommodation with either the Soviet Union or China. As diplomat John Foster Dulles remarked as he negotiated the peace treaty with Japan in 1951, “Unless Japan works for us, it’s going to work for the other side”. Decisions implemented in 1948 to rebuild Japan’s economy, curb the power of organised labour, and promote conservative political parties also reflected growing concern with

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China’s revolution. Past US support for a strong China to replace Japan as a dominant power seemed to have come true but in the worst possible way. Even if a communist China lacked the industrial foundations to affect the Asian power balance, American officials feared that China would use its raw materials and markets to bait or blackmail Japan. The primary danger proposed by China’s communism, diplomats such as George Kennan argued, was not military. Rather, Japan’s prosperity and security could not be assured unless we opened for them “some sort of empire to the South”, Kennan put it. This occasioned the frequent assertions by the late 1940s that the US had to get back into, as the Mitsui executive had said, the “Co-Prosperity Sphere”. The solution to Japan’s dependence on American economic assistance or its subordination to China, Secretary of State Acheson told senators in January of 1950, was for the US to shift its centre of interest away from China, where the US could do little to alter the communist victory. We now had to develop, Acheson said, “a great crescent or semi-circle which goes around Japan at one end and India at the other”. From this zone, the US could both contain China and provide needed markets and raw materials for Japan. To be sure, not all Americans shared this vision of Japan’s economic integration with Southeast Asia. The Joint Chiefs of Staff, for example, continued to view Japan, right through the 1950s, as little more than a military platform on which to base American power to deploy against China and the Soviet Union. During prolonged bureaucratic battles in 1949, ‘50 and ‘51, to ensure peace settlement with Japan, the Truman administration’s chief diplomatic negotiator, John Foster Dulles, before he became Secretary of State under Eisenhower, caustically observed that the most difficult battle of World War II was going to be getting American Army colonels to abandon their hillside villas in occupied Japan. The outbreak of the Korean War in June 1950 broke the logjam. The State Department

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ceded to Pentagon demands for extensive post occupation base rights in Japan. The Joint Chiefs agreed to a treaty returning domestic sovereignty to the Japanese, and in the peace and security pact signed in San Francisco in September of 1951, Prime Minister Yoshida bowed to US based demands and committed Japan to minimizing its economic and diplomatic ties to China. To sweeten the deal, the United States continued a high level of military procurement from Japan followed by exceedingly generous trade terms that opened US markets to Japanese exports. In the wake of the 1951 peace treaty with Japan, Washington still feared that a communist surge in Southeast Asia, starting with Vietnam, might push Japan towards neutrality. In fact, from the moment the Truman administration opted in 1950 to help support the US-French war effort in Indochina, right through to the early 1960s, American strategists both in private and public described their actions in support of the French, and later in support of South Vietnam, as needed to contain China directly while preserving Southeast Asia as a Japanese economic sphere. In the first weeks of the Eisenhower administration, January of 1953, then Secretary of State John Foster Dulles declared that the Soviets were making a drive to get Japan – not just through the fighting in Korea, but also through what they were doing in Indochina. The loss of Southeast Asia, Dulles warned the Joint Chiefs of Staff, would lead to the loss of Japan. A communist breakthrough in Indochina would set the “Japs” thinking “how do we get to the other side?” The US military officials agreed, in 1954, that a French defeat in Indochina would “force Japan, by economic and political pressure, to reach accommodation with China”. President Eisenhower echoed these sentiments. In April of 1954, he famously told journalists that the loss of Vietnam would topple the rest of Southeast Asia like a row of dominos. But Eisenhower’s fuller explanation of what he meant by the domino theory was

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The US and the “Altering” of Japan SCHALLER, Michael

often ignored. With the loss of Southeast Asia, Eisenhower explained, Japan would move towards the communist areas in order to survive. In June, following France’s defeat at the Battle of Dien Bien Phu, Eisenhower told a group of American newspaper executives that protecting Southeast Asian resources as well as opening US consumer markets in Japan was the only way to keep Japan in our orbit. Near the end of his administration in 1959, after the US had become the patron of South Vietnam, Eisenhower told an audience, including Japanese foreign minister Fujiyama, that Japan represented the essential counterweight to communist strength in Asia. But Japan, he acknowledged, must export to live, and the US had to ensure that Japan had trade alternatives to the communist empire. The security of Japan and Vietnam, Eisenhower insisted, were inseparable. Japan needed raw materials and markets and Southeast Asia needed cheap manufactured goods. “By strengthening Vietnam in Southeast Asia”, the President said, “the United States ensured the stability of Japan and the safety of the free world”. The Kennedy and Johnson administrations embraced this idea. In 1961, John F Kennedy told Japanese journalists he believed Japan was destined to rule Asia. To blunt continuing Japanese pressure to trade with China, Kennedy spoke to his aids of taking evermore Japanese exports, so that Japan could never afford to sever its ties to the US. As the Kennedy and Johnson administrations expanded the Vietnam War, Japan prospered, of course, in many ways. Tokyo became the largest foreign supplier of non-lethal products to the US armed forces. As American factories ramped up military production, Japan dramatically boosted consumer exports to the United States, and many of the US dollars spent in South Vietnam, South Korea, the Philippines and Taiwan were harvested by Japanese companies selling to these markets. In many unintended ways, the Vietnam War accomplished the long-standing American goal of integrating Japan into Southeast Asia.

By 1968, of course, military reversals in Vietnam and domestic political upheavals forced President Johnson from office. Despite the new President’s previous support of the Vietnam War, Richard Nixon recognised that the Sino-Soviet split, the growing stability of Southeast Asia, and above all Japan’s economic strength, now made fighting in Vietnam counterproductive. In addition, Nixon’s sense of personal betrayal over Japan’s failure to carry out promised curbs on textile imports led him as he explained to an aid to “stick it to the Japanese”. Between 1969 and 1971, the “Nixon shocks” we heard about earlier jolted the Japanese-American relationship. Washington moved secretly to open relations with China, to abandon the dollars link to gold and to impose various surcharges on Japanese imports. On the eve of announcing his opening to China in July 1971, Nixon told his close aids how “in politics, everything eventually turns around”. The Chinese were making a deal with us due to concern about the Soviets, their former ally. Nixon said he had fought the Battle for Taiwan since the 1950s and had always taken the line to stand by the South Koreans, by the South Vietnamese, and so on. It was ironic, he admitted, that a conservative like himself was now the one to move in the other direction. But cooperation between the US and China, he predicted, would shatter old alignments. The pressure on Japan might even push it into an alliance with the Soviets, he speculated. Washington reassured their Pacific allies that they were not really changing their policy. The fact is, although there was validity ten years ago to play the free nations of Asia against China, the US could now play a more effective role with China than without it. During his February 1972 meetings with Mao Zedong and Zhou Enlai, Nixon offered sceptical Chinese leaders a reinterpretation of the US-Japan security pact. Nixon and Kissinger asked Zhou to ponder the alternative of a Japan uncoupled from America. Do we tell the second-most prosperous nation – Japan to

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go it alone or do we provide a shield? Wasn’t a US-Japan policy with a US veto less dangerous to China than a Japan-only policy? Without US bases in Japan, the Philippines and South Korea, Nixon added, the potential wild horse of Japan could not be contained. As the best way to contain Japan, Nixon told Zhou, the security treaty is really in China’s interest, not against it. By 1973, following Japan’s own opening to China, Zhou Enlai told Kissinger that he now recognized the US-Japan’s security treaty as “a break on Japanese expansion and militarism”. In effect, the anti-China containment policy of 1951 had been repurposed to contain both Japan and the Soviet Union. As Kissinger told Nixon in 1973, with the possible exception of the United Kingdom, the Peoples Republic of China might well be the closest country to us in global conceptions. In plain words, Kissinger concluded, the United States and China had become tacit allies. “History”, as Mark Twain observed, “may not repeat itself, but it often rhymes”. Or as Nixon used in July of 1971, “in politics and diplomacy, eventually everything turns around”. The task before today’s policy makers in Washington, Beijing, and Tokyo is to adjust to these changes without repeating the tragedies of the wars that ravaged Asia from the 1930s through the end of the Cold War.

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Examining the Diaoyutai/Senkaku Islands Territorial Dispute Through Japanese and Chinese Government Archives SHAW Han-yi (邵漢儀)

Examining the Diaoyutai/Senkaku Islands Territorial Dispute Through Japanese and Chinese Government Archives (從中國和日本政府檔案中審視釣魚島領土爭議) SHAW Han-yi (邵漢儀) Research Fellow, Research Center for International Legal Studies, National Chengchi University, Taipei, Taiwan

y key points are the following:

Neither China, Japan nor Taiwan truly has a water-tight case. They have some merits and they have some de-merits. First, China’s claim that the islands have belonged to it since the Ming Dynasty does not pass the historical test. That said, there is some interesting historical evidence that does support a strong case. Second, Japan’s incorporation did not conform to discovery occupation of Terra Nullius, which means land without owner, but its claim to date is not a revival of militarism as many Chinese will claim. Third, the United States did not use this issue as a wedge between China and Japan. In fact, as I will show you, documents from international archives will indicate that the US tried very hard to broker something between the Republic of China (ROC) and Japan. The State Department spent quite some time trying to figure out a legal path for it to be resolved. Lastly, I would like to talk about what options we have. I believe that too much scholarly material in the past forty years has been misused, misinterpreted, sometimes deliberately. This has not helped with any of the legal assessments, because a lot of the historical data is problematic. Let me start with the Japanese position. The Japanese position claims that the islands, prior to

1985, were land without owner. And by virtue of discovery occupation, if its land without owner, it has a right to claim it. So, the basic position as published in 1972, basically said that from 1885 on, the Japanese government spent 10 years carefully researching the islands, and revealed that they were land without owner with no trace of Qing ownership. And therefore, according to international law, they passed a cabinet decision and made it Japanese territory. Furthermore, it was not part of the Shimonoseki Treaty, because the Treaty did not list out the islands. Thirdly, China did not express objection to any of the post-War arrangements. In other words, it did not make any claim. This is something that people on the Hong Kong and China side have to recognize. I have my theories as to why this happened. Last but not least, the Japanese position is that there is, in fact, no territorial dispute. Allow me to go through the Japanese incorporation process. In 1885, there was an effort to try to incorporate the islands. Basically, the Minister of Internal Affairs wanted to incorporate it, and sent an order to the Governor of Okinawa. However, the Okinawa Magistrate reported back saying that the islands have already been documented in Chinese archives. At the same time, the Chinese newspapers were talking about Japan’s intention to occupy the islands.

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Examining the Diaoyutai/Senkaku Islands Territorial Dispute Through Japanese and Chinese Government Archives SHAW Han-yi (邵漢儀)

SHAW Han-yi at “70 Years After the End of WWII in Asia: Lessons from History and Peace in the Balance”

This is what’s really interesting. What this indicates is that the Japanese were well aware that under the East Asian order there is what you may call an area of influence, and in this case, it actually denoted the islands as part of Taiwan. Subsequently, in 1891, in a letter to the Navy department from the Okinawa Magistrate, the Magistrate asked for survey ships to go to the islands and survey them, and as a result of it not being a part of Japanese naval jurisdiction, it was denied. Then, lastly, on May 12, 1894 – three months before the Sino-Japanese War, another letter was sent by the Governor of Okinawa back to the Interior Ministry saying that over the past 10 years we did not conduct surveys, and therefore there are no reports I can give back to you. Fast-forward to 1913, after the islands were incorporated. Fishery officials of Okinawa prefecture basically said that, with regard to the islands, prior to its incorporation, because there were rumors that they were part of China, the Japanese government decided to not take the islands. But when in 1895 we had

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a war with China and had a glorious victory, their status became clear – meaning that they had become part of the Japanese empire. The problem that I have with the position of governments, not necessarily from Taiwan, China or Japan, is that they make very overarching statements that don’t really talk about the historical context. For example, when Japan incorporates the islands in 1895, it does not make reference to the fact that there was a war at the time, and China was losing. This really needs to be brought up in order for us to make an objective evaluation. Prior to the incorporation, there have been several instances where you can clearly see that the government of Japan made very deliberate decisions to not go forward. One should also note that between 1890 and 1900, there were three separate acts of island incorporation. One happened in 1891, one in 1895, and another in 1898. The only one that was unannounced was that of the Senkaku islands, and one wonders why.

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Examining the Diaoyutai/Senkaku Islands Territorial Dispute Through Japanese and Chinese Government Archives SHAW Han-yi (邵漢儀)

So, here is the context. Historians will say that the Sino-Japanese War did play a very significant role, and that is what I call the inconvenient truth that the Japanese government prefers to not talk about. There is a war in the East during 1894 and 1895 between Japan and China, ended with China’s loss. On April 17, 1895, the Shimonoseki Treaty, an unequal treaty, was signed between Qing China and Japan. One of the key statements here is that the islands of Formosa, together with all islands appertaining or belonging to it, were also ceded to Japan. That is the question – are the Senkaku/Diaoyu islands part of it? The basic position of the ROC is: “Since antiquity”, and no more. That is very problematic. What does “antiquity” mean? This is not a statement that is very useful or helpful to this conversation. If you press further, they will say, “First discovered, named and used by Ming China.” But that does not mean that those islands are yours either. All too often, the Chinese will unearth a laundry list of hundreds of these maps that say that the islands are there. But what is problematic about this is that sometimes these maps include islands that already belong to Japan or Indonesia etc. and are not disputed. Where I feel that the Chinese claim starts to become more legitimate is the Qing Dynasty evidence. The Ming Dynasty is problematic because even Taiwan at the time was not a part of China. This is what many Chinese consider “iron proof”: In 1555 Zheng Shungong wrote that the Diaoyu islands were part of Xiao dong, the old name for Taiwan, and so therefore they must be Chinese. The problem is, Xiao dong was not part of China. So at that time, the Senkaku islands were not Chinese. Another interesting thing lies in that, because of China’s relations with the Liuqiu (琉球) Kingdom, there are many maps showing how to reach it. On these maps appear islands that are part of the Diaoyu or Senkaku islands. On a modern version of the same map, there is something called the Black Water Trough,

which today is known as the Okinawa Trough. In these maps, which are official documents written by the ambassadors from Qing China to the Liuqiu Kingdom; there are many statements that are interesting. These documents say that the Black Water Trough is the border between the Min Sea (Fujian Waters) and foreign waters, and were recorded as the natural boundary between the two nations. The Trough was also mentioned in a poem written by an ambassador, and his vice ambassador further wrote that the Black Water Sea was the boundary between China and foreign lands. This I think is very relevant, because it denotes the notion of a boundary. The reason this is important is because the Diaoyu/Senkaku islands are to the west of this “border”. The text goes further to mention crossing the Chinese Boundary at the Black Water Trough. Last but not least, in a museum in Okinawa there is a twelve-picture scroll of the journey from Fuzhou to Okinawa, each scroll indicating a step of the way to get there. There is one picture called “Passing the Trough at Midnight”. In this picture the trough is drawn as a gaping crevasse or split in the sea, something that cannot possibly exist in the natural world. However, the fact that it was drawn this way means that to the Chinese there was in fact the notion of a boundary, and it was recorded as such. The problem with Taiwan and China is that they do not talk about this in the context of international law. What does this mean under international law? In 1900, after Japan had acquired Taiwan, a document talks about what the islands to the north of Taiwan consist of. It says that prior to their acquisition, according to British map, both the “first group of islands” and the “second group of islands” were a part Taiwan. Now let’s fast-forward to the post-War period. What is interesting is that when the three great powers, China, Great Britain and the US met at Cairo for their declaration, the spirit of it was to strip Japan to its pre-1895 status, and the Senkaku islands were incorporated

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Examining the Diaoyutai/Senkaku Islands Territorial Dispute Through Japanese and Chinese Government Archives SHAW Han-yi (邵漢儀)

in 1895. In 1947, two-years later, the Japanese Ministry was sending documents to the general headquarters to help influence what in the future would be the Peace Treaty. In here it talks about the Sento islands, which are basically the Senkaku islands – this would suggest that at the time they did not have a standardized name – as being small, uninhabited and insignificant. That was the position at the time. But they had the upper hand, because Japan was directly negotiating with the United States. China, on the other hand, did not have that opportunity. But if you look at the first draft, as Professor Kimie Hara mentioned earlier at this Forum, it said that the territorial limits of Japan shall be those existing on January 1, 1894. The Senkaku islands were incorporated on January 14, 1895. So, if there was no Cold War and all this ambiguity that followed, this would have settled it. But it didn’t, because it was later removed. Then, the million dollar question is why did the Chinese government not ask for the islands to be returned? It turns out that in 1947, in documents recently unearthed, the Chinese Mission to Tokyo tried to ascertain what it is that really constituted Liuqiu. Based on several maps, they concluded that when exactly the Japanese incorporated the islands could not be found. It was unclear when the islands became Japanese territory. In other words, the ROC government tried to figure it out, but they were unable to crack this. What it’s noteworthy though, is that on the map that illustrates the territorial clauses of the Japanese Peace Treaty, the islands were excluded from the territories of China and Taiwan, and this was not protested. This is something that the Chinese have to acknowledge. So today, when the Chinese are trying to convince the Western world or Japan that they should have the islands back they need to make a good case for it, as they did not challenge it for 20 years. A lot of Chinese whether on the Taiwan side or China side, will also say that the US purposefully put a wedge between these two

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countries. That is not true. In a letter between the State Department to the Embassy, it says that Americans don’t want China and Japan get involved in “any pointless territorial problem”. And then on September 3, 1968, through the fishing activities of the Taiwanese fisherman, the US realized that there was ambiguity around the Senkaku islands on all sides. As a result, the US government, as the administrating organ of the islands decided to put up a sign. Now fast forward to April 1969. When oil was found, all of a sudden, this attracted not only the attention of Taiwan, as the Japanese would claim, but also that of the Okinawans and the Japanese themselves. The fate of the Senkaku islands was decided on June 7, 1971 in Camp Davis. Nixon, Kissinger sat down for about forty-five minutes and decided that they had to return them to Japan, because China and Taiwan protested too late. Had we raised it in 1945, there would not have been a problem. But we had raised it to them only earlier that year, because in 1945 when we took over Taiwan, we did not realize the composition change of it between 1895 and 1945, that when Japanese talked about Senkaku, they actually refers to Diaoyutai. Unfortunately, neither the Taiwanese government nor the People’s Republic of China (PRC) government talks about the historical context. They tend to make blanket statements saying “our territory since ancient times”. What is problematic is that China today is using hard power, while japan uses soft power. However, Japan’s stance is to refuse to talk about it. The root of this, therefore, was Japan’s refusal to sit down where it belongs. Japan did not do that for 40 years, and we all overlooked this fact because China is sending ships to this area, not to mention because Taiwan was kicked-out of the UN. In 1971, when Taiwan was no longer a part of the United Nations, Japan severed ties with Taiwan, together with the line of communication. In a State Department document dated June 11, 1971, we can see how the US government was looking at how to get the ROC and Japan to

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Examining the Diaoyutai/Senkaku Islands Territorial Dispute Through Japanese and Chinese Government Archives SHAW Han-yi (邵漢儀)

talk. They were encouraging the parties to sit down and talk about it. But this never happened. Then, of course, the PRC replaced the ROC as the legitimate Chinese government. So, what are the solutions? Neither side has a water-tight case, but they do have some merit to them. What we need is a diplomatic “grand bargain” that is based on legal criteria. Each side believes that they are righteous and the other side is evil, militaristic. Japan claims that China is trying to use the islands to expand, but in actuality, it was the ROC that started it and they had no territorial aspirations. While China says that there is military revivalism occurring in Japan. I believe there are three ways we can achieve peaceful settlement: International adjudication, political negotiation, or political negotiation with third-party mediation. Taiwan decided that they were never going to solve this sovereignty dispute in the short term. They proposed simply returning the islands back to its initial state, where it was just an area used by the Chinese and the Ryukyus in the region, for whatever purpose they found useful at the time. In 2012, the ROC, or Taiwan, proposed the East China Sea Peace Initiative and then signed a fisheries agreement with Japan which covers a vast area that was mapped to the area where Taiwanese fishermen have traditionally been fishing. This agreement does not prejudice any party’s sovereignty claim. As an alternative to shelving sovereignty and pursuing joint developed as described above, we may also consider simply shelving sovereignty without any development. This is essentially returning to the “no man’s land” arrangement from 1972-2012. The problem with this approach is that Japan denies that such an agreement ever existed with China. Or we may pursue joint sovereignty. Spain and France actually share sovereignty over Pheasant Island, each controlling it for alternating six-month periods. Even split sovereignty is an option. As Diaoyu/Senkaku consists of five islands, one option would be Chinese ownership over three, and Japanese

over two, and negotiations between Beijing and Taipei could settle rights over three. In 1992, the ICJ awarded El Salvador two islands and Nicaragua one island in the Gulf of Fonseca. In other words, there are many formulas that exist.

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Remembering China’s Bitter Victory HSIUNG, James C. (熊玠)

Remembering China’s Bitter Victory (艱苦卓絕的勝利：中國勿忘) HSIUNG, James C. (熊玠) Professor of Politics & International Law, New York University

immediately grabbed at the opportunity to plan for this conference for a reason, because I thought that after the guns fell silent so many years ago, the story has yet to be fully told, and the Japanese, to this day, deny everything. Let me tell you one episode involving myself. When the War broke out I was only two years old, and my family took me to Chongqing in Sichuan. After a year of traveling with difficulty, by the time we reached Chongqing I was three years old. I remember we had to go to the air raid shelter every day to hide from Japanese planes that were bombing the city. One time we got to the cave late, so we could not go in. There were so many people there and the cave was fully packed, so we could not go into the cave. It was a big cave and so we stayed at the entrance. Then somebody outside cried out, “it’s over! It’s over! The aid raid is over!” We believed it so we left. Before we could travel too long, we saw Japanese planes flying overhead, so we had to seek temporary shelter by hiding ourselves under a building. Then we heard the bombs drop. After a while, my father went out to see if it was safe for us to move. A few minutes later he came back and whispered something to my mother. My mother covered my eyes with a scarf, and, carrying me, we started to move. As I lifted the scarf stealthily to look, I saw body parts scattered all around us. We did not know the seriousness of the damage until the next day. 80,000 people were killed in that cave. First, the bomb closed off the cave and killed people immediately at the entrance of the cave, which

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started a stampede inside. This, combined with suffocation, killed 80,000 people in that one cave. Years later when we returned to Chongqing, I asked to see that cave, and everybody remembered that 80,000 people were killed there. The name of the cave is is Da Di Dong (大地洞), or “big cave”. Therefore, the War of Resistance has become a fixation in my life. In planning for this conference, I started by working out the topics that should be covered and I drew up a list of speakers, potential speakers. These were all big names that had done work on these different topics that I had laid out. But one sad thing was, when I started to contact these people, I discovered that many of them were deceased. After 70 years, it is no wonder. Therefore we can’t afford to wait another 70 years, when you and I may not be here either. So there is some urgency. We will begin today’s conference with a film called World War II: Japanese Invasion of China, from the Best Film archives. These archives are kept by the National Film Preservation Foundation, which is a non-profit organization created by the US Congress to promote public access to films preserved by the American War Archive Community. The film shows clips of the real fighting by the Japanese forces killing Chinese, and also shows many other episodes in the War. This film consists of clips taken by the Japanese forces, which were later captured from the Japanese forces. It also includes the films taken by foreign missionaries in China, and

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Remembering China’s Bitter Victory HSIUNG, James C. (熊玠)

HSIUNG, James C. at “70 Years After the End of WWII in Asia: Lessons from History and Peace in the Balance”

films taken by the Chinese themselves. What you are about to see is very disconcerting, and I must say, I had a difficult time keeping a dry eye. I hope this film will be able to show you, in graphics, what really happened.

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Remembering China’s Bitter Victory HSIUNG, James C. (熊玠)

Call for Papers China Eye is an international academic journal on geopolitics, energy security, economy and culture. It is published by China Energy Fund Committee (CEFC) – a non-governmental nonpartisan Chinese think-tank registered in Hong Kong. This English publication aims to facilitate a better understanding of China by providing a forum for diverse views, carrying Chinese as well as non-Chinese perspectives. Would-be contributors should forward their proposed original contributions with a synopsis, to include:

(1) title; (2) author’s affiliation, and (3) e-mail address, phone and fax numbers.

Our contact details are: E-mail: com@chinaenergyfund.org Phone number: (852)-2655 1666 Fax number: (852)-2655 1616 Address: Room 3401-08, 34/F, Convention Plaza Office Tower, 1 Harbour Road, Wanchai, Hong Kong

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Remembering China’s Bitter Victory HSIUNG, James C. (熊玠)

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Remembering China’s Bitter Victory HSIUNG, James C. (熊玠)

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