Asia’s Rise and America’s Decline


May 5, 2017

Asia’s Rise and America’s Decline

 by Jessica T. Mathews
May 11, 2017 Issue : nybooks.com

Easternization: Asia’s Rise’s Rise and America’s Decline from Obama to Beyond Trump

by Gideon Rachman
Other Press, 307 pp., $25.95
Image result for trump and xi at mar a lagoPresident Xi’s Geo-Economics vs Trumpism

Gideon Rachman’s Easternization, his new survey of a transformed Asia, admirably does what so little writing on foreign affairs attempts. It treats with equal facility economics, geopolitics, security, enough history for needed background, official thinking, and public attitudes. Rachman, Chief Foreign Affairs columnist for the Financial Times, has an eye for the telling statistic and for the memorable detail that makes it stick. He packs an enormous amount of information into a short book and opens windows of understanding for non-experts onto this immensely important three fifths of humanity. And while not directly concerned with the new American administration, the story he tells shows well why Donald Trump’s foreign policies could end so badly for the United States and for the world.

But Rachman does not, in the end, make a convincing case for the book’s thesis—embodied in its one-word title. The central issue, he writes, is “how the rise in Asian economic power is changing world politics.” His momentous answer is that “the West’s centuries-long domination of world affairs,” stretching back to 1500, “is now coming to a close.” Without doubt, Asia’s economic ascent has been extraordinary, but Westernization—the spread of the West’s influence and values—has rested on much more than its wealth and the military power derived from it. Those other elements—including open governments, readiness to build institutions, and contributions to others’ security and growth—are weak or absent in Asia today. Easternization is neither here nor coming soon.

Asia is the world’s largest continent and home to 4.4 billion people. But its story is disproportionately about China’s economic growth. Beijing’s official statistics are notoriously unreliable, but by most reckonings, China became the world’s largest economy (measured by purchasing power parity, PPP) in 2014. What isn’t so well known is how astonishingly fast the end came for the 140-year reign of the American economy as the world’s largest. According to numbers Rachman cites, China was just 12 percent of the size of the US economy in 2000 and only half as big as late as 2011. Such meteoric growth has been enough to lift hundreds of millions out of poverty, finance the US deficit, and still allow China to increase its military spending at double-digit rates every year for two decades.

In matters of national security the momentum of Chinese growth has meant, for example, that while Japan’s military spending was triple China’s in 2000, it was only half as large by 2015. A rapidly expanding military has underwritten Beijing’s surging confidence in its own strength vis-à-vis both its neighbors and the US, and increasingly aggressive behavior in the South and East China Seas, where it has claimed islands, rocks, and waters also claimed by Japan, Vietnam, and the Philippines. It has built artificial islands and constructed runways and other dual-use facilities on them. It has deployed planes and ships to assert its rights and challenged others’ rights to fishing areas, oil resources, and even freedom of navigation in areas of open ocean. It has vehemently rejected a strong ruling against its claims by a tribunal under the United Nations Convention on the Law of the Sea.

Though Chinese leaders have not specified exactly what waters they claim and insist that China wants a peaceful, negotiated solution to these disputes, it is easy to see their actions in a very different light. Beijing has notably failed to clarify its goal: whether to assert its newfound strength, to test others’ resolve, to extend its regional sway, or to claim sovereignty over everything within the so-called nine-dash line (a demarcation of China’s claims to the South China Sea that dates back to 1947) and attempt to push the US out of the western Pacific—an outcome Washington will not accept. In the atmosphere of profound strategic mistrust that defines US–China relations, the potential for tragic miscalculation by both sides is obvious.

This is not the only or even the most immediate security risk in the region. Taiwan’s official status as part of mainland China—known as the One China policy—is nonnegotiable for Beijing. Trump’s biggest blunder to date was to suggest that he might no longer accept that policy, which has kept the peace among the US, Taiwan, and China for four decades while allowing Taiwan to flourish. Beijing instantly—and entirely predictably—froze all communication with the US, and Washington was forced to back down.

Assuming that the Trump administration has permanently learned this lesson, the far more serious threat is North Korea’s advancing nuclear capability (it could soon have enough nuclear fuel for one hundred warheads) and its progress toward nuclear-armed ICBMs that could reach the US. Though it is formally China’s ally and largely dependent on it, Pyongyang routinely ignores Beijing. In a rare misjudgment, Rachman devotes only a few short paragraphs to what may well be the first major crisis the new US administration confronts, and a source of acute contention between it and China.

Image result for China's Geo-Economics

China’s Geo-Economics

Rachman links China’s newly aggressive policies to President Xi Jinping, noting that the month after he took office “Chinese military aircraft entered Japanese-controlled airspace for the first time since 1958,” and that in his first eighteen months Xi “paid more official visits to the People’s Liberation Army than his predecessor had done in a decade.” Xi has paid equal attention to building public support for his newly assertive policies, bolstering decades of Communist Party propaganda that China, at long last, is claiming its rightful place as a world power after more than a century of foreign humiliation.

This “aggrieved nationalism” coexists with an equally strong feeling of insecurity within the Chinese government—a dangerous mixture. The Communist Party’s legitimacy no longer rests on ideology but on economic growth, which is slowing. The Party is convinced that the West fomented the string of so-called color revolutions demanding democratic governance that took place during the 2000s—from Ukraine, Georgia, and Kyrgyzstan to Lebanon and Iran. It fears and expects similar subversion in China. Outrage at elite corruption was a common feature of these movements, and corruption is rampant in China. So Xi has launched a vigorous campaign against it—conveniently jailing many of his political opponents. The difficulty, as Rachman points out, is that “arresting more than one hundred thousand people…risks creating political instability by another route.”

China may appear an economic and military powerhouse but it is confronting critical challenges at home. Environmental pollution—especially of the air—is not only hugely unpopular and economically costly; it is a killer, responsible for the deaths of a staggering million to a million and a half Chinese annually. China also faces a looming demographic crisis with its aging population, shrinking workforce, and huge number of people who will retire with only a single child and a drastically inadequate social safety net to support them. The cost of pensions and health care will balloon. Anticipating the coming cliff, Beijing changed its one-child policy to a two-child policy in late 2015, producing a small increase in births but not yet what is hoped for. Stalled economic reform also belongs on this list of weaknesses, as does widening inequality and continuing deep poverty in rural areas.

Not surprisingly, China’s recent belligerence has intensified long-standing fears among its neighbors. Many of these fraught relationships stretch very far back. Rachman recounts the Vietnamese joke that the shape of its coastline reflects a spine bent under the weight of China, with which it has fought seventeen wars. In Southeast Asia, too, countries fear China, look to the US for support, and hope that they will not be forced to choose between them. In China, the memory of Japan’s brutal World War II occupation remains fresh, while Japan fears that China’s new militarism may be a repeat of its own mistakes of that period. And India, Asia’s other superstate—and one of China’s four nuclear-armed neighbors—sits across the longest disputed border in the world.

India’s Act East Policy

Image result for narendra modi's Act East Policy

India is growing faster than China and may one day surpass it as the world’s largest economy, but today it is far behind. Indeed, the country faces a list of challenges so long that one is forced to conclude that it is little short of a miracle that a unified, democratic state exists at all. But in Narendra Modi, India now has dynamic leadership for the first time in many years. Led by the Hindu nationalist BJP party, the Modi government has come under criticism for its restrictions on civil liberties and its failure to protect religious minorities. But with his recent landslide win in state elections, particularly in Uttar Pradesh, India’s largest state, Modi may be consolidating enough political strength to force through long-needed reforms in New Delhi.

Though Rachman takes India’s growth as more evidence for Easternization, culturally and politically India is facing west. In contrast to its wary and sometimes actively contested relationship with China, India’s relations with the US have been growing steadily closer since the George W. Bush years. Russia is no longer India’s major arms supplier; the US is. And the stunning success of Indian immigrants in the US, from Silicon Valley to Wall Street to academia, is a powerful draw for others to follow.

Russia, too, is turning east, Rachman argues. Its doing so is “part of the same phenomenon” as China’s increasing assertiveness, namely relative Western economic and political decline. Evidence includes joint Russian–Chinese military exercises, shared pressure against color revolutions, and, in 2014, a loudly trumpeted natural gas deal (though the latter has yet to be implemented). In reality, Moscow’s latest turn toward China happened because it could not get what it wanted—respect as a great power and equality in NATO—from the West. Then Russia’s actions in Crimea and Ukraine triggered tough sanctions that the US and its allies show no sign of lifting. Thus, the turn is at least as much a push from the West as it is a pull toward the East.

Asia is the World’s Economic Center

With India, China, and Japan accounting for three of the world’s four largest economies (as measured by PPP), and rapid growth in two of them, Asia is becoming the world’s economic center, though today the US and the EU together remain substantially larger. Arms purchases and greatly increased military strength have followed Asia’s growth. China, in particular, is closing the gap, though the US retains a huge advantage. When alliances are added to the picture—as they should be—the picture becomes much more lopsided and more complicated since Japan and South Korea and several other Asian states, together with the twenty-eight members of NATO, number among America’s vast global alliance network. China’s main allies, Pakistan and North Korea, may be a net burden.

But, as Rachman shows, the West’s ability to impose order on the world is not what it once was. Among the many reasons is its relative decline in military power, the advent of asymmetrical warfare, decades of under-spending on defense by European powers, and the salutary disappearance of the artificial order imposed first by colonial empires and later by the cold war. America’s European allies have placed such a strong priority on social spending over defense spending that in many cases their individual military capabilities have become negligible. Rachman notes that when Britain’s cuts are completed next year, its army would fit comfortably in London’s Wembley Stadium with 16,000 seats to spare. Even collectively, the EU has been content to largely offload its strategic responsibilities to the US.

For its part, the US is still fighting the longest and most expensive wars in its history in Iraq and Afghanistan. The Trump administration may well escalate US military operations in Iraq, Yemen, and Syria, but special operations and even missile strikes can only achieve so much. The American public has little appetite for any new commitment of ground troops, especially in the Middle East. Taken together, these trends do create an unsettling new environment in which the Western powers are less in charge. But this does not translate into a greater influence for Asian nations.

More telling, though, is that throughout history, the dominance of the West has been driven as much by values, ideas, and political attraction as by economic and military power. The West has stood for open, usually democratic and secular polities and a shared culture that places a high value on individual freedoms. Western nations have preferred open trade to mercantilism. They have evolved a uniquely successful capitalist economic system and been devoted to the rule of law. They have prioritized education and technological innovation. And in the decades since World War II, Western nations have invested enormous effort and money into building a liberal, rules-based world order and a panoply of international institutions whose work benefits all countries. In short, Westernization has spread as much through the positive attraction of its model as through overt or implicit coercion.

What does Asia-based Easternization look like in this light? The first thing to be said is that Asia is not remotely cohesive. There is no “East” comparable to “the West.” Though the region is integrating economically, it is riven by active conflicts, bitter historical memories, and deep cultural divisions. Economic and political systems vary widely. Adherence to the rule of law is extremely uneven. One result is the rampant flight of capital—to the West. Wealthy Russians and Chinese flock to put their money in US securities or real estate in London or Miami. Education lags behind the West. Not a single Asian university ranks in the globe’s top tier.

China is becoming much more active in international governance and many Asian  countries have staffed United Nations peacekeeping missions.   But by and large Asians have been the beneficiaries rather than the creators of the regimes, agreements, and institutions conceived and built by the West, whether to manage global finance, underwrite economic development, control nuclear proliferation, govern the Internet, slow climate change, detect epidemics, preserve shared natural resources, manage air travel, and so on. And except for the city-states of Singapore and Hong Kong, there is no Asian nation whose governance stands as a model others seek to emulate.

Rachman sees Asian countries choosing to “reassert their own histories and heritages, and scrape away some of the accumulations of Westernization.” Others see the opposite. Kishore Mahbubani, an influential former Singaporean diplomat, has been writing about the dawn of Asia and the “sunset” of the West for two decades, urging the West to learn to share power gracefully. In his book The New Asian Hemisphere: The Irresistible Shift of Global Power to the East (2008), he argues that the fast-growing Asian economies owe their success to having finally adopted the “pillars of Western wisdom,” namely open polities, free markets, and the rule of law. (This was easier to say about China nine years ago than it would be today.)

Image result for kishore mahbubani quotes

Powered, above all, by China’s economic dynamism, Asia is stronger than it has ever been. At the same time, the United States and much of Europe are struggling with deep challenges to their democracies. The EU faces what may be existential threats from Brexit, from populist, right-wing parties, and from member states in Eastern Europe that have turned away from democracy. NATO is in disrepair. The US is more divided now than it has been at any point in the past century, with no discernible path out of what appears to be a political dead end. Yet the West still provides the robust institutional infrastructure that undergirds the global economy. And as it has for decades, the United States still provides global leadership and the security that has enabled Asia to achieve its tremendous growth.

Rachman writes that China’s long-term goal is “overturning America’s global role.” If he means that Beijing sees itself as a strategic competitor and wants to replace the US as world leader, he has gone too far. China would like to see a weaker US where US policies threaten its interests, especially in its neighborhood, but it has shown no desire to possess America’s global preeminence. China is a challenge to the United States on several fronts; not an enemy. However, the relationship is riven with tensions that could escalate into open conflict. Neither side understands or trusts the other. Avoiding these thorns will depend on steady leaders and skilled diplomacy in reading each other’s behavior. Improvisation or short-sighted deals made for a domestic audience are likely to end badly. History also warns that success will not be easy. Most often, in the past, rising new powers have clashed with reigning ones. The US–China relationship will remain the most consequential in the world for decades to come.

So far President Trump has sent decidedly mixed signals about how he intends to deal with China. He attacked China throughout the presidential campaign, promising to designate it as a currency manipulator on his first day in office and to slap on punishing tariffs—a step that would have ignited a trade war. He stumbled into a needless hole by suggesting a US reversal on the status of Taiwan. He appointed several top officials known for their fierce anti-China views, but also a treasury secretary, Steven Mnuchin, with different ideas. While Trump had called the Chinese “grand champions” of currency manipulation, Mnuchin promised a review based on established criteria that will show that China has not, in recent years, been devaluing its currency. Notwithstanding an early summit with Japan’s prime minister, the president’s frequent derogatory remarks about allies and alliances left Asians fearful and guessing about American intentions.

And then, at his summit with President Xi in early April, Trump reversed himself in tone and substance from all he had said before. There was no mention of unfair trade, of China “raping” the US economy or failing to do enough about North Korea. The two presidents stressed their personal relationship and the basis they had laid for future progress in resolving issues between the two countries. It could not have been a more conventional preliminary meeting, or more distant from what candidate and even President Trump had earlier promised. While presumably relieved by this, Xi surely did not appreciate being taken by surprise and completely overshadowed by a US missile strike on Syria in the middle of the meeting. And who can know whether this welcome traditional approach—new to this administration—will last when the governments actually tackle the differences between them?

Several of the administration’s actions, however, have been unequivocal and unequivocally harmful. The president followed through on his campaign promise to take the United States out of the Trans-Pacific Partnership. The TPP would have made a relatively small economic difference—most of its members already have low trade barriers—but it was geopolitically important. The partnership, which did not include China, was a means of drawing America’s Asian allies closer together and of signaling US resolve and permanent engagement in Asia. China wasted no time in taking advantage of the diplomatic gift it was handed with the TPP’s demise. At January’s global forum in Davos, President Xi appeared as the spokesman for globalization and open trade. A few weeks later, China sent high-level officials to a meeting of the eleven remaining TPP members to discuss forming a new regional trade regime in which it, and not the US, would be a member.

The administration’s reversal of measures to reduce greenhouse gas emissions created a similar opportunity for China. Whether or not the President decides to formally renounce the Paris climate accord, these steps will make it unlikely that the US will be able to meet its commitments under the agreement, moving the US from leader to outlier. Here, too, China immediately acted to reassert its own commitments and, by default, international leadership.

The President’s policy choices, as revealed in the budget he submitted to Congress in mid-March, promise more of the same. Draconian cuts to the State Department, to foreign aid, to most international institutions, and to the international programs of most domestic agencies suggest that Trump holds a dangerously one-dimensional view of what constitutes US security.

Both Democrats and Republicans have underinvested in diplomacy relative to the military for decades, but both have generally recognized the immense value of the nation’s nonmilitary assets to securing the whole gamut of its interests. As General James Mattis, then the head of the US Central Command and now Trump’s defense secretary, famously put it in shorthand to a congressional panel in 2013, “If you don’t fund the State Department fully, then I need to buy more ammunition ultimately.”

Never before has a President suggested handing over most of the currency of US global leadership to others, free of charge. China will not hesitate to seize every opportunity offered. A much diminished and less influential America, and consequently a much less secure Asia, would be the result.

—April 11, 2017

7 thoughts on “Asia’s Rise and America’s Decline

  1. America’s decline and Asia’s rise is real. This has led many analysts to argue that the United States must either yield primacy to China or fight a war that at most could delay the shift but not reverse it. For the power shift is the culmination of a long historical process that will not be derailed even if China suffers a temporary economic or political setback. But I believe the United States need not yield primacy to China nor fight a war to delay the power shift. All it needs to do is to share power with China in Asia.

    China’s benefited greatly from the world order set by the West, and it’s no desire nor the capability to replace America as global leader. Moreover, Asia may be rising but it is culturally fractured and rife with strategic mistrust, and its financial systems and other features of the international order will remain “wired” through the West. If Washington can skillfully manage its relations with China, it will not have to match China’s GDP or fleet size to maintain a strong position in Asia. The two Asian countries that really hope America will continue taking the confrontational approach with China are Japan and India. These two countries are colluding to sabotage the Chinese One Belt One Road initiative.

  2. Nothing surprising as change is common and has been ongoing since time immemorial. Only the greedy for power think that they are immortal and the world cannot function without them. The most recent examples are the colonial powers who are now themselves fighting for survival while Russia-China-India are on the way up while USA is on its way out due its arrogance of military power.
    Every generation will learn to adjust and live with the changed environment.

  3. A mature leader gives those he or she leads a blanket of secured peace. Trump’s insecurity illustrates a weaker America caused by decades of arrogant pushiness. The same applies to a China that has to deal with the angst of billions living under Xi-core with senseless propaganda and threats. SCS, Japan illustrates the deep yearning of billions demanding respect. Yet, we Chinese forgot that respect from others comes naturally when we respect the weakest of us all.
    When we Chinese forgive others of their past sins, we gave them a chance to forgive themselves. For the very least, we get to live one day happier. When the billions of us are happy and secured, the rest would experience security.

    I am ashamed of a Xi-core that bailed out an undeserving 1MDB to curry favor a SCS simply because a Xi-core does not know how to deal with angst of a billion. I am ashamed of a President Trump who will likely to forgive 1MO1 just to irk Xi-core. Most of all, 1PM.. I am just.. Welayu.

    Today’s China is not accustomed to a strong China. Today’s America is living well with our weaker presence. That is why we all feel so jittery. I am just glad that there is a New Day New Earth in my worldview. Glory be to Him.

  4. Leave China alone for the good of all. Like all superpower, she needs space to determine her rightful place in the world.

    For her capacity, she is very modest in her demand at this stage.

  5. My take is that the US has another century of dominance before it goes kaput.

    Therefore i would label this as the Pacific Century and not an Asian century – only if Drumpf, Putin and Xi (and their successors) can keep their hands inside their pockets, while coddling each others cojones.

    The Atlantic century have gone into senescence.

    America remains the largest grain and food producer, innovation incubator and for advanced manufacturing. Smaller countries along the rim like Canada, Mexico, Oz, Indonesia, Peru, Chile and heck, even Malusia have abundant raw resources. S. Korea, Japan, Vietnam, Thailand, ROC and PRC will remain the unstoppable industrial machine that drives the world. Russia is like a hibernating bear.

    The financial centers will remain in Singapore, H.K, Shanghai, Tokyo, Vancouver L.A and Seattle. Perhaps Santiago, Mexico City or Panama can snuggle in too.

    While the main existential threat in the Rim remains desperado DPRK, i think it is too brittle politically and economically to last another decade without some sort of implosion. 3 generation curse and all that. Besides there will be Taiwan’s inelegant consummation dance with PRC and the dispute in the East China Sea and SCS.

    Duterte’s Phillipines? The Roman Catholic Church will excommunicate him and send him to Purgatory for an aeon. Mt. Mayon might even blow up.

    India and the the ‘tan central Asian countries will remain messy and conflicted. They have the largest disparity of wealth and will be hard pressed to clean the cow-dung off their shoes, if they have any. MENA? What a mess!

    Btw, all of us will either be underground or our ashes will be scattered or else buried under a tree (as my kids have been advised to do), before this happens.

  6. Quote:- “His momentous answer is that “the West’s centuries-long domination of world affairs,” stretching back to 1500, “is now coming to a close.”

    Yes, that may seem so.

    But we must not forget that “the West’s centuries-long domination” was not just “domination”, but colonization, a very different creature altogether.

    So would “Asian” countries, led by China, translate domination into colonization?

    Hardly likely.

    But will the “West” give up without a fight, (even if there is no colonization following on from economic domination), I mean a real winner takes all fight to re-orientate the global human family to the West’s advantage, again?

  7. Mr. Gideon Rachman and book reviewer Jessica T. Mathews are very interested in who are bigger. What are the underlying motivations for people to be interested in nations’ powers in the international stage?

    There could be many motivations by the author, but none of those motivation is about what matter to core American value called individual liberty. From the Declaration of Independence, to US Constitution, to Lincoln’s Gettysburg Address, all traditional Americans understand the nation is created for preserving the individual liberty. In Gettysburg Address, Lincoln mentioned about a nation conceived in liberty for the first time in human history. In US Constitution, Americans are told to have the right to destroy its own nation if the nation is not serving to protect individual liberty.

    From a conservative traditional American perspective, the United States being the first, or second, or 100th of the world in terms of power is immaterial as long as it has enough power to preserve individual liberty against foreign or domestic enemy to its Constitution.

    Mr. Gideon Rachman is just one of those intellectuals in the Old World, of which individual liberty rings as hollow as those who claim freedom is to do whatever ones feel they want to.

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