What happens when China eclipses the US in Asia

This article first appeared in The Edge Financial Daily, on February 5, 2018.
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CONTRARY to what you might read or hear, President Donald Trump alone has not surrendered US strategic leadership in Asia to China. What he has done is accelerate long-term trends that have severely diminished America’s position in the Western Pacific.

That era of primacy is close to an end. In fact, the US strategic position is eroding so quickly that even sharing the region with China is not really a valid option any longer, argues Hugh White, a professor at the Australian National University in Canberra.

White put these thoughts to paper and pixel with a much-debated essay in the Australian publication Quarterly Essay. “Without America” envisions a situation room scene where a fictitious US president decides that, even with America’s superior conventional military, the risk of a confrontation with China just is not worth it. 

For context, White is no raging left-wing academic. He has worked for Bob Hawke, a former Australian prime minister, and Kim Beazley, Hawke’s defence minister. Both politicians were among the most pro-American figures in the Australian Labor Party. 

We spent a few days recently interviewing him over email. Here is a lightly edited transcript:

Daniel Moss (DM): Given China’s huge stake in the world economy and the combined role that China and the US play, why would either side get themselves into a situation where there becomes a face-off where one must blink?

Hugh White (HW): Clearly China and America face an economic equivalent of mutually assured destruction. For each side the economic consequences of a rupture are so immense as to be almost unthinkable. Beijing believes that America will blink first to avert a crisis because its interest in Asia is, in the long run, less important than China’s. And I think they are probably right. 

Tobin Harshaw (TH): In a Bloomberg op-ed last month, Hal Brands of the Center for Strategic and International Studies warned that your outlook on US abdication in the Pacific was over-dire and dangerous in that it could become a self-fulfilling prophecy. What is your response? 

HW: I can understand his concern, but I think it is misplaced. The suggestion that the arguments I have presented may hasten America’s withdrawal from Asia overlooks the massive tectonic forces that are driving this process. As China’s power grows, the costs to America of resisting China’s ambitions for regional leadership grow too. But America’s reasons to remain the primary power in Asia have not become more compelling. The trend therefore is clear: We will reach the point at which the costs of resisting China’s ambitions outweigh the benefits. The failure of Obama’s “Pivot to Asia”, and the instincts of the current administration, suggest that point is very close, if not already upon us. 

DM: A year on from Xi Jinping’s 2017 Davos speech, how much has China seized the moral and intellectual high ground in the world’s political economy?

HW: I am not sure that China has really won any of the moral and intellectual high ground, because its claims to it are so transparently self-serving. But clearly, under Trump, America has lost that high ground. The damage Trump has done to America’s leadership credibility certainly accelerates the process. Who can take the US seriously as the guarantor of regional or global order under his leadership? And who can be sure that whoever takes his place will be much better?

DM: China is Asia’s largest economy, but global supply chains of US-headquartered multinationals crisscross the region. Will this not underpin at least some leadership role for America?

HW: Of course America will remain a major economic player globally, and in Asia, for as far ahead as we can see. But its position will be like that of the Europeans, who trade and invest massively in Asia without any real strategic presence there.
That will mean that America will have to engage economically within the terms set by a regional strategic order led by others — presumably by China. 

TH: Former Australian Prime Minister Paul Keating, who hails from the Labor Party you served, said that Australia’s long-time alliance with the US has taken on a “reverential, sacramental quality.” What do you think he meant by that, and do you agree?

HW: Australia’s alliance with America dates back to 1951 or before, and for most of that time there have been hot debates about whether, or how far, Australia can or should depend on America for its security. But since the mid-1990s, that debate has largely disappeared among major political parties, public officials and policy analysts. It has become unquestioned, and unquestionable, across the political spectrum that the alliance can and will remain the foundation of Australia’s foreign and defence policies indefinitely.

TH: If we feel that the US has thrown in the towel in the Pacific, what does that mean for Australia in security terms? Does it do more to solidify itself militarily with greater anti-access/area denial capabilities, or should it look to cut security deals with China and other Pacific nations?

HW: Australia has never had to make its way in Asia without the support of a global preponderant ally — first Britain, then America. So we do not really know what to do as US power and leadership in Asia fades, and no new global power steps forth to take its place. Certainly we will have to build a whole new set of relations in Asia — both with the great powers of China, India and Japan, and with our fellow middle powers like Indonesia and Vietnam. 
But we will also, I think, have to build our independent military capacity in a way we have never done before. 

TH: Going one step further, it has been suggested that Australia look into becoming a military nuclear power, either by developing its own weapons, by teaming up with the UK on submarines, or asking the US to deploy weapons on its soil. Do any of these ideas make sense?

HW: It is a big question. Personally, I am appalled by the thought of Australia deciding to acquire nuclear weapons. But if, as seems likely, America ceases to play a major strategic role in Asia over the next few decades, then we can no longer rely on America’s extended nuclear deterrence to shield us from the nuclear weapons of others. So we may well face a choice between living under the shadow of China’s and India’s nuclear forces — and perhaps those of others in Asia as well — and creating a minimum deterrent force of our own, perhaps in partnership with Britain. 

DM: Does “Indo-Pacific” — a phrase now favoured by Trump and others — have an economic underpinning the way “Asia-Pacific” does, which is partly what makes the latter such an attractive term?

HW: I do not think the “Indo-Pacific” has much substance either economically or strategically. Despite its immense potential, India is still far behind China, both in the size of its economy and in its global and regional interconnectedness. Likewise, strategically, the Indo-Pacific concept presupposes that India’s power can play a real role in limiting China’s influence in East Asia. So far, that seems to be just wishful thinking. — Bloomberg