“Germany now has a bright foot in the door”, or, U-boats of the Indo-Pacific

So writes Felix Seidler – somewhat gleefully, as he explains the benefit of Singapore’s purchase of two Type 218SG U-boats.

In addition to the potential for these lucrative arcontracts, Germany has an interest in a stable, peaceful maritime arc running from Singapore and Vladivostok. China’s re-armament, coupled with a more assertive military doctrine, and its aggressive enforcement ensures the opposite.

Seidler flags growing doubt about the US pivot in the region, and says “the countries of the region must be able to balance China’s rise, at least partially, by themselves. Therefore, German-built subs can surely do their share.”

As the post-WWII order erodes, you can’t help but wonder where it will leave Germany. Just weeks ago, erstwhile German foreign minister Guido Westerwelle was on the streets of Kiev, stirring things up with the Kremlin. If geography is destiny, a Germany unchained from that post-WWII feeling, will resume its role in international affairs. I can’t help but think that’s also part of the subtext of all the Stasi-talk regarding the Snowden allegations.

And so, here come the U-Boats of the Indo-Pacific, courtesy of Singapore.

Quick list: Russia down, China up for now, US tracking sideways – What we know so far

chiaruss

Russia

Russia’s options are narrowing. Putin is not stupid but the strong-man tactics will only gain the country so much leverage with his neighbors such as Ukraine. The economy of Russia is smaller than Britain’s, and the basis of Russia’s economic power is weakening.

Even diplomatically, a series of hardline actions towards protesters (Greenpeace, Pussy Riot) have paradoxically hurt Russia by making it look unduly repressive and authoritarian. It’s a shame. The losses suffered by Russia during WWII make it difficult for the outside world to understand the motivations of the country. It’s as if Russia tends to read too many events as threats (gay rights, a desire for reform in Ukraine). Nonetheless, in recent years, this trend of seeing the world through a prism of coercion has led Putin to being unnecessary coercive.

China

No one disputes that China is in a stronger position than Russia. Even if the economy is wildly unbalanced, the rapidly development of its economy, and the expansion of its trade ties outpaces anything Russia can achieve. But it’s not certain China will achieve actual superpower status, given the amount of disorder and factionalism masked by its system. Outsiders ascribe grand strategies to China’s actions in geopolitics (East China Sea) for example, but it’s possible its military hardened its stance toward the US and Japan precisely because of internal pressures. Likewise, a modern country wouldn’t want to suppress foreign media – and yet again internal sensitivities that go straight to the legitimacy of the ruling elite, are likely behind the crackdown on foreign media. This trend is more in line with a large developing country, rather than an emerging superpower. In a model where the Communist Party stays in power and tries to enforce its rule on a more modern and restive population, China could emerge as a super-economy, rather than super-power. Besides, capable countries don’t link genetic code theft from the US to state visits by their leaders.

United States

It’s been a chaotic decade for the US. After the post-9/11 hysteria helped usher in the War on Iraq, the brains behind the war for Middle East oil conquest must be asking themselves if was worth it, given the impact of the fracking revolution today. For many years the US will be coping with the bad PR generated by that War of Adventure. It was the clearest sign of a superpower out of control.  The diplomatic effect of the Snowden disclosures should help to further isolate the country, giving all allies reason to question the pros and cons of the American-way and American-leadership. Finally, the ideological battles and gridlock between the parties have hurt the country in the global public’s eyes, generating appetite for a counterbalance like China.

If the US succeeds in emerging from the domestic chaos that arguably began with the Monica Lewinsky scandal – or better yet, the result of the 2000 election (both of which undermined its credibility) the US will have an altered role in world politics. Soon it may no longer be the biggest economy. But the sense of a political realignment within the US may mimic a geopolitical realignment. There may once again be space for the US near the center, as a counterbalance to China and Russia, among other things. But it depends if the US can successfully make the transition.

One last thing

…And recall, China’s ascent has occurred during a period of US decline. Should the US reverse that, China may find a much different trade and diplomatic party to contend with. Russia, for now, will be man in the middle.

The Trans-Pacific Partnership looks increasingly doomed – and possibly with good reason

Not only is US congress reasserting its right to oversee an agreement whose details have been kept secret from it but the period of trade deal mania may be passing. That’s because the period of globalization may be drawing to an end. Sure, global trade continues. But there is a Balkanization going on. Russia and China are drifting further from Western trade institutions. The China-Japan tensions are likely to have a lasting effect on East Asian trade. As Russia’s economy falters its reliance on coercion grows. At the same time, the US is looking decidedly inward, after the post-9/11 age. In this climate, the value of trade deals remains dubious. And as US trade expert/globalization-scoffer Clyde Prestowitz elucidates on the TPP: 

“Congress is saying that free trade deals now truly have to be about trade and not about reassuring allies of U.S. commitment to them. No longer will Congress agree to buy allies with distorted and lopsided trade deals. The end of American hegemony will be mourned by many around the world and in America, but it is likely to be a very good thing for U.S. workers and the American middle class.”

Further, the WikiLeaks TPP leak shows how US corporates are fashioning a sweetheart deal for themselves in the area of IP trade negotiations. This group is already on the bad side of US citizens after decades of gaming the economy against them. Now companies want to have their legal wishlist enshrined in a pan-Pacific trade deal.

“The extent of this unbalanced influence and how it works can be seen in the contents of the leaks. The deal being proposed apparently includes measures like those contained in the Stop OnLine Piracy Act (SOPA) and the Protect Intellectual Property Act that have already failed once to achieve passage in Congress… Clearly what is afoot is that the non-transparent TPP talks are being used to make an end run around the Congress and the parliaments and publics of many countries to achieve far reaching special rights in the guise of free trade.”

It also raises an intriguing question: should the US look to trade as the best way to reassure allies in the region? Compare the trends emerging in the past three decades in the US and hold them up against what’s happening with China. In the US business has assumed a prime place in society since the time of Reagan. Even the Supreme Court has upheld corporations’ “right” to free speech. (Is this really what the American Revolution was about?) But now incomes in the US are dangerously unequal, thanks in large part to a system in which capitalism has effectively eroded democracy. China meanwhile is aggressively growing its economy and trying to find a balance between state control and some form of citizen’s right. Its economy is dangerously unequal, as well.

More crucially, China’s government relies on secrecy as a strategy. The more powerful it grows, the more uncertainty and ambiguity it can foist onto global affairs (We want peace with our neighbors/we want revenge on Japan-duality, etc). What the US can offer as a strategic counterbalance is transparency. The world craves it. But engaging in secret trade negotiations over the TPP runs counter to a long-term US strategy.

Even though business has essentially driven politics in recent years in the US, it’s likely that will the difficulties faced in the US economy, politics will move business. Obamacare is the biggest example of that. History runs in cycles and in the US, just as deregulation hastened the decline of the middle class, re-regulation in key areas may assist its restoration. This represents a switch from the concept of people as citizens, rather than people as consumers. In China, too, there is a tentative effort to embrace a kind of civil society (while cracking down on journalists- there is that duality, again).

In this period of reform on both sides of the Pacific, if the US wants to send a signal to non-China Asia, maybe the US should consider an agreement less about trade and more about codes of conduct in diplomacy and security with a measure of transparency. The last thing the US would want is to shackle citizens of Pacific countries with the kind of onerous trade laws that undermine their own rights. If the outlook for the TPP is uncertain, it could be because the agreement is founded on an already-dated understanding of how to achieve international influence.

Further, if war is possible, then US business is wrong to think it can piggy-back its needs onto the needs of the US as it contends with the turbulent region. How thoroughly 1995.

The problem with the “power-sharing” expectation in China-US relations

The respected Australian security studies analyst Hugh White has argued for some time that the US should “accommodate” a rising China in a power-sharing agreement in the Western Pacific. The view is broadly shared by former prime ministers Paul Keating and Kevin Rudd.

White argues that China and the US are strategic rivals and while China is plainly rising, it should not be denied its zone of influence in Asian security affairs. The US should instead acknowledge the inevitable rise of China will cede responsibility and power to it to ensure security in the region. The US should not try to hold on to its grip of security in the region which has been in place since the end of WWII.

White’s view sounds good on paper. But the reality is not nearly so clear-cut. His view seems to assume some kind of civilized handover of power between the US and a China that mirrors the sort of diplomatic protocol common in the US, Australia and other Western nations. One only has to look to China’s strategy of raising the pressure on neighbors in the East China Sea to understand that White’s view represents a kind of well-meaning fantasy.

But it’s one of many fantasies that have underpinned China’s rise. The Western fantasy always was that China would open to Western companies, to Western ideas, to Western-designed international bodies of governance, and finally, to Western influence as it marched toward modernism.

No doubt China is modernising. But often its strides come at the expense of Western countries as well as the notion of fair play. And what’s becoming of that rules-based order that has dominated world affairs since the end of WWII? Well, it’s eroding. As Google CEO Eric Schmidt and Google Ideas chief Jared Cohen writes, China is a signatory to international agreements on copyright laws.

At the Asia-Pacific Economic Cooperation CEO Summit in 2011, then Chinese president Hu Jintao privately told a small group of business leaders that China would ‘fully implement all of the intellectual property laws as required by the WTO and modern Western practices.’ We attended this meeting, and as we filed out of the room after President Hu’s comments, the American business contingent clearly expressed scepticism toward his claim….

The treaties of which China is a signatory are either unenforced or ignored by China. Increasingly, China and Western businesses make a cynical trade-off. Basically, companies can hand over their technology for access to China’s markets. The Germans do it. The US does. All modern economies hand over technology in exchange for access to China. It’s all done in the hope that the value of access to China will lead to justifiable profits from China. Basically, a blue skies projection.

But the reality is a lot less beneficial to Western business, economies and standards of living.

Likewise, in the realm of security, Hugh White and others believe that China can be “accommodated” and it will prevent an inevitable clash. But that belief assumes that inside China there is a rational decision-making apparatus that wants to avoid risk. The reality on the ground is that it’s never clear who is making decisions in China, and obviously, avoiding risk is pretty low on their priority.

Basically, it reminds me of a phrase I have heard from a US policymaker, which is that the US must deal with the China that is, not the one it hopes for. Security analysts may be well-served to do the same.