Ideology and Eckert’s Offspring of Empire

Pohang is where POSCO, one of the world’s largest steel producers, was founded in 1968 with the help of the Japanese government.  I toured around the steel plant itself and took a self-guided tour at the POSCO museum located next the steel plant.  While walking through the museum and reading the abridged history of POSCO written on the murals, podiums and displays throughout the museum one thing stood out:  the concept of “steel patriotism” (제철 보국).  It reminded me of the concept of “Kokutai no hongi,” the Japanese idea of putting public interests over private and a key tenet of a view of capitalism from the standpoint of “national economy.”  In other words, capitalism ought to be used as a means to advance state ends — an explicit form of economic nationalism.  I came across this term while reading Eckert’s Offspring of Empire.  I’ll quote part of the passage quoted in Eckert:

Our national economy is a great enterprise based on His Majesty’s great august Will to have the Empire go on developing for ever and ever, and is a thing on which the subjects’ felicity depends; so that it is not a disconnected series of activities aimed at fulfilling the material desires of individual persons, a doctrine expounded by Western economists.  It is a thing in which the entire nation joins the Way of musubi, each person fulfilling his duties according to the part he has been assigned to play… The attitude of mind which is based on the spirit of musubi and puts public interest before private ones, paying full attention to one’s allotted duties and to being in harmony with others, has been an attitude toward industrial enterprises in our nation; and it is a basic reason for the rise of a strong impetus in the world of industry, for encouraging initiative, stimulating cooperation, greatly heightening industrial efficiency, bringing about the prosperity of all industries, and for contributing toward the increase of national wealth.

Although I haven’t made any in-depth inquiry into the similarities, from my tour of the POSCO museum and what I already know about the political economy of Korean economic development, there is a link between the Japanese concept of Kokutai no hongi and “steel patriotism.”  Consider this quote from a Chung-a Ilbo  article (중아 일보) about industrial management ideology following the death of POSCO founder and industrial giant Pak Tae-joon (박대준):

On June 9, 1973 at 7:30 a.m., workers cheered after molten metal poured out of a furnace at Korea’s first steel mill POSCO. When a yellow flash coming out of an iron notch rose higher than a human`s height, POSCO founder Park Tae-joon clenched his fists. This was the moment Korea’s first blast furnace produced molten metal, called the “rice of industry.” Korean-made steel boasting high quality and affordability laid the foundation for Korea to be a leading player in shipbuilding and manufacturing of cars and electronics.

When Park began construction of the still mill in 1970, he advocated the “spirit of facing right,” saying, “If we fail to build a steel mill, all of us shall jump to our deaths into Yeongil Bay on the right side.” He built a 200-square meter, two-story wooden building on the coast of Yeongil Bay for use as a control center for the construction. At night, workers slept in the building and called it “Rommel House” since it looked like a field army command post operated by Nazi field marshal Erwin Rommel in World War II.

Park, who built the world`s fourth-largest steelmaker in operating capacity on a sandy plain, passed away Tuesday at the age of 84. He was the symbol of Korea’s rapid economic growth and the epitome of the indomitable entrepreneurial spirit. Korea was a poor agricultural country whose per-capita income was 254 dollars in 1970. For the country to be transformed into an advanced industrial nation, steel production was a must. Equipped with patriotism and a military spirit, Park fulfilled his task of building a comprehensive steel mill assigned by then President Park Chung-hee.

From a political economy, and modern Korean history point-of-view, the similarities between Japanese and Korean development ideology, which, according to Eckert’s historical analysis, is a result of colonial economic development in Korea between the years 1910-1945.  The two quotes are slightly different, one being more philosophical, the other editorial.  However, I think the similarities can be seen:  development for the sake of the state at the sacrifice and hard work of the people.  The notion that economic development is not done in order to make individual profit but to make the state prosperous and wealthy is a rather general, unspecific tenet of Korea as a “late industrializing” state, but still an important one to note.  The militaristic theme is also found throughout both Japan (pre-War) and Korea (one can read about the “blitzkrieg war” that Pak Tae-joon decarled in order to complete phase one of POSCO construction; also, to my knowledge, compared to Japan, the pervasiveness of military culture pervades Korean society to this day).  The German theme at POSCO (the Rommel House, “Blitzkrieg” construction) strikes me as very strange; I have not explanation for it at the moment.

Eckert’s book also does well to show the opportunistic behavior of the Korean bourgeoisie (land owners and early industrialists) during the colonial period and their preference for profit over cultural and political identity.  I don’t know how, exactly, this book was received by Korean scholars (I’ll find out this semester), but I think I can safely assume that the conservatives (at least) didn’t find Eckert’s research and conclusions regarding the origins of capitalism in Korea and early industrialization to be in line with their own.  I’ll quote a few passages to show what I mean:

Without condoning Japanese imperialism, one may say that the forty years of Japanese occupation left both halves of postwar Korea with a substantial material base for subsequent industrial development….

[C]olonialism was the setting in which Korean capitalism experienced its first real surge of growth.  Although this was certainly unfortunate, and is perhaps embarrassing or distasteful for many Koreans to admit, it is nevertheless a fact…. Korean capitalism had been spawned within the matrix of Japanese colonialism.

Engaging North Korea

I recently had a in-depth discussion with professor Park Young-chun (박영준), a professor at Korean National Defense University.  His recent editorial in the Chungahn Ilbo (Korean) talks about various ways in which to engage Kim Chong-un and the DPRK leadership in order to mitigate the “provocative tendency of North Korea.”  He suggests that South Korea enlist the help of Russia and China for diplomatic assistance, since China and Russia are the two major power allies of the DPRK (China an official guarantor of the DPRK; Russia a de facto ally).  He thinks the US’s role, regarding ROK-DPRK relations is strictly military in nature (deterrence).

I’ll have more substantial analysis of our discussion in the next day or so.

Zakaria – Japan and (American) Industrial Policy

Fareed Zakaria analyzes the recent reports indicating that Japan has registered its first annual deficit since 1980.  His analysis is very different from that of Eamon Fingleton’s.  Fingleton disagrees with analysts who focus on only the visible trade balance.  Part of his critique:

The proper way to measure a nation’s performance is not by the visible trade balance alone but by the current account, which is the widest and most meaningful measure of a nation’s trade. The current account includes financial flows such as interest payments,  dividends, insurance premiums, and patent royalties. The balance in such items has been positive for Japan since the 1960s and the net invisible surplus has grown astoundingly in the last two decades. This reflects not only the fact that the underlying economic performance in true invisibles has been strong but because of so-called transfer pricing, which is now rampant in Japanese industry and results in massive understatement of exports.  (In a typical maneuver, goods might be shipped to China via Hong Kong. The goods are exported from Japan at heavily discounted prices and a Hong Kong subsidiary takes a huge profit in selling to China. Such profits constitute hidden export revenues that are not caught in the visible trade numbers. The maneuver makes sense because Japan’s corporate tax rate is one of the world’s highest.)

Zakaria also chimes in on the (emerging?) debate surrounding this age-old question:  does America needs an industrial policy?  A summary of his answer:  it may be “inefficient” and contrary to conventional economic wisdom (whatever that is), but it seems to work.  So, it appears he answers in the affirmative.

The Unipolar Era

I’m finally getting on board with the “Unipolar Era” debate (following links in Walt’s article; also see here and here — yes, it is Walt-heavy in analysis; I’ll diversify later). I got around to reading Michael Beckley’s article (chapter from his dissertation) “The Unipolar Era:  Why American Power Persists and China’s Rise Is Limited” this morning.  Definitely engaging and worthy of a read and several critiques.  Perhaps I’ll have more on this later; for now, these passages from to beginning of his article stand out to me:

[Globalization works in favor of American industry because] globally networked production — in which goods are produced in multiple stages in a number of locations.  This system helps American firms preserve their competitive advantages by specializing in high-value activities, exploiting innovations created abroad, and attracting high-quality human capital.

The dollar’s global role … forces the U.S. to run persistent balance-of-payments deficits to supply the world with liquidity, a policy which diminishes the competitiveness of U.S. exports as well as the confidence of markets and central banks in the dollar.

The U.S. … manipulates international trade and investment flows to benefit itself and its allies while excluding potential adversaries.

Beckley paints a relatively brighter future for America, compared to the “declinists” he critiques throughout his article.  Most important for IR theory and foreign policy is the notion that the unipolar world order the world has come to know since the end of World War-II isn’t going anywhere.  If Beckley’s analysis of the future America’s military prowess is anywhere near accurate, neither is America’s defense-biased outlook on world affairs (for better or worse).

To Hell With the Establishment

James Fallows’ follow-up piece to Robert Kaplan’s “sympathetic Atlantic profile of John Mearsheimer” (to quote Jeffery Goldberg) shows establishment scholars (e.g. Mearsheimer, Waltz and Kaplan — but definitely people like Walt, too, and probably Beckley in due time) at their worst.  Fallows states:

(Kaplan)  also explains why Mearsheimer believes a strategic/military confrontation between the US and China truly is inevitable — and why he, Kaplan, mainly shares this view. I mainly disagree with both of them, and the basis of our disagreement touches on another important theme of the article.

In an article of my own in next month’s issue, and in my forthcoming book, I argue that China has too many things going on, and going wrong, within its own borders to have the time, energy, skill, or ambition for much of an “expansionist” world effort. From the outside, it looks like an unstoppable juggernaut. From inside, especially from the perspective of those trying to run it, it looks like a rambling wreck that narrowly avoids one disaster after another. The thrust of Mearsheimer’s argument is that such internal complications simply don’t matter: the sheer increase in China’s power will bring disruption with it. I am saying: if you knew more about China, you would be less worried, especially about military confrontations. He is saying: “knowing” about China is a distraction. What matters are the implacable forces.

Why really “know” about the other culture?  To quote Beckley, who is summarizing Waltz:  Because of anarchy, uncertainty and all that jazz, “states become ‘like-units,’ taking on similar characteristics as they compete for superiority across a full spectrum of capabilities.  Waltz calls this dynamic the ‘sameness effect.’”

Yes, I know I am oversimplifying Waltz, Measheimer and others.  But, it also occurred to me living as an ex-pat in Asia, studying about Asia that, despite the wonderfully systematic theories and air-tight logic of the big-shot establishment scholars, Asia is different — very different at times.  To understand this requires one to know about the other culture, its institutions, language, history (especially modern history) and so on.  Mearsheimer, Waltz, et al. sometimes come across as polite ivory tower know-it-alls with little practical knowledge about what’s really going on in these monoliths (aka: nation-state) they talk so much about.

Cumings and the Military-Industrial Complex

- I recently finished reading Bruce Cumings latest book Dominion from Sea to Sea.  I’ve got it slated for review sometime in the next month.  One of the major themes put forward throughout Cumings’ book (there are many, perhaps too many) is the notion that American development (particularly western development) was — and continues to be — built on defense contracts.  American industrial policy (yes, one exists! or at least existed) was underwritten by the needs of the defense department.  Cumings attempts at painting an accurate picture of American history by suggesting the following grand narrative:  America is a nation built on war and expansion lead by a small number of political and industrial elites, especially since 1945 when American enter onto the world.  This view is reflected in Cumings use of C. Wright Mill’s conceptualization of the “power elite” of American society.  Cumings states:

Somewhat like President Eisenhower, C. Wright Mill took a look around in the 1950s and discerned something entirely new in American life:  a military-industrial complex.  More than that, a ‘power elite’ made most of the important decisions: a tripartite group of corporate leaders, executive branch administrators, and military brass had a virtual monopoly on key choices, industrial production, and the use of force.  They talked to each other, exchanged jobs, sat on the same corporate boards, played golf together, and occupied the top portion of a pyramid of power (which suspiciously resembled the Masonic symbol on the back of your dollar bill).  Just beneath the top were ‘the middle levels of power,’ which corresponded to the democratic and pluralist theories about how the country works that people imbibed from first grade through their PhD programs.  Below that was a ‘mass society’ filling two-thirds of the pyramid and containing most Americans, who were mostly clueless about elite practices.

In the aftermath of Wolf War II, American found itself on top.  Elites like George Kennan would provide the theoretical framework from which America would shape her internationalist agenda and interventionist foreign policy and through which the so-called military-industrial complex would flourish.  As it relates to Asia, Cumings looks out towards the peninsula and the “forgotten war:”

The Korean War was the crisis that built the American national security state and pushed through the money to pay for it, and with victory in the war to reestablish the South (containment) and defeat in the war to topple the North (regime change), this war transformed and stabilized Kennan’s doctrine.  It also finally got the Japanese and West German economies growing strongly.

Stated alternatively, the American military-industrial complex drove the world and opposed anything that restricted America’s desire for “maximum, unhindered American freedom in the world.”  This, in short, lead to America’s drive west, across the Pacific and into the Oriental theater.

The implications for policy makers of understanding America’s proclivity to war and the existence of a military industrial complex is touched upon in this Lexington Institute report by Loren B. Thompson entitled:  “Keeping America Competitive: The Military Needs To Limit Its Industrial Roles.”  The gist of the argument is summarized as follows:

During the Cold War, the U.S. military acquired a vast network of public-sector industrial facilities and private-sector suppliers. Over time, a division of labor emerged between the two segments of the defense industrial base: private companies would develop and manufacture combat systems, while public facilities would maintain and repair them. Although this arrangement required the government to fund two parallel industrial systems, it worked reasonably well as long as the U.S. economy generated the wealth necessary to support a vast “military-industrial complex.”

However, in recent years the U.S. economy has begun to falter and the federal government’s debt has risen rapidly. That has led to a widespread belief that the government needs to reassess how its activities impact economic performance. One facet of the debate is the relationship between military spending and the nation’s industrial base. While it is indisputable that Pentagon research has led to important technological breakthroughs such as computers, jet engines, lasers and the Internet, other facets of the military enterprise may be impeding economic competitiveness and progress.

- William Astore, in this recent article at the AsiaTimes Online, is decidely more critical of the military-industrial complex, as is revealed in these passages:

When it comes to weaponry, to paraphrase Seger, we’re still young and proud and makin’ Predators and Reapers (as in unmanned aerial vehicles, or drones) and Eagles and Fighting Falcons (as in F-15 and F-16 combat jets), and outfitting them with the deadliest of weapons. In this market niche, we’re still the envy of the world.

Yes, we’re the world’s foremost “merchants of death”, the title of a best-selling expose of the international arms trade published to acclaim in the US in 1934.

….

As a country, we seem to have a teenager’s fascination with military hardware, an addiction that’s driving us to bust our own national budgetary allowance. At the same time, we sell weapons the way teenage punks sell fireworks to younger kids: for profit and with little regard for how they might be used.

Sixty years ago, it was said that what’s good for General Motors is good for America. In 1955, as Seger sang, we were young and strong and makin’ Thunderbirds. But today we’re playing a new tune with new lyrics: what’s good for Lockheed Martin or Boeing or [insert major-defense-contractor-of-your-choice here] is good for America.

- Arthur Herman’s review of Cumings’ book at the WSJ provides a good summary.  His comments at the end, however, are not so insightful.  I won’t go into here, but think Fareed Zakaria’s book about  illiberal democracy and his section on how referendums contributed no small part to California’s current budget woes.

“Fingleton Dialogue”

- My term to describe the (what seems now stalled or blown-over) debate about the truth behind Japan’s so-called “Lost Decade” (see my post at my homepage for more on the first slavo of articles).

- Eamonn Fingleton’s latest piece criticizes the Wall Street Journal for inaccurately reporting on the state of Japan’s trade — thus adding to perception that Japan is much worse-off economic than she actually is.  I’ll have a summary of the articles (with commentary sometime in the future, along with a reading packet with all the readings synthesized, if I can get Instapaper to do it correctly).

Asia-Pacific/Security Architecture

- Geoff Wade, at the East Asia Forum, discusses the establishment of an “Offshore Asia” security zone to compliment the Northeast Asia security zone.

The Darwin deployment is only one part of a much larger regional strategy, placing US forces far enough from Chinese missiles to be comfortable, but still sufficiently near to maritime Southeast Asian allies to swiftly engage if necessary. The proposed stationing of the US Navy’s newest littoral combat ships in Singapore and the growing American naval and air force cooperation with Indonesia serve a similar function.

This episode is the beginning of a major addition to US-led East Asian security architecture, involving the creation of a Southeast sector to the ‘Offshore Asia’ security zone.

- Wade links to another East Asia Forum article by Donald Emmerson.  In this article, Emmerson indicates something I’ve written on myself:  changes in the geopolitical landscape caused by the emergence of a new China-centered economic architecture in the Asia Pacific.  America has, to according Emmerson, become a half-super power in Asia.  Here’s the reason:

But back in 2003 America took in more than three times the share of ASEAN’s exports absorbed by China — 19 per cent versus 6 per cent. Seen from Southeast Asia, that American advantage over China has since disappeared. From 2003 to 2008, China’s share of all Southeast Asian trade burgeoned at an astonishing average annual pace of 26 per cent.

China’s economic importance to its southern neighbours will only increase as Western economies retrench. Certainly, China will not escape collateral damage if the euro zone implodes and American budget deficits and national debts spiral unchecked. But China could still emerge from such extreme turbulence relatively better off than Europe or America, thus better equipped to cushion the shocks to Southeast Asia.

Southeast Asians are by no means giving up on the American market. But the tendency in Southeast Asia is to think of Beijing and Washington as playing specialised roles: China the economic partner who facilitates prosperity, America the security provider who guards the peace.

Or the provocateur of war.  What if the Chinese moved 2,500 Chinese marines to a base somewhere in South America?

Papers, Essays and Reviews (PEAR), the Yonsei University Graduate Journal of International Studies provides an opportunity for scholars of International Studies, especially graduate students, to publish their work.  We accept submissions on all topics related to the study of international relations.

We are currently seeking submissions for our forthcoming Spring/Summer 2012 issue.

For more information on submissions refer to the ‘Call for Papers’ information sheet [.pdf] or visit the ‘Submit’ section of our website.

For inquiries, contact me (the Editor in Chief) at pear@yonsei.ac.kr.

The deadline for papers is March 10.  The deadline for essays and reviews is April 15.

China-Centered Growth and Development

Despite the United States maintaining its position as a primary import market for finished products from East Asia, there has been a considerable shift in the balance of economic power and political influence in the region. As John Ravenhill points out, “what has occurred” since the Asian financial crisis “has been … a reorientation of trade patterns in response to the rapid emergence of China as the assembly plant to the world” and the emergence of “China-centric networks.”  This shift highlights the effects of China-centered economic growth and a relative decline of American economic power and influence.  With significant implications for the balance of power in East Asia, China has replaced the US as the number one market for Korean and Japanese exports.  The increase in China’s economic power comes at an expense to US power and influence in the region – a conventional zero-sum situation.  As explained by Thomas Christensen, the combination of China’s economic growth and the decline in exports from regional actors to the US“means that China is gaining leverage over its neighbors at US expense.”

The effect of this shift in power distribution in East Asia is revealed in China’s economic policy and East Asian trading patterns.  As Searight explains, China is courting the Association of Southeast Asian Nations (ASEAN) states through free trade agreements as a way to balance against US influence in the region.  The ASEAN-China Free Trade Area (ACFTA), the largest free trade area in terms of population and GDP, is one example of Beijing’s efforts to use its economic power to lure states away from American influence and into the Sino-controlled sphere of influence.  David Shambaugh calls the ACFTA the “accord of greatest significance” for China, because it represents a change in the way ASEAN countries perceive China and the way China engages its neighbors.  “China and ASEAN are forging a productive and lasting relationship that is gradually erasing a history built on widespread suspicion, painful memories, and lingering tensions.”

Although the ACFTA is certainly useful as a tool to patch-up ideational rifts caused by historical animosities, the more likely reason China’s neighbors are seeking closer economic ties with Beijing is the acknowledgment of China’s growing economic might and regional influence.  As Shambaugh recognizes, the ASEAN countries “believe that China’s rise is inevitable and that the best strategy for ASEAN, to hedge against potentially disruptive or domineering behavior, is to entangle the dragon in as many ways as possible.”  However, the effectiveness of such a strategy is likely to be limited, if effective at all.  ASEAN member states are small and highly dependent on Chinese for trade and economic growth.  China is ASEAN’s top trading partner, which, as analysis in the next section suggests, may actually put ASEAN in a more vulnerable position.

Moreover, China’s engagement with regional states is not primarily about forging closer economic ties for purely commercial or ideational reasons.  If anything, China’s decision to “entangle” itself with ASEAN is a strategic move.  Policymakers in Beijing are confident that its economic might and political leverage will allow it to dictate the course of regional integration on Chinese terms.  As Christensen points out, “the Chinese leadership has kept an eye on the great power prize, has created strategic dependencies on China among its neighbors, and has prevented balancing coalitions ….” China is, like Germany in the 1930s, setting up a network of strategic asymmetric trading partnerships.

But what, exactly, is China’s “great power prize?”  According to Searight’s analysis, China is pursuing a strategy of regional hegemony with the ultimate goal of supplanting the US as the “hub” in the US-centered hub-and-spokes system.  China’s explosive economic growth, coupled with the relative decline of US regional power, has put it in a position to be the most influential regional actor and most likely candidate to challenge America’s supremacy in the region.

Competing Hubs

Searight’s revisionist view of China beckons an alternative view of East Asian geopolitics.  According to her theory, the US-centered hub-and-spokes system is giving way to a “competing hubs” system, where major powers with vested interest in the region are “vying to form competing ‘hubs’ by forging FTAs with multiple regional and trans-Pacific partners,” with China as the clear leader of states that are challenging US primacy.  Stated alternatively, East Asia is in a form of economic tug-of-war, with the US and China competing with each other for the position of dominant “hub state.”

As I briefly discussed in my article about Korea’s “unnatural” alliance with the US, international economics, particularly trade, is used as a mechanism through which to achieve international political and strategic goals.  Korea and other East Asian nations are being courted simultaneously by the US and China.  As Searight illuminates and I expound upon in my article (I go into more depth in my paper), one way through which policymakers in Washington and Beijing are attempting to accomplish this goal is using FTAs to build/rekindle (China) or strengthen/maintain (US) strategic partnerships in the region.  Although Japan was a viable contender in the 1970s and 80s, hopes at continuing the post-war manifestation of the Greater East Asian Co-Prosperity Sphere (see James Fallows) as a direct challenge to the US’s regional hegemony have all but vanished during Japan’s descent from Everest following the burst of its real estate bubble in 1991; Japan’s major demographic shift and shrinking population makes another run that less likely.  No other power, save for perhaps India, has the market size, industrial capacity (latent or real) and population base to challenge American regional hegemony like China does.  Given the rapidity of China’s economic growth and the shift in trading patterns throughout the region, China is posed to challenge and perhaps sometime in the future supplant the US as the hub to the East Asian hubs-and-spokes system currently centered around the US.

Political Economy Effect on the Peninsula

From a geopolitical perspective on the Korean peninsula, this could have major ramifications for the future of North Korea.  As is highlighted in analysis of the effects of a China-Korea FTA, the strategic objectives underlying China’s efforts to conduct an FTA with Korea are not too difficult to speculate.  Although economic motives are not totally absent from Beijing’s perspective, given Korea’s high level of economic dependency on China for economic growth, further cementing the growing economic ties (bilateral trade between Korea and China is growing at a rate of 20% per year) opens up more opportunity for Beijing to exploit its relationship with Seoul to advance strategic objectives.  One of these goals, which is not necessarily at odds with Seoul’s strategic objectives, is channeling investment and facilitating economic growth and reform (perhaps this is what Kim Jong-nam would like to see?) in North Korea.  The DPRK, aside from international aid packages from Korea, the US and others, is entirely dependent on China for any bit of economic productivity the DPRK can muster out of its basket case of an economy.  Given Pyongyang’s dependence on economic trade and assistance form its neighbor across the Yalu, China is in the unique position as its only credible ally and nation with the connections and wherewithal to force (or incentivize) economic reforms in the Hermit Kingdom.  If Korean scholars are correct, a China-Korea FTA could be the conduit through which reforms, a la Jong-nam, could be realized.  A recent Chosuilbo article states:

If China forges closer business ties with South Korea, it could put pressure on the North Korean regime to conduct economic reforms or face even greater isolation. The collapse of Communism in Eastern Europe led to a rough patch for North Korea in the 1990s.

The FTA could play a role in goading North Korea to open up its economy, some experts say — not least because products from the joint Korean Kaesong industrial complex could be included in tariff-free trade with China. That would make Kaesong an attractive place to manufacture goods, because labor is much cheaper than in South Korea.

Choi Jin-wook at the Korea Institute for National Unification said, “If China decides to include products made in Kaesong Industrial Complex, which the Korea-U.S. FTA doesn’t do, then the joint manufacturing zone could get a strong boost leading to increased South Korean investments in North Korea and play a role in getting the North to open up.”
The FTA could even become an alternative route for South Korean investment to North Korea. Some pundits speculate that some South Korean businesses would then be able to invest in North Korea from China without meeting any other legal requirements, because that is much easier than investing from South Korea.

More Changes to Come

Although it may be a stretch of the imagination to think that something like an FTA between Korea and China could lead to the “opening up” of North Korea, in something like the Chinese way, it illustrates two basic points.  One:  Beijing is increasingly becoming the center of economic attention, through trade and fostering further economic development perhaps so much so that it will soon replace the US as the hub to the historically US-centered hubs-and-spokes system.  This leads to two:  Because of China-centered growth, the geopolitical landscape is undergoing fundamental changes:  with economic power comes to ability to advance power and strategic goals.  The situation on the Korean peninsula is only one example of the shifting geopolitical landscape in the region that involves China.  Issues revolving around the speculation that the South China Sea is within China’s “core interest” and the subsequent disputes of the Spratly and Paracel Islands are likely to intensify in the coming years.  China’s economic-borne political power will only galvanize China’s efforts to advance its strategic interests.  The emerging economic structure in the region facilitates this shift in the geopolitical landscape.

However, even a cursory glance at Korean history — or geographic location — will lead one to question whether the strong US-Korea economic and military relationship is at all “natural.”  By natural I mean, exit special circumstances (e.g. a Cold War), which country would Korea more naturally gravitate towards?  The answer is rather obvious:  China.  Korea was long an apendage of the Middle Kingdom under the tributary-state system, a political system in many ways fundamentally different from the Western European-inherited Anglo-Saxon lead nation-state system.  Cultural, institutional, linguistic influence flowed from China towards the Choson (Yi) Dynasty.  Most importantly, trade and commerce was conducted primarily with China, in addition to Korea’s status as a tutelage state – a sort of ancient security guarantee, if you will.  Given this historical precedent, Korea’s strong economic and military ties to the US during the Cold War can be characterized as “unnatural.”  The reason for Korea’s unnaturally close ties to the US is found in the chief motivation behind the establishment of the San Francisco System:  winning the Cold War.  One primary way the US did this was to effectively buy its allies, hence development by selection;  as Cumings points out, and any student of political economy is sure to note, the US did not “choose” to develop Korea for development’s sake.  It was a conscious, strategic decision on behalf of US policy makers to use their preponderance of economic and military strength to shape the US sphere of influence in the Asia-Pacific that would serve the US’s Cold War strategic and political endgame.

As I explored in a recently written paper, the US-Korea relationship is a case-in-point of a large state utilizing an asymmetric trading relationship for the purpose of achieving international political and strategic goals.  The dynamics of the asymmetric relationship between the US and Korea is what permitted an unnatural alliance to be formed.  In exchange for priority market access and developmental aid, in addition to US support for Syngman Rhee over Kim Il-song, (South) Korea was pulled into the American sphere of influence and away from potential competitors, namely China and the Soviet Union.  This relationship, however, is undergoing a fundamental shift in trajectory.  As Calder points out, the US was able to “secure security” through prosperity.  Stated alternatively, America exploited its economic prosperity and dominance of global trade to achieve international political and strategic goals.

As I argue in my paper, the recent Korea-US Free Trade Agreement (KORUS FTA) is an example of the US’s efforts to preserve the San Francisco System by providing Korea with greater market access.  Despite its best efforts, Korea has begun — and will continue — to gravitate towards a closer relationship with China, its more natural partner.  Evidence for this is found in the shift in Northeast Asia’s regional economy, particularly trading patterns.

Changing Trading Patterns

A brief overview of Korean trade patterns with the US and China between the years 2004-2009 is reflective of the broader regional shift in regional economic power and an interesting case study.  Korea is an ally of the US, and thus concedes to the US benefits of a security-alliance, namely high levels of political influence and preferential trading status.  However, given the exponential growth of the Chinese market and Korea’s heavy reliance on trade for economic growth, the traditionally strong economic and political ties between the US and Korea are being challenged.

Between 2004-2009, total merchandise trade between Korea and China increased significantly, as Tables 1 and 2 below indicate.  In 2004, Korean exports to China increased approximately 72 percent from $49.76 billion to $86.7 billion.  Imports to Korea from China also show a significant jump.  In 2004, a total of $29.58 billion worth of merchandise was imported from China. In 2009, this number had increased to $52.25, an 80 percent increase.

Table 1

Source:  WTO “International Trade Statistics”

Although the nominal increase is not surprising, given China’s high levels of growth and Korea’s proximity to China, when the numbers are compared to Korea’s trade with the US , a different story is revealed.  Korea’s level of dependence on the Chinese market is increasing relative to the US.  In 2004, exports to the US market were $43.03 billion.  Between 2004-2009, total exports decreased to $37.8 billion.

Between 2004-2006, a divergence occurred in exports from Korea to China and the US, with China taking a clear lead as the largest market for Korean exports.  By 2009, imports to the Chinese market were more than double that of US imports.  As the numbers show, Korea’s dependence on China for trade has increased significantly, relative to the US, in the latter half of the previous decade.  This has significant implications for economic as well as political and strategic concerns for policymakers in Beijing, Seoul and Washington.  When the numbers are broken down further, Korea’s asymmetric trade with China is even clearer and the implications more significant.

Recent trade profiles by the World Trade Organization (WTO) reveal the high levels of asymmetry in the Sino-Korean trading relationship, as well as the degree to which Korea is dependent on trade for economic growth.  As of October 2011, China accounted for 23.8 percent of Korea’s total exports in merchandise trade and 16.8 percent of total imports in merchandise trade.  Contrast this to 4.4 percent in exports and 9.9 percent for imports for China.  This is an example, par excellence, of trade asymmetry.  If Korea’s Trade to GDP ratio is taken into account, the implications are even greater.  Between 2008-2010 Korea registered an extraordinarily high 105.8 GDP-Trade ratio, compared to 55.4 for China or 30.8 for Japan.  Korea is extraordinarily dependent on exports for economic growth.  Most important to note is the fact that Korea is becoming exceedingly dependent on China’s market to feed this growth.

Geopolitical Implications

As recent news reports indicate (see here and here for a few of the recent reports), China is set to start negotiations with Korea for a Korea-China FTA.  Although this is not anything new (China has indicated a willingness to negotiate with Korea for an FTA before), the timing of the negotiations and the motives behind China wanting to conclude an FTA with its middle-power neighbor cannot be separated from the broader geopolitical situation unfolding in the region.  Consider this quote from a Chosun Ilbo article:

The South Korea-China FTA could have a major geopolitical impact on Northeast Asia as well. Until now, the security landscape in Northeast Asia has been a Cold-War-style standoff between the South Korea-U.S.-Japan alliance on one side and China and North Korea on the other. But if the Seoul-Beijing FTA is signed and economic cooperation increases rapidly, this traditional framework would crumble.

As I indicated above, Korea is becoming increasingly dependent on China for trade (and thus economic growth); China knows this, and given the coming great power power struggle and the current balance of power tug-of-war underway between the US and China, is seeking to use its economic weight to pull Korea closer into its sphere of influence and, subsequently, away from its Cold War partner.  Immediate shifts in behavior, policymaking and public perception are not likely to change in the immediate future but certainly over the long run there is bound to be a fundamental shift in Korea’s geopolitical orientation, particularly in regards to who it considers to be its closest partner, from a trade and security perspective.  Shifts in the geopolitical makeup of the region can be seen in the US’s new defense strategy — a strategy indicative of the decline in US economic power and its inability to maintain the traditional San Francisco System.  This has significant implications for Korea, US-Korea relations and Sino-Korean relations.  Given the US’s declining economic power, China’s rising economic influence and the major shifts in trading patterns, it is only a matter of time before Korea finds itself viewing China is more favorable light, relative to the US.

It is only natural.

Organski’s Power Transition Theory:  Understanding the Global Order

Introduction: Getting Realistic
Hierarchy in the Global Order

A belief at the core of all Realists’ theories is the notion that the international system is anarchic.  This notion is so highly regarded by realists as to suggest it an absolute truth in the realm of international relations theory.  Despite its popular appeal, the theory is an incorrect assessment of the international system.  Perhaps in strictly legal terms, the international system could be conceptualized as having no central governing body, insofar as there is no “world government.”  However, a more realistic assessment of the international system reveals a different world.

Power, another key component of Realists’ theories, is the element responsible for imposing order in the international system.  The ways in which nations use their respective levels of power determines the way order is imposed.  Power, however, is not evenly distributed amongst the nations in the international system.   There is a distinguishable international hierarchy based on power.  The more powerful nations are situated at the top and the less powerful nations at the bottom.  Due to the structure of the international order, the modern international system as a whole acts in a relatively predictable way based on international norms of behavior.  “Orders,” in this sense, are created and imposed by dominant nations at the top of the hierarchy and obliged by the relatively less powerful nations.  These established world orders consist of a system of political and economic norms by which all member nations are expected to oblige.  Failure to abide by prevailing international norms typically results in some form of reactionary measures.  Diplomatic wrangling and economic sanctions are popular measures taken by the international community against non-complying states.  In more extreme cases, complete isolation, like the U.S. diplomatic and economic response to Cuba after the Cuban Missile Crisis or North Korea’s relationship with most of the international community today.  The rarest of the extreme comes in the form of forced regime change of a reticent nation’s government; the most recent example being the U.S. invasion of Iraq to remove Saddam Hussein and his government from power.  The bottom line is that in real anarchy no such organized structure can exist.

The global order is relatively rigid and structured, meaning nations cannot easily enter and exit the system.  As A.F.K. Organski points out, “nations are not free to shift from one international order to another without serious internal changes, usually involving a change in economic systems, a change in the predominant class, a change in the political system, and a change in ideology.”[1]  Nations may compete with each other for better positions vis-à-vis one another, but the system under which this power tug-of-war takes place remains relatively the same.  This does not mean, however, that the global order of today will be the international order in the next era, much in the same way that the global order of today is different from previous eras.  As all students and scholars of international relations know, international orders are not fixed; changes and transitions occur.  Nations dissatisfied with the status quo global order may attempt to use their power to change the system to reflect the way they see the world and to make it operate under conditions best suiting their particular interests. Understanding when, why, and how these transitions occur is essential to understanding the way the international system works.

Under the current global order, America is the dominant global power of a so-called Anglo-American world order, established during the glory days of the British Empire and continued by the emergence of America as the dominant power after World War II.  The political and economic norms of the Anglo-American world order that “govern” the international system can be summarized by two basic characteristics:  liberal democracy, as the preferred form of government, and free and open markets, as the preferred economic model.  The degree to which these two general traits are promoted under the current global order is tempered by the circumstances of each case.  It is naive to assume that the United States and nations supportive of her role as dominant global power will at all times and under any circumstances promote the two dominant traits of the Anglo-American world order.  Myriad of other important factors play a part in determining the way in which the global order is maintained.  However, these two general characteristics are the most fundamental characteristics of the current global order.  This, however, may not be the case for much longer.

In light of the rise in the East Asian development model, the recent financial crisis and the ongoing American occupations of countries in the Far East and central Asia, the status of the current Anglo-American world order as the standard bearer for international norms of behavior appears to be coming under challenge by the strongest of all the nations under the banner of the East Asian development model: China.  How this challenge came to be and the implications for the international system are of paramount importance to understanding the direction the current global order is heading.

I’m not nearly convinced of the positive social value and good precedent setting of humanitarian intervention to begin with, but assuming, for the time being, that humanitarian intervention is net positive and a good international precedent to set, I’m finding it hard, in light of recent reports, to see the intervention in Libya as a necessary humanitarian mission (aside from Kuperman’s article, see here and here).  Instead, things are shaping up to look more like another case of western powers intermeddling with the internal affairs and violating the sovereignty of another middle eastern nation resulting in instability and chaos.  But, lest I go on a idealist realist tangent about western imperialism and the cooked-up notion of the right to sovereignty, let’s stick squarely to the humanitarian issue.

If the justification for the intervention in Libya is truly about saving innocent civilians from being ruthlessly massacred by a merciless government, then, as Kuperman suggests, the pretense for intervention in Libya may turn out to be false.  Even though protecting civilians was the stated reason, I still think it’s rather unclear for why, exactly, the U.S. and her NATO allies were so gun-ho about wanting to bomb Libya (especially France).  Regardless of the real intent, the stated reason of preventing the massacres of civilians isn’t holding up under the current information being revealed.  Contrary to expectations, there seems to be nothing close to a “bloodbath” being perpetrated by the Libyan government on its people.  Instead Khadafy seems to be targeting rebels – those actively revolting against the central government.  As Kuperman reports,

Human Rights Watch has released data on Misurata, the next-biggest city in Libya and scene of protracted fighting, revealing that Moammar Khadafy is not deliberately massacring civilians but rather narrowly targeting the armed rebels who fight against his government.

Misurata’s population is roughly 400,000. In nearly two months of war, only 257 people — including combatants — have died there. Of the 949 wounded, only 22 — less than 3 percent — are women. If Khadafy were indiscriminately targeting civilians, women would comprise about half the casualties.

Instead of stopping the deaths of civilians, the intervention by western powers seems to be causing them.  The intervention by NATO has, in effect, thrown a life-line to the rebels and turned what would have certainly been a suppressed resurrection, into a continuing civil war.

It is true that Khadafy (I’m going with Kuperman’s spelling here) is killing his own countrymen, but probably in the same way that any central government dealing with a rebel insurrection would.  There is a major misconception that Khadafy had pledged to show no-mercy to the civilians in the rebel-occupied cities, that he was intent on using the military to massacre civilians.  This isn’t true.  Back to Kuperman’s article,

Khadafy [never] threaten civilian massacre in Benghazi, as Obama alleged. The “no mercy’’ warning, of March 17, targeted rebels only, as reported by The New York Times, which noted that Libya’s leader promised amnesty for those “who throw their weapons away.’’ Khadafy even offered the rebels an escape route and open border to Egypt, to avoid a fight “to the bitter end.’’

It seems, instead, that the U.S. and her NATO allies were either deliberately duped by rebel propaganda, which made it seem as if a massacre of civilians was an inevitable barring western intervention, as Kuperman suggests.  Either that, or, the real reason lies elsewhere.  Questions like why, if saving civilians from slaughter is the reason for bombing Libya, are air-strikes being carried out on retreating government forces and forces stationed in areas of the country not currently in contention with the rebel forces?  And why was there such an abrupt change in position regarding whether Khadafy stayed in power or not?

Whatever the case, the net result is still uncertain.  Will intervention by the western powers end up being directly or indirectly responsible for the death of civilians?  Despite our “good intentions,” have we ended up perpetuating civil war and humanitarian suffering?  The Obama Doctrine may be based on a noble principle that innocent lives ought to be protected when possible from merciless governments.  But what happens with the doctrine has the reverse effect?  Or, what happens when the doctrine is invoked in an inapplicable situation?

The road to hell is paved with good intentions, isn’t it?

Regardless of what is said in public speeches or in official statements, we are at war in Libya.  The most stated reason for intervention is in order to “prevent” further civilian bloodshed and destabilization in Libya and the region – when you’re the United States, almost anything you do is “preventative.”  Barring a surprise, large-scale terrorist attack, the United States is extraordinarily safe and isolated from potential conflicts.

Reasons for intervention aside – because let’s be honest, the notion that we’re intervening for the sole purpose of “protecting the civilian population,” although a noble reason, is more than likely not true – the next lingering question is:  what will be the outcome?  Will this be a relatively brief intervention that ends in a regime change and the establishment of something “democratic-ish,” or at least a regime more responsible and responsive to its people.  Or will this be another long, drawn-out conflict that, despite whatever good intentions, ends up as another prolonged Western intervention in an internal Eastern conflict?

The reason I find this question pertinent hasn’t much to do with what actually happens in Libya or why Libya’s civil war is no longer an exclusively Libyan conflict; although, for the record, I do care, in an abstract sense, what ultimately goes down there – it just doesn’t seem to me to be the most important issue, especially from an American perspective.  It has more to do with political ramifications for president Obama and American/Western legitimacy in the eyes of non-Westerners, specifically those living in and around Libya.  When all’s said and done, everything will boil down to results, as they almost always do – or, in the age-old political adage:  the ends justify the means.  A cheesy link between political reality and the overused realist adage?  Maybe.  But it’s more often than not true.  (hone in on the word often – meaning:  not always, just a lot).  The results will determine whether the Western intervention was a good or bad idea.  Stephen Walt says it best:

[...] what matters is not the justification that he provided for it or the ways he attempted to assuage concerns about possible precedents, the risks of getting bogged down, etc. What matters is what actually happens in Libya over the next few weeks or months. If Qaddafi is soon ousted and the rebel forces can establish a reasonably stable order there, then this operation will be judged a success and it will be high-fives all around. If a prolonged stalemate occurs, if civilian casualties soar, if the coalition splinters, or if a post-Qaddafi Libya proves to be unstable, violent, or a breeding ground for extremists, than Obama’s eloquence last night will be disregarded and his decision will be judged a mistake.

Words and justifications do matter on occasion, but in the end its results that count

There are a multitude of ideas and theories that various intellectuals, statesmen, and pundits propose as a way to predict the way China will rise in the international system, given its newfound power fueled by explosive economic growth.  Conventional theories, put forth by scholars like realist John Mearsheimer, state that some form of Great Power clash is likely unavoidable between the U.S. and China.  According to Mearsheimer, China’s rise to power will take a path similar to the one taken by other Great Powers throughout history.  China will use its immense power base to make a run at world hegemony, or to at least supplant the U.S. as the leading global power.  China will essentially recreate the existing global order to reflect that which seems more suitable to its ideas and core interests.  According to this theory, the result will be an intense security competition between China, the U.S. and the U.S.’s allies.  As I’ve stated before, this particular interpretation of power transition points to the likelihood of military confrontation.

Is armed conflict the inevitable result of Great Power competition between the United States and China?  There are plenty of theories that address this question.  Many western predictions of the way China will choose to handle its rise on the global stage point to a strong likelihood that China’s rise will not be peaceful.  I’d like to present an alternative path seen through a uniquely Chinese perspective, which, if correct, shows how China may, by its nature, seek a non-violent path of ascendancy onto the world stage.

An Eastern Alternative to Great Power Development

One thing seriously lacking in most analysis of the Chinese rise to power is an alternative interpretation to the conventional western view of interstate relations.  Almost all dominate theories that suggest the likelihood of conflict stem from a western point of view –from a realpolitik perspective.  Analysis of China’s rise seen from the perspective of realpolitik is likely to draw parallels between China’s rise and the historical rise of imperial powers such as Germany, France, or Japan.  The problem with this parallel is that it stems from an inaccurate reading of China’s principles regarding development, warfare, and power.  As a proponent of the “peaceful rise” camp, Henry Kissinger argues that the kind of military imperialism practiced by nations like Germany and France “is not the Chinese style.”  According to Kissinger, there is a fundamental difference in philosophy between east and west that cannot be discerned by applying the theories of Machiavelli – or Von Clausewitz – to China’s rise:

Clausewitz, the leading Western strategic theoretician, addresses the preparation and conduct of a central battle.  Sun Tzu, his Chinese counterpart, focuses on the psychological weakening of the adversary.  China seeks its objectives by careful study, patience and the accumulation of nuances –only rarely does China risk a winner-take-all showdown.

As Giovanni Arrighi points out in his book Adam Smith in Bejing, Kissinger’s alternative realist position “is remarkably compatible with the Chinese doctrine of heping jueqi (literally ‘emerging precipitously in a peaceful way’), quoting also one of the main advocates of the doctrine, Zheng Bijian:  “China will not take the road of Germany in the first world war, or Germany and Japan in the second world war—using violence to pillage resources and seek world hegemony” [emphasis mine].  Instead of seeking to remake the world order in the way that other imperial powers have done (America included), China seeks to integrate itself in a non-violent way, thus making China’s challenge to U.S. primacy non-militaristic.
There are obviously a lot of reasons to doubt that China will actually follow this path of development.  As was recently reported, China’s “official” military budget increased by 13% this year, a 5.5% increase from last year’s budget.  Although an increase in military budget isn’t an indication, per se, that China will become more militaristic in the future, such moves, whether significant or not, are almost always certain to raise concerns from westerner analysts who see things in light of their own imperial pasts.  This western mindset sees state competition amongst Great Powers ultimately leading to some form of direct military confrontation.  Such fears of increased militarism is only compounded by other issues such as the expansion of China’s navy and the flaring up of terrotorial and economic issues in the South China Sea.

It’s All about Your Attitude

Everything considered, one of the more important factors that determines is the nature of the U.S. – Chinese relationship, according to Kissinger, is attitude – the kind of idea that makes me think Kissinger isn’t a “true realist” (whatever that means) but more of a Alexander Wendt-like constructivist .  According to Arrighi’s analysis of Kissinger’s ideas regarding the best way for the U.S. to deal with China, the best route for the U.S. to take is one grounded in cooperation with China in order to preserve a stable international system.  In order to do this, Kissinger states,

Attitudes are psychologically important.  China needs to be careful about policies seeming to exclude America from Asia and our sensitivities regarding human rights… America needs to understand that a hectoring tone evokes in China memories of imperialists condescension and that it is not appropriate in dealing with a country that has managed 4,000 years of uninterrupted self-government.

Attitude may indeed be an important quality of health state-to-state relations.  However, what may be more essential to maintain a healthy status-quo in the international system is a less-confrontational, less-violent approach to development.  If true, the Chinese development model based on a “peaceful” rise may help keep the competition limited to political and economic challenges and not military confrontation.

There is an interesting anti neo-liberal* theory presented in Giovanni Arrighi’s book Adam Smith in Beijing:  Lineages of the Twenty-First Century concering the Asian development model and rise of the east debate.  The theory rests on a re-reading of Adam Smith’s conception of market-based development.  The theory is a rebuke of the merits of the neo-liberal, minimalists government, self-regulating Washington Consensus in favor of a “less-liberal,” gradualist approach aimed not at maximizing profit for capitalists, but fostering competition amongst the capitalists and controlling the rate of liberalization so not to upset social stability.  Giovanni Arrigghi identifies China as the model developing nation taking a development route much different from the route taken by most western nations.  This alternative path to development is often called the Beijing Consensus.  It’s worth some contemplation, especially in wake of the latest economic crisis wrought by the lauded western free-market system.

Creative Destruction Development

In contrast to the path of development taken by western countries during their respective industrial revolutions and those industrial revolutions executed in accordance with guidelines and recommendations made by western economists, China’s development path follows what James Galbraith calls “reformed socialism.”  While those countries who followed the policy prescriptions of Washington Consensus-promoters – the World Bank, the IMF, the US and UK Treasuries, and other influential government and non-government organizations – have suffered through a cycle of economic crisis, China, on the contrary, has been quite economic crisis free.  Arrighi quotes Galbraith:

Both China and India steered free from Western banks in the 1970s, and spared themselves the debt crisis.  Both continue to maintain capital controls to this day, so that hot money cannot flow freely in and out.  Both continue to have large state sectors in heavy industry to this day… yes, China and India have done well, on the whole.  But is this due to their reforms or to the regulations they continued to impose?  No doubt, the right answer is:  Partly to both.

China, although adopting some economic policy recommendations from the west, has throughout its recent economic expansion refused to follow the more severe neo-liberal shock therapies suggested by advocates of the Washington Consensus in favor of a more gradualist approach to market-liberalization.  There are, no doubt, strong political incentives to maintaining social stability.  But the political motive aside, a state that doesn’t have to bear the social, political and financial costs of a crisis and the “creative destruction” of the status quo will, naturally, be a stronger footing for other state or private projects.  Instead of focusing on deregulation and privatization, China puts a strong emphasis on stability and steady growth instead of western-preferred shock therapy.

[H]aving recognized that social stability can only be maintained if job creation goes in tandem with restructuring; and to having sought to ensure the fruitful redeployment of resources displaced by intensifying competition.  Although China welcomed the World Bank’s advice and assitance from the start of the reforms, it always did so on terms and at conditions that served the Chinese ‘national interest,’ rather than the interests of the US Treasury and Western capital.”

In short, China has sought to avoid the destructive cyclical tendencies that unfettered capitalism has produced in countries that have developed along the neo-liberal, capitalist-based development instead of a Smithian, market-based development path.  The former focuses on the maximization of profit through intensive competition while the latter focuses on the maximization of employment with a minimal tolerable level of profitability.  These two approaches, in their essential forms, represent the two contrasting models of development.  It seems that Smith isn’t from Detroit after all

*I understand the danger in making such statements.  Far too often in today’s ultra-divided, socialist-phobia political environment, making any comment seen to be anti free-market or socialist is commensurate to high treason, or at least discredited as quickly as it is read.  I use it nonetheless.