The End of the Asian Century

By

DATE: 31 January 2017

VENUE: House of Commons

SPEAKER: Michael Auslin

CHAIR: Catherine West MP

Catherine West: Hello I’m Catherine West, I’m the Member of Parliament for Hornsey and Wood Green and Labour’s front bench spokesperson on the Far East, the Americas and overseas territories, so bang on topic. It’s a real pleasure to have been invited by the Henry Jackson Society to do today’s question and answer, and mainly we want to hear questions from you. So I thought just initially, I thought Michael could do three minutes on an update as if he were writing a final chapter because a lot has happened in the past month or so, and it’s important that we take all the learning from the book but also that we think about themes of globalization and so on in the context of recent events.

I’ve just come from the Chamber where we’ve been discussing the Supreme Court’s decision about the triggering of Article 50 and there are certainly themes that came out in the Brexit vote which are also relevant to questions around globalization. And last night I heard Liu Xiaoming, the Chinese Ambassador to the UK from the PRC speaking at a dinner with George Osborne, and it was interesting to see from my point of view as someone who sits in the parliament with him, everyone was taking selfies with him. It was as if the golden age with China had never been questioned or anything. So I think there is a slight change of our policy towards china that you can see: various questions that have arisen since our new Prime Minister came in in the summer but it is just very interesting to see whether that strong push for globalization will in the end be the thing that carries us through or whether there has been a big questioning of that, because that’s having the effect its designed to have. So with no further ado, and bearing in mind that picture which I’m sure you saw on your television screens this morning of Mr. Trump up the TPP, I hand over to our expert, Michael, to give us some thoughts, so we can then launch our Q&A.

Michael Auslin: Catherine thank you very much, thank you John and to the Henry Jackson Society for inviting me to come back for my second event in parliament talking about Asia issues in America. And thank you most of all to all of you for coming out, I really appreciate it. Very briefly I think I would give you a sense of what the book is about and then, as asked, an update on what would be a new introduction to the book. It needs to be revised before it must even be published which is a problem with this type of book. I wrote the book to give the other side of the story about Asia, I think we’ve all become used to one side of the story over the past decade. Of this linear rise of Asia, this unstoppable force and the inexorable shift of power from west to east and I was actually going to write a book about that and that America’s future should be an Asian one.

But as I started going around Asia for the book, and I’ve dealt with Asia for a quarter of a century, everybody started telling me about all the things they were worried about, they started talking about all the bad news and most importantly saying this is the stuff you guys aren’t paying attention to. So after rejecting that a little bit, I realized there was another story to tell, and it doesn’t deny the growth in Asia, what’s happened, the strength of the Asia that we’ve all come to know? Simply to say: don’t be surprised about a crisis in Asia should one occur. And to know what that meant I divided the book into five chapters that I call five risk regions, I tried to figure out what a risk map might look like. We came up with this Lord of the Rings type fantasy map that walks you through the five regions in the book of risk Asia: The failure of economic reform throughout the region; the demographics dilemma, which I call the Goldilocks dilemma of too many people or too few people; the unfinished political revolutions throughout the region, the threat to established regimes whether they are democracies or autocracies; the lack of political community, why can’t they all just get along in Asia, why isn’t there an EU-style or NATO-style thing, why aren’t the Asians more united than we would expect; and then finally, the one that Washington DC really cares about, the threat of war, how close is Asia to an armed conflict.

The book is not predictive, I’m not trying to predict war or revolution or oppression, but I’m diagnosing the risks that might be out there that we ignore because we like to focus on one story. Now Asia’s entering a new era where easy growth is finished, the tensions between nations are growing, the internal problems can no longer be ignored and if we don’t pay attention to them and more importantly if the Asians don’t pay attention to them, then we will see a much more unstable and fraught Asian future inside particular countries or between them and that is something that we need to guard against. Here’s where I will shift into talking about president trump about what should we do? I’ve gone through a couple of hundred pages of all the dangers that are out there, everything from environmental devastation to minority issues and the rise of radicalism and the right. What do we all do about it? And so I talk very strongly about free trade, I talk about TPP (that’s a chapter that needs to be rewritten), I talk about a values agenda not necessarily a freedom agenda or pushing for freedom but to talk about liberalization and work with the countries that are liberal, that want to liberalize, countries that are struggling with the question of where they want to go on domestic, political and social development. And then I do talk a lot about what I think is the proper role for the American military: that we do need a strong American military presence, we have commitments, and we have formal alliances with five Asian nations. We’ve made commitments to other nations, we have a lot of partnerships. For the most part it has been accepted that the US role has been a beneficial one, especially over the past several decades. One that has built stability and I don’t want to see it go away because a vacuum would emerge.

So all that being said, where does the new president fit into that, president trump and his plans? Well the first thing we have to say is that he’s doing what he said he would do on the campaign. Most American presidents have their honeymoon period to basically walk back all over their campaign promises subtly. President Trump doesn’t have a honeymoon period, firstly, the first thing he did was push through with withdrawing the US from TPP and I’ll come back to that in a second when we do questions. The other thing which is most striking and makes the book more relevant I think is his China policy and approach. He is threatening to undo forty years of American policy towards China: the One China Policy, as a counter to it the commitments we’ve made to Japan, South Korea and other countries. But he’s shows no signs of backing down from that. What he means by it and what he wants are obviously open to question but he obviously feels like the time has come of the USA to push back and not to accept a future that increasingly looks like it’s shaped by the Chinese. So we’ll have to see what that means in terms of trade and potential trade wars, in terms of the security situation, politics and the like but there is no question that he has put the Chinese off balance. They didn’t expect this and they don’t know how to respond, they definitely thought he would ramps things down and the tension that he in fact stoked. He has not done that, he has continued to talk about these things.

I would caution that we need to wait and see what his entire team is who are actually in charge of the policies – he has cabinet appointments but not everyone underneath. The deputy, the under-secretary, the assistant secretary, the deputy assistant secretary, the people that really make policy come alive. We have to wait and see who they are and what they’ll be doing. And another thing is look for the documents that have to come out: the national security strategy, the national defence strategy, the national military strategy. Those three in particular will give us a sense of what their priorities. And then finally what does he have to do? He has to do three things in my opinion. One is figure out what I will have to do on free trade, he said he’s in favour of bilateral free trade agreements and Prime Minister May is going this Friday to see him. That will be high on the agenda, a UK-US bilateral trade agreement. I’ve written that I think we should do one with Japan as well, so we have to see what he is going to do on free trade and hold him to the idea of bilaterals – number one.

Number two – what is your North Korea policy? You’ve got to come up with one because they will test you and, I think it’s fair to say, the Obama administration did nothing for eight years. One ill-conceived agreement that was quickly broken by the North Koreans. What are you going to do about North Korea? And then third, you need to come up with your overall China policy. The One China Policy – are you going to support it or not? By extension of that, the South China Sea, what will you do there because things have already moved down a road to where the Chinese were warning about a war with Barack Obama? So you have to figure that out as well. So with those three things, I will leave it at that and look forward to a discussion with you.

CW: Thank you Michael, it’s just so nice to have you here in person. Just before I bring people in, I just wanted to throw in one question myself, chair’s privilege. To emphasise a couple of positives that have happened in China and that is, the leadership on climate change, green investment. And also, even though it hasn’t been an unmitigated success, the emphasis on anti-corruption because it is one thing that many nations struggle with and I think there has been an attempt to try. And obviously the globalization speech that was given at Davos was, to some degree, a game of chess with other leaders. But bearing those rather positive things in mind, I wonder if those of us who care deeply about human rights, the rule of law, democracy, Hong Kong, the burning down of monasteries in Tibet, what do you think? I know we’ll get lost on the geopolitical stuff, so many of us in here care about human rights abuses so I just wanted your view on that.

MA: I think that many of the people on the right, Senator Marco Rubio and so on, care very much about this and were very worried about two things. First, worried that the Obama administration did not make this a priority in any sense and so we’ve lost ground, I would argue, over the past eight years on the human rights equation. Hillary Clinton, when she was secretary of state, explicitly said we’re not going to let that derail the relationship. The Dalai Lama had to go through the back door, the servant’s entrance, when he visited the White House twice. They put it very publicly on the backburner. The Obama administration was criticised for that very strongly. I think the worries about Trump are that human rights have never been part of his worldview, it’s something that he never talked about or thought about. He gave no indication of how important it would be, it was really about the America First agenda, the trade and the like.

So we have to wait and see, he had to fill his positions. There is assistant secretary of state for human rights, that’s one of those positions that have to be filled. Will it become an issue that they use, quite honestly, as a stick with which to beat china somewhat. This is another way you can pressure China, it doesn’t mean that you necessarily support the idea of human rights per se, it’s more about the political usage. That’s not necessarily a bad thing, you can actually get things done because you’re using it as a tool. It could be one way of ensuring that you’re promoting human rights by talking about these issues. There are human rights problems all throughout Asia and you can define it in different ways: The region has been spectacularly bad at dealing with the Rohingya crisis in Myanmar and it’s spread into Thailand and other areas. And this points out the limitations of that political community, that after forty years of ASEAN we wash our hands of one of the greatest humanitarian crises in decades. They said you’re on your own so there are Rohingyans dying on boats, on beaches, there are mass graves being found. And the Obama administration also did nothing about it, that’s something that the Trump administration inherits.

There are other human rights issues such as air pollution in China. There are hundreds of thousands of deaths a year because of the air pollution in China. You’ve probably seen the photos from the past couple of weeks, where China was forced to declare a red alert for the first time. How you define it as access to clean water, food, air – these are rights issues that can be part of a package in assessing how you approach the larger geopolitical issues in China, huge obviously. The question of transparency and the independence of the legal system as well as in other countries, Myanmar for example, how do we build up an independent judiciary? So we have had almost no talk about that during this campaign and it will be something that is very easy to overlook if you’re talking about the dogs of war in the South China Sea and ripping up grand trade agreements. These kind of things very easily slip under the radar but the answer is we need to be pushing them from the outside quite frankly, and I think both liberals and conservatives can come together on these issues and talk about them. They are not liberal or conservative issues, these are human rights issues, we should all be supporting them and I think the United States, along with its partners like the UK and others, have a very important role in keeping it at the forefront.

On Hong Kong, part of the problem here, and I try to detail it in the book, is that when things change you have to be very aware of the point that you are approaching the issue. For example the Trump administration inherits a failed North Korea policy for a quarter of a century on the part of the Republican and Democratic administrations alike. North Korea is effectively a nuclear power, how do you approach that without talking about denuclearization, it’s not going to happen. The same thing with the South China Sea, there are islands that have been built and militarized, you can’t pretend they’re not there. So Hong Kong is the same thing, I would say. There have been dramatic moves made by China to restrict Hong Kong, to overturn the agreement with the UK, the original understanding in 1984 and then the handover in 1997, you can’t go back.

And the latest contretemps over swearing in of legislators who didn’t want to take certain oaths and the like, this is the pressure that’s being put on the courts; put on society; the media and the like. I think it’s very important that we have a firm Hong Kong policy; Britain almost has a more direct stake than we do although I’d argue our stake is very big and the response of the United States to the pressuring and shutting down of the protests last year and the year before, and the kidnapping of the British passport holder from Thailand was almost non-existent. Again that was the Obama administration, it was non-existent because the thinking was you de-link the economics from the politics and the security because you did not want to put at risk the economic partnership. Trump has explicitly re-linked these in his statements, his tweets and the like. Whether that follows through to policy we will see but that’s a very risky move, it changes the dynamic of what we have done in our China policy and how we have pursued our China relationship in the past forty years.

But it also means that you may have more opportunities to insert these things into the core of the relationship, they don’t have to be side issues anymore because, and this is being generous to President Trump, he has said why would I do X if I’m not getting cooperation from china on Y? He said that specifically on One China Policy and economics but you can see the dynamic there. If you’re going to be oppressing citizens or continuing forced abortions and doing these horrific things then we’re not going to have the same level of political relationship: there may be an opportunity here to put it back at the centre of relationships not in a way where it’s sidelined or put as a secondary or even tertiary issue for the past couple of decades.

CW: It’s certainly something that we in the Shadow team try to push much harder on and we had a debate on Burma last week which was very good because Boris Johnson, our Foreign Secretary, is there at the moment and we had a debate on Hong Kong when Lee Po, the book seller, was having trouble. And I think those sorts of debates are really important but it’s very much not coming from our executive so we need to make sure it’s much more a genuine part of our policy on China, to be raising these sorts of things. I just think of the love-in last night between George Osborne and Liu Xiaoming, there’s got to be a balance because the average person out there thinks we should be raising those issues as well as trade, as well as national security and at the moment that doesn’t seem to be the case.

MA: Trump is radical enough that he may surprise people because he’s thinking of it as a negotiating tactic and tool, don’t forget he’s a very transactional person. But it may mean that things that Presidents have treated in a very ethereal academic way become part and parcel of the elbow-throwing that you’re doing because you’re looking at the broad sweep of relations. I’m not saying it’s going to turn out well necessarily but certainly there’s the potential for a very different approach from what we’ve become use to for 25 years or more.

John Hemmings: As a Henry Jackson member I’d like to take the opportunity to ask you about something. Of course Britain has this Brexit thing hanging over it and we need to get economic growth balanced with the values. How do you see the UK doing that? How do you see us balancing relations with China? This book is a bit of a revelation, it’s not a straight success story with China, and there may be issues ahead. Also in some ways with the George Osborne promise with China, it may not be something you want to link with without caution. How should the British proceed?

MA: I appreciate the question because in America I signed one of the anti-Trump letters so no-one in America is asking me! I’m very happy to advise Britain now, clearly I can’t advise my own country. Look, I spend a fair amount of time here, I have a lot of friends here and care very much about the Transatlantic relationship. And I’m not a British scholar or expert, as much as I wish I could be, but I think from my perspective the biggest risk with Mr. Osborne’s approach is that he’s buying the stock at a high and I think the stock is beginning to decline. First of all, China’s economic growth has moderated dramatically, the 6.7% GDP…. First of all GDP is a useless figure it doesn’t really tell us a lot about what’s going on inside in the economy. There’s no-one who really knows the figures apart from the Chinese leaders themselves. That said a lot of the economists in Washington are coming out to talk, are saying that China may be near stagnation point already. You have to define exactly what that means in the Chinese case: is it 0 growth, is it a half, or is it one and a half? But it’s not six and a half or seven per cent, even if it was it doesn’t tell you about what’s actually happening.

So my concern was when Mr. Osborne was pursuing the policy he was really buying at a high. What you have to be much more worried about is a weakening China over the coming years. The opportunities in China are going to be more difficult, less plentiful. There’s more pressure on foreign businesses, it’s harder to do business there. The Chinese make huge promises in these economic packages and never deliver such as the oil and gas deal with the Russians. If you look at the deal there’s nothing really there, it’s more of an aspirational idea of what they’ll do. They will use monies in many ways to buy support amongst smaller nations, and that’s an approach that they do. But the real give and take of an economic relationship, it’s becoming harder and harder to do with China, the American Board of Commerce in China has turned very negative lately, talking about difficulties so I was worried in the sense that Britain might be tying it’s cart to a horse that’s slowing down very dramatically and is not going to get you where you’re going.

And opens you up to other kinds of pressure, like what you saw with Hinckley Point for example. A different government but the pressure put on, and the explicit threats that if you did not pass Hinckley Point you would see an overall effect on your relationship. Well that’s the danger of getting too close to the Chinese from that respect, and every country that deals with them has got stories like this. I’m not saying there isn’t still opportunity and there aren’t ways of making a profit but these sort of grand sweeping deals will become less and less attractive the more we get a sense of how weakening and softening the Chinese economy is. I think you pursue that relationship but there are others as you consider a post-Brexit global economic future that make a lot of sense. Clearly the FTA with the United States makes a lot of sense but why not an FTA with Japan? That links the world’s third and fifth biggest economies in which there’s a lot more transparency, a lot more accountability, a lot more rules that go with it and can also be done at the higher level, the gold standard level that you think of when you think about UK trade deals. Japan entering that space with things like environmental protections, labour protections, consumer protections: these are much harder things to get with China and much easier with Japan.

So I’d like to see Britain pursue that, and act as a springboard to more integration with Asia. I firmly believe, and have been arguing for a long time, that the US needs more non-Asian partners in Asia. We’re very used to asking for help from our friends everywhere around the world except Asia, it’s the one place that we go on our own. We say that we’ve got alliances and we’re really the big dog because we’ve got aircraft carriers and submarines there, that’s all fine but there’s so much more that we could do with the UK and I think France as well. This gets to issues like human rights and governance issues to security issues to big economic issues. The Trump administration, and certainly if I’d hoped there would have been a Clinton administration would certainly have pursued it, has a big opportunity to pursue it in these terms and change the debate about with whom we work in Asia.

Q: If there were to be a trade war between the US and China, how do you see that panning out? Is the US vulnerable because China holds so much US debt?

MA: It’s a good question, it’s interesting I’ve been asked that a couple of times and I’ve come up with a different answer which is “oh! A trade war, he won’t do it, it’s dangerous!”. I think President Trump’s response is “What are you talking about? We’re already in a trade war and we’ve lost”. I think he feels there’s no risk tot a trade war because we’ve already lost it, that’s why he talks about the hollowing out of American jobs, the hollowing out of American factories, those rusted factories like tombstones that he talked about in his less than uplifting inaugural speech. But very realistic and very hardcore and an inaugural speech that chimed with his campaign points. So number one, he thinks we are in a trade war so you have nothing left to lose. Number two, both objectively and from their perspective America has a lot less to lose from a trade war than China does and I think that’s right overall. The Chinese economy is more fragile than the American economy and has not shifted in the way that the American one has towards domestic consumption to a balance between industrial production and consumption let alone all the infrastructure you need. I don’t mean roads I mean clear rules: a legal system, arbitration. The US I think could weather it better, we could lose China as a supplier but they cannot lose America as a market. They will find it much harder to replace us as a market; we will after some disruption find someone else to replace them as a supplier. And countries like Vietnam, Indonesia and Malaysia are chomping at the bit to get into that space. They want to take away market share from China.

And debt, they are having a much worse time with it than we are, not just with their domestic debt but the debt that they hold from us. The reason being, first of all we are about 18 trillion in debt and at least 16 trillion we own ourselves. It’s fictive, it’s on the books of the Federal Reserve. China owns roughly a trillion, I haven’t looked at the latest figures, it goes up and down. If they dump it, it’s only a trillion, we’ve got another 17 out there but that means they lose a trillion dollars, it’s much more significant for them. If they dump it and they can’t get par, they can’t get what they paid, they can’t get the interest for it they’ve lost out. And the Chinese will tell you, they really hate being in that position which is why they’ve eased a bit off on their debt purchases. But they’ll tell you they don’t want to be captive to US debt but where else are they going to look? There’s nowhere to turn, there’s nowhere else and they went with America so it’s sort of mutually-assured destruction. I’m not saying it wouldn’t be messy – the infinite line from Dr Strangelove, we wouldn’t get our hair messed in thermonuclear war but I think we would come out of it a lot better, and they’re willing to run the risk simply because their perception is that China would blink, they would back down.

Q: I wanted to ask about Japan – Prime Minister Abe was a very early visitor to the President-elect. Abe went quite a way against his own domestic constituents to get TPP done. Can President Trump offer him a good enough free trade deal to compensate for the loss of political capital suffered with the end of TPP?

MA: I hope so, I don’t know, they have to think about it and come up with a plan and be smart enough to approach Abe with an FTA. But they’ve been very clear, Tokyo have, that they don’t want to give up TPP yet, in fact they just reiterated that when President Trump signed his executive order. They want to go ahead with the 11 nations, it’s far less significant with the US out of it. I’m also not sure that TPP is dead fully. First, there are other voices in the cabinet: Rex Tillerson, secretary of state nominee who said he supports TPP; some of the economic advisors, Larry Kudlow and I think Stephen Moore and others who have said that they support TPP. Again, you have to understand how Trump works, he’s a maximalist, he starts in the maximum position and then negotiates down to a deal that he can get and that’s as far as we can tell the type of person he has been and is. If that’s the case, announcing that you’re dropping TPP doesn’t mean that you won’t turn round at the eleventh hour and say “but here’s what you could do to get us back in…”.

I’m not saying he’ll do that but it certainly is open to say “we don’t like the current deal”, and I don’t know all the rules, if you have to reopen negotiations but you could turn around and say “here’s what we don’t like, fix it and we’ll come back in”. It’s like Reagan and the law of the sea treaty. Reagan said, “Fix these things and I’ll consider it”. It got fixed but by that time it was gone and no other President took it on but you could come back so I think Japan is in part hoping that America hasn’t walked away from TPP in finality, number one, and number two, that they should be receptive to the idea of an FTA. I mean if I was Japan I’d say “yeah, fine, have the rump TPP of the eleven nations and do an FTA with the United States”. You are still getting most of what you wanted. Be open to that and I would propose don’t be stubborn about TPP or nothing, that would get you nowhere.

Q: Japanese people are very worried about heightened military conflict risk with Mr. Trump. Do you think economic ties like AIIB (that Japan hasn’t joined yet) can have a deterrent to military conflict between nations?

MA: I think Japan has less of a role in the South China Sea, it has a presence but has said that it’s not going to get involved with freedom of navigation issues. I thought that the Abe administration might do that but so far they’ve said no so they’ve removed a potential direct confrontation with China. I would say first, relations in the South China Sea and relations between China and the US worsened under President Obama. It’s not like everything was great until January 20th, now there’s going to be war. It’s that the US was talking about confronting China before President Trump came in, China warned about the United States before President Trump came in. They have been vociferously opposed to the US rebalance and increase of military forces in the region, the new types of partnerships the US was trying to build. All of this happened under President Obama’s watch and for China, Trump is a shock on the One China Policy but the overall security tensions have not only been worsening over the past several years but I think they see the shift from Obama to Trump as one of degrees, not of kind. Maybe really short degrees but it’s been getting bad, this was never a great relationship, now it has the potential of getting worse.

Although if you think about how Trump operates, he wants clarity and he’s a hard-driving negotiator. The problem with Obama was that he was so academic about a lot of things, it was never clear what he was doing. It was never clear what the point of the rebalance of the pivot was. Or these freedom of navigation operations that were never really freedom of navigation operations. Obama was too nuanced by half, too clever by half. Trump is the opposite, he’s just not nuanced at all but there’s a clarity of that that can actually help at times. You may not like what you hear but you know what you hear. There’s no ambiguity – you may not like it but you know where your starting point is. That’s a negotiating tactic: start with it and then move forward. And the Chinese, who are hard negotiating operators themselves, may actually welcome this behind the scenes. I don’t think they’re going to like what they’re hearing but there’s a solidity to it that they never had when dealing with the Obama administration. They couldn’t quite put their hands on these slippery figures. I don’t think that if there’s a threat of war it’s because of President Trump directly, I think things have been getting bad for a long time and I think there is at least the opportunity for some bare-knuckled negotiating to go on. To say, this is what we’re going to accept and not accept and they started that in the press conference yesterday, so we’ll see.

Q: There was an interesting article yesterday about truck drivers’ jobs being taken over by driverless cars. In four years’ time when Mr. Trump hasn’t been able to make America great again and jobs have been replaced by robots, he’s going to have a big problem?

MA: I think that’s a really good question and it’s a part that we really haven’t focused on. Trump had a rather neat answer to that if you heard it. Somebody asked him something about jobs being replaced by robots; he said “well then we’ll build the robots and we’ll service the robots”. So I mean he is this sort of “what’s the problem? I’m going to fix it in a way that makes me profit” kind of guy. So yes, he’s a billionaire developer but he is a populist and he strikes a lot more of the themes that were traditionally democratic party themes in the US, working class themes. He obviously got a lot of those votes and got them where they counted more in our system. Hillary Clinton got more absolute votes but it doesn’t matter, it matters where you get the votes and he got the votes in the right places. And he’s saying these things, he hasn’t backed down from them. I’m optimistic because you have to be and this is what we have and you want things to work out but when you see him rip up TPP yesterday and say “it’s a great day for the American worker”. Ok, we’ll see what happens, that’s fine. And then he stacks his cabinet with Goldman Sachs guys and Exxon Mobil guys and we can joke about it but at the same time it’s an interesting balance that he seems to be achieving.

And this is someone who really clearly does not like losing because his losing was a direct impact on his own business. It’s different when you lose and there’s no real repercussions. I think his mindset is, what is going to be that best deal and you have to figure out a balance and he tells us how he’s going to go about it. So you’re right, he’s going to have a hard time with automation but he’s also not willing to sit there and say “I promised something and I can’t deliver”, he’s going to drive a different type of bargain. And I think I wouldn’t be surprised at all to see greater support for him over the course of the term from the working class not because he delivers, because delivery is very hard but because it is clear that he is focused on their concerns and interests. And that was the single best line of the election, Trump’s critics take him literally but not seriously; his supporters take him seriously but not literally. Meaning, they don’t expect a wall but he’s the only one talking about open borders and the impact of migration on my job at home. And I wouldn’t be surprised him to continue that and really make a resonance that no President has had with American workers since Lyndon Johnson. It has been this growing globalization, the transnationalisation of the Presidency and the American economy that has consumed all Presidents and Bill Clinton was a perfect example of that, signing NAFTA and bringing China into the WTO. Trump may be the first one who brings it back to the people in a way that he promised. How that actually works and if he makes their lives better or not, politics is a combination of aspiration and rhetoric and hope and delivery and all the like and he may be figuring something our that is just different from what we’ve come to expect.

Q: I just wanted to go back to human rights that we started talking about because it seems like ASEAN doesn’t do much in terms of human rights issues within the region probably because of the divergence of human rights in all those countries. I understand what you’re saying that China could be pressured on economic policy by goals in that country but how would it work in other countries like Burma for example? I’ve spent the last five years in Burma, I’ve found it very hard as a freelance journalist even selling stories to US papers. Even at the time of Obama who had an interest in Burma himself, there didn’t seem any interest in improving the human rights situation when economically there doesn’t seem to be too much to gain for the Trump administration. So how do you see human rights in Asia in these smaller countries where there is not so much to gain economically, how do you think the Trump administration could potentially still influence that?

MA: Again it’s really an open question. It was not a part of the campaign, he doesn’t have that team in place, I really don’t know. Again if his point is he wants to get the best deal he can with a country like Burma which is half way in between democratization and authoritarianism if you look at the role of the military that’s still in the current system as well as the anti-democratic things that Aung San Suu Kyi herself has done. This is still a very fragile settlement, and if it is something that he cares about seeing Burma not swing back to China, stay in our camp or towards it, he’s going to have to push that balance. And still the Rohingya issue, it’s clear they’re not getting support from the government as well, so he has to figure out is this the sort of thing I have to potentially risk a rupture with?

And a good example of this is Obama and Duterte in the Philippines. That was a complete failure on the part of President Obama. Duterte literally hated him as a person because we came in with this very hectoring tone about what you shalt or shalt not do and they said forget you. And Trump gives a call and now Duterte is talking about his brother and other crazy stuff but again maybe that’s the negotiator in Trump. Obama loved to think of himself as above the fray in so many ways, he knew better than everyone else and he could tell people what to do and people finally started saying “well fine, that’s nice, see you later”. Trump figured out the key for a man who had nothing but hatred for the United States, to come away from a phone call saying “I love the guy, he’s my brother, I’m going to come to the White House!”. No-one knows what the deal is but he’s clearly a better inter-personal negotiator than Obama ever was and there have been a lot of domestic reports about even at the inauguration there was Trump huddling in the corner with the Congressional leaders. The old-fashioned, press-the-flesh way, he’s a big alpha-guy, getting in their face but really trying to forge some kind of connection. Obama never did that, and the democrats hated him more for that than the republicans. The republicans didn’t expect it; the democrats did, and hated the fact that he treated them like chattel. Here’s Trump going back to the old Reagan, Johnson style of in your face, big guy, he’s your buddy, let’s talk, what can I do for you but what are you going to do for me?

That approach may actually work with some of the foreign leaders. It may work with Putin, it seems to be working with Duterte, I think it’s going to work with Abe because, we’ll see about Prime Minister May. But he’s already softened the ground, he’s already said it’s the most important special relationship, Sir Winston is back in the oval office, all is good, we’ll see where we go with that.

CW: Xi Jinping’s been everywhere – Puerto Rico, Davos, the announcements on climate change. What do you think is going to be the relationship between Xi and Trump, two alpha males?

MA: It’s a really good question and I was going to come onto that now. There’s four alpha males to deal with immediately – there’s Trump, there’s Putin, there’s Xi and there’s Erdogan. Four alpha males at the centre of geopolitics. And then I would put Prime Minister Abe there as a second tier person coming in and Prime Minister May, not in terms of importance but in terms of approach to global issues. Xi is very important in terms of Xi Jinping, will Trump be able to make a deal with him? I’ll give you an anecdote in the form of an answer to the question. A couple of days before the Taiwan call the Chinese sent eighteen of their top scholars to DC, and these were the guys that were plugged in with Xi Jinping and the central leadership and the intelligence agencies. All people that we know but they came through en masse which is why I think they knew about the Taiwan call beforehand. Anyway I met with six of them, and an hour in they said “you think Trump is a strong guy right?” and I said “yeah I guess so”. They said “well Xi Jinping is a strong guy as well. Tell me how these two strong guys are going to get along because Xi Jinping is not going to back down”. And so they’re laying out the stakes right there, Xi Jinping does not want to become the Chinese leader who loses Asia to America.

Now he’s gone so far out on a limb, I would say the Davos speech brought him way out on a limb, further than China is actually able to do. China is not going to be the white knight of economic globalization, it is not their system. Their system is more closed than other systems, there is more opaqueness, there are things they are not willing to do but rhetorically he has jumped into that gap. And he’ll have to actually compromise if he wants to be seen as that leader but he and Trump are going to be like this and this is one way that Trump may use Putin as a balancer to Xi Jinping. Americans can only think about Russia in a European context but Russia in an Asian context is a very different player. It’s a balancer, it’s a spoiler, it can maneuver between partners, it’s not the other side of the bloc you’re worried about. And vis-à-vis China, Trump maybe using Putin. I mean, Putin will probably use him but possibly using Putin. So I don’t know which way this is going to go but I think in many ways Trump relishes the opportunity in ways that Barack Obama did not. Obama shied away from this stuff, he felt it was beneath him in many ways to horse trade and deal. He’s Barack Obama, he’s a healer and this stuff did not come easy to him; Trump it’s been his whole life.

Q: I am from the Philippines and thank you very much Michael for mentioning our President Duterte. At the moment America is giving us aid but with very strong caveats; Russia and China are giving us aid without caveats. For example we have to buy arms from America which is the latest technology and very expensive; with Russia and China we can buy good equipment at a good price. What will happen with this with Trump?

MA: Well it’s a good question, I think he will be much more willing to deal with Duterte on his own ground. And one thing the US doesn’t do very well buy the way around the world is infrastructure. We don’t do that, we do capacity building: you need better judges, better police? We can help. You need a road or a school? Go to China or Japan. We should be better in infrastructure building and that’s what Duterte wants, he said it. So we need to be more sensitive to that and I think Trump, as a businessman, will maybe understand that better but America does attach values to these things. It’s very hard to say, “do what you want with these weapons! You want to use them against your own people? Go ahead”, we don’t do that. That’s why we have limited relations with Indonesia for decades, that’s why with our own ally the Thais it’s very difficult at the moment with the coup. I don’t want us to give that up but you do have to seek a middle ground and encourage when you can appropriate use of whatever we are giving including weapons. We should stand for values, that’s what separates us and the UK I think from many other countries and regimes around the world. But you also don’t want to cut off your nose to spite your face, you want to make sure you retain a voice and an influence. Barack Obama failed at that; Trump may be better at it.

HJS



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