2 June 2013

Karzai's India Gamble

Pakistan isn't helping the Afghan government end its standoff with the Taliban -- so Karzai is looking to India instead. 

MAY 31, 2013 

KABUL, Afghanistan—Before he set off for India with a wish list of military hardware, Afghan President Hamid Karzai gave negotiations with Pakistan one last chance -- at least in principle. On April 24, he traveled to Brussels for a trilateral meeting with U.S. Secretary of State John Kerry and General Ashfaq Kayani, Pakistan's chief of Army Staff, whose cooperation is seen as essential for any post-2014 peace deal with the Taliban. The protocol screw-ups were telling: A photo-op from Truman Hall, the residence of the U.S. permanent representative to NATO, shows a startled looking Kerry (standing in front of the wrong flag) betwixt the stonefaced Afghan president and his effective counterpart in Kayani. Pakistan's civilian foreign secretary, also present on the trip, was not even in the frame. 

Already strained over how to approach negotiations with the Taliban, the relationship between Kabul and Islamabad had reached a new level of intransigence in April over Pakistani plans to build a military gate on what the Afghan government considered its side of the border. Karzai had responded by ordering Afghan troops to remove the gate and any other "Pakistani military installations near the Durand Line," the contentious British-mandated border between the two countries. 

Against this backdrop, it's little surprise that the Afghan president had given up on Pakistan before he even touched down in Belgium. In trying to resolve the conflict with the Taliban before he leaves office next year, Karzai has repeatedly bent over backward in hopes of securing Pakistani cooperation -- often risking political capital at home, where anti-Pakistan sentiment is on the rise. Now, it seems, Karzai no longer wants to wait at Pakistan's mercy. 

According to a source close to Karzai, Kayani actually agreed in the talks to help push the Taliban toward publicly agreeing to negotiate with the Afghan government, but the offer was evidently not trustworthy enough to dissuade the Afghan president from looking to Pakistan's archrival for assistance. (The July deadline for a similar offer -- made at a previous summit in Britain -- for a "peace settlement" with the Taliban to be reached "over the next six months" is fast approaching with no progress.) Kerry summed it up aptly before jetting back to Washington: "We are not going to raise expectations or make any kind of promises that can't be delivered." 

India to Approve Troop Buildup on China Border?

By Zachary Keck
June 1, 2013

India’s Cabinet Committee on Security (CCS) is expected to approve a proposal to deploy 40,000 additional troops along the 4,057-km line of actual control (LAC) that acts as the border between China and India, the Times of India reported Saturday morning. 

“The Army has proposed a mountain strike corps, two independent infantry brigades and two independent armored brigades to plug its operational gaps along the entire line of actual control (LAC) with China, as well as to acquire offensive capabilities,” the newspaper report said

It continued: 

“The proposed mountain strike corps, with over 40,000 soldiers and headquartered at Panagarh in West Bengal, will for the first time give India the capability to also launch offensive action into Tibet Autonomous Region (TAR) in the event of a Chinese attack.” 

The new forces would be part of a larger plan to strengthen India’s defenses along its northern border with China and western border with Pakistan. Between 2009 and 2010, India beefed up its LAC presence by raising two new infantry divisions consisting of 35,000 troops. 

The government is also planning on spending around US$4.6 billion building infrastructure on the Indian side of the LAC, and will deploy more mechanized elements and restructure troop formations to achieve greater mobility. The mountain strike corps would be part of India’s goal of having a rapid response force along the border. 

The CCS’s approval of the plan will come after the Ministry of Defense (MoD) responds to questions raised by the Ministry of Finance, the Times of India report said. Previously, the MoD had said raising the extra 40,000 troops would cost $14.3 billion, which would be spread across India’s 12th Five Year Plan (2012-2017) and could even stretch into the 13th Five Year Plan (2017-2022). 

Back in March, India’s Defense Minister AK Antony told Parliament the army also intended to raise 30 infantry battalions during the 13th Five Year Plan, although these wouldn’t necessarily be stationed along the LAC. According to The Indian Express, the cost of raising these 30 infantry battalions would be similar to the US$14.3 billion that raising the 40,000 troops for the LAC will cost. 

Returning to the Land or Turning Toward the Sea? India’s Role in America’s Pivot

By Evan Braden Montgomery
April 28, 2013

China is pushing the U.S. and India closer. Are they focusing on the wrong set of challenges?

Few diplomatic overtures have generated loftier expectations in recent years than Washington’s rapprochement with New Delhi. Frequently at loggerheads during the Cold War, then kept apart by the U.S. commitment to counter-proliferation and India’s pursuit of a nuclear deterrent, the two sides have never had a warm relationship. That began to change during the George W. Bush administration, a transformation that was symbolized by a controversial agreement allowing the United States to sell civilian nuclear technology to India, despite its status as a nuclear-armed nation that is not recognized by the Non-Proliferation Treaty. The Obama administration has since picked up where its predecessor left off. The president, for example, has called India a“natural ally” of the United States, while his former secretary of defense, Leon Panetta, declared that India was “a linchpin” of America’s pivot to the Asia-Pacific. 

While there were many reasons for the world’s oldest democracy and the world’s largest democracy to mend fences, perhaps the most important reason was the one that few officials could point to in public: the rise of China. In modern times, tensions between New Delhi and Beijing date back to their border war in 1962. In fact, the contested boundaries between these two powers are some of the only land border disputes that China has yet to resolve. To keep up with Beijing’s growing military power, India needs to modernize its armed forces, which means moving away from its reliance on Russian hardware and looking toward Europe and the United States. Meanwhile, Washington is searching for ways to preserve its position in the Asia-Pacific as China’s strength continues to increase. Having the region’s other rising power on its side is a good place to start. 

If a partnership between the United States and India makes sense on paper, so far improved relations between the two nations have hardly been game changing. There are a host of explanations why the fruits of strategic collaboration have been relatively modest, from bureaucracies on both sides that have impeded potential arms sales, to broader considerations such as the fear of antagonizing China. One important factor, though, is the mismatch between what the United States wants India to do and what New Delhi is best suited to do. 

Proponents of closer ties between Washington and New Delhi often view India as a budding maritime power. As then Secretary of Defense Robert Gates declared in 2010, “India can be a net provider of security in the Indian Ocean and beyond.” For example, with a bigger and better navy, India could help patrol vital sea-lanes, deter or counter smuggling operations, combat piracy, provide humanitarian assistance far from home, and respond quickly when natural disasters strike. All of this could help relieve some of the burdens shouldered by the U.S. Navy, which is juggling its day-to-day role as a global security provider and first responder with the longer-term challenge of a shifting military balance in the Western Pacific. Not surprisingly, areas like counter-piracy and humanitarian assistance are at the center of U.S.-India security cooperation today

Romanticising the killer Maoists

02 June 2013

Union Tribal Affairs Minister Kishore Chandra Deo told a television channel that calling the Maoists ‘terrorists', did not really matter. What was important was that the authorities must effectively tackle the menace.

He said this when the television anchor asked him pointedly whether he agreed with his ministerial colleague Jairam Ramesh's remark, which came in the wake of the killing of senior Congress leaders of Chhattisgarh by the Red ultras, that the Maoists were indeed terrorists.

Mr Deo is wrong. The label is important because it determines the Government's (both at the Centre and in the States) course of action. The authorities will not deal with a pick-pocket in the same manner that they would with a dacoit. A drunkard with a record of creating nuisance in his colony will be handled differently from that of a rapist. A terrorist has to be tackled differently from that of an individual who in a fit of rage picks the gun and shoots his tormenter. If there has to be a national policy on combating the Maoists — and there should be one at the earliest — it will have to take into account what sort of criminals these ultras are.

But Mr Deo's reluctance to call a spade a spade is not surprising, because it derives its basis from the romanticised notion that the Maoist killers are a response to the repression of the tribals by the state over decades and that, if they are terrorists, so are the state agencies which have ‘terrorised' and exploited the marginalised sections of society. While it is true that Government agencies have been far from responsive to the needs of the tribal population, and that on occasions the police and the security agencies have indulged in indefensible excesses, the solution cannot be the subversion of democracy through the gun. In any case, the Maoists have travelled far from their earlier lofty ideals of waging a war against wrongdoing, which began with the Naxalbari movement in West Bengal in the late 60s. They are now at war with the country; in the process they have been targeting innocent citizens, security personnel, politicians and just about every institution that represents democratic India.

The romanticised version of Maoist violence has been a devious creation of the apologists of these brutal killers, and it has sought to be embedded in the conscience of the unsuspecting populace through the media and seminar circuits frequented by so-called human rights activists. These apologists have received booster shots off and on from mainstream politicians as well, many of whom reside within the Congress. But after the Maoists killed senior leaders of the party, these apologists have either gone silent or have abandoned their soft speech. Jairam Ramesh is an example of the latter and Digvijaya Singh represents the former category. There have been exceptions, though, with senior Cabinet Minister

P Chidambaram having long maintained that the Maoists are terrorists and the single biggest threat to the nation's internal security. But each time strident voices such as his emerged on the need to use the iron fist against the Maoists, the party's resident doves rushed to dilute the impact by striking a counter note. As a result of these contradictions, the Maoists thrive.

U.S. Energy Exports to India: A Game Changer

MAY 30, 2013

Recently, there has been much discussion about possible American gas exports overseas. Will the U.S. export LNG? Will it go to India? Should it go only to American free-trade and security partners, or should it be market-driven? This month, our U.S.-India Insight explores some of the background behind the discussions and the reasons why it makes good economic, environmental and strategic sense to expand exports of LNG to India.

Indeed, high-ranking Indian and U.S. officials already think it makes good sense. India’s Ambassador to the U.S., Nirupama Rao, recently wrote in the Wall Street Journal that, “A boost in LNG exports would have many positive effects on both the U.S. and Indian economies. For the U.S. it would help create thousands of jobs and an expanded revenue stream for the federal government. For India, it would provide a steady, reliable supply of clean energy that will help reduce our crude oil imports from the Middle East and provide reliable energy to a greater share of our population.” Wendy Sherman, Undersecretary of State for Political Affairs, during her trip to India last week noted that the Department of Energy has announced that there will be sales of LNG to non-FTA countries. "This will take some time," she said, "but I think it speaks very well to what the future might look like in the U.S.-India LNG relationship.” This will also be a big step forward in overall U.S.-India energy cooperation.

A party with many faces

By Casey Garret Johnson
May 31, 2013

Since the fall of the Taliban regime in 2001, the U.S. and international community has never known quite what to make of the former mujahideen party Hizb-e Islami (HIG). Is it really two distinct entities? Is the registered political organization which split from the militant wing in 2004 and whose members occupy some of the most powerful cabinet posts in the Karzai government really autonomous from the insurgent group claiming responsibility for the deadliest attacks in Kabul in the last two years? The one pledging allegiance to the party's founding father, Pakistani-based uber-warlord Gulbuddin Hekmatyar, perhaps the most widely reviled man in a country with no shortage of reviled men? 

Our continued befuddlement was highlighted in a recent article by the New York Times' Matthew Rosenberg. In it, an advisor to Gen. John Allen, a former commander of the International Security Assistance Force, concludes that the political party had "a certain degree of autonomy from the militant wing" and was not quite operating like "Sinn Fein and the I.R.A." However, Rosenberg also cites an Afghan official who invoked the Northern Ireland example to make the exact opposite point, explaining that HIG "has a political face and a military face, like Sinn Fein and the I.R.A." 

Understanding the real and perceived links between the legitimate political party and the Pakistani-based militant group is especially important given the role that the former may play in the upcoming elections and future reconciliation talks, and our diminishing capacity to target, either militarily or diplomatically, the latter. 

"It didn't matter who your father was" 

HIG is rooted in the Muslim Youth Organization, an Islamist student group founded at Kabul University in the late 1960s to counter the larger leftist movements that would seize control of the state in a bloody coup a decade later. In the mid-1970s, the Muslim Youth split into two wings: a moderate faction led by Professor Burhanunddin Rabbani, the man who would twice serve as President of Afghanistan before his assassination in 2011, and a radical group led by an engineering student named Gulbuddin Hekmatyar. 

HIG earned a reputation throughout the 1980s as the most organized and ideologically driven of the various mujahideen parties. HIG's Islamist ideology borrowed heavily from the Muslim Brotherhood but, like most things in Afghanistan, the nature of the party owes a great deal to the more personal fact that Hekmatyar was born into a land-poor family from an inconsequential Pashtun tribe and was thus held outside traditional power structures. 

HIG recruited across ethnic lines and unlike factions reliant upon traditional networks of tribal elders or religious figures for recruitment and leadership, HIG was based upon a centralized party system -- a system more closely related to those of the Communist parties it waged war against during the 1980s than to the Taliban insurgency with which it is often lumped today. 

As one former HIG mujahideen told me in Kandahar in 2012: "When you joined Hizb-e Islami you became part of a party -- it didn't matter who your father was or what you did, everyone was given an ID card and was on equal footing." This aging mujahid went on to explain that party loyalty was so fierce that HIG members from his village in Helmand had buried their ID cards during the Taliban regime to avoid persecution "but they dug them up when the regime fell. They dug them up because once you are a member of Hizb-e Islami there is this feeling that you never stop being one." 

A Shameful Neglect

It's time to stop pretending that America's in Afghanistan to help women.

MAY 31, 2013 

Afghanistan's iniquities are grotesque. At Kabul University last week, zealots -- all men -- protesteda law that would abolish child marriage, forced marriage, marital rape, and the odious practice, called ba'ad, of giving girls away to settle offenses or debts. Meanwhile, in jails all over the country, 600 women, the highest number since the fall of the Taliban, await trial on charges of such moral transgressions as having been raped or running away from abusive homes. 

It is tempting to wring our hands at such obscene bigotry, to pity Afghanistan's women and vilify its men. Instead, we must look squarely at our own complicity in the shameful circumstances of Afghan women, billions of international aid dollars and 12 years after U.S. warplanes first bombed their ill-starred land. 

I have been traveling to Afghanistan since 2001, mostly to its hardscrabble hinterland, where the majority of Afghans live. Over the years, I have cooked rice and traded jewelry with Afghan women, cradled their anemic children, and fallen asleep under communal blankets in their cramped mud-brick homes. I have seen firsthand that the aid we give ostensibly to improve their lives almost never makes it to these women. Today, just as 12 years ago, most of them still have no clean drinking water, sanitation, or electricity; the nearest clinic is still often a half day's walk away, and the only readily available palliative is opium. Afghan mothers still watch their infants die at the highest rate in the world, mostly of waterborne diseases such as bacterial and protozoal diarrhea, hepatitis, and typhoid. 

Instead of fixing women's lives, our humanitarian aid subsidizes Afghanistan's kleptocrats, erects miniature Versailles in Kabul and Dubai for the families of the elite, and buys the loyalty of sectarianwarlords-turned-politicians, some of whom are implicated in sectarian war crimes that include rape. Yet, for the most part, the U.S. taxpayers look the other way as the country's amoral government steals or hands out as political kickbacks the money that was meant to help Afghan women -- all in the name of containing what we consider the greater evil, the Taliban insurgency. In other words, we have made a trade-off. We have joined a kind of a collective ba'ad, a political deal for which the Afghan women are the price. 

To be sure, a lot of well-meaning Westerners and courageous Afghans have worked very hard to improve women's conditions, and there has been some headway as far as women's rights are concerned. The number of girls signed up for school rose from just 5,000 before the U.S.-led invasion to 2.2 million. In Kabul and a handful of other cities, some women have swapped their polyester burqas for headscarves. Some even have taken jobs outside their homes. But here, too, progress has been uneven. A fifth of the girls enrolled in school never attend classes, and most of the rest drop out after fourth grade. Few Afghan parents prioritize education for their daughters because few Afghan women participate in the country's feudal economy, and because Afghan society, by and large, does not welcome education for girls or emancipation of women. To get an idea about what the general Afghan public thinks of emancipation, consider this: the post-2001 neologism "khanum free" -- "free woman," with the adjective transliterated from the English -- means "a loose woman," "a prostitute." In villages, women almost never appear barefaced in front of strangers. 

Excess German Savings, Not Thrift, Caused the European Crisis

MAY 21, 2013

National savings represent a lot more than the thriftiness of local households, and as such it has a lot less to do with household or cultural preferences and more so with the policies or institutions that restrain the household share of GDP. 

One of the reasons that it is been so hard for a lot of analysts, even trained economists, to understand the imbalances that were at the root of the current crisis is that we too easily confuse national savings with household savings. By coincidence there was recently a very interesting debate on the subject involving several economists, and it is pretty clear from the debate that even accounting identities can lead to confusion. 

The difference between household and national savings matters because of the impact of national savings on a country’s current account, as I discuss in a recent piece in Foreign Policy. In it I argue that we often and mistakenly think of nations as if they were simply very large households. Because we know that the more a household saves out of current income, the better prepared it is for the future and the more likely to get rich, we assume the same must be true for a country. Or as Mr. Micawber famously insisted:

Annual income twenty pounds, annual expenditure nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pound ought and six, result misery. 

But countries are not households. What a country needs to get wealthier is not more savings but rather more productive investment. Domestic savings matter, of course, but only because they are one of the ways, and probably the safest, to fund domestic investment (although perhaps because they are the safest, investment funded by domestic savings can also be misallocated for much longer periods of time than investment funded by external financing). 

Saving in itself, however, does not create wealth. It is productive investment that creates wealth. Domestic savings simply represent a postponement of consumption. 

In a closed economy, total savings is equal to total investment or, to put it differently, whatever we don’t consume we invest (if we produce something that we neither consume nor invest, we effectively write its value down to zero, so the balance remains). In an open economy, if a country saves more than it invests it must export the excess savings. It must also export the excess production. 

Notice that by definition if a country saves more than it invests, total consumption plus total savings must be greater than total consumption plus total investment. The former is the sum of the goods and services it creates, whereas the latter is the sum of goods and services it absorbs. That country, in other words, supplies more goods and services than it absorbs, and so it must export the excess. 

What is more, by exporting excess savings, the country is providing the funding to foreigners to purchase its excess production. This is why the current account and the capital account for any country must always add up to zero. 

In the late 19th Century, as I discuss in my most recent book, economists like John Hobson in the UK and Charles Arthur Conant in the US noticed that the rich countries of the west were exporting large amounts of savings abroad – mostly to what were later called by the dependencia theorists of the 1960s the peripheral nations. Hobson and Conant argued that the reason for this excess savings had to do with income inequality. As more and more wealth is concentrated into the hands of fewer people, consumption rises more slowly than production, largely because the wealthier a person gets, the smaller the share he consumes out of his income. Notice that because savings is simply total production of goods and services minus total consumption, this forces up the national savings rate. 

How to Free the Chinese Internet

Focus on Businesses, not Dissidents 

May 30, 2013

See 11 phrases that are blocked on Weibo -- and learn the reasons why.

The Google China headquarters is seen behind a surveillance camera in Beijing, 2010. (Jason Lee / Courtesy Reuters) 

The Chinese Internet is becoming a walled garden -- an Orwellian environment, separated from the rest of the global Web, where information unfavorable to the government simply disappears, public discussions are shaped by undercover agents, and censorship and surveillance are built into the most popular online services. 

This system is bad for the United States, not just because it contradicts American values and holds back China’s political liberalization but also because it harms U.S. businesses. Part of the problem is that U.S.-based online services, such as Facebook and Twitter, are blocked from reaching Chinese consumers, but the true stakes are much larger: Every American business that operates in China needs a secure, fast, and reliable Internet connection. And China’s censorship system puts these connections at risk. 

The core of China’s repressive online system is its so-called Great Firewall, which makes large sections of the Internet unreachable from the Chinese mainland and steers Chinese users toward censored domestic sites. As part of its worldwide “Internet freedom” agenda, the United States has funded the creation of special software tools to help Chinese dissidents, journalists, and other users for whom privacy is paramount sneak through their government’s barriers. This focus on human rights, high-risk users, and customized software has worked well in some countries, but in China, U.S. policymakers need to take a broader view. 

The existing U.S.-supported tools aim to give high risk users the protection they need -- protection far beyond what mainstream computing tools provide. But such cloak and dagger methods tend to be too slow and unreliable for most users. And each time these tools improve, Beijing’s army of censors adapts in response. China has bottomless reserves of high-caliber engineering talent to devote to shoring up its barricades, and it has developed advanced techniques to identify the distinctive signature of particular censorship circumvention programs, blocking them automatically or leaving them barely usable. Tools built explicitly to support free expression, which lack a broad commercial footprint, are ultimately no match for this pressure.

At the same time, the U.S. focus on China’s digital dissidents neglects a much larger group of Chinese Internet users. Most Chinese citizens want Internet access for personal, not political, reasons -- think of young workers in the technology industry and students in Chinese universities. They want to watch popular videos more than to read anti-regime material, to tweet more than to plan protests. They do not expect or need their activities to be clandestine -- they just want a fast and unrestricted connection. Chinese students try to circumvent censorship in roughly the same way that American students share pirated movies: it’s against the rules, and the authorities warn against it, but by itself it seldom gets people into serious trouble. 

In order to help the Internet unlock political change in China, American policymakers should focus on defending the commercial needs of U.S. businesses operating in China, rather than the political needs of dissidents and journalists. A Chinese Internet that allowed free and private online communication would be valuable not just to Chinese users (dissident and otherwise) but also to the many American businesses whose offices in China need to communicate with their U.S.-based headquarters. In other words, making the Chinese Internet safe for American business might be the best way to advance human rights online. 

The need for a shift in U.S. Internet freedom policy toward China was made clear by a recent surveyof more than a thousand Chinese users of circumvention software, conducted by my colleagues and me at the Open Internet Tools Project. We found that where politically motivated software is failing to give Chinese users secure and free Internet access, business tools are succeeding. Every foreign firm that operates in China needs a secure, fast, reliable, and uncensored connection to its home office. Tens of thousands of such connections break through the Great Firewall every day, including Virtual Private Network (VPN) connections and encrypted connections to cloud-hosted business services (such as secure websites for holding corporate documents). These types of connections, rather than the niche circumvention tools that currently receive the most U.S. support, are increasingly offering Chinese users their best option for Internet freedom.

China and US to begin first high-level meetings on cybersecurity and industrial espionage

June 1, 2013 

After months of political back-and-forth, top-level officials from US and China will meet next month to discuss agreements on cybersecurity and industrial espionage, reports The New York Times. The talks mark the first diplomatic push to resolve tensions since the issue of Chinese cyberattacks on American media and infrastructure targets first came to the fore earlier this year. 

After months of reports of hacking from major US newspapers, a February report from security agency Mandiant showed evidence that a spate of attacks against US targets could be traced back to a People’s Liberation Army building in Shanghai. For its part, China has staunchly denied any role in the attacks, pointing to US cyberattacks on its own military websites. Intellectual property theft has been a particular concern in the attacks, underscored by a report last week from The Washington Post indicating that Chinese hackers managed to get access to confidential design documents for American weapons systems. The Pentagon has downplayed the documents’ importance

"We need to get some norms and rules." 

The talks are scheduled to start as part of the US-China Strategic and Economic Dialogue, writes The Times, a yearly diplomatic meeting between the two countries on a variety of issues centered on trade and finance. While government officials don’t expect the talks to bear any significant improvements in the short term, the hope is that they will lead to the creation of international standards of behavior down the road. "We need to get some norms and rules," said an unnamed senior official.

America or China: one day, we will have to choose

May 28, 2013 

Politicians can no longer bury their head in the sand about our foreign policy direction.

There is something obsessive about the way our leaders keep saying that Australia does not have to choose between America and China. Julia Gillard says it almost every time she talks about foreign policy. Bob Carr and Stephen Smith cling to it. It's woven into the government's Asian Century white paper and National Security Statement. 

And it's there again in the Defence white paper: ''The government does not believe that Australia must choose between its longstanding alliance with the United States and its expanding relationship with China.'' 

Tony Abbott and Julie Bishop say the same thing, and John Howard said recently it was ''infantile'' even to discuss the idea that we might have to choose. 

But is it true? It depends what precisely we think our leaders are saying. If they are talking about the past and even the present, then the mantra is true. For many years now we have not had to choose between the US and China, and this has been absolutely vital to us. America has kept us safe and China has kept us solvent. 

The whole question, however, is whether this will still be so in future. Our leaders shamelessly evade this question, because although grammatically ''we don't have to choose'' is about the present, they present it as a prediction about the future. They therefore assume that what's been true must stay true. 

One can see why they are so edgy about it. If they turn out to be wrong, and we do have to choose, all our ideas about Australia's future will be overturned. How can we be secure without America? How can we be prosperous without China? These are questions they want to evade, because they have no answers to them. 

But this is precisely why they are so wrong to avoid the whole issue. This is why our highest foreign policy priority must be to keep both relationships strong, and why it is so important to understand what might threaten our ability to do that. 

Whether in future we will face a choice between America and China depends absolutely on how their relationship with one another develops. The decision will not be ours, but theirs. If either of them decide that we have to make a choice, then we do. The better they get along, the less we will be forced to choose. The more they see themselves as rivals, the starker our choices will be. 

Asia-Pacific: A Strategic Assessment

Added May 28, 2013
113 Pages
Download Format: PDF
Brief Synopsis

Dr. David Lai provides a timely assessment of the geostrategic significance of Asia-Pacific. His monograph is also a thought-provoking analysis of the U.S. strategic shift toward the region and its implications. Dr. Lai judiciously offers the following key points. First, Asia-Pacific, which covers China, Northeast Asia, and Southeast Asia, is a region with complex currents. On the one hand, there is an unabated region-wide drive for economic development that has been pushing Asia-Pacific forward for decades. On the other, this region is troubled with, aside from many other conflicts, unsettled maritime disputes that have the potential to trigger wars between and among Asia-Pacific nations. Second, on top of these mixed currents, China and the United States compete intensely over a wide range of vital interests in this region. For better or for worse, the U.S.-China relationship is becoming a defining factor in the relations among the Asia-Pacific nations. Third, the U.S. strategic shift toward Asia-Pacific is, as President Obama puts it, not a choice but a necessity. Although conflicts elsewhere, especially the ones in the Middle East, continue to draw U.S. attention and consume U.S. foreign policy resources, the United States is turning its focus toward China and Asia-Pacific. Fourth, in the mid-2000s, the United States and China made an unprecedented strategic goodwill exchange and agreed to blaze a new path out of the tragedy that often attends great power transition. Fifth, at this time of U.S. strategic reorientation and military rebalancing toward Asia-Pacific, the most dangerous consideration is that Asia-Pacific nations having disputes with China can misread U.S. strategic intentions and overplay the “U.S. card” to pursue their territorial interests and challenge China. Finally, territorial dispute is becoming an urgent issue in the Asia-Pacific.

How Beijing Can Reassure Its Neighbors in the South China Sea

MAY 30, 2013 


Regional stability is vital to sustaining the vibrancy of the Chinese and regional economies. It is in China’s interest to take steps to prevent further militarization of these disputes.

Competing territorial and jurisdictional claims in the resource-rich South China Sea have once again brought states in the region into direct confrontation. Maritime tensions have spilled over into broader regional interactions, injecting new frictions into relations among ASEAN members. 

China’s substantial maritime claims in the resource-rich waters put it at the center of these disputes. Beijing’s claims overlap extensively with those of Vietnam, while the Philippines and several other states ringing the South China Sea have competing claims as well. In recent years, more assertive action by claimants, including China, to promote or reinforce their maritime stakes has increased the risk of conflict emerging that could destabilize the region. 

Yet, regional stability is vital to sustaining the vibrancy of the Chinese and regional economies. In an era of international uncertainty and global security challenges, it is in China’s interest to take steps to prevent further militarization of these disputes. Beijing should take steps to foster cooperation with neighbors with which it has maritime disputes. 


After years of relative calm, claimants in the South China Sea have intensified efforts to assert their interests through official statements, new domestic policies, and more frequent and intrusive patrols. These actions and others have brought China head-to-head with both the Philippines and Vietnam at the same time that a dispute between China and Japan over the Diaoyu/Senkaku Islands in the East China Sea has erupted into risky displays of force. 

Beijing contends that its actions in the South China Sea are reactive rather than deliberately escalatory, undertaken to defend its position against challenges to its sovereignty claims and related maritime interests. It has repeatedly conveyed its commitment to an approach to relations with ASEAN member states that promotes peace, stability, and prosperity in the region, including where territorial disputes are concerned. 

Nonetheless, some of what Beijing has done, such as the announcement in 2012 by the China National Offshore Oil Company (CNOOC) of a vast sweep of new exploration blocks, has confused this message and reinforced regional concerns that China is prepared to use its superior capabilities to assert its claims. CNOOC’s announcement, for example, set back what had been improving relations with Vietnam at the time. 

Meanwhile, Washington’s pivot—or rebalance—to Asia, rolled out during the Obama administration’s first term, reinforced the U.S. commitment to a strengthened forward military presence in the region that focused on supporting its allies and strategic partners. These military measures were complemented by so-called “forward-deployed diplomacy,” marked by a revitalized American presence in regional forums. 

Geopolitical consequences

Rite of passage
The opening up of Myanmar could transform the rest of Asia

May 25th 2013

Putting the Irrawaddy to work 

ON THE NORTHERN outskirts of Yangon lie the sprawling industrial estates that used to provide Myanmar’s economic muscle, such as it was. Now, after decades of sanctions and economic mismanagement, many of the factories have been demolished and the ones left standing are mostly derelict. But amid the rubble are signs of new life, not only for Myanmar but for the rest of Asia. Near the gates of the Mingaladon Industrial Park two new Japanese-owned factories have sprung up out of the debris. One of them, Famoso Clothing, offers a glimpse of a better future for Myanmar—and for Asia. 

Owned by Daiei Ready Made Clothes Corporation, based in Japan’s Nagoya, Famoso was set up in Yangon in 2002 as a small operation to make men’s suits exclusively for the Japanese market. The parent company did most of its business in China, where it employed thousands of local workers in three factories. But three years ago two of the factories in China were closed and the plant in Yangon was rebuilt at a cost of $7m to become the company’s new Asia hub, explains Famoso’s managing director, Kazuto Yamazaki. The company’s last Chinese factory will close within a year and the Yangon operation will triple its output, from 170,000 suits a year to half a million. 

The reason for the switch is simple, says Mr Kazuto: the high cost of labour in present-day China. In Myanmar he pays workers around $100 a month, a quarter of the going rate in China. Moreover, Famoso is well placed to take advantage of the most important economic consequence of Myanmar’s political reforms: the ending of Western sanctions, and in particular the ban on imports from Myanmar. Famoso is making its first suits for Britain’s Marks & Spencer, ready for shipping in July. Famoso has even applied for a licence to sell its suits in Myanmar itself for the first time. Mr Kazuto says there is growing demand for Western clothes from politicians in Naypyidaw. 

Famoso has the full backing of the Japanese government. The new prime minister, Shinzo Abe, has identified South-East Asia, and in particular Myanmar, as places where goods can be assembled cheaply but also as new markets to help revive the Japanese economy. Japan has written off billions of dollars-worth of Myanmar’s debts to it and is now investing heavily in the country. Among other things it is building a large new river port, part of the Thilawa Special Economic Zone just south of Yangon, to replace the former capital’s old, silted-up facility. This will cost about ¥20 billion ($200m) in the first instance, which will come out of its overseas aid budget. And if that sounds very Chinese, Japan is spending another ¥14 billion to help fix the dodgy electricity supply in Yangon and a further ¥20 billion on other infrastructure projects throughout the country. The mix of low wages, a plentiful supply of labour and access to American and European markets should mean that many more Famosos will be set up in Myanmar. 

Japan's Military Moves Toward Pre-Emptive Strike Capability

TOKYO—Japan's military, long constrained by the nation's postwar pacifist constitution, moved toward gaining the freedom to strike enemy targets abroad if an attack is anticipated. 

WSJ Tokyo Bureau Chief Jacob Schlesinger discusses the Nikkei stock selloff early Thursday morning, and explains Japan's military moving toward the ability to carry out pre-emptive strikes, with North Korea its main focus. 

Tokyo is preparing a new basic defense policy framework under hawkish Prime Minister Shinzo Abe, and recommendations for that framework compiled Thursday by ruling party lawmakers called for building the capability to attack an enemy's strategic bases for self-defense purposes. 

Such a step would allow Japan's Self-Defense Forces to launch a pre-emptive missile strike at an enemy's military target when an imminent attack on Japan from that specific site is confirmed, officials for the ruling Liberal Democratic Party said. 

Specifically, such a step assumes possible missile attacks from North Korea, which has been stepping up its nuclear and missile threats against targets in Japan and South Korea and U.S. bases in the region. 

"We have just gone through a period when people in Japan felt extreme anxiety about national security," Yasuhide Nakayama, a lawmaker who heads the LDP's National Defense Division responsible for the recommendations, said in an interview Thursday. In addition to North Korea's missile program, he cited China's intrusions into territorial waters around contested East China Sea islands. "We believe we need to rebalance our basic policy." 

The adoption of a first-strike doctrine would mean a significant shift in the responsibility for the SDF, whose role is strictly confined by the constitution to activities construed as "self defense." Mr. Abe, known for his hawkish foreign policy stances, sees constitutional revision as a top goal of his government—and, short of outright revision, has advocated military policies that would stretch conventional interpretations of postwar constitutional restrictions. 

Soon after the LDP returned to power in December after three years in opposition, the government said it would publish by the end of 2013 a new National Defense Program Guideline, the most basic policy statement that determines the course of the nation's defense strategies for the medium- to long-term, or up to 10 years. While the guideline will eventually be packaged by the defense ministry under the leadership of the prime minister, the ruling party's recommendations this week carry significant weight. Mr. Abe is eager to revise the guideline even though the current ones are less than two years old, as they were compiled by the previous administration run by a rival party. 

Mr. Nakayama said there are three challenges Japan faces as it starts developing a capability for attacking enemy bases abroad. It must make significant investment in research and development for weapons technology, as Japan now has only those designed for more strict self-defense purposes. It needs to clarify legal implications of such a move, including the possibility of adjusting the official interpretation of the constitution. Finally, it must gain the understanding of neighboring Asian nations that are nervous about Japan's military revival. 

"Through diplomatic steps, we need to give careful and thorough explanation that we are talking about attacks strictly for the purpose of self defense," he said. 

How to Fix America

Which Tools Should Washington Use?

The crisis of democracy identified in the 1970s never really went away; it was just papered over with temporary solutions and obscured by a series of lucky breaks. Today, the problems have mounted, and yet American democracy is more dysfunctional than ever -- and it has fewer levers to pull in a globalized economy. This time, the pessimists might be right. 

President Barack Obama's fiscal 2014 budget proposal. (Gary Cameron / Courtesy Reuters) 

Edward Conard

In "Can America Be Fixed?" (January/February 2013), Fareed Zakaria argues that American democracy has grown increasingly dysfunctional since the 1970s and that "a series of lucky breaks" -- namely, the end of inflation, new information technologies, globalization, and excessive borrowing, which has allowed Americans to consume more than they have produced -- have covered up structural problems in the U.S. economy. He worries that these factors are now keeping unemployment high and wages low. In outlining his solution to this problem, Zakaria looks back to the 1950s and 1960s, when Washington spent lavishly on domestic investment and the economy "boomed." What the U.S. government needs to do today, he concludes, is establish "massive job-training programs" and a "national infrastructure bank" from which "technocrats" could allocate funds to public works projects based "on merit rather than . . . pork." 

But Zakaria's argument is grounded in a misreading of history: although government investment in infrastructure in the 1950s and 1960s did contribute to economic growth, many other factors drove that growth as well. Moreover, it is unlikely that building new physical infrastructure would do as much for growth in today's knowledge-based economy as it did in the two decades following World War II. Finally, there is little reason to believe that politicians would allow technocrats to control infra-structure spending. And even if they did, it is doubtful that technocrats could choose investments effectively -- much less with the wisdom and efficiency of free enterprise. After all, private-sector investment and risk taking, not infrastructure investment, have driven U.S. economic growth over the last two decades, and they will likely continue to do so in the future. 


Low inflation, information technology, and globalization do not fully explain the United States' economic success over the past two decades. Europe and Japan also enjoyed these things, yet their productivity growth fell to near-record lows, while the United States' soared to near-record highs. (Productivity, which measures output per worker, is the best measure of economic success, because it excludes population expansion, which adds to GDP without raising livings standards.) In fact, the contrast is even starker than it appears, because American innovation helped boost the rest of the world's productivity. It is thus difficult to conclude that a dysfunctional U.S. democracy slowed economic growth. 

Many advocates of government spending claim that productivity growth has not benefited the middle and working classes. Since the early 1980s, however, the U.S. economy has added 40 million jobs to the country's work force -- an increase of roughly 40 percent. France's and Germany's work forces have grown by less than half that amount, and Japan's, by even less. Indeed, U.S. job growth was so robust over the last two decades that it pulled 14 million new immigrants into the work force. Contrary to popular belief, the United States did not outsource jobs; it insourced them. Even if wages have remained flat (a disputable point), the United States still created an enormous increase in total middle-class income relative to Europe and Japan during this time. No other high-wage economy has done more for the middle class and the working poor. 

America's Anti-Access Nightmare Coming True

As America's military shrinks thanks to defense reductions and the nightmare known as sequestration, defense planners face an ever increasing challenge by nations who wish to limit military access to areas of the globe vital to their strategic interests. The question of access could end up being the strategic challenge of the 21st century, but will America's armed forces be up to the challenge? 

The strategy, dubbed Anti-Access/Area-Denial, or A2/AD -- while nothing new but a fancy term for layered defense across multiple domains such as land, sea, air, cyber and space seeks to wedge an asymmetrical dagger in the heart of America's seemingly insurmountable military edge. Weapons such as ultra-quiet diesel submarines, advanced mines, anti-ship weapons, and even cyber or anti-satellite weapons would seek to engage U.S. forces an in an effort to slow, stop or deter enemy combatants from entering a combat zone or contested geographic areas. 

The nation that is most associated with A2/AD -- and rightly so -- is the People's Republic of China (PRC). The PRC has developed a robust anti-access capability that certainly would pose a challenge to any force that wished to operate in the near seas along its coasts and near what is commonly referred to as the first island chain. China's military has intently studied America's victory in the First Gulf War and subsequent operations but also recalls a bitter experience where it had no response to U.S. power -- in the 1995 - 1996 Taiwan crisis. In areas of strategic tension such as the East and South China Seas to the now calm but still contested area around the Taiwan Strait, China could shower any target with an abundance of cruise and ballistic missiles from various platforms. Combined with robust cyber, submarine, and surface forces that could be synergized to deny access across multiple domains, U.S. and allied forces could find themselves constrained unless they are willing to accept high levels of casualties not seen in recent memory. 

But one does not need to have the robust resources of the world's second largest economy to develop a potent A2/AD strategy. Iran is also developing its own anti-access approach. With a small but capable force of Russian build diesel submarines, mines, various types of missiles and a growing cyber capability, Iran has certainly embraced A2/AD. While certainly not as capable as the PRC, U.S. forces that operate close to Iran's coast as well as maritime shipping that must transit the Strait of Hormuz are certainly in the capable crosshairs of Iran's forces. And with Iranian threats to close the straits in time of a crisis, such threats should be taken seriously. If American forces do attempt at some point to halt the progress of Tehran's nuclear program with military force, anti-access systems will be Iran's weapon of choice. 

America's access problem however does not stop with Iran in the Middle East. Syria's A2/AD centric purchases have figured prominently in the news just recently. Damascus will reportedly acquire from Moscow the S-300 air-defense system. Such a system could constrain the ability of anyone considering intervening in Syria's bloody civil war, or future Israeli actions to prevent weapons transfers to Hezbollah. Russia has also reportedly sold to Syria advanced supersonic anti-ship cruise missiles. Called the Yakhont, it speeds to its target at Mach 2.5 and has a reported range of 300 kilometers. Such weapons, with properly trained crews, would certainly constrain military options for intervention and could embolden President Assad to press forward at a time when the world seeks his departure. 

While depictions of access challenges in various geostrategic hotspots sound quite grim, America's military is more than up to the challenge. Even as U.S. military planners will face access challenges with diminishing resources, America's armed forces remaining the world's best by whatever measure employed. The best solution to solving the access challenge is a clear shift in priorities to meet the threat environments of the future. This has clearly begun with the creation of the AirSea Battle operational concept and the Joint Operational Access Concept. However, words and defense papers must now transform into action. For example, America's carriers will clearly need to operate further away from coastlines stacked with robust A2/AD missiles. Systems such as the recently tested X47-B and the follow-on Unmanned Carrier Launched Airborne Surveillance and Strike System (UCLASS) are important in ensuring carriers do not becoming obsolete. U.S. planners must also continue to fund and consider increasing the amount and types of nuclear submarines that will need to operate in areas of contested access. Submarines that can carry large amounts of missiles with long-ranges that can degrade the command and control systems of anti-access nations will be of vital importance. Cyber forces must also be ready to attack the ability of advanced missile systems to target vessels on the open ocean. 

No Longer Unthinkable: Should US Ready For ‘Limited’ Nuclear War?

May 30, 2013

AI FORCE ASSOCIATION HQ: For more than 60 years, most Americans have thought of nuclear weapons as an all-or-nothing game. The only way to win is not to play at all, we believed, because any use of nukes will lead to Armageddon. That may no longer be the game our opposition is playing. As nuclear weapons proliferate to places that might not share our reluctance to use them in small numbers, however, the US military may face a “second nuclear age” of retail Armageddon for which it is utterly unprepared. 

Outside the US, both established and emerging nuclear powers increasingly see nuclear weapons as weapons that can be used in a controlled, limited, and strategically useful fashion, said Barry Watts, an analyst with the Center for Strategic and Budgetary Assessments, arguably the Pentagon’s favorite thinktank. The Cold War “firebreaks” between conventional and nuclear conflict are breaking down, he wrote in a recent report. Russia has not only developed new, relatively low-yield tactical nukes but also routinely wargamed their use to stop both NATO and Chinese conventional forces should they overrun Moscow’s feeble post-Soviet military, Watts said this morning at the headquarters of the Air Force Association. Pakistan is likewise developing tactical nukes to stop India’s much larger military. Iran seeks nuclear weapons not only to offset Israel’s but to deter and, in the last resort, fend off an American attempt to perform “regime change” in Tehran the way we did in Baghdad. The US Air Force and Navy concept of“AirSea Battle” in the Western Pacific could entail strikes on the Chinese mainland that might provoke a nuclear response. 

It’s precisely because US conventional power is so overwhelming that the temptation to turn to nuclear weapons to redress the balance is so irresistible. Ten years ago, the Iraqis sidestepped American dominance in the middle of the spectrum of conflict – regular warfare with tanks, planes, and precision-guided non-nuclear weapons – by going low and waging guerrilla warfare, for which the US proved painfully unprepared. In the future, nuclear proliferation means more and more countries will have the option to sidestep US conventional power by going high and staging a “limited” nuclear attack, for which we aren’t really prepared either. Indeed, some countries, notably a nuclear Iran with its terrorist proxies and North Korea with its criminal ties and special operations forces, couldoutflank America’s conventional military from both sides at once. 

So, could the US military keep going after losing an Army brigade or a Navy aircraft carrier to a tactical nuclear strike? “I don’t think we’ve thought about continuing to do conventional operations in an environment in which some nuclear weapons have been used, [not] since the Cold War,” Watts told me after his talk. “You’ve got to have equipment that continues to work in that environment, and, in general, we don’t.” 

For example, one of the ways the Army economized on its new “Nett Warrior” communications gear for foot troops was to scrap the requirement for its circuit to survive the electromagnetic pulse, or EMP, from a nuclear detonation, which can spread far below the lethal blast and radiation effects: Such shortcuts make sense for Afghanistan and Iraq, but not for Korea. 

“So there are a lot of things you might want to invest in, to put it mildly,” said Watts.