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What is the Real Goal of the US Pivot Policy? Peace Pivot (I)

5/30/2015

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Dr. Wordman
The subject question has been in debate ever since the 'Pivot' policy was announced during the Obama-Clinton Administration. The recent hype of the Japanese Prime Minister's state visit to the United States to cement a revision of the U.S.-Japan Mutual Defense Treaty pushed the subject issue into a higher level of discussion among political analysts in the U.S. as well as elsewhere in the world. The unusually staged 'honor' bestowed to Abe Shinzo to let him address the joint session of the US Senate and Congress brought the subject question to the attention of US common citizens. The word 'honor' for Abe in quotation marks highlights that such an honor was first given to Winston Churchill, the British PM, who was the genuine ally of the U.S. and the strongest leader in the British history. Churchill was influential in cementing a US-GB partnership, fighting successfully against the Fascist Nazi and the Japanese Imperial Army during WW II. He was the first foreign leader addressed the US joint congress, December 26, 1941 and May 19, 1943. Is Abe in the same caliber of Churchill? Other than being a ‘Pivot’ supporter, what did Abe Shinzo accomplish to deserve such an 'honor'? What does the U.S. need so badly from Japan? Sell her beef and rice or complete the new US military base Camp Schwab in Okinawa? These are legitimate questions to ask, related to the subject question.

When the 'pivot' policy was first introduced by Obama-Clinton; the media, mainstream and organic were questioning its real purpose from the start. The U.S. administration repeatedly stated that the intension of the policy was for maintaining peace and stability in Asia Pacific            (AP), first by changing the word ‘pivot’ to ‘rebalance’ then emphasizing that the policy was “not targeting” at China”.  However, the interpretation of the real goal of “pivot’ persists into the Obama-Kerry administration,  and it is still puzzling to the world. The recent actions, such as redefining the U.S.-Japan Mutual Defense Treaty, organizing with Japan to define a 12 member Trans-Pacific Partnership (TPP) excluding China and howling like a lone wolf with Japan opposing the China led Asia Infrastructure Investment Bank (AIIB), all cast doubt on the U.S. AP-policy regarding its officially stated real intension.


The recent developments happening prior to 2016 presidential election compel anyone who cares about the US-China relation to think deeper about the subject question, one of the most important US foreign policy questions. There are different opinions in interpreting the real goal of ‘pivot’. I am devoting this column space to do an analysis on ‘pivot’, dissecting two opposite theses regarding her real goal. Hopefully such an analysis can provide us some food for thought in plain language instead of diplomatic jargons so to allow fellow Americans to formulate a clear understanding on the pivot policy, in turn, to influence the U.S. AP policy to move on to a desired and correct path.

Unquestionably the U.S. is still the strongest nation on Earth, but she is struggling financially. The U.S. is in enormous debt, her economy has long shifted away from manufacturing with tangible productivity to services, especially financial services where the U.S. relies on making money based on money as the principal element. The US government relies on the US Dollar to be the world's trade instrument so that her debt burden can be relieved by printing more US dollars and issuing more government bonds and treasury bills based on the US dollar. Americans are ingenious in financially engineering their economy. In the post WW II era, especially the last three or four decades, many countries in the world including the U.S. have experienced serious financial crises, recessions and hyper inflations, but the US economy has been maintained with a reasonable GDP growth rate ever after coming out of the depression. The U.S. economy was managed continuously to be the number one economy and the most attractive investment environment in the world owing a large extent to her successful monetary policy.


China had miraculously risen in economy from a very poor state. Her great success dwarfs that of the four little Asian Dragons. China survived the Asian financial crisis because of her manufacturing focused economical policy, poor and hard working people with strong tolerance to recession and an unsophisticated 1.3 billion people/market extremely lucrative to foreign investments. China has sustained her high digit GDP growth for the last three decades advancing her economy to be the number two in the world surpassing Japan. This fact naturally causes concerns in the U.S. and Japan. Japan’s economy has been stagnant and her population is aged. Abe’s three arrows did not seem to solve Japan’s economic problems. It appears that Abe is playing the Japanese die-hard right wing political card – Japan must return to her Pre-war glory by directing the Japanese youth’s attention to external affairs rather than their domestic economy.

The U.S. survived the worst financial crisis occurred in 2008 - the collapse of a housing and credit market bubble, again because of her ingenuity in financial engineering. So long the U.S. maintained the dollar as the world trade instrument, her bail-outs and Quantitative Easing will work and the U.S. economy can still be the most attractive investment environment absorbing the needed money to pump up her economy. China and Japan are the largest two US debt holders. China’s trillions of dollars of foreign exchange reserve would lose value at the mercy of the US monetary policy. Keep buying and selling US treasury bills or bonds with low or negative yield is definitely not the way to keep her hard earned dollars. So China needs to find a way to put their money to use rather than just to finance the US governments.

The above is the background situation under which the ‘pivot’ policy operates. It is this background and observations of current events in Asia that cultivated different theses regarding the goal of the US AP policy.

The U.S. is recovering well from the recent recession despite of the Euro crisis and her slow recovery and despite of the long stagnant Japanese economy. The most serious issue hurting the U.S. is her huge expenditures in military and foreign wars that are draining the US coffer and skyrocketing her debt. Logically, the U.S. should definitely exit wars and maintain peace so the U.S. could nurse her economy to stay no. 1 in the world. Under this logic, one would interpret and accept the sincerity in the US AP foreign policy statements - wanting to balance power and maintaining peace in AP so to avoid a collapse of the fragile world economy. This is the ‘peace theses’ under which one might interpret the US call for China to shoulder more world responsibility as part of the ‘rebalance’ goal. However, China seems to have her own formula to conduct her peaceful rise rather than just providing funds supporting the US foreign policies; especially when the U.S. is conducting an ambiguous diplomacy towards China, sometimes warm and sometimes cold, seemingly purposefully tolerating Japan’s ambition to take sovereignty of Diaoyu Islands. On the other hand, Japan’s economy had grown to no. 2 before threatening to surpass the US economy, but it is stagnant now facing tough competition from China and South Korea. Japan, apparently behaving very differently from China, is eager to support the US call to shoulder more world responsibility by engaging militarily to relieve some of the US financial stress. Japan, an export oriented country, depends heavily on external markets, especially China. The Japanese businesses and industries would naturally want to maintain a good relationship with China under a peaceful environment.

The ‘peace thesis’ simply interprets the real goal of the US ‘pivot policy’ as genuinely for maintaining peace in Asia Pacific. However, this is not very convincing to China or to many US political analysts. Therefore, there is an opposite thesis, an ‘evil thesis’, that will be discussed in the next column.
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