Obama Turns His Attention to Where the Money Is: William Pesek. By William Pesek

Of all the realizations Barack Obama has made in three years in the White House, this may be the most crucial: The U.S. is a Pacific nation.
Odd as it sounds, the U.S. spent the past decade forgetting a fact that’s obvious from consulting a map or tracking container ships. When George W. Bush’s administration bothered with Asia, it was all terrorism all the time. Quite odd, considering how reliant the largest economy became on Asia’s money during his tenure. The region became America’s banker.


Obama’s pivot east ends the neglect that allowed China to begin challenging U.S. primacy, and Beijing isn’t happy. It’s high time for this shift as a crisis-racked Europe turns inward and Asia booms. Yet the U.S. must engage Asia more wisely, constructively and sincerely than in recent decades.
China’s irritation can be seen in what might be termed a culture war. The Americans and the Soviets had their Cold War; Washington and Beijing are now battling over soft power. First China took on Google Inc.’s search engine. Now the battle is over something both bigger and more existential -- saving the Chinese soul from Western encroachments. A new Cultural Revolution? Not exactly.

New Cultural Revolution

In a recent Communist Party magazine article, President Hu Jintao wrote: “We must clearly see that international hostile forces are intensifying the strategic plot of Westernizing and dividing China, and ideological and cultural fields are the focal areas of their long-term infiltration.” Hyperbole aside, this is simply an effort to shore up support for Hu’s government by appealing to sentimental nationalism.
Could it be a coincidence that this comes six weeks after Obama visited Asia with big plans, including a deployment of troops in northern Australia? China clearly got the memo.
Obama’s Asian shift was solidified days later at the East Asia Summit in Indonesia. There, maritime security and territorial disputes in the South China Sea were up for discussion in ways that irked China to no end. All the talk of China expanding its soft power is met with skepticism when the topic of claims to the resource-rich waters of the South China Sea comes up. The issue encapsulates why many leaders in Asia welcome the U.S.’s return and view China (CNGDPYOY)’s assumptions and ambitions with wariness.
China has little time for the sensitivities of governments from Vietnam to the Philippines to Malaysia. That attitude fuels perceptions of a China convinced that its interpretation of history matters most, be it disputed claims to tiny islands hundreds of miles from its shores, the motivation behind its sizable military buildup or the fate of 23 million Taiwanese voting for a democratically elected president this week.
There’s little doubt over China’s trajectory. Barring a major crisis, China’s economy might surpass that of the U.S. before the end of this decade. Yet there’s great debate about the merits of China’s belief that world hegemony is its due and that small economies should pay it tribute with undying loyalty and natural resources while an undervalued yuan hurts them economically.
In conversations in Bangkok and Jakarta (IDGBFRGN) this week, and recent ones in Tokyo and Seoul, Obama’s intentions in Asia came up constantly. This much seems clear: Although Asians have loads of problems with America’s policies and frown on its domestic politics, many don’t harbor great fears about its long-term ambitions. Obama’s push for a Trans-Pacific Partnership trade agreement with nations including Australia, Malaysia, Singapore, Vietnam and eventually Japan -- China is pointedly excluded -- is being viewed in reasonably warm terms.

Myanmar Beckons

Hillary Clinton’s visit in December to Myanmar, which China views as being within its orbit of influence, is a fascinating footnote. The U.S. secretary of State landed there three months after Myanmar suspended China’s construction of a $3.6 billion dam, a move that enraged Beijing. Was President Thein Sein expressing a sudden preference for the West over China? Only time will tell, but it raises fascinating possibilities.
Anyone who thinks the power shift from the U.S. to China will go smoothly is dreaming. Possible flash points: currencies, trade, intellectual property rights, climate change, military spending, North Korea, scarce global resources, human rights, control over cyberspace, Beijing’s coddling of rogue regimes and China’s vast holdings of U.S. Treasuries. China is also sure to figure in this year’s U.S. presidential election.
China should forget the soft-power push for the moment and use its influence to rein in Kim Jong Un in Pyongyang and Iran’s saber rattling over the Strait of Hormuz. It should accelerate the rise in the yuan and play by international rules of commerce, not bending the World Trade Organization to its benefit at the expense of everyone else.
The U.S. must do its part, too. It’s no longer in a position to lecture Asia the way Bill Clinton’s White House did. The 2008 financial crisis and the Iraq war before it did great damage to the American brand and sapped its economic power. The U.S. must leave the arrogance of the past at the door as it re- enters Asia. This return must go beyond appearances and be a genuine partnership.
As China tries to extend its sway in Asia, the U.S. must realize that its own regional ambitions need some polishing, too.