#155 (11/21) - "What Should America Do About China?''

by The Heritage Foundation - November 18, 2011
http://www.askheritage.org/what-should-america-do-about-china/?utm_source=AH_Weekly&utm_medium=Email&utm_content=2011-11-18&utm_campaign=2011_Brand

Want to hear something disturbing? China has increased its defense budget by double digits every year for the last 20 years. Just as China seems to be gearing up for some undefined enterprise, the U.S. is winding down its defense budget at a similarly rapid pace. Despite the obvious contrast, President Obama said recently that reductions in U.S. defense spending “will not—I repeat, will not—come at the expense of the Asia-Pacific.”

Yesterday [11/17], Obama visited Australia to announce a renewed U.S. troop presence in coming months, part of a new security agreement thought to be a response to this ever-more aggressive China. The President brushed off the connection, but upping U.S. presence in the Pacific is related, and it’s critical—as long as it’s done with genuine commitment, according to Heritage Asia expert Bruce Klingner.

When Republican presidential candidates gather next Tuesday for a foreign policy debate sponsored by The Heritage Foundation and the American Enterprise Institute, they should focus on the complicated balance found between maintaining cooperative economic ties and asserting a strong and lasting military presence in Asia with sufficient funding. The complicated stability of our relationship with China and our position as a world superpower depend in part on this balance.

The situation is certainly complicated. Yesterday, the United States hit $15 trillion in debt—much of it held by the Chinese. Despite that reality, China is actually reliant on America due to a highly investment-driven economy that thrives on an open, global system of trade. It is a system in which the U.S. is China’s best customer and trading partner by far, something that is frequently overlooked in what Heritage China expert Derek Scissors says is an overrated Chinese economic system.
China is simultaneously one of America’s greatest competitors and one of its biggest partners in the Asia-Pacific on energy, trade, economics, and more, and China’s disturbing military aggression is perhaps the most worrisome issue of all. Tangibly reasserting U.S. authority will assure regional friends of our commitment to them, and it follows through on Secretary of Defense Leon Panetta’s recent promise of a stronger American military presence in Asia.

The U.S. should play a delicate hand moving forward. A deliberate plan that zeroes in on fundamental things like harmful Chinese subsidies, alliances with nearby territories, market transparency, and preserving a strong response against human rights violations would be a strategic win.

Scissors writes that Chinese subsidies to state-owned or state-controlled enterprises are a vital focus area in how Congress handles China. He writes that “too little consumption and too much investment” are the main contributors to globally threatening economic imbalances when it comes to China.

The U.S. should also consider our other allies and trading partners in surrounding Asia-Pacific areas. Heritage Vice President for Foreign and Defense Policy Kim Holmes notes that China has gotten more aggressive in claiming territories in the South China Sea, so the U.S. should be especially assertive in territorial claims that affect our allies.

Klingner explains that a sustained U.S. military presence “is a tangible sign of America’s commitment to the peace and security of the Pacific.” The question remains, however, whether the U.S. can maintain a powerful, enduring role in the Asia-Pacific in light of planned $465 billion in defense budget cuts.

China has also been notably aggressive in investing in “clean energy,” provoking President Barack Obama to declare them a leader in the movement. But, the declaration is misguided. As Scissors describes, the U.S. has raised energy efficiency by 2.5 percent annually in the past decade while China has only raised efficiency by 1.7 percent, despite their so-called “investment” in green energy.

This week, the State Department opens the Bureau of Energy Resources, which will reportedly work closely with China due to its status as the world’s largest carbon emitter. But a word to the wise: It’s best to let the free energy market prevail over government intervention.

China must also own up to its dismal human rights record, which has not improved since the 1989 Tiananmen Square massacre. It was just last year that the Nobel Peace Prize was presented to an empty chair, because recipient Liu Xiaobo and his family were imprisoned by the Chinese government for speaking out on behalf of political and democratic reform.

The government resists any effort to loosen restrictions on speech, press, assembly, or religion and ignores discrimination against women and persistent child trafficking. President Obama has repeatedly turned a blind eye to this behavior and shunned the Dalai Lama, the spiritual leader of the repressed Tibetan Buddhists.

China faces a significant leadership transition in the next year, so its policies and positions are not necessarily set in stone. Thus, America’s own presidential leadership should be constantly monitoring the state of the Chinese military and economy for pertinent, critical changes that will affect how we deal with China moving forward. Maintaining a strong U.S. presence in the Pacific region is imperative for our position in the world, and we must ensure all the funding necessary to make it happen.

[bold and italics emphasis mine]