CHRISTOPHER REAPS THE WHIRLWIND IN EAST ASIA: KOW-TOWING TO BEIJING, APPEASING PYONGYANG, BUNGLING IN TOKYO

(Washington, D.C.): Even before it is
completed, Secretary of State Warren
Christopher’s road trip through the
Western Pacific is likely to rank high in
the record of U.S. diplomatic debacles.
It may even come to rival for that
dubious distinction his infamous mission
to Europe in May 1993: Then, as
now, instead of demonstrating the needed
U.S. leadership — in that case, by
forcefully selling Bill Clinton’s
“lift and strike” strategy for
Bosnia to the allies — Mr. Christopher
seems capable only of conveying messages
of weakness, indecisiveness and
ineptitude.

Unfortunately, the consequences of the
Clinton Administration’s diplomatic
fiascos in East Asia are likely to prove
even greater than the hash-up it has made
of the most portentous crisis on the
continent Europe since the Berlin
airlift. The Christopher trip is
confirming the view already held by too
many in the region — and most especially
in high places in Beijing, Pyongyang and
Tokyo — that the current U.S. leadership
has neither a coherent sense of its own
vital, long-term interests in the region
nor the wit to pursue and protect them
competently.

This perception is likely to
accelerate already evident and extremely
dangerous trends: It is emboldening China
as it steadily pursues the military and
economic means needed to secure regional
hegemony and global superpower status. It
also nurtures North Korea’s bid to
acquire useable nuclear arms. And it
compounds the damage already being done
by the Clinton-backed free-fall in the
dollar’s value against the yen and the
economic and strategic ripple-effects of
a feared “trade war” with
Japan.

Emboldening China

China’s behavior during the fortnight
between the visit to Beijing by Assistant
Secretary of State for Human Rights, John
Shattuck, and that of the Secretary of
State which started today is not simply
— as Mr. Christopher put it on 9 March
— evidence that “China is going in
the wrong direction.” It is also a
calculated insult to the Clinton
Administration.

Indeed, the ongoing round-up of
Chinese dissidents is meant not only to
show that the communist regime remains
committed to brutal totalitarian rule,
even as it experiments with market
capitalism.⁽¹⁾
It is, moreover, not just a highly
visible demonstration of Beijing’s
refusal to yield to U.S. demands for
improved performance on human rights.

It is also a tangible demonstration of
the PRC’s view that the American
administration is a contemptible
“paper tiger.” Clearly,
the Chinese leadership discounts
President Clinton’s ability — and
probably his will — to follow through on
the threatened withdrawal of Most Favored
Nation status if no improvement is
discernible in their abysmal record on
human rights.

Unfortunately, recent comments by
Secretary Christopher and other
Administration spokesmen can only have
reinforced that calculation.⁽²⁾
For example, as the Washington Post
noted yesterday: “In recent months,
U.S. officials ha[ve] signaled China that
the steps necessary to avoid a showdown
are minimal….[The Clinton
Administration] would keep no ‘scorecard’
but rather would press for commitments,
if nothing else, to portray a positive
trend.”

In case the Chinese missed the point,
Mr. Christopher on 8 March personally
stressed that Beijing need do nothing
more than make promises to improve its
odious human rights record.⁽³⁾
He said that he had “been hoping to
go to China and find overall, significant
progress in the actions they take when
I’m there, or pledge to take.”

The Secretary of State’s
refusal to cancel his visit to Beijing —
even though the Chinese have effectively
spat in his face — is the sort of
humiliation known all too well in the
Forbidden City: the demeaning kow-towing
of barbarians before the rulers of
superior Chinese society.⁽⁴⁾
It is certain to reinforce Beijing’s
assessment that it can, with impunity:
pursue its offensive military build-up;
transfer missiles and other deadly
technologies to the world’s pariah
nations; assert its primacy in the
region; and intensify its repression of
the people of China.

Acquiescing to Pyongyang

Beijing’s display of contempt for the
Clinton Administration should also put to
rest any lingering expectation that China
will play a constructive role in
preventing North Korea from acquiring
operational nuclear weapons. The Chinese
past refusals to agree to international
sanctions against Pyongyang should
already have put Washington on notice
about the futility of “playing the
China card” in this context.
Certainly, no one should delude
themselves — or the American people —
into thinking that the PRC is going to be
more helpful on this score in the future.

This is singularly bad news for the
Administration because a Chinese deus
ex machina was the only hope for the
Clinton strategy of negotiation and
appeasement of North Korea. In
the past few days, Pyongyang has shown
that it is no less contemptuous than
Beijing of the United States’ empty
threats and pocketable concessions.
According to a report in yesterday’s Post,
the North Koreans have diddled the
U.S. once again by preventing
International Atomic Energy Agency
inspectors from “carrying out
certain procedures agreed on before the
inspectors arrived on 4 March to inspect
a total of seven facilities, including a
plant for reprocessing nuclear
fuel.”

Of course, Kim Il Sung may well chose
to relent before the inspectors leave
North Korea. This may be because he has,
yet again, obtained a new concession from
the United States for doing so.
Alternatively, it may simply be because
such a bait-and-switch routine helps
obscure the fact that he
continues to refuse to allow inspections
where they might be of real
value in determining the status of
Pyongyang’s nuclear program —
namely, at two nuclear waste storage
sites and other suspicious facilities.

In the final analysis, though, as long
as Secretary Christopher and his
colleagues continue to reward North Korea
for its intransigence (e.g., by
cancelling joint U.S.-South Korean
military exercises, holding high-level
bilateral meetings, deferring deployment
of Patriot anti-missile batteries and
other reinforcements to the South, etc.),
the bottom line will be the same: The
West will continue to be defied and
reviled by a ruthless despot relentlessly
— and successfully — pursuing a nuclear
weapons capability for Pyongyang.

Hurting U.S. Consumers,
Taxpayers — Not Japan

Even as the Clinton Administration is
figuratively devaluing the currency of
American power vis à vis
potentially dangerous adversaries like
China and North Korea, it is deliberately
manipulating financial markets literally
to degrade the value of the dollar to
affect relations with a friend, Japan. In
the process of doing the latter,
moreover, the Administration’s economic
team is risking incalculable harm to
American consumers and taxpayers while
unnecessarily jeopardizing ties with a
key regional ally.

Remarkably, the last
Democratic U.S. administration also
experimented with the deliberate
weakening of the American currency as the
preferred means of enhancing American
export competitiveness. The results of
such an approach were as unmistakeable as
they were undesirable:
heightened expectations of spiralling
inflation; attendant, sharp rises in
interest rates; and a protracted and
extremely costly recession.

In the words of Bruce Merrifield, a
former Under Secretary of Commerce and
distinguished member of the Center for
Security Policy’s Board of Advisors,
rises in interest rates have a
devastating ripple-effect on the U.S.
economy:

“…Investments then are
cancelled or deferred; consumer
spending (which accounts for
two-thirds of GNP) also collapses;
demand for production falls; excess
capacity results; operating profits
decline; unemployment surges as
workers are laid off; severe
competition increases because of
falling demand; prices also then
fall…and budget deficits
soar.” ⁽⁵⁾

The really bad news
is that a further, powerful downward
impetus to the dollar has been introduced
by the Clinton Administration’s myopic
pursuit of numerical targets for opening
Japanese markets to American exports
(read, “managed trade.”)
The fact that long-term U.S. interest
rates are already moving up rapidly is,
in part, tangible evidence of concerns
over an incipient trade war and attendant
inflationary dislocations.

Over the 12 years of the
Reagan and Bush Administrations, by
contrast, American free trade policies
helped lead to a decline of some 60 to 70
basis points ⁽⁶⁾
in long-term interest rates per year.
To be sure, there was growth in the U.S.
trade deficit with Japan during this
period. Still, the adverse impact of this
development was, on net, modest compared
to the enormously beneficial effects of
declining interest rates.

President Clinton’s embrace of serious
deficit reduction as the centerpiece of
his domestic fiscal policy and his
aggressive support for free trade
arrangements like NAFTA and GATT
encouraged many to believe that there was
actually something to his claim to be a
“New Democrat.” His
active pursuit of a weak dollar (leading
to unpredictable currency markets) and a
tit-for-tat retaliatory dynamic in
U.S.-Japanese trade (likely to produce,
at the very least, a “trade
war” atmosphere), however, now
threatens to cancel out the hard-won
progress made to date — progress that
has led to lower interest rates and the
sort of climate for investment essential
to increased productivity, long-term
growth and sustainable constraints
on inflation. In short, Mr.
Clinton is looking ever more the “Old
Democrat.” ⁽⁷⁾

The Bottom Line

In a recent “Open Forum”
with senior State Department staff,
Secretary Warren Christopher reportedly
gave a most illuminating response to a
question about the U.S. strategy toward
the world. The Center for Security Policy
has learned that he told his subordinates
the United States did not have an
overall strategy — and, moreover, that it
was not going to get one.
The reason: In his years as a lawyer, he
had learned that it was best to do things
on a case-by-case basis and that was what
this Administration was going to do as
long as he was Secretary of State.

The Center has believed for some time
that the nation can ill afford to have
Mr. Christopher as its Secretary of
State. Certainly, if given the choice
between a national strategy for promoting
and securing U.S. interests around the
world and Mr. Christopher, America would
be better off without Warren Christopher
(and, for that matter, virtually his
entire management team).

The Center believes that, with or
without Mr. Christopher, the United
States must readopt the strategy of
stength, engagement and leadership in
international relations that has
characterized the best of U.S. foreign
policy under both Democratic and
Republican administrations. Such a
strategy would, for example: resist
Chinese repression at home and
adventurism abroad; prepare a credible
defense of U.S. forces and allies against
North Korea’s nuclear ambitions,
ballistic missiles and other threats; and
refrain from further use of exchange rate
manipulations and “managed”
interventions in U.S.-Japanese trade in
favor of tried-and-true approaches to
promoting free trade and long-term
suppression of inflation.

– 30 –

1. Incidentally,
Beijing’s hard-line premier, Li Peng,
should have added to the unease of those
in Washington and elsewhere who are
betting — ironically in the fashion of
Marxian economic determinism — that
economic reform will guarantee political
liberalization in China. The Washington
Post described his speech to
parliament yesterday as a
“call…for greater economic and
political control by the central
government” in the face of
“pressing problems” facing
China.

2. Even more
instructive than the Administration’s
hollow words about human rights in East
Asia have been its cynical deeds.
Surely, Mr. Clinton’s February 1994
decision to lift the trade embargo
against Vietnam — notwithstanding
Hanoi’s atrocious human rights record —
was not lost on the Chinese. China can
reasonably see itself as entitled to no
less favorable treatment than that
accorded its fellow communist
dictatorship and historic enemy, Vietnam.

3. This is
particularly astounding given that the
Administration is already obliged to
ignore China’s unfulfilled promises
concerning curbs on the export of
ballistic missile technology and the use
of slave labor in export-related
industries.

4. The toasts to
China’s leaders offered by National
Security Advisor Brent Scowcroft and
Deputy Secretary of State Lawrence
Eagleburger within months of the 1989
Tiananmen Square massacre was another
reprehensible example of the modern
kow-tow.

5. Secretary
Merrifield’s observation was made in a
forthcoming book in the context of
domestic forces like intervention by the
Federal Reserve. It is no less valid for
inflation precipitated by downward
“jawboning” of the dollar on
international currency markets.

6. The standard
unit of measure in international
financial markets, equal to 1/100 of one
percent.

7. The rewarding
of Derek Shearer — a self-declared
“economic nationalist” (read,
anti-free trader who opposed NAFTA),
socialist, long-time friend of Bill
Clinton and brother-in-law of Strobe
Talbott — with a key post as U.S.
Ambassador to Finland is further evidence
of Mr. Clinton’s regression to the failed
Democratic policies of the past.