Saturday, September 24, 2011

WAKE UP DC - THE ASIAN CENTURY IS HERE, Part 1

(Picture Credit: BBC)
"China has indisputable sovereignty of the South Sea, and China has sufficient historical and legal backing" to support its claims, Senior Col. Geng Yansheng, a Ministry of Defense spokesman, told reporters.
--- And there it is.

This is the first part of a 4 part series that canvas a range of national security issues concerning US policy.



ASIA MUST BECOME - FOCUS OF EFFORT
The US foreign and security policy community has to get back up to speed on Asia - and do so as quickly as possible - transforming it from a niche concern to a central focus of effort. It is a choice between the 'Middle East Decade' of the past, and the 'Asian Century', not of the future, but of the now. A global power shift has been in progress for some time. While Washington has been enmeshed in the intricacies of understanding myriad sub-cultures in the Middle East (and more recently, North Africa [MENA]), in an effort to hasten the kind of political and social change that took the West 500 years of bloody religious wars to master, two titans have emerged in Asia. During the past 'middle east decade', Asia has transformed from a comparatively benign and largely stable zone, to a rapidly growing fulcrum of issues spanning the power spectrum (soft to hard), for states and non-state actors (NSAs) alike. This is not just about China's rise, it is also about India's rise, economic competition, trade, energy, proliferation, terrorism, cyber security, and old fashioned nationalism and territorial disputes;  all set against growing military capabilities. 


Despite the best efforts of officials like Kurt Campbell at DoS for example, Washington is not as fully engaged intellectually, physically, politically, or diplomatically, as it needs to be to keep ahead of rapid change in Asia. For a simple but telling example, according to the DoD policy website the Assistant Secretary for Asian and Pacific Security Affairs is vacant. Can anyone but a few insiders even name the DASD? This is not an attack on the incumbent. Rather it is an indicator of the place Asia holds in official Washington. In private, intelligence and security officials routinely refer to Asia as a "backwater", an "after thought", it is as if Washington can only concentrate on one problem at a time. As the US starts to contemplate a post-2014 world order, it will need to quickly grasp the significance of Asia.  To get an idea of the extent of radical change in the global balance of economic, social and political power look at this excellent short video by Hans Rosling.

MEGA TRENDS - ENERGY
The really big meta-trends are coming out of Asia. For example, energy demand is expected to soar in coming decades according to the US Dept of Energy. Until now analysts have thought of energy security as supply driven, from here on out analysts should see it as demand driven. Looked at from that perspective, a whole new world opens up. Consider this projection from the NYT:
Global energy demand will increase 53 percent from 2008 through 2035, with China and India accounting for half of the growth, the United States Department of Energy said on Monday. China and India will consume 31 percent of the world’s energy by 2035, up from 21 percent in 2008, the department’s International Energy Outlook projected. In 2035, Chinese energy demand will exceed that of the United States by 68 percent, it said.
Despite the Fukushima disaster, analysts expect nuclear power to continue to be a focus of interest in SE Asia.

ECONOMIC

The US, China and Japan are the world's top 3 economies respectively (India is 9, Australia 13, S Korea 15, Indonesia 18). The US is still clawing its way out of recession while China is experiencing 10% growth year on year. If that rate were sustained China would double its GDP in seven years. The future of the US dollar as the global reserve currency will be determined in Asia. In March 2011, China held $3.04tn US dollars in reserves, Xinhua news agency reported. It is the largest holder of US treasuries, or government debt, with $1.166tn as of June 30, 2011. Ever wonder why Gold prices continue to soar? Part of it is due to general market uncertainty, but behind the scenes China has been buying gold to mitigate its exposure to the USD.  Following the downgrading of US credit to AA+, Gabe Collins and Andrew Erickson at China Signpost blog observed:

Beijing is lecturing the U.S. to protect its investments. In a strongly worded editorial on 6 August 2011, Xinhua, one of China’s main state-controlled media entities, declared that “China, the largest creditor of the world’s sole superpower, has every right now to demand the United States to address its structural debt problems and ensure the safety of China’s dollar assets." 
Chinas global investments provide the PRC with tremendous access and influence from Africa to Latin America. The People's Daily reported in March 2011
In 2009, China became the world's fifth largest ODI investor, rising from 12th in 2008. In 2010, China's ODI surged 36.3 percent to $59 billion, while its FDI rose 17.4 percent to $105.7 billion.
This FT graphic gives an idea of the global scope and reach of Chinese investments. PRC trade within  the ASEAN block is a useful example of the power of its economy. According to the China Post
China's trade with ASEAN has jumped six-fold since 2000 to US$193 billion last year, surpassing that of the U.S. China's share of Southeast Asia's total commerce has increased to 11.3 percent from 4 percent in that time, whereas the U.S.'s portion of trade with the bloc fell to 10.6 percent from 15 percent, ASEAN statistics show. During that time, ASEAN's trade deficit with China widened by five times to US$21.6 billion. The bloc reported a US$21.2 billion trade surplus with the U.S. last year, down 12 percent from 2000. 
SCIENCE 
But the story does not stop with economic power. From advances in medicine to green tech, China is surging ahead in science and technology far surpassing expectations. The Guardian reported that China is poised to overtake the US in scientific research output:
The Royal Society said that China was now second only to the US in terms of its share of the world's scientific research papers written in English. China could overtake the United States as the world's dominant publisher of scientific research by 2013.
The dominant language in many of the labs in the National Institutes of Health in Washington DC is mandarin. In a very smart move the Chinese are now engaged in the Thousand Talents Program - which is designed to take advantage of the exceptional education and training Chinese nationals have received around the world by luring them back home with money and state of the art labs to work on projects of national significance. Many top scientists and entrepreneurs sometimes referred to as "sea turtles" are taking the education and running: here is an example, and another and another.  For entrepreneurial examples see here. 

SPACE

China has an advanced space program. It became only the third country to launch an astronaut into space in 2003; its first space walk followed in 2007; it has already launched 6 indigenous Beidou satellites to provide it with an independant GPS capability in the Asia Pacific region; and it is soon to send the first element of its own space station into orbit.  Scott Pace, an associate NASA administrator in the George W. Bush administration compared the US and Chinese space program thus:
Space leadership is highly symbolic of national capabilities and international influence, and a decline in space leadership will be seen as symbolic of a relative decline in U.S. power and influence.
Space is a vital enabler of advanced science, communications (including cyber), navigation, and war. Notably, it has also demonstrated an anti-satellite kill capability back in 2007 when it shot down one of its own old weather satellites. From a first manned space flight in 2003, to a GPS network and space station in 2011, is a frightening pace of advanced application of science and technology. 

SUMMARY OF MEGA TRENDS

Official Washington has spent the past decade concerned about around 432 million people of the MENA region, while Asia's 4.2 billion have been, quite frankly, an afterthought.  The terrorist threat posed by AQ is serious, but the global stakes in Asia are profound. 

CAPTURING THE DC MIND - ARAB SPRING V RISE OF CHINA
AQ killed ~3000, collapsed two major buildings in NYC, and damaged the Pentagon. The sole remaining superpower, economically, militarily and politically supreme until that moment, rightly went after its new ragtag enemy. But in the process it got sucked into tangential and exhausting efforts to provide governance where none previously existed (or was destroyed by the US), over great distances, with weak local partners, and little to no buy-in from the people who were to be governed. In part, because of the idealist impulse in American foreign policy, the realist policy of killing the enemy was not enough. The people among whom the enemy lived had to be lifted up from their misery and, under the shining light on the hill, given democracy where none had existed before. Not surprisingly, long-range expeditionary nation building in hostile, culturally-alien environments, has met with mixed success. However, it has been highly successful in one respect alone: diverting official Washington's attention from geostrategic change of historic proportions. 
The emergence of a nascent modern-day enlightenment in the Muslim world is a vast and complex phenomenon, if indeed that is what is starting to unfold.  One can hardly criticize US officials for the time and effort devoted to the region given the insistence of the most recalcitrant therein to blame the US for their woes and thus plan and mount attacks accordingly.  Direct engagement in wars in Iraq, Afghanistan, Libya, and Yemen, and concerned observation of yet further wars in Somalia, Syria, Sudan, and elsewhere, present very significant challenges to regional and global security. Thankfully, they also present real opportunities - in part because the masses at the heart of the Arab Spring seem to be clamoring for normalcy as it might be defined in the West. This is not to say that revolutions can't be derailed. The compression of time and space, the availability of technologies (eg. smart phones, facebook, blogs) and weapons (the greatest WMDs: the AK47 and RPG), and the ungoverned ideological spaces created by rapid political change; all make change in the volatile middle east uncertain and fraught with danger. Yet these trends are not confined to the MENA region. While the cultures maybe different, Asia is just as exposed to key global political drivers. 


All the while, by dint of economic reform, easy credit, masses of cheap labor, size, and some luck, China and India have grown to a point where their very existence, let alone their policy choices, are having a global impact. The global media has started to track events in the South China Sea with the same focus and drive as the regional media back in the 1990s. Back then there were fears of an arms race among SE Asian nations, before the Asian Financial Crisis put an abrupt end to that narrative. That micro "rise and fall" history may incline analysts and decision makers in DC to pay less heed to Asia compared to other pressing macro global issues, like the Arab Spring, for example. But focusing on MENA at the expense of Asia, is a dangerous trap. The 911 Commission rightly asserted that the biggest failure in the run-up to the attacks was a failure of imagination. Today, there is plentiful evidence that a global power shift is underway, so downplaying it cannot be excused on a failure of imagination. It is a failure to comprehend whats staring us in the face.

QUANTITY HAS A QUALITY ALL ITS OWN
Much of China's importance can be related to sheer scale - people, money, and markets. The rise of China has already become the defining event of the 21st Century. China's economic liberalization lifted far more people out of poverty than all global-aid programs combined. As China Signpost blog noted recently
China is already the world’s second largest economy, second largest energy importer, largest natural resource importer by volume, and largest emitter of greenhouse gasses. Where China is headed domestically and internationally has major implications across the board for virtually everyone on this planet.  

The basics of life in China are simply staggering. The pressure on the country’s infrastructure is so overwhelming that something as simple as a traffic jam can turn into a national event. In 2010, road work on the outskirts of Beijing turned into a 60 mile long disaster that literally took weeks to untangleThis kind of problem is not uncommon. Each year an estimated 178 million Chinese travel by train and a further 22 million by aircraft from cities to their villages for the lunar new year. In 2008, an estimated 67 million were stranded when snow ground all traffic to a halt.

The following pictures best illustrate the extent of change in China over the past 30 years. In the 1970s news reports from Beijing would always have masses of bicyclists in the background. Today, the major cities in China swam with vehicles on a scale unimaginable to most.


 CHINA'S TRANSFORMATION IN 30 YEARS
From the Bicycle Kingdom of the 1970s
To the Car Kingdom of the 2000s
MASSIVE CHALLENGES
China's rapid rise is a double edged sword not just for its neighbors and the US but for China itself. With economic growth comes environmental costs - a factor that loomed large in the run up to the Beijing Olympics. With significant foreign holdings comes dependence on others to repay their debts. With dependence on foreign energy and raw materials comes a requirement to ensure their steady flow at acceptable costs. With a swelling of national pride, comes advances in military capabilities, triggering uncertainty in others, thus creating the conditions for a classic security dilemma - an action-reaction spiral leading to war.


In an excellent new assessment Gabe Collins and Andrew Erickson at China Signpost blog have written about the likelihood that China will experence an "S-Curve-shaped path of slowing growth as key internal and external challenges—including pollution, corruption, chronic diseases, water shortages, growing internal security spending, and an aging population—feed off of one another and exact increasingly large costs." Readers are urged to fully explore the China Signpost article for the full evidence and ramifications of their analysis. 
Source: China Signpost
Asia is also exposed to many of the same forces of change - social networking technologies, weapons and un/under governed ideological spaces - that are making state control more difficult all around the world. Consequently, Bloomberg reports China spent more on "its internal police force than on its armed forces in 2010" and had 180,000 "so-called mass incidents, everything from strikes to riots and demonstrations".

The iPhone is one of the most dangerous weapons ever created. It provides the following military and intelligence functions to anyone interested in so using it:

  • C2 (flash mob/twitter), 
  • COMS, 
  • SATNAV, 
  • IMINT (2m resolution), 
  • HUMINT and Network analysis tools (Facebook), 
  • financing
  • propaganda (video and youtube), 
  • espionage (recording, FMV, live streaming), the list goes on. 

There is an unclas Army brief which described how a photo of a young woman in a park could be used in conjunction with a range of commonly available software programs to determine within a few minutes her identity, address, right down to pictures of her inside her apartment (geo-location and pattern matching). The following is a satire MIL INT has used before, but it nicely illustrates the power of smart phones to be complex intelligence/military systems. They are the ultimate dual use technology - empowering people to take on the state but also empowering the state to take on the people. The CCP instinctively know this and have started to clamp down where they can. President Hu and others have discussed how the internet might be controlled. As MIL INT has discussed in relation to the response to the High Speed Train disaster, micro blogging is having a political impact. Put smart phones into the China scenario and add in some of the problems Collins and  Erickson write about and things could get very interesting internally for the Chinese Communist Party.


Part 1 (Why Asia Should be #1 US Concern)

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