Amongst the news of crashes and weather, one story of immense significance to New Zealand has been widely ignored... The US has reviewed its defence priorities and is moving back into our neighbourhood big-time. This offers huge risks and opportunities
At the start of President Obama's first term there was talk of him being the first "Pacific President" – being born in Hawaii and schooled in Indonesia gave him a rare westward view of the world, a perspective that's different from the focus on Europe and the Middle-East, which dominates on America's east coast. Then Obama was awarded that Nobel Peace Prize and there was hope be may be a more pacific president as well.
Both of these notions seemed to have been over-hyped as the years passed by, with America's wars in Iraq and Afghanistan dragging on longer than hoped, the failure to close the prison at Guantanamo, the heavy use of drones in the Middle East – peace and the Pacific hardly seemed urgent priorities.
But this (southern) summer, that's changing. The Iraq War is over, the Pentagon and US defence forces are facing budget cuts in the hundreds of billions of dollars and of huge significance to New Zealand, Obama has announced the results of his comprehensive defence review.
What does it conclude? In short, the US is in transition from a decade of war in the Middle East. As that chapter ends its new focus is the Asia-Pacific region. The review says:
"US economic and security interests are inextricably linked to developments in the arc extending from the Western Pacific and East Asia into the Indian Ocean region and South Asia, creating a mix of evolving challenges and opportunities. Accordingly, while the US military will continue to contribute to security globally, we will of necessity rebalance toward the Asia-Pacific region. Our relationships with Asian allies and key partners are critical to the future stability and growth of the region. We will emphasize our existing alliances, which provide a vital foundation for Asia-Pacific security."
Richard Haass, President of the Council for Foreign Relations (one of the world's most respected foreign affairs think-tanks and our partners in Pundit's World News Brief), writes:
"The United States has become preoccupied with the Middle East... and has not paid adequate attention to East Asia and the Pacific, where much of the twenty-first century's history will be written.
The good news is that this focus is shifting. Indeed, a quiet transformation is taking place in American foreign policy, one that is as significant as it is overdue. The US has rediscovered Asia."
Of course we've seen the US preparing the ground for some time, most significantly for New Zealand in the form of the Wellington Declaration at the end of 2010. But this announcement last week locks it in. A Pacific focus is now official US strategy.
Obama even pointed out that the Asia-Pacific region is the one area where the Pentagon budget cuts won't bite, saying:
"... we will be strengthening our presence in the Asia Pacific, and budget reductions will not come at the expense of that critical region".
The main reason for America's "reorientation" is China. On that subject, the defence review says:
"Over the long term, China’s emergence as a regional power will have the
potential to affect the US economy and our security in a variety of ways. Our two
countries have a strong stake in peace and stability in East Asia and an interest in building a cooperative bilateral relationship. However, the growth of China’s military power must be accompanied by greater clarity of its strategic intentions in order to avoid causing friction in the region"
While the diplomatic stressing of peace and stability will be welcomed by countries such as ours, that "however" indicates this transition is not without threat and tension.
China and America remain in competition, not just for regional power, but for resources and, ultimately, money.
As Haass notes:
"With its large populations and fast-growing economies, it is difficult to exaggerate the region's economic importance. American companies export more than $300 billion in goods and services to countries in the region each year... Regardless of whether the twenty-first century will be another "American century," it is certain that it will be an Asian and Pacific century."
All this should send a shiver down the spines of New Zealand leaders – the opportunities and dangers are sizeable.
This places New Zealand slap bang in the middle of things – not geographically perhaps, but geopolitically. That tyrant distance is no longer in charge in New Zealand and our thinking should no longer be determined by our sense of isolation, but by one of engagement. The world's two great powers will spend this century jostling for position in our back-yard.
Given that China and the US are our second and third largest trading partners, our standard of living is at stake in this new game. But those close ties suggest a unique role for New Zealand and one we should be positioning ourselves for already.
Even more than Peter Fraser suggested at the end of World War II, we can play the 'honest broker' role in our region, one that ensures a close friendship with, but ultimate independence from, both major powers.
This is not a time to choose sides.
We should be the voice for democracy, the rule of law, mediation and human rights in this region that encourages the rise of new powers, but respects the role of the old actors as well. That at times may mean speaking for Asia rather than our traditional allies and some difficult conversations – and I'm not sure if this government is on that path – but if we are wise, that's where our future lies.
Out of that can come the trade we desire, but it will be important to realise that greater trade is an outcome of these nobler goals, not a goal in itself. Trade alone does not guarantee peace and prosperity.
Just look at the Opium Wars of the 1800s to see that trade between China and the West does not guarantee peace, but rather if mishandled can become a cause of conflict. I've read Amitar Ghoshs's River of Smoke this summer, and it's a telling reminder. British sales of opium became vital to Britain because of the immense profits gain and because they addressed a terrible trade imbalance between the two powers, which had seen vast demand for Chinese goods in the West but few sales the other way.
Sound familiar? It's frightening to look at how unbalanced US and Chinese trade has become in the past 20 years and what little impact the recession has had on it. While the US is unlikely to go to war as Britain did, this is just one area of potential tension between the two powers; a tension that now inevitably involves us.
There are other risks. Since World War II, the US has focused on Europe and then the Middle East. Hostilities and an expanded military presence grew out of that focus, so we should be wary of having the US move into our neighbourhood.
Already the US has identified South Asia alongside the Middle East as a "primary loci" of terrorist threats. (Why not north Africa?). Already it has convinced Australia to open a military base for 2500 marines (for now). Already countries are choosing sides.
That's scary, but it also provides us with opportunities. If we want to be a friend to both countries we will have to be careful how we play this hand, but the diplomatic fact will be that both countries will need us more than in the past, and that strengthens our hand in bi-lateral relationships.
That's especially true of the US. No, that doesn't mean a free trade deal – we really have to get over that obsession, because even if the Trans-Pacific Partnership doesn't pull itself apart, it'll be a long time before we're likely to see a Congress willing to touch such a deal. Our focus should be more incremental gains.
I'm not expert enough to suggest what – but we should be looking at what we need to improve our prospects and what the US has to offer, such as investment capital, business expertise on a grand scale and education. Whatever we may think important, we're now in a better position to find partners in or via the US government.
Our clear message to it should be that their interests in the region are not best served by an increased military presence, but by an increased economic presence – the region is happy for it to engage more in the region and to buffer China somewhat. But its tools should not be primarily planes and ships, but investment, innovation, education, aid and skills.
Much the same can be said for China. For a "western" nation, we have a unique relationship with that country. Just because we already have an FTA doesn't mean we shouldn't be identifying how else we can benefit from that special friendship. Even better, we should be looking to deepen it, thus building trust and making future tensions easier to manage.
China's reaction to Obama's 'Pacific pivot' has been to again stress that its growth is a threat to no-one (so long as no-one stands in the way of that growth – let's not forget that China remains a very poor country). It's goal is to be a good friend to the Pacific and share its growth around the region. At the same time, as this editorial from the Chinese news agency warns, the new US policy "has further complicated China's neighbourhood".
When talk of complications arise, New Zealand needs to be the voice of simple, common partnership.
The robust growth of Asian economies is the key to unlocking our own economic prospects, but that depends on the growth of democracy, law and human rights in the region. The promotion of those values are also the key to peace here in New Zealand and in our neighbourhood.
So as the new year kicks off, we should recognise the new environment Obama's announcement has created. New Zealand's job will be to help mediate America's new focus on our patch and to stress the importance of the region's common interests. Our top priority must be helping to manage relationships from a position of independent friendship so that the Pacific remains an ocean of peace.