The Asia-Pacific Century Challenges and Opportunities Dr. Adam Lowther, Editor Air University Press Air Force Research Institute Maxwell Air Force Base, Alabama Published by Air University Press in May 2013 ISBN 978-1-58566-224-1 Disclaimer Opinions, conclusions, and recommendations expressed or implied within are solely those of the author and do not necessarily represent the views of Air University, the United States Air Force, the Department of Defense, or any other US government agency. Cleared for public release; distribution unlimited. AFRI Air Force Research Institute Air University Press Air Force Research Institute 155 North Twining Street Maxwell AFB, AL 36112-6026 http://aupress.au.af.mil ii Contents Foreword vii About the Authors ix 1 Why Asia Matters 1 Dr. John P. Geis II Introduction 1 The “Asian Tigers,” Pandas, and Elephants 2 Getting International Trade “Strait” 6 A Place Where It Is Natural to Have Problems 8 A Military Race . but to Where? 14 2 Thinking about the Asia-Pacific 25 Dr. Adam Lowther Introduction 25 The Delphi Method and Analysis 25 Focus Group Analysis 31 Conclusion 43 3 Top Five Asia-Pacific Economies: Integration, Conflict, Vulnerability, and Crisis, 2010–2020 45 Dr. Brooks B. Robinson Abstract 45 Introduction 45 Bottom Line Up Front 46 Economic Integration 47 Economic Integration and Military Conflict 50 Economic Integration in a Game-Theoretic Framework 51 Economic Vulnerability 53 Impact of an Asian Crisis on the Global Economy 56 Conclusion 58 4 Chinese Soft Economic Warfare 63 Dr. Chad Dacus Introduction 63 Peace and Prosperity 64 Soft Economic Warfare 69 The US Response 75 iii CONTENTS 5 Steaming up the Hudson: China, the United States, and the Problem of Misperception 81 Prof. Simon Reich Introduction 81 Why Do Americans Fear China’s Growth into a Great Power? 82 Is This Sense of Alarm Justified? 85 What Are the Consequences of the Current Trend in US-Chinese Relations? 90 6 The Contradictions of US China Policy: Implications for the US Air Force 93 Justin Logan Abstract 93 Introduction 93 US Policy toward China 95 The Problems with US Policy 97 Changes for US China Policy 101 Potential Objections to the Alternative Strategy 103 Conclusion 110 7 Shadow Dancing in the Indian and Pacific Oceans: China, India, and America 115 Dr. Dhirendra K. Vajpeyi Introduction 115 The Theatre Stage: The Indian Ocean 116 The South China Sea (Nanyang) and China’s Southeast Asia Neighbours 118 The Pacific Ocean 125 The Players (the Actors) 126 Conclusion 146 8 US Role in the Asia-Pacific Region: A Regional View 153 Dr. Rajeswari Pillai Rajagopalan Introduction 153 Regional Perceptions of the US Role in the Asia-Pacific 154 As China Rises, Will Its Neighbours Bandwagon or Balance? 166 Conclusion 168 iv CONTENTS 9 The Security Environment in the Asia-Pacific: An Australian Viewpoint 171 Dr. Sanu Kainikara Introduction 171 Australia’s Strategic Interests 173 Factors Affecting Australia’s Strategic Outlook 176 The Role of the United States in the Asia-Pacific Region 177 The Status of South Pacific Nations 178 The Shift in Global Economic Activity to the Asia-Pacific 179 An Australian Perspective on Its Security 184 Conclusion 187 10 Conflict and Diplomacy in the South China Sea 189 Dr. Sheldon W. Simon Abstract 189 Introduction 189 Conflict and Diplomacy: Alternative Approaches to the South China Sea 192 Multilateral Diplomacy 193 The United States, the Code of Conduct, and South China Sea Diplomacy 195 The United States and the Philippines: A Special South China Sea Relationship 199 Other Significant External Actors: Japan and India 201 Implications for the United States 204 11 Nuclear-Strategic Asia 211 Dr. Stephen J. Cimbala Introduction 211 Policy Problems and Issues 211 States and Forces 217 Conclusion 224 12 Aspects of Korean Unification: Planning for US Involvement on the Korean Peninsula 229 Dr. Kimberly Gill and Dr. Thomas P. Dolan Introduction 229 Background of Korean Separation 229 Scenarios for Korean Unification 230 Cost Estimates of Korean Unification 233 Why Germany Is the Wrong Model for Korean Unification 246 Conclusion 248 v Contents 13 Building Positive Relationships in the Asia-Pacific 253 Dr. Adam Lowther Introduction 253 Why the Asia-Pacific Matters 253 China 256 Airpower in the Asia-Pacific 257 Conclusion 263 Abbreviations 267 vi Foreword In 2002 Pres. George W. Bush proclaimed that the twenty-first century would be the “Asia-Pacific Century.” While I am not sure he was the first person to use that phrase—and it has been often used by others over the past 10 years—for those of us who study the region and/or have more than a casual familiarity with the region, the proc- lamation rings true. In a November 2011 article in Foreign Policy magazine, Secretary of State Hillary Clinton went so far as to say, “The future of politics will be decided in Asia, not Afghanistan or Iraq, and the United States will be right at the center of the action.” These are powerful words, underscoring the fact that Asia matters, and it matters a great deal. For those who are interested in national security affairs, the ques- tion is not whether Asia matters but what our country should do about the fact that Asia matters. How should we posture ourselves to best advance our national interests in a region that will have so much to do with our future security and prosperity? Certainly, there will be much study and many well-considered judgments concerning these important questions, and most of this work will contribute to advancing our collective ability to successfully confront the scores of challenges that lie ahead. In this regard, I was pleased to learn that the Air Force Research Institute was undertaking a year-long study of the Air Force strategy in the Asia-Pacific region. While it is clear that all instruments of national power will play critical roles in our national strategy for the region, the military in- strument will underpin all of our efforts in the region. The US Air Force will play an especially key role, with its ability to rapidly span the vast distances in the Pacific while engaging our allies, partners, and friends in the region through forward presence and exercises. By addressing issues from economic integration to a potential nuclear arms race and key regional actors (China, North Korea, India), this book provides a broad perspective on the topics that will shape the future of US involvement in the region. I was especially interested in the chapter on building partnerships because my experience tells me we will need to increasingly leverage the capabilities of other na- tions if we are to achieve our objectives in an affordable manner. The Asia-Pacific region is neither generally at war nor completely at peace. This is a region that holds the promise of multilateral coop- eration that can lead to greater economic prosperity, as well as the vii FOREWORD ability to deal constructively with many of the most significant secu- rity challenges of our time. These include the areas of nuclear prolif- eration, international criminal activity, terrorism, environmental degradation, pandemic diseases, natural disasters, and more. This is a region whose future is not preordained but that will be shaped by the actions of the Pacific nations themselves, and the United States will continue to be a leading member of this group of nations. This is also a region where both hard and soft power will be required to maintain stability and achieve progress. During the three years I lived in Japan, it struck me that the people who felt most viscerally positive about the relationship between our countries were those who were children during the post–World War 2 period. The lesson they could have taken from that time was one associated with the trauma resulting from the utter devastation our country had brought to theirs. Instead, the lesson many of them took away was one of gratitude for the vast effort we made to help them stand back up after the national tragedy that befell them. Much of that immense effort was undertaken by the US military forces sta- tioned there after the war. This combination of hard power during the war and soft power after the war demonstrates the versatility of the military instrument of our national policy, a flexibility that will con- tinue to be required in the years and decades to come. This book does an admirable job of addressing both the hard power and soft power challenges we will face in the region. I am con- fident readers will find this to be a worthy addition to their literature collection on the Asia-Pacific. EDWARD A. RICE, JR. General, USAF Commander Air Education and Training Command viii About the Authors Dr. Stephen J. Cimbala is a distinguished professor of political science at Penn State Brandywine. He is the author of numerous works in the field of national security studies, defense policy, nuclear arms control, deterrence, and other subjects. Dr. Cimbala is an award- winning Penn State teacher. His recent publications include Nuclear Weapons in the Information Age (Continuum International Publishing Company, 2012) and his edited volume, Civil-Military Relations in Perspective: Strategy, Structure and Policy (Ashgate Publishers, 2012). Dr. Chad Dacus is a research professor of economics at the Air Force Research Institute (AFRI), Maxwell AFB, Alabama. His current research interests include defense acquisition, economics and strategy, and cyberspace risk modeling. Before joining the AFRI staff, Dr. Da- cus worked for the Center for Naval Analyses as a research analyst in readiness and infrastructure and then as a field representative to US Fleet Forces Command. Dr.