Trade Malaise

Obama’s ambivalence toward free trade is damaging our position in East Asia—and handing new markets to China.

One of the incorrigible habits of being the world's only superpower is believing that the world revolves completely around you. American foreign-policy makers assume that the center of the world is Washington, DC-because it's been that way for so long. And, in some ways, nothing has changed. The shift from the G-8 to the G-20, for example, actually enhances American influence at the expense of the Europeans.

Sometimes, however, the world really does change. When Barack Obama heads to the Asia-Pacific Economic Cooperation (APEC) summit meeting in Singapore this week, he will be encountering a region that has simply bypassed Washington. Last month the East Asia Summit convened to debate the future of East Asian integration. The meeting highlighted two salient facts about the region. First, contrary to perceptions, the Asia/Pacific region has witnessed the most fervent efforts at institution-building in the past decade. The Asian financial crisis clearly spurred the creation of a number of regional arrangements, including the East Asia Summit, Chiang Mai Initiative, Asian Bond Markets Initiative, and the ASEAN Plus Three meetings. It's not just the interstate meetings that are relevant, however-increasingly, regional elites are also meeting more frequently. Having just returned from an academic conference in Kobe, it was striking to hear Japanese, Korean, and Chinese scholars talk excitedly about how often and how easily they could see each other. Naazneed Barma, Ely Ratner and Steve Weber argued in TNI that the rest of the world was becoming more integrated outside of the West. Their follow-up research suggests that this trend is not limited to academics.

Second, what's noteworthy about these regional arrangements is the absence of the United States from all of them. To be sure, the United States still maintains an active presence in East Asia through APEC, the ASEAN Regional Forum, the Six-Party Talks, and security alliances with Japan and South Korea. Most of the forward momentum in regional integration, however, does not include the United States. The Democratic Party of Japan's (DPJ) ascent to power could accelerate this trend. DPJ leaders have articulated a message similar to China about a need to rebalance away from American economic hegemony. If Japan and China were to articulate similar preferences about regional issues, the rest of the Pacific Rim would not be far behind.

Can Barack Obama reverse this trend? The evidence is decidedly mixed. On the one hand, Obama is quite popular in the Pacific Rim. The administration's approach to North Korea has been well-received by everyone not living in Pyongyang (and, as it turns out, Pyongyang is OK with it as well). The new administration acceded to the ASEAN Treaty of Amity and Cooperation over the summer, reversing Bush's policy on the issue. Obama will earn goodwill simply by not being monomaniacally focused on anti-terrorism.

On the other hand, Obama's policy malaise on trade will not win him friends in a region hell-bent on deepening economic integration. U.S. policy on trade liberalization has stalled out so badly that rumors are swirling around the Beltway that U.S. Trade Representative Ron Kirk is contemplating resignation. Meanwhile, countries in the region are signing free-trade agreements with each other at a record pace. The European Union has inked a free-trade deal with South Korea, and is negotiating one with Japan. In contrast, the chances of the Korea-United States free trade agreement passing this Congress is hovering around zero. The comparison with China is particularly dispiriting. As the Financial Times reported earlier this week, former-Singaporean prime minister Lee Kuan Yew warned American policymakers that, "you guys are giving China a free run in Asia. . . .The vacuum in US policy is enabling the Chinese to make the running."

The United States has not been eclipsed yet-the bevy of activity in the Pacific Rim is a lot more about hedging than balancing against the United States. Nevertheless, if President Obama wants to be taken seriously in the region, he needs to take the region's issues more seriously. Trade is not merely about economics-it's about foreign policy too. Just because Washington ignores a policy issue does not mean others do not think it important. As we are learning, some regions can bypass America altogether if they so choose.

 

Daniel W. Drezner is a professor of international politics at the Fletcher School at Tufts University and a senior editor at The National Interest. His book, Avoiding Trivia: The Role of Strategic Planning in American Foreign Policy, was published in April by Brookings Institution Press.