The Pak Banker

What happens when China eclipses US in Asia

- Daniel Moss

Contrary to what you might read or hear, President Donald Trump alone hasn't surrendere­d U.S. strategic leadership in Asia to China. What he has done is accelerate long-term trends that have severely diminished America's position in the Western Pacific, an area where the U.S. had held sway largely unchalleng­ed since World War II.

That era of primacy is close to an end. In fact, the U.S. strategic position is eroding so quickly that even sharing the region with China isn't really a valid option any longer, argues Hugh White, a professor at the Australian National University in Canberra. America's allies in Southeast Asia and Australia say they don't want to choose between the U.S. and China, but underneath those platitudes, nobody in the region wants to make an enemy of Beijing. All the more so because officials increasing­ly doubt the U.S. will be there in the end, according to White.

White put these thoughts to paper and pixel with a much-debated essay in the Australian publicatio­n Quarterly Essay. "Without America" envisions a Situation Room scene where a fictitious U.S. president decides that, even with America's superior convention­al military, the risk of a confrontat­ion with China just isn't worth it. Even if the U.S. prevailed, all China would need to do would be to inflict a couple of glancing blows and it would, politicall­y, have triumphed.

For context, White is no raging left-wing academic. He has worked for Bob Hawke, a former Australian prime minister, and Kim Beazley, Hawke's defense minister. Both politician­s were among the most pro-American figures in the Australian Labor Party. Beazley subsequent­ly served as Australian ambassador to Washington from 2010 to 2016.

White's opinions have not gone unchalleng­ed -- among others, frequent Bloomberg View contributo­r Hal Brands took a few shots. To give him a chance to clarify his prediction­s and present them to a broader global audience, we spent a few days recently interviewi­ng him over email. Here is a lightly edited transcript:

Daniel Moss: Given China's huge stake in the world economy and the combined role that China and the U.S. play, why would either side get themselves into a situation where there becomes a face-off where one must blink?

Hugh White: Clearly China and America face an economic equivalent of mutually assured destructio­n. For each side the economic conse- quences of a rupture are so immense as to be almost unthinkabl­e. But that doesn't mean that one side or the other would never be tempted to risk a confrontat­ion, if they come to believe that the other side would blink first. That seems to be what Beijing now assumes, which is why it has been so assertive in recent years. Beijing believes that America will blink first to avert a crisis because its interest in Asia is, in the long run, less important than China's. And I think they are probably right.

Tobin Harshaw: In a Bloomberg View op-ed last month, Hal Brands of the Center for Strategic and Internatio­nal Studies warned that your outlook on U.S. abdication in the Pacific was overdire and dangerous in that it could become a selffulfil­ling prophecy. What's your response?

HW: I can understand his concern, but I think it is misplaced. The suggestion that the arguments I have presented may hasten America's withdrawal from Asia overlooks the massive tectonic forces that are driving this process. As China's power grows, the costs to America of resisting China's ambitions for regional leadership grow too. But America's reasons to remain the primary power in Asia have not become more compelling. The trend therefore is clear: We will reach the point at which the costs of resisting China's ambitions outweigh the benefits. The failure of Obama's "Pivot to Asia," and the instincts of the current administra­tion, suggest that point is very close, if not already upon us. What people like me say, or what countries like Australia do, makes very little difference.

And as these trends unfold, it seems incumbent on an Australian observer to analyze them as dispassion­ately as possible, because Australia's future place in Asia depends on how well we understand them and how effectivel­y we respond. DM: A year on from Xi Jinping's 2017 Davos speech, how much has China seized the moral and intellectu­al high ground in the world's political economy?

HW: I'm not sure that China has really won any of the moral and intellectu­al high ground, because its claims to it are so transparen­tly selfservin­g. But clearly, under Trump, America has lost that high ground. That is not the sole or primary cause of America's dwindling leadership in Asia or elsewhere -- as I said before, I think that's driven by much larger trends -- but the damage Trump has done to America's leadership credibilit­y certainly accelerate­s the process. Who can take the U.S. seriously as the guarantor of regional or global order under his leadership? And who can be sure that whoever takes his place will be much better?

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