Byron Scott, professor emeritus, Missouri School of Journalism: This time we’re here to discuss President Barack Obama’s recently concluded “Four Democracies Tour” — India, Indonesia, South Korea and Japan. The 10-day trip, which included the G-20 in Seoul and the (Asia)-Pacific Economic Cooperation conference in Yokohama, produced mixed results for President Obama’s foreign policy resume. Admittedly, his to-do list was lengthy; everything from United Nations reform to regional stability to free trade agreements.
And then there was a country Obama didn’t visit: China. Not a democracy, of course, but the world’s second-largest economic power and a nation with a key role in resolving all these issues — as The Economist called it this week, “the elephant outside the room.”
Joining us to give us their assessment are four journalists who have been covering these stories: Bridget Johnson, online editor and foreign policy writer, The Hill, Washington, D.C.; Peter Ford, Beijing bureau chief, Christian Science Monitor; Donald Kirk, Korea correspondent, Seoul, Christian Science Monitor; Endy Bayuni, senior editor, former editor-in-chief, Jakarta Post. Endy, perhaps the most positive reception for the president was in Indonesia. Tell us why.
Endy Bayuni, senior editor, Jakarta Post, Indonesia: Well as you all know President Obama spent four years of his childhood in Indonesia and his mother dedicated practically all her professional career life to Indonesia, and for Obama this was like a homecoming. This is a country he hasn’t visited in the two years since he has been president, therefore Indonesia waited. Obama himself had on two occasions tried to come to Indonesia this year but failed because he had domestic issues at home. But when he finally made it here there was a very warm welcome for him and for Obama himself it was a very emotional homecoming visit.
Scott: And I know that his Indian visit went very well too, but, Donald Kirk in Seoul, not so much in Korea?
Donald Kirk, Korea correspondent, Christian Science Monitor, Seoul: Right. He faced two big disappointments in South Korea. The first was that the U.S. and South Korea could not agree on a free trade agreement that was actually concluded in the final months of the George Bush presidency, but needs ratification by Congress and also by Korea’s National Assembly. They still have to iron out technical details. A lot of people thought that Obama and South Korea’s President, Lee Myung-bak, were going to stand tall at a press conference at the Blue House and announce that everything worked out and they were submitting the agreement to their respective legislative bodies, but that didn’t happen. I was there actually at that press conference and there was a sense of real surprise. It was almost a shock announcement. That is overstating it a little, but they’re hung up on the questions of all these standards that require motor vehicle imports and also hidden taxes. But, it is the car issue that is really overwhelming. Korea imports about 10,000 American cars a year, exports about 600,000 or so, plus manufacturing cars in Montgomery, Ala. and West Point, Ga. so the imbalance is just overwhelming.
Scott: Things were also very interesting in terms of the role of the Chinese in all this, was it not?
Peter Ford, Beijing bureau chief, Christian Science Monitor: You referred earlier to China being the elephant outside the room. When the Obama administration came to office a couple years ago they made a quite serious effort to get China into the room. Indeed, Mr. Obama didn’t come to China this time but he was here a year ago. China has been a focus of his administration’s foreign policy but he has been running into a number of difficulties over the past year. Copenhagen, the conference on climate change, was perhaps the first indication that the Chinese were not going to be quite as supportive of U.S. goals as the administration had hoped, and it has been going on like this ever since. Now we’re really badly hung up because of the issue of the Chinese currency, which is somewhat of a red herring. Mr. Obama didn’t get very far at the G-20 in trying to persuade the Chinese to move any faster on re-valuing their currency, probably because he couldn’t really muster much support among several other members of the G-20.
Scott: In part this was because of the so-called “quantitative easing,” a new phrase for us from the Federal Reserve. Bridget Johnson, tell us about this and the Washington reaction.
Bridget Johnson, online editor and foreign policy writer, The Hill, Washington, D.C.: The Federal Reserve and the decision to push $600 billion into the economy was sort of a jumpstart move. The reaction that Obama got for that when he went abroad was really interesting. The German finance minister called the decision “clueless” at the G-20 meetings. Obama spent so much time having to defend his domestic policies on the campaign trail and the Democrats took a drubbing at midterms. At this point our president would basically welcome the chance to escape and go abroad and work on some foreign policy issues, but bad luck followed him. He took heat from other world leaders, other countries not liking his view of increasing spending to increase growth.
Scott: The international perspective is that this somehow holds down the value of the American dollar and allows American products to sell more cheaply abroad, which is exactly what we have been criticizing the Chinese for.
Ford: The Chinese perspective shared by many other countries in this region and elsewhere is that this $600 billion is going to go to the banks. If the banks were able to use it in the United States to pump up the economy that would be fine. But nobody in the United States is borrowing, neither consumers, who have got too much debt already, nor companies, which are very cautious. So the banks are going to look for the best returns on their money and they’re going to find that in the countries with high growth and that is Asia.
So we’re afraid this $600 billion is going to flood into Asia, into the emerging economies and it is going to push the dollar down because everyone is going to have to buy the currencies of these Asian economies in order to invest in them. So it is going to pump up the Asian currencies and pump down the dollarand, as you say, do exactly what America is charging the Chinese with and the Chinese aren’t having any of it.
Kirk: Everyone says they’re just a U.S. device for printing more money. When I first came to Asia, we were always saying these Third World countries were just printing more money, that’s why their currency basically became funny money. Now it seems the United States is printing more money, $600 billion, and this is on top of $1.7 billion in treasury bonds that were issued that were bought up earlier by the Feds. So the Chinese are all the more reluctant to raise the value of their currency.
I should have said that this was not a disappointment to Obama in Seoul because everybody knew that the Chinese were not going to go along with this. The real question in Seoul was how they were going to fashion a great action statement that kind of papered over all the differences and they did a pretty remarkable job. It is quite a statement. There is a lot in there. One thing that is not in there is any agreement on currency.
Scott: Bridget, we wanted to hear what the Capitol Hill response is to all this.
Johnson: Currency manipulation is definitely not dead on Capitol Hill. When Congress first started this effort, the White House was trying to get the lawmakers to ease off, and we’re talking Democratic lawmakers here, in addition to Republicans. They were afraid it would rankle relations with China at a sensitive juncture. However, the White House did start to lose a bit of patience with China itself and vowed to bring this issue up at the international meeting.
So the immediate response from Congress was that, OK, if we have a failed G-20 then we’re definitely going to pick up the Chinese currency manipulation bill, which was passed in committee in the House before they left for the campaign recess, and the Senate has vowed to take it up at the lame duck session. Of course there are a lot of issues that they’re trying to fit into the lame duck session so we’ll have to see how that plays out.
Scott: Let me change the focus here a little bit and ask that we also talk about the other matters of United Nations reform and regional security, which were all part of this trip. We know that Mr. Obama promised the Indians he would work to get them a permanent seat on the Security Council of the United Nations, and he also supported the Japanese in their long-term territorial controversy about Dokdo. Peter Ford, wouldn’t China prefer to be the hegemon and the elephant inside that particular room?
Ford: The Chinese have been unusually assertive in their claims on the South China Sea in the last year or so. They were also making noises earlier this year about this territorial claim as being a core national interest. I think it is being counter-productive apart from the fact that it made the Americans wake up. Mrs. Clinton has said that the United States would be happy to get involved in mediating between ASEAN, a Southeast Asian nations group, and China on this. The Chinese insist that it is not an issue for the Americans to get involved in any shape or form.
They also insist, of course, that they will deal with the individual countries with which they have territorial disputes one by one because it is much easier for China to deal with Vietnam, for example, or Malaysia than with ASEAN as a whole. They found that they have really stirred up a hornet’s nest the way they’ve behaved this year. And I think they are taking steps back. We’ve heard them suggest that it is not really a core national interest about which they would go to war. The foreign minister earlier this year said very bluntly at a national meeting that China is a big country and southeast Asian countries are small. The man who is likely to be the next president was in Singapore last week and he made a great point of saying all countries, large and small, in this region are equal. So I think the Chinese have got the message that they’re going to have to be more diplomatic about this but I don’t think in the long term that is going to do anything to dampen their appetites for territorial control of areas that may have significant energy reserves.
Scott: Don, what was the discussion about this on the sidelines of the G-20 and the Obama visit?
Kirk: Well there was quite a lot of discussion about that. We have just been hearing about the South China Sea but there is also the Yellow Sea, which lies between the Korean Peninsula and China. China is very concerned about the possibility of U.S. naval exercises. There already have been some. They raised a hue and cry when the aircraft carrier, the George Washington, was said to be on its way there. In fact it didn’t go there. It refrained, apparently, under that kind of pressure.
The reason for the U.S. exercises is the response to the sinking of the South Korean navy corvette for which an investigation holds North Korea responsible. North Korea, according to the investigation, sent out a midget submarine and torpedoed it, splitting it in two and killing 46 South Korean sailors in March. So this is a terrific issue in South Korea and South Korean leaders are quite upset with China for failing to endorse this investigation.
China’s interest, as is often stated, is in stability on the Korean Peninsula. China doesn’t want to upset its relations with North Korea, which is really a protectorate of China, and at the same time China wants to maintain huge trade relations with South Korea. South Korea invests heavily in China and South Korean investors have factories all over China, and so there is a very interesting relationship there between China and the Korean Peninsula – every interesting issues involved with U.S. issues at stake too, with the U.S./South Korean military alliance with the presence of a major air force here as well as 27,500 U.S. troops. It is very sensitive and it is getting more sensitive and has a lot to do with, talk about the elephant in the room. China is viewed as kind of a monster force and no one knows quite how that is going to play out. No one wants to offend China and it is not believed that China wants a second Korean War either. In fact it is quite certain that China does not.
Scott: Let’s get Bridget to chime in on this. How likely is the new Congress to pay much attention to these increasing tensions?
Johnson: Well, facing a House GOP majority President Obama is definitely going to have some challenges. Now obviously Obama is setting his own foreign policy and he can take it the route that he wants but the Congress can affect things such as funding for war measures and such. I think it is important to note that Obama is also jumping out of the G-20 situation for which he is getting very much panned on Capitol Hill and going straight into the NATO summit which is going to be this weekend. There, he is going to have to face talks about an entire restructuring of the strategy post-Cold War of NATO and Afghanistan. He is taking Afghanistan from both liberals who want a quicker withdrawal and from conservatives who don’t like the fact that he is putting down a timeline in the first place. So he is kind of taking it from both sides and I think the pressure that he is going to face on Capitol Hill is only going to increase.
Scott: Let’s ask Endy to give us a perspective here about what not only Indonesians but also our Asian allies might expect from the United States, both its president and its Congress?
Bayuni: We hope that the United States might continue to pay attention to what is happening in Asia. I think there’s more of a focus on Europe and the Middle East and important events like APEC and other international conferences. I think many Asian countries welcome the return of the United States to this part of the world. In this part of the world they saw this as a successful visit. At least we get the impression that the United States is paying more attention to Asians this time.
Scott: A quick couple of sentences, first from the Korean perspective on this topic, Donald Kirk?
Kirk: The Korean perspective is that there is a terrific amount of legacy of the U.S.-Korean alliance and at the same time there is concern about where the alliance can go while the free trade agreement is up in the air waiting resolution on technical details. There has been quite a lot of goodwill between the U.S. and South Korea lately but we’re not at all sure where that’s going. Nor are we at all sure if there is going to be any resolution of the North Korean nuclear issue.
Ford: I think Beijing knows very well that the United States intends to remain a Pacific power and they also know that the smaller Asian nations are bound to want to use the United States as a counter-weight to the rising power of China. There is nothing they can do about this, except they can be a little more diplomatic than they have been over the last 12 months. But China is inevitably a rising power in this region and it will be a very delicate game between the United States and China as to how both sides manage that.
Scott: It has become traditional for American presidents to upgrade their international credentials after bruising mid-term Congressional elections. Remember Bill Clinton doing this famously in ’94? They can put domestic problems aside for a few days and remind everyone that theirs is the most powerful elected position on the globe. Barack Obama’s so-called four democracies tour was, among other things, a mission of reassurance. Reforms, if they come, are for later.
Producers of Global Journalist are Missouri School of Journalism graduate students Ryan Kresse, Youn-Joo Park, Tim Wall, Kuba Wuls and Rebecca Wolfson. The director is Travis McMillen, audio by Pat Akers. The floor director is Yue Jiang. The video producer is Erika Croonenberghs. The transcriber is Pat Kelley.