ICAS Spring Symposium
Humanity, Peace and Security
The Korean Peninsula Issues
May 21, 2009 1:00 PM -- 4:30 PM
Senate Dirksen Office Building Room SD 419
United States Senate
Captiol Hill, Washington, DC 20510
Institute for Corean-American Studies, Inc.
965 Clover Court, Blue Bell, PA 19422
Biographic Sketch & Links: Rudy deLeon
Senior Vice President
National Security and International Policy
Center for American Progress
Now with elections, America starts new chapters, and indeed, more than 100 days ago with the inauguration of President Obama, we turned the page. Now today, we're having a national debate with the President speaking at the National Archives at 11 o'clock, and the former Vice President of the United States speaking at the American Enterprise Institute at Noon. Just about how quickly and how dramatically we turn that page, but this is a critical time economically. This is a critical time in terms of environmental policy, a critical time in terms of trade and then also national security as the United States deals with both economic problems and wars in Iraq and Afghanistan.
Yet, here we are, and the purpose of my talk here will be to focus on Asia, more concentration on China, but additionally talking about Korea and Japan as well. So indeed, the United States, distracted by Iraq and Afghanistan, the attention to Asia diminished during the previous administration. President Obama and the administration has already moved out quickly to turn a page. Hillary Clinton's first trip as Secretary of State was to Asia, carefully chosen to convey the message that America's relationships across the Pacific are indispensible to seizing the opportunities and to addressing these new challenges.
Now, the U.S./Japan alliance has been the bedrock of U.S. foreign policy in the Pacific for the last 60 years, and it is as strong and as important as ever. American efforts to reduce the U.S. military footprint and realign bases in Japan have improved relations. China is rising as an economic powerhouse, as a major political player on the global stage, a significant security presence in East Asia, for better or worse still to be determined, and I might add - a practitioner of what our colleagues up at Harvard refer to as "smart power," and they are a critical partner in solving the climate change issue.
A positive U.S./South Korean relationship forged in blood during the Korean War remains of paramount strategic importance to both our nations. Meanwhile, the whole architecture of East Asia is rapidly integrating through increased economic, technological and social interactions. The United States wants to remain engaged in Asia as nations in this region undergo this dynamic transformation.
Now let's break the issues down because the issues in national security are no longer just simply balances of power and strategic security alliances. They encompass trade, climate, the whole global exchange of sharing technology.
So on the security front, let's go to two main concerns. First, China's military modernization. It's accelerated significantly over the last 15 years. There's a lack of transparency in China's military modernization. It remains difficult to analyze due to the lack of public information. So more transparency would be important. China reported its military budget in 2008 to be about $60 billion. DOD's most recent studies estimate that actual spending is closer to $100 billion or $150 billion. The crucial question: what are the objectives? As the world becomes more globally integrated through trade and cultural and educational exchanges, what is the Chinese military strategy and what are its objectives? They're difficult to answer. One of the challenges of the new administration will be to answer those questions. And, as far as objectives, we can speculate that China's modernization may be aimed at preventing Taiwan independence and laying the foundation for a military force to accomplish broader regional security and global exchanges.
Now, to this end, China is professionalizing its military, improving training, purchasing more robust, realistic joint exercises and accelerating acquisition and development of modern conventional and nuclear capabilities. In addition, they are making dramatic strides in human space flight. They've had a series of very successful missions and have already conducted extra- vehicular activities and may be planning their own moon program.
Now, for Taiwan, the primary flashpoint for U.S./China relations has actually cooled off since March of last year when Taiwan President Ma was elected. Relations between Taiwan and China have warmed, and Taiwan policy is now geared more toward a working relationship with China rather than independence. At the Center we receive regular delegations from both China and Taiwan, and what's interesting is the amount of discussion coming from those visiting from Taiwan talking about the economic exchange and the new economic opportunities that they are pursuing with the Mainland. So President Ma and the stability that he brings in terms of how he conducts the Taiwanese presidency and then the coolness of his speaking, combined with these economic exchanges are extremely important.
So on the security side, the U.S. national security must be oriented toward ensuring that China's pursuit of national security is one that is tailored to the region and one that indeed does not destabilize the region. The United States needs to continue to be a player in Asian regional security. Americans have been distracted by Afghanistan and Iraq, and so moving forward with a new invigorated Pacific presence is extremely important because the U.S. has to remain engaged in East Asia for the long haul to guarantee peace, to deter aggression, and to encourage peaceful resolutions of disputes while emphasizing the cooperative and mutually respective U.S./China relationship. In fact, throughout the second half of the 20th Century, the tremendous stabilizing role of the U.S., diplomatic, military, particularly the naval presence in Asia, was extremely critical.
Now, one of the new things that the administration will have to do as it conducts its quadrennial defense review is to task the national security tools of the United States with a rigorous in-depth assessment of the ability of current and programmed U.S. forces to fulfill our security commitments in the Western Pacific in the face of the military capabilities that China possesses or are likely to acquire in the next decade, also develop a long-term defense program and strategy for U.S. basing and posture in the region based on these findings, and then to make specific recommendations for investment, acquisition and procurements in East Asia, and greater transparency, intensifying the dialogue on nuclear non-proliferation of which China needs to play a critical role, to continue to play the critical role in multi-national talks on the North Korean nuclear issue, increase U.S./Chinese military-to-military contacts. This has been a start-stop really period in terms of U.S./Chinese military-to-military exchanges. The mil-to-mil meeting in February 2009 was a very good start. Both sides have pledged to continue. It will be very critical for those talks to continue. And then of course, the Peoples Republic of China and the United States need to learn together to continue to do the humanitarian mission throughout Asia. The United States through its armed forces has tremendous capability on the humanitarian side, and when these disasters of nature occur, it will be very important for countries to work together.
Now, on North Korea, I think we know the issue there. It is a regime that lacks any transparency whatsoever. On the recent test of the missile, very clearly - if you look at the cover story that this was an effort to put a satellite into orbit, turned out not to be the case. So there will be a continued need for China to engage on the North Korean question.
U.S./China - one bit phase of the relationship in Asia.
Now, next let's look at Japan briefly. On the security side there are 53,000 U.S. troops currently stationed in Japan. Japan bases facilitate forward deployment of the U.S. military in Asia Pacific. For Japan, the U.S./Japanese alliance and the U.S. security umbrella provide maneuvering room for dealing with both China and North Korea. In 2005 the United States and Japan announced a sweeping new agreement to strengthen military cooperation. The plan calls for U.S. forces to be realigned and for Japan to take on a more active, non-combat role in maintaining regional and global security. Presence is extremely important. The Japanese defense forces are very capable in that sphere.
On economics, Japan is the second largest export and import market for the United States. Trade frictions have alleviated in the last few years. Japan is the second largest source of FDI in the United States which helps to finance the U.S. deficit and reduce upward pressures on U.S. interest rates. And so managing the U.S./Japanese economic exchange during this economic downturn will be extremely important and a must-fix issue for the Obama administration.
Now, recent developments: Secretary Hillary Clinton's visit to Japan - her first trip abroad as Secretary of State was to Japan where she signaled that U.S. ties with Japan were exceptionally important, as firm and as important as ever. This allayed Japanese fears that the United States was leaning toward a China-first position, and they extended to Prime Minister Aso an invitation to become the first foreign leader to visit the Obama White House. They stressed that the Obama Administration will closely coordinate with Japan in dealing with North Korea, a reassuring statement as Japan was feeling left out in the bilateral talks between Washington and Pyongyang.
And on climate change, representatives from the U.S. Environmental Protection Agency, Japan's Ministry of Environment and Japan's Institute for Global Environmental Strategies met this week to discuss collaboration on key climate change affecting the two nations. So building on the security relationship and then of course the criticality of the U.S./Japan economic relationship.
Now, on South Korea, just continuing to go through the region and hen after discussing South and North Korea, then to focus on really climate change as one of the key issues for the U.S. and Asia to move out smartly on. On South Korea: both countries have new presidents and new administrations. Both President Lee Myung-Bak and President Obama have attempted to steer away from many of the policy directions of their predecessors and to really turn and start a new page. The recent missile test by North Korea, whether it was a success or failure, whether it was a ballistic missile test or a failure to put a satellite in orbit, poses a great threat to the security not only of the Korean peninsula, but to the entire Northeast Asian region and to the United States as well. It is especially worrying at a time when the six-party talks are standing at a stall without any sign of reaching a concrete agreement any time soon.
On economics, critical is the cooperation between Korea and the United States concerning the financial crisis and trade agendas. It is becoming clear that the global financial system that we have maintained for most of the 20th Century is in need of fundamental change and both of the countries have economic systems that are based heavily on a free market liberal trade system. It's vitally important for the United States and Korea to reach agreeable terms for a Korea/U.S. free trade agreement. Leadership in both countries is pushing for this, though the U.S. has raised issues on automotive, and that needs to be an area where progress is very critical.
On North Korea - The launch of the Taepodong-2 intercontinental missile on April 5 went further than any of its predecessors before landing in the Pacific. Now, this was clearly a provocative action and certainly not a nice welcome card to the new Obama administration. Interestingly, Teheran did the same thing yesterday. As the U.S. is extending an opportunity to engage in discussions, there was a missile test in Teheran yesterday, hardly a step in the right direction.
Now, on the Korean missile launch, in the U.N. Security Council, the U.S. did issue a strongly worded non-binding condemnation of the launch, consistent with existing U.N. resolution and sanction. The Obama administration believes the six-party talks and the ultimate goal of denuclearization of the peninsula need to proceed. Ambassador Bosworth met with leaders on Tokyo, Seoul and Beijing to discuss the coming six-party talks. The U.S. is open to bilateral talks with the Democratic Peoples Republic of Korea, but only if it supports the multilateral process. So creating leverage among our Asian allies - China, Japan, South Korea - will be very important because without that leverage, little will be accomplished in terms of preventing North Korea from continuing testing both on their missile program and also on their weapons program. So North Korea will likely continue to try to create their own incentives, but I think that patience may indeed be limited in terms of dealing with North Korea as the six-party talks continue.
So as the new administration starts and as we turn the page, a busy set of issues in terms of the U.S./China relationship, the U.S./Japan, the U.S./South Korea, and then of course, a reluctant and pesky series of issues from North Korea.
Now in terms of China, just going back to a few other items, the United States continues to have significant issues with the Chinese in terms of their approach to human rights, and looking for a peaceful resolution of issues with Taiwan. Those issues are well understood and we can expect to see the Obama administration - Secretary Clinton and Assistant Secretary nominee Campbell, once he is confirmed - be very engaged in the region.
But at the core of the U.S. and Asia will be: can steps be taken with the Chinese in the area of climate change, energy consumption and the revolution in green technology?
So let's start right there: coal. China relies on coal for 80% of its energy needs, and right now the country is building two 600 megawatt coal plants per week to keep up with energy demands. So while the government highlights that it is shutting down coal plants, it is building bigger plants while closing smaller. There's also a water crisis that also generates a considerable energy consumption in China. China makes up 20% of the world's population, but has only 7% of the world's water resources. So China has a very high water poverty rating on the Oxford University's Water Poverty Index. A U.N. study lists China's water situation as critical.
This is what we would call a vicious cycle. China has built massive hydrological infrastructure projects to move water from the south to the northern regions where the situation is especially dire. However, these projects consume lots of energy which in turn also consume a significant amount of water. So facing climate change - you start with coal and water consumption.
Second, on current initiatives and efforts it's going to be very imperative to introduce the concept of green energy technology and policy with the Chinese. Now China, to their credit, has set a goal to reduce energy intensity by 20% by the year 2010, compared to 2005 levels, but the country is currently behind schedule and will work to come close to the target but probably won't hit their own targets.
Now, on energy, renewable energy the Chinese have set very, very high renewable targets, to have 10% of energy needs come from renewable resources by 2010; by 2020 16%; and by 2050 40%. Here we can see the turning in their R&D and development cycle and investment. The previous speaker spoke about the amount of Chinese resources that at one time were focused on export items, that currently are instead looking inward, and so the R&D in the energy technology area and in battery storage in particular is considerably aggressive, and given their track record for innovation, an area of potential collaboration between the West and the Chinese on peaceful technology exchanges. So on renewable energy, wind has been one of their biggest alternative energy successes thus far. The country has increased its goal for wind power generation by 2020 by as much as 100,000 megawatts. On solar, the government has said it would provide new incentives for solar voltaic projects, further opening up this rapidly growing energy market to the solar industry. The Chinese Finance Ministry has said they will provide 2.9 per watt for projects of 50 kilowatts and above. So just as the United States through the stimulus package has funded a vigorous green technology initiative and the Department of Energy is moving out quickly to make that stimulus actionable through awarding contracts, we're seeing a parallel program on the Chinese side to move out, and to take their own initiative in this area.
On water, the government has set a target to reduce water consumption per GDP unit by 60%. And then provincially the central government created a new system for evaluating for provincial governments. Green measures now account for 60% of the provincial governments evaluation. The central government has also prioritized energy intensity in the provincial governments' mission.
So a tremendous emphasis on solar and wind, and then electric vehicles - China is leading in this field and likely largely to become the largest producer of electric vehicles. Now there's fascinating technology work going on. As our Detroit very much has its problems in the economy, we shouldn't overlook as an engineering project the General Motors Volt. If we read the literature, the vehicle is capable of a battery that will have a range of 300 miles, but will have a small electrical generator, gasoline powered on board, for trips longer than 300 miles so the business model is there. Interestingly, if the Volt uses the electrical generator to recharge the battery, it's still capable of getting 100 miles on a gallon of gasoline. The question in the United States is that the Volt will be more expensive than an internal combustion engine, and so for American consumers that are already stretched thin because of the unemployment and the other economic limitations right now, will they have the capital to invest in next generation technologies?
Now here, China has over a dozen companies competing to design electrical vehicles, and so this surpasses the entrepreneurship initiatives that we see in the United States right now. Chinese models are likely to be smaller and more efficient than U.S. vehicles. China is posed to surpass the United States as the world's largest auto market. In 2008 it was the first year where more automobiles were purchased in China than in the United States. And of course, China already possesses significant manufacturing prowess. In the economic downturn it's especially notable that China's auto sales and manufacturing continue to grow at record levels, while the U.S. market shrinks significantly and our own companies deal with the economic loans to remain viable.
On electrical vehicle infrastructure: China has already begun electrical vehicle infrastructure projects in Beijing, Cinjon, Uha and Shanghai.
Now one key element of the U.S. stimulus package is high voltage transmission grid technologies, and China has claimed that it has emerged as a world leader in the ultra high voltage transmission grid technologies, thanks in large part to the 1000 kV transmission project. This project was put into operation in January 2009 and marks a breakthrough in the technology of long-distance, large capacity, and low loss UHV power transmission. And also there are significant efforts at the municipal level in China to implement the transmission grid technologies.
Now, Kyoto has been an issue. And the Chinese have not - did not sign on to Kyoto, and I think the Europeans, the U.S. are waiting to see what their strategy will be as the nations of the world move toward Copenhagen and the summit that will occur there later in the year. But of all of the issues that are on the U.S./Asia agenda, we quickly get to a series of issues between the United States and China as the two largest players on the economic side and how to get improvements made in China's consumption of coal and their greenhouse emissions. And so this will be very much a major challenge. As the United States looks at China on a host of other issues - from Taiwan to human rights to trade - it will be to find a path forward on the energy side and in ways that will reduce the impact of climate change so that unlike Kyoto, Copenhagen will show progress for the United States and China.
That was a quick review of looking at Asia as we sit here on this morning in 2009 with a new administration not yet at its second 100 days, very much engaged with the U.S. economic crisis, trying to continue the path of progress that has been made in Iraq and trying to come up with a new strategy that will quickly pacify the hostilities in Afghanistan. Asia remains the critical area for the United States as we look forward to the Obama administration in 2009. And so I very much appreciate the chance to be here and take the questions.