In the post-September 11, post-bubble-economy world, the acid test of national success is mastering the relationship between national security and economics. In East Asia, this is a test that US President George W. Bush is failing miserably, as shown by Treasury Secretary John Snow's visit to the region.
America's biggest national security challenges in East Asia are dealing with North Korea's nuclear weapons ambitions and preventing China becoming too strong, too fast. Its biggest economic challenges are combating the predatory East Asian economic strategies that threaten America's industrial and technological leadership. And central to accomplishing both aims is developing the right mix of policies not only for China, but for Japan and South Korea.
Unfortunately, the Bush administration has decided that Chinese and Japanese co-operation on the North Korea issue is so valuable that it cannot risk pressing them to stop keeping their currencies artificially cheap or eliminate more conventional trade barriers. It sounds just like America's Asia strategy during the cold war - tolerate the protectionism of Asian 'allies' no matter what the economic cost, for fear they will become communist. And it suffers most of the same problems.
Like their cold war predecessors, US officials today ignore the reality that if China and Japan truly believe that a nuclear-armed North Korea is not in their interests, they will pressure the regime regardless of US criticism and action. If America's alleged Asian partners are not unduly alarmed about North Korea's nuclear programme, no amount of US economic blandishment will change their minds.
The Bush administration also seems oblivious to the costs of tolerating Asian mercantilism. Denuclearising North Korea is a vital security objective for the United States. But America's security will not improve if North Korea is denuclearised largely by permitting Asia's protectionists to continue hollowing out the industries needed not only to equip America's military, but also to keep the US economy productive and innovative.
For two main reasons, America's highest North Korea priority is denuclearisation. First, North Korean nuclear weapons would endanger America's enormous military deployments all over Northeast Asia and eventually could target the US itself if the regime ever developed powerful-enough missiles. Second, and perhaps more important, a nuclear-armed North Korea would be able to sell its weapons and related technology to global terrorists, who in turn, would threaten other American forces around the world.