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.It is a likely possibility that highly cooperative diplomatic efforts by the United States with China might be far preferable to our participating in arms racing with China in East Asia’s waters and the space above it.12JAPAN AND RUSSIAWhat about Japan’s and Russia’s Asian interests? Can we expect Japan to accept being a poor third and ceding control of the East Asian waters to China and the United States? Japan currently is, and is likely to remain, a long-term military ally of the United States in Asia, but the United States and Japan are competitors in important nonmilitary respects.As to security, the two nations are not to be expected always to see eye to eye.Japan’s ideas about security are bound to differ importantly from America’s if for no other reason than that historically the Chinese really hate the Japanese but not the Americans.Russia might be forced to give East Asia less priority than other areas that it may have to rate as more important.But Russia is there permanently, and its presence cannot be ignored; perhaps Russia might be helpful to the United States in diplomacy with China.In fact, a China–United States–Russia–Japan long-term peaceful cooperation for solving all East Asia security problems is not to be ruled out as a possibility, even as China and the United States are competitors for military superiority there.Never in history have the two most powerful nations of the world been in the position of needing to prepare for being militaryChina and the Asian Military Arena 141enemies and yet fated simultaneously to be locked into an ever-tightening involvement with each other in their peacetime endeavors.China’s vital economic strength, growth, and stability are extremely dependent on U.S.trade.China needs continued huge exports to the United States.In time China’s leaders will feel the pressure to do more with their growing pile of U.S.government bonds than simply collect interest payments.They likely will be a large acquirer of various U.S.-based assets.13 America’s economic strength and policies will become increasingly affected by what happens in China and by each nation’s being a major investor in the other.RATING THE POSSIBILITYPredicting by the United States’ DoD must be a routine procedure as regards China.First, the DoD must list possibilities, some of which have been described in the foregoing.Then, the Four Measures presented in Chapter 3 should be applied for refining the list: (A) probability of occurrence, (B) time of occurrence, (C) sever-ity of impact if the possibility should become a reality, and (D) ability to influence the future to improve it by early action.What of the other aspects of American life? How does China affect the U.S.manufacturers of commercial apparatus, our universities, producers of clothing, furniture, agricultural equipment, and food? How should American companies handle the Big Externalities originating from China that will have an important impact on forecasting and shaping their futures? Some consequences seem easy to predict.Outsourcing manufacturing to China will increasingly be planned by American producers.Future Possibilities142Cooperative arrangements for financing Chinese manufacturing will be made by American financing companies.American companies will set up many subsidiaries in China.China will buy large and small American companies.Venture capital firms will be established in China with help from and in partnership with American venture capital companies.These are all important possibilities.Let us choose one possibility, namely, a war over Taiwan, for illustrating further the application of the Four-Measures rating: First, (A), how likely (1 to 10) is it that the United States will find itself at war with China over Taiwan? We submit that it is improbable that such a war will occur.If it does, it will be far off in time (B), when conceivably the present situation might change for unforeseen reasons.This is because Taiwan-China trade is so huge and of very high importance to each.Taiwan, triggering this war by announcing to the world that it is an independent nation and asking for separate membership in the United Nations, would severely endanger its investment in and trade with China (now in the hundreds of billions of dollars) and would lower its economic status.It would virtually stop its economic growth because its military expenditures would have to rise enormously.The impact (C) on the DoD would be high because influential sources would see promises by the United States to defend Taiwan as having to be kept.Could the United States take actions ahead of time to affect the results (D)? The answer is yes.Changing U.S.policy and allowing China’s takeover of Taiwan is conceivable
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