Book Review 4 in 2002
First published in ejcjs on 22 March 2002

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Understanding US-Japan Relations in a Time of Unilateralism

by

Paul Midford

Associate Professor
School of Policy Studies
Kwansei Gakuin University
Japan

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About the Author

This volume brings together a bi-national team of four Japanese and four American young scholars under the direction of Gerald Curtis. In many ways it appears to be a follow-up to two earlier volumes edited by Curtis, one focusing on Japanese foreign policy after the Cold War, and another on US-Japan relations in the context of Asia (Curtis 1993, 1994). The findings of this volume will help scholars and policy-makers alike to understand how US-Japan relations have changed since the initial confusion and euphoria following the collapse of the Soviet threat. Weighted more toward economics than politics or security, this work nonetheless integrates a wide range of issues. These include the role of Gaiatsu (or foreign pressure), Japanese market opening, fiscal and macroeconomic policies in the context of bilateral relations, the role of ideas, the relationship between regional multilateralism and the bilateral relationship, the revised US-Japan Defense Guidelines, theater missile defense, the impact of Japan’s prolonged economic slump, the rise of China, and the emergence of American unipolar dominance and accompanying unilateralism.

Although the authors approach these issues from distinct perspectives, the overall effect is to give the reader the ability to view the relationship from several distinct angles that nonetheless yield a coherent overall picture. However, one deficiency is the lack of an introductory or concluding chapter clearly tying together the diverse themes and approaches adopted in the course of nine chapters. Curtis’ introductory chapter provides little more than a cursory description of the chapters to follow. Thus, it is left to the reader to construct a coherent overall picture.

Gaiatsu

Several contributors address the effectiveness of American Gaiatsu, or foreign pressure, on Japan. The implicit consensus they reach suggests that the influence of Gaiatsu is limited and has been significantly overrated.

Kojö Yoshiko examines Japan’s policy responses to its balance of payment surpluses, and finds that Gaiatsu does not play a very significant role. Japanese policy has primarily tracked the preferences of domestic actors. Counter to the mainstream economics literature, domestic actors, especially export industries and small and medium sized corporations, had significant preferences regarding macro-economic policy adjustment, at least during the 1970s and 1980s. These actors preferred fiscal stimulus to Yen appreciation as a way to reduce current account surpluses, fearing that the latter would hurt their international competitiveness. However, over time, the preferences of these actors regarding the value of the Yen have become more diffuse and the effectiveness of fiscal stimulus as a means of avoiding Yen appreciation (as per the Flemming-Mundel model) has declined. Consequently, Japanese corporations curtailed their lobbying efforts for Yen depreciation and instead concentrated on ways to compensate for a higher Yen by becoming less export oriented and more focused on overseas investment and production. As a result of all these changes, Japanese policy in the 1990s has focused more on stimulating the sluggish domestic economy and less on reducing Japan’s current account surplus. Given a continuation of Japan’s economic stagnation, renewed US pressure on Japan to reduce its current account surplus, Kojö predicts, will not succeed.

Similarly, Katö Junko addresses the issue of Gaiatsu in the context of Japanese macroeconomic policy. She finds that when the Japanese economy outperforms others, as it did after the 1973 oil shock, its leaders can easily be pressured into stimulating their economy out of a sense of obligation, or perhaps from fear of retaliation. Conversely, when the Japanese economy under performs other major industrial countries, as it has in the 1990s, Japan did not prove to be very responsive to foreign pressure to stimulate its economy. Moreover, other advanced economies, including the US, apparently feel that they have little leverage to pressure Tokyo when Japan’s economy is lagging behind. Like Kojö, Katö concludes that the success of Gaiatsu is situationally dependent.

The reader is left wondering, however, whether the link between Japan’s economic difficulties and its reduced responsiveness to Gaiatsu is direct or indirect. In contrast to the direct link that Kojö and Katö suggest, economic difficulties might reduce trade frictions and fears about a Japanese “economic threat”. This would imply that an indirect link is more important, with Japanese economic difficulties reducing the demand for Gaiatsu in the US and elsewhere, and hence the pressure that is actually applied to Japan.

Robert Bullock offers perhaps the most sophisticated look at the effectiveness of Gaiatsu. He looks at Japanese market opening and deregulation in four diverse sectors, including Telecommunications, Finance, Rice and small-scale retailing. While agreeing with Leonard Schoppa (1997) that Gaiatsu cannot succeed absent corresponding domestic pressure (one is tempted to call this Naiatsu), he disagrees with Schoppa that international-level tactics, such as American attempts to build broader coalitions in favor of market opening (this tactic is known as “participation expansion”), is a significant factor. Rather, American pressure and such tactics are only of secondary importance. Pre-existing divisions within a sector represent the key variable determining the degree of market opening and deregulation in the four sectors he examines. Thus, instead of focusing on “international tactics”, the US should concentrate on searching for sectors where there are already strong constituencies favoring opening.

Taken together, these three chapters, as well as Robert Uriu’s chapter on the role of ideas, suggest that American Gaiatsu works only in some circumstances, most notably when strong domestic interests favor the same policy and when Japan’s economy is out performing others. As suggested above, one might wonder about the reliability of the second finding, since Japan has rarely been subjected to intense Gaiatsu during periods when its economy lags behind others (although the early 1990s might be a partial exception). Nonetheless, the findings of the present volume tempt one to conclude that Schoppa’s (1999) claim about the effectiveness of Gaiatsu declining is exaggerated, since foreign pressure was never effective to begin with. Perhaps American leaders have long deluded themselves about the scale of their influence.

Ideas

New Perspectives emphasizes the role of ideas and the contrast with material factors in several ways. Jennifer Holt Dwyer, for one, distinguishes two levels in the Japan-US contest for leadership in Asia. One level deals with the role of material-capabilities based power. The other refers to a competition over ideas. Japan has clearly done better in the ideational competition than in the material dimension. Tokyo has realized some success in convincing Asians that Japan is on “their side” and that its ideas for less stringent conditionality better reflect the values as well as the economic interests of Asian states.

Beyond Dwyer’s account, Tadokoro Masayuki and Robert Uriu focus squarely upon ideational influences. Tadokoro’s chapter provides an insightful comparison between the US and Japanese media, and serves as a useful corrective to Ivan Hall (1998) and others who claim that Japan’s media is uniquely closed and hierarchical (pages 181-83). Tadokoro traces the origins of many influential ideas to the distinctive way that each partner is covered by the other’s media. Most strikingly, he suggests that whether bashing or admiring Japan in the 1980s, the American media stressed contrasts between the two countries rather than their important similarities as advanced industrial democracies. “This is the background for the rising influence … of the so-called revisionist school on Japan.” (page 194) On the other hand, Curtis suggests in passing that the roots of revisionist thinking can be traced back to “the attitudes of the men who made China policy during the Nixon administration.” (page 6)

Uriu in turn argues that revisionist ideas were an important independent cause of Clinton’s initial “managed trade” approach to Japan: “Even though the rise of Japan’s economic power was an objective one, the revisionist view of Japan as adversarial increased the perceived threat and spurred a stronger response than objective factors alone would have led us to predict.” (page 235) Uriu also briefly touches on how the Japanese side was able to effectively mobilize the power of ideas, namely liberal free trade ideas, to successfully beat back US demands for managed trade and numerical targets. On the other hand, he has to admit that changes in the material milieu, in particular Japan’s economic troubles and America’s economic renaissance, also played a crucial role in defeating revisionist ideas.

Multilateralism

The impact of regional multilateralism is one of the more interesting themes tackled by several authors. In particular, the reader is treated to several perspectives on Japan’s apparently ill-fated 1997 proposal to establish an Asian Monetary Fund (AMF). For Gerald Curtis, the lesson to be drawn from this incident is that Japan should avoid the appearance of trying to “wrest ‘autonomy’” from the United States when making regional diplomatic initiatives (pages 36-37). Michael Green draws a similar lesson, namely that when Japanese attempts to demonstrate independence in its foreign policy are not preceded by consultation with Washington, its proposals are likely to go down to defeat. Japan can bank on this adverse result in no small part because the US can count on Chinese cooperation to defeat Japanese initiatives (page 254). Green fails to note, however, that Chinese opposition to Japanese initiatives has declined significantly as a result of the 1999 War in Kosovo. One might also wonder, however, how Japan could possibly pursue an “independent” foreign policy if prior consultation with Washington is a prerequisite.

On the other hand, Jennifer Holt Dwyer draws a more complicated picture. According to Dwyer, Japan’s attempt to create an AMF was in fact the opening shot of a coherent and long-term strategy, one that has continued even after the initial proposal’s demise. Looked at from a slightly longer perspective, Japan’s AMF initiative appears to have attained many of its goals by the middle of 1999, with the acceptance of the “New Miyazawa Initiative” (page 98). Similarly, Tanaka Akihiko notes that the new “ASEAN+3” Summit (that is, the ASEAN leaders plus those of China, Japan and South Korea) is comparable in membership, if not controversy, to Malaysian Prime Minister Mahathir’s proposal for an East Asian Economic Caucus. Perhaps the difference between the two forums is more one of marketing than of substance. Although not suggesting that this summit threatens APEC, much less the US-Japan alliance, he implies that this new multilateral venue increases Japan’s potential for independent diplomacy vis-à-vis the US. These views impart the impression that regional multilateralism, whether focused on economics, politics, or security, will continue to be a testing ground for a more independent Japanese foreign policy, and a locus of tension in the bilateral alliance.

China

One of two major themes in Curtis’ chapter concerns the role of China in the alliance. He notes that the basic patterns for dealing with China within the alliance context were set during the Nixon administration, and have changed little since then. He argues that “Japan passing,” at least in the context of China policy, was not a Clinton invention. Rather, Japan passing was already being practiced when the Nixon administration pursued secret normalization talks with the China, entirely bypassing Japan. One intangible reason for Japan passing in these early years was that while Kissinger, Nixon, and subsequently Brzezinski obviously enjoyed discussing strategic issues with the Chinese leadership, they were “bored to tears” by their talks with Japanese leaders (page 17).

Relying heavily on Michael Schaller’s (1997) recent work, Altered States, and Kissinger’s (1979) and Nixon’s (1978) memoirs, Curtis demonstrates the extent to which US officials manipulated Japan’s “militarist” reputation in Chinese eyes for their own purposes. As Curtis puts it, “The popularity of the idea that the Security Treaty is the ‘cap in the bottle’ of Japanese military is a legacy of the Nixon-Kissinger era, even if the phrase itself is not.” (page 10) The Chinese accepted the cap-in-the bottle and gave the Security Treaty implicit support until after the Cold War. Then, with the issuance of revised US-Japan defense guidelines in 1997, which called for Japan to support US forces in conflicts in “areas surrounding Japan,” Chinese leaders began to suspect that the US was attempting “to pull the cap at least partway off the Japanese military bottle.” (page 10) This reaction suggests that the strategy of exploiting Chinese fears about Japanese militarism has boomeranged since the end of the Cold War. More generally, Curtis observes that because “the triangular metaphor is becoming a more realistic image of relations among the United States, Japan, and China … it is important that the United States and Japan consciously seek to keep their two corners of the triangle close.” (page 34) Yet, this observation suggests a fluidity in the interests of the US and Japan that belies the overall emphasis of the volume on the durability and strength of the alliance.

A Shifting Balance of Power

Several of the contributors suggest that Japan’s prolonged economic slump and the seemingly remarkable revitalisation of American power in the 1990s mean nothing less than a significant shift in the balance of power away from Japan and toward the United States. Dwyer suggests that had the Asian financial crisis come ten years earlier, when Japanese economic institutions appeared to be at their peak, America would have been hard pressed to prevail in the leadership struggle over the AMF (page 101). Although ostensibly writing about US-Japan financial relations, she reveals the deep linkages between the economic and security sides of the relationship by demonstrating how even Tokyo’s policy independence regarding finance has been severely limited by its extreme dependence upon the US for security.

As Michael Green observes, the so-called Revolution in Military Affairs (RMA) has so far primarily been an American revolution. Consequently, the RMA is increasing America’s unilateral options while threatening Japan’s latitude for autonomous decision-making in a crisis. Plans for the joint development of a Theater Missile Defense system (TMD) illustrate the point. The very short-warning time and high degree of bi-national integration necessary for a regional missile defense system would deprive Japan of the opportunity for autonomous decision-making. In short, recent technological change is exacerbating the abandonment or entrapment alliance dilemma for Japan (page 248).

Green nonetheless concludes that the US and Japan do not suffer from any fundamental conflict of national interests. As suggested above, however, Green apparently does not fully appreciate what a more independent Japanese foreign policy would imply. Moreover, he perhaps underestimates the role of growing American unilateralism and other factors pushing Japan toward greater independence. Green mentions Japanese misgivings about the war in Kosovo, but does not seriously consider whether the American unilateralist impulse, evident in that conflict, if left unchecked, might lead to far more serious clashes of national interest. Indications that the Clinton administration was seriously considering a preemptive strike on suspected North Korean nuclear weapons facilities in 1994 makes one wonder whether we should interpret Japan’s reluctance to actively support the US in this crisis as reflecting one-country pacifism or underdeveloped alliance institutions, as Green implies, or as a case where Japan deliberately tried to restrain (perhaps successfully) the US by tacitly threatening to deny support. If it is the latter, even the Revised Defense Guidelines do not ensure that a future US preemptive against North Korea will necessarily enjoy Japanese support. Needless to say, a lack of Japanese support would likely trigger a grave crisis for the alliance.

Recent indications that American might extend its post September 11 war on terrorism to Iraq have produced quiet Japanese warnings paralleling more public ones issued by European allies. This may thus be another case where American unilateralism could lead to a sharp conflict of national interest with Japan as well as with European allies.[1] More generally, the recent US tendency to unilaterally withdraw from international agreements, ranging from the Kyoto Protocol on Global Warming to the ABM Treaty and the Comprehensive Test Ban Treaty, while not posing a significant challenge to Japan’s national interests, nonetheless are serious irritants to the US-Japan relationship, much as they are for the US-European relationship.[2] At the least, the overall effect negates the goodwill that the Bush administration initially created in Japan by moving away from Clinton’s vague notion of a Sino-US strategic partnership and toward a more Japan friendly Asian policy. Perhaps the key variable that will determine the continued viability of the alliance will therefore be the strength of America’s unilateralism. If Japan and Europe can exert significant Gaiatsu on Washington, and if domestic American interests push US policy in a parallel direction, then the US-Japan alliance can probably avoid any serious challenges in the short to medium term. Unfortunately, this may prove to be a very big “if.”

References

Curtis, Gerald L. (ed.) (1993), Japanese Foreign Policy After the Cold War, Armonk, NY: M.E. Sharpe
——— (ed.) (1994) The United States, Japan, and Asia, New York: Norton.
Hall, Ivan P. (1998), Cartels of the Mind: Japan’s Intellectual Closed Shop, New York: W.W. Norton & Company, 1998, especially chapter 2.
Kissinger, Henry (1979), The White House Years, Boston: Little, Brown.
Nixon, Richard (1978), RN: The Memoirs of Richard Nixon, New York: Grosset and Dunlap.
Schaller, Michael (1997) Altered States: The United States and Japan since the Occupation, New York: Oxford University Press.
Schoppa, Leonard (1997), Bargaining with Japan: What American Pressure Can and Cannot Do, New York: Columbia University Press, 1997.
——— (1999), “The Social Context in Coercive International Bargaining”, International Organization, vol. 53, no. 2, Spring, pp.307–42.
Washington Post (6 January 2002)

Notes

[1] For a pessimistic view of the ultimate consequences of unchecked American unilateralism, see Josef Joffe, “Consider This, America-Germany: Flex Your Muscles, Softly,” Washington Post, January 6, 2002, p. B02.

[2] For a Japanese view of the unilateralist trend in US foreign policy, see Yutaka Mataebara, “Consider This, America-Japan: Resist the Unilateral Route,” Washington Post, January 6, 2002, pp. B03.

About the author

Paul Midford graduated with a BA from Pomona College in 1987. In 1990 he received a Master of International Affairs from the School of International and Public Affairs, Columbia University. Continuing at Columbia, he received a Master of Philosophy in 2000 before completing his Ph.D. (Political Science) in 2001. His dissertation topic was Making the Best of a Bad Reputation: Japanese and Russian Grand Strategies in East Asia. Paul has worked at the Research Institute for Peace and Security (RIPS) and the National Institute for Research Advancement (NIRA) in Tokyo. From 1997 until 2001, he was an Assistant Professor at the Department of Public Policy in the Faculty of Law, Kanazawa University. Until 2003 he was Visiting Assistant Professor in the Department of Government and Law, Lafayette College, Easton, Pennsylvania. Currently he is Associate Professor at the School of Policy Studies at Kwansei Gakuin University, Hyogo, Japan.

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Copyright: Paul Midford
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