U.S. and Japan Free Trade Agreement

Lamont Colucci Foreign Policy Article in the Washington Times

Lamont Colucci

In 1853, an American naval squadron with lead ships Susquehanna and Mississippi steamed into Tokyo Bay and anchored off of Uraga. This event, set into motion by a never remembered president, Millard Fillmore, and led by a famous American naval officer, Matthew Perry, created the terms for a complex and symbiotic relationship that no other two countries share. The intellectual cry of the Japanese reformers of the 19th century, a direct result of this American opening, was bunmei kaika (civilization and enlightenment), whose central tenet was the westernization and modernization of Japan, the mania of which almost replaced the Japanese language with English.

If we fast forward to 1990, former National Security Advisor Zbigniew Brzezinski advocated the creation of “Amerippon” to create a special strategic and economic partnership between the United States and Japan whose economic clout, based on control of 40 percent of the world’s GDP, could be fully realized. The new American administration can make all of this a needed reality.

In light of the media obsession with the economic downturn, the war in Iraq and the flavor of the month, we often forget that the stability of the international system is determined on longstanding relationships and strategic planning. One way we can address this economic crisis is to use this opportunity to push for a U.S./Japan Free Trade Agreement (FTA) – lost in an election dominated by domestic economics was any real discussion of trade and its interdependence with diplomacy.

President-elect Barack Obama can explode the fear among world leaders that he is a closet protectionist by making his flagship foray into international trade waters the U.S./Japan FTA. He can further reassure a critical ally that the United States is ever more committed to the U.S./Japan military and political alliance by demonstrating leadership in this area of economic diplomacy. No country has been more open to American culture and soft power outside of Europe and Canada than Japan (perhaps more so). America has 11 FTAs with 17 countries (two of them Pacific Rim countries, Australia and Singapore) and a recently negotiated agreement with South Korea. Japan has pursued most of her FTAs with Asian countries, but the recently negotiated agreement between the U.S. and South Korea sent a jolt throughout Japan similar to the shock they received over NAFTA.

These fears cut to the heart of Japanese trepidation, especially regarding the United States and isolationism, neglect and abandonment. If Japan wishes to avoid this, and in particular if she wants to compete with China for political and economic influence, she will encourage the creation of “Amerippon.” Her most difficult constraints are her xenophobic agricultural lobby, lack of consistency from government ministries, and a deficiency of transparency. The U.S. can only commit to an FTA if it is comprehensive. However, it will take political leadership in Washington for the Japanese to create the political will to overcome their obstacles. The incoming Obama administration can make this a top priority, especially in light of the world economic crisis. Studies indicate that the current trade between the U.S. and Japan of $200 billion would be exponentially enhanced. If 10 percent of the service sectors were liberalized, Japan would gain $130 billion and the U.S. $150 billion. If 30 percent were liberalized, the total enhancement would be $350 billion.

This kind of agreement is real diplomacy with a real ally. It bolsters the Mutual Security system, cross-cultural relations, and widens the door for military, political, and technological cooperation and partership. One cannot divorce political from economic diplomacy, and the majority of advocates for the FTA ignore these other factors.

If the United States wishes to combat the rise of an aggressive China and a renewed expansionist Russia, a solidification of the partnership with Japan is an absolute necessity. There are national security issues at stake here, not merely economic ones. Further, if the U.S. wishes to truly pursue the creation of a League of Democracies, what better springboard to do this from than a series of free trade agreements with our democratic allies. The liberalization of trade is a fundamental of the free market system, making it a bedrock of political democracy.

The Free Trade Agreement with Japan can serve our economic, military, diplomatic and core values in one fell swoop. The new administration’s push for “Amerippon” can demonstrate the kind of foreign policy dynamism this president will sorely need.

Dr. Lamont Colucci, a former diplomat with the U.S. Department of State, is an assistant professor of politics and Government at Ripon College.

Free trade exigencies

Lamont Colucci

In January, North Korea demanded that the United States normalize relations before the North would abandon its nuclear weapons program.

North Korea since has launched a multistage rocket, quit the six-party talks, restarted its nuclear reprocessing facility at Yongbyon, performed a second nuclear weapon test, test-fired two short-range missiles, announced its own version of the "reset button" by declaring the Korean War armistice over, and now plans to test launch an intercontinental ballistic missile.

In this security context the United States should push for the free-trade agreement with South Korea, known as KORUS-FTA. In a prior column, this author discussed the necessity for a U.S.-Japan free-trade agreement, but that cannot occur while the agreement with our other East Asian ally languishes. The KORUS-FTA is the linchpin for any future Asian free-trade agreements.

The agreement was signed by both nations in June 2007 and would eliminate tariffs on 95 percent of most goods and services. South Korea is the 10th-largest economy, our seventh-largest trading partner and our sixth-largest market for agricultural goods.

A number of independent and government studies indicate that the KORUS-FTA would add $20 billion in bilateral trade, increase U.S. gross domestic product by up to $11.9 billion, and raise U.S. exports by 49 percent.

On average, current American exports face higher tariffs in South Korea than the other way around. Although 70 percent of South Koreans believe it would promote friendly relations with the United States, there is great opposition by forces against free trade and various people in the new Obama administration.

Secretary of State Hillary Rodham Clinton said, as a candidate for president, "While I value the strong relationship the United States enjoys with South Korea, I believe that this agreement is inherently unfair." There have been outstanding issues over items like U.S. beef exports, pharmaceuticals and products produced at Kaesong industrial complex.

However, President Obama must reassure the world of his free-trade credentials. There is consternation in many capitals over perceived protectionist sentiment and its dubious partner, isolationism. This issue is another victim of the lack of media attention to international affairs.

Aside from South Korea and Japan, the other democracy in Asia with which a free-trade agreement is needed is Taiwan. This agreement would seem easier, as Taiwan is not only our ninth-largest trading partner, but it also would provide an overall boost for U.S. manufacturing (Taiwan exports no automobiles), agriculture and especially the high-tech sector. As with South Korea, the stakes are high politically and diplomatically.

Rejection of free-trade agreements with East Asia’s democracies run counter to American values and economic interest. Bolstering free trade with Japan, South Korea and Taiwan sends a message of solidarity, stability and commitment. It is also a warning to potential aggressors. The negative outcomes of a KORUS rejection are legion and would send an ominous statement to Tokyo and Taipei. It will prove the unreliability of American diplomatic commitments to a political and military ally, which has risked much domestically in pushing for the agreement.

Rejection would play into the hands of the expansionists in Moscow and Beijing who seek to diminish our influence in the entire Pacific. There will be a chilling effect with other countries that plan to seek a free-trade agreement with the United States as this entire scene of political theater plays into the hands of the propagandists in Pyongyang.

There is more at stake here than an economic agreement; there is our entire presence in the Pacific.

Lamont Colucci is a former State Department diplomat and is an assistant professor of politics and government at Ripon College in Wisconsin. He recently published a book titled "Crusading Realism: The Bush Doctrine and American Core Values After 9/11," and is a contributing author of "The Day That Changed Everything: Looking at the Impact of 9/11 at the End of the Decade."