Tuesday, February 23, 2010

Hit over the head with a baseball bat

Drezner - da blogosphere MAN - has welcomed me by hitting me over the head with a baseball bat... I LOVE IT!

Here's the link: I'm officially welcoming Jim Vreeland to the blogosphere by hitting him over the head with a baseball bat.

Dan disagrees with me about President Obama meeting with the Dali Lama. He makes good points:

"foreign policies are never crafted with a clean slate, even with a change in presidential administrations. If no president had ever met with the Dalai Lama before and then Obama bumped into him in the Map Room, that sends one signal. If every president for two decades met with the Dalai Lama and then Obama abstains from meeting him -- let's call this the Vreeland Gambit -- that sends another signal.

"I understand Vreeland's concerns that Tibet will gum up the foreign economic policy works, but I also know that the signal Obama would have sent by canceling this meeting would not have been a good one.

"I would interpret this is a massive exercise in (oh, the irony) kabuki politics. Obama has a meeting that leads to no real policy differences, and China gets visibly upset and the inconsequential meeting. A week from now, neither side's rhetoric on this issue will matter all that much."

I agree that in the long-run, this particular meeting will not have much of an effect. But it's part of a trend:
(1) US protectionism against Chinese tires
(2) Arms sales to Taiwan
(3) Repeated references from the State Dept to Tibet
(4) Meeting the Dali Lama...

If I were advising the Obama Administration on China policy, my agenda would look more like this:
(1) Press for the revaluation of the renminbi
(2) Press for the revaluation of the renminbi
(3) Press for the revaluation of the renminbi
(4) Press for the revaluation of the renminbi ...

To be more specific:
(1) I would make the revaluation of the renminbi an integral part of daily US public discourse domestically
(2) I would make the revaluation of the renminbi an integral part of daily international public discourse
(3) I would address the domestic audience in China about this issue - yes, revaluation would hurt the export sector, but it would help the growing consumer class in China - esp. people who want to send their children to study abroad in the United States

With this last point in mind, please note that we in the United States have so many friends in the citizens of China - people who would love to embrace our most important policy objectives. But don't underestimate how much meeting the Dali Lama offends Chinese people - and here I mean the people, not Beijing, whose reaction is actually moderate compared to that of many Chinese.

By showing some sensitivity on this issue - even just a little - Obama could go a long way towards opening a dialogue with most Chinese people. Obama has been so deft at addressing the public in Iran. Winning points with the domestic audience in China would be so easy if he'd snub the Dali Lama.

Would this send a signal? Yes it would - to the country with whom we have an interesting economic arrangement of mutually assured destruction... It would send a signal that we are taking China seriously and are interested in a serious dialogue about the most immediate threat to world stability.

We need to work on the G2… and fast. For, the root cause of the financial collapse is still looming large… to the tune of $800 billion in debt. This is the next crisis waiting to happen. And every time I hear our governments talking about Tibet they’re not talking about solving this serious problem. And if we don’t, then we’ll really be hit over the head with a baseball bat…


  1. Dear Professor Vreelander,

    I'm afraid I agree with Mr.Drezner on this one. You seem to put too much emphasis on this Dalai-Lama-issue.

    Just imagine the scenario in which Obama wouldn't have met the Dalai Lama. The whole domestic and international chorus of critics would have excoriated him! Everyone would have said that Obama is too soft on the Chinese and has no regard for traditional American values such as freedom and human rights. Even the A-word would have come out: APPEASEMENT! And instead of comparing Obama with Jimmy Carter, foreign policy wonks would have dusted off the Munich Analogy and compared him with Chamberlain.

    You are right to stress the importance of pressing for the revaluation of the renminbi. Exchange rates are not only important in trade issues, but also from an international macroeconomic perspective, especially now that the world economy is attempting to re-adjust the global imbalances. However, the issue of exchange rates is only one element in the broad relationship between the U.S. and China.

    The U.S. faces the huge and thankless job of integrating China into the U.S. based international order. From the American standpoint, it would be awesome if Washington could simply thwart the rise of China. But that obviously would be too costly a strategy. So the second-best alternative is to engage Beijing, but at the same to make sure that they don't wreak havoc as their economic and military clout grows. On the one side, China has been granted the access to Western institutions such as the WTO. On the other side, the U.S. has strengthened its relations with countries located in the Chinese periphery, in particular Japan, India, Indonesia, Vietnam, and so on.

    This is essentially the Grand Strategy that the US has been pursuing in East Asia and indirectly on the global stage. It's a foreign policy that combines elements of both realism and liberalism. On the one side, "speak softly" and "douceur du commerce", on the other side, "insurance policy" and "carry a big stick".

    You claim that by deciding not to meet with Dalai Lama, the U.S. would "send a signal that we are taking China seriously". Well, during the last three decades China should have had many occasions and events to see that the U.S. is making serious efforts to engage them and take them seriously. A decision not to meet with Dalai Lama, instead, would have sent the perverse and counterproductive signal that the U.S. is ready to incur high political and moral costs, just to please the Chinese leadership. The last thing the world wants to see is an American president who doesn't show resolve and confidence in his country's values and traditions. The current preponderance of US power has no historical precedence. But the country's president continues to make every attempt that we are entering a "post-american world", then the country degenerates into a self-fulfilling prophecy and loses its vigor and vitality.

    Even the idea of G-2 that you have mentioned shows the extent to which the U.S. is trying to engage. True, Washington can't get whatever it wishes. In other words, unipolarity doesn't necessarily translate into full-blown influence. But the fact is that China is nowhere near the US, as far as its military, economic, and technological capabilities are concerned. China needs the U.S. more than the U.S. needs China.

    Mr. Vreelander, Welcome to the blogosphere!


  2. One more remark:

    You suggest that the root cause of the financial collapse is the global imbalances, in particular due to the Chinese exchange rate policy. But you know that that the real root cause is not the "savings glut", but the US government policies toward the government-sponsored enterprises (GSEs) and the critical role of GSEs in promoting lax underwriting standards and underpricing the risk in the mortgage market. Just to criticize the Chinese for their exchange rate policy seems to be silly when we have problems back at home that still need to be adressed.

  3. Dear dm301060,

    I find it a very interesting blog and I will have to say that I do not agree with you on some points you made.

    1. You mentioned that the U.S. would accuse Obama of "being too soft on China" if he does not meet Dali Lama. I just do not get why. Too soft? Who thinks meeting with a spiritual leader instead of communicating with the Chinese government is a tough move? Leave alone the fact that Tibet's "freedom" is still in discussion, shouldn't it be a problem that the Obama administration talks to the Chinese government directly if the U.S. cares about it that much? I bet the Chinese government will never choose to talk to any of the state governors about such serious issues. This could barely be called a strategy. This is just a trick the U.S. government has been playing along the way to balance its relationship with China and its image of the freedom bearer.

    2. You said the U.S. has been trying to show that it is taking China seriously -- I guess my understanding for these actions is paying great attention to the development of China and trying to maximize the U.S.'s benefit from it. I do not oppose to that -- I think we should all consider ourselves global citizens and promote this beneficial relationships between nations. But to say U.S. has been engaging in developing a more cooperative relationship with China? I cannot get on board.

    3. "China is nowhere near the US, as far as its military, economic, and technological capabilities are concerned. China needs the U.S. more than the U.S. needs China."? Even if China needs the U.S. more than the U.S. needs China, is it an excuse for dominating the interactions and trying to "have whatever it wishes for"?? This concept does not fit into the Americans' idealistic definition of being equal, does it? If the U.S. is trying to act as a role of the world police, which again, I am not against at all, it should start acting like an objective judge, not an overbearing dictator.


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