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Ending Asia’s zero-sum games

by Koichi Hamada

If a space alien landed in East Asia today, it would find a region shaped by rapid economic transformation, complex geopolitical dynamics, and deep historical animosities. Perhaps viewing the region from such a perspective is exactly what Asia’s leaders need to do to ensure that its positive trends continue — and to halt the dangerous ones.

Our alien guest would most likely land in East Asia’s largest country, China, where three decades of phenomenal economic growth have lifted millions out of poverty and transformed Chinese society. Yet China retains its traditional Sino-centric worldview, which it seems keen to impose on its neighbors. Indeed, as China expands its military resources, it is taking increasingly bold steps to assert its dominance over sea-lanes in all directions — provoking both anxiety and ire among its regional neighbors.

In Japan, which China recently overtook as the world’s second-largest economy, the visitor would find a country more interested in protecting its citizens’ living standards and relatively stable political system than economic or political dominance.

Nonetheless, Japan is eager to re-establish itself as a fully independent country, free of the guilt and obligations stemming from World War II. In a sense, it seeks to complete the diplomatic equivalent of what in the Japanese samurai tradition is called genbuku — a sort of coming-of-age ceremony, after which Japan would be considered a normal “adult” country.

Nearby South Korea, too, is working to transcend a painful past, which included being the battleground for both the Sino-Japanese and Russo-Japanese wars. In Koreans’ view, the tragedy that their country endured over the past two centuries merits their neighbors’ acceptance of their view of history, especially concerning World War II.

The resulting rift between Japan and South Korea creates a problem for another key player in the region: the United States. Given America’s diminished capacity to provide global leadership, it must rely more than ever on its allies to ensure that regional and global affairs hew to its ideals and interests — which include preserving the Pax Americana that has shaped East Asian affairs since World War II.

If the alien taking all of this in had some knowledge of game theory (at least a general understanding of its uses in assessing conflict), it would immediately comprehend that all of the relevant countries’ objectives — whether territorial or related to historical narratives — cannot be fully satisfied simultaneously. But the challenge goes further: Disputes over territory and history may well amount to a zero-sum situation or, worse, a prisoner’s dilemma, in which mistrust and betrayal exact a heavy price from the parties involved.

Consider Prime Minister Shinzo Abe’s controversial visit last December to the Yasukuni Shrine, which honors those who died in the service of Imperial Japan from the Meiji Restoration until 1951 — including 14 Class A war criminals from the Pacific War.

Contrary to the prevailing interpretation, Abe’s visit was not intended to celebrate the brutal aspects of Japan’s history or justify its cause in World War II; Abe was driven by the sincere desire to honor those who sacrificed their lives for his country. He was genuinely practicing politics faithful to what Max Weber called the “ethics of conviction.”

The international community was not interested in that distinction. Condemnation of Abe’s visit was to be expected from China and South Korea, which felt firsthand the devastation wrought by Japanese militarism.

But few anticipated that the United States would adopt such a harsh tone in expressing its displeasure — a response that was likely driven by America’s fear for the region’s increasingly fragile peace (and perhaps, on some level, by the recollection of Japan as the enemy that attacked Pearl Harbor).

The U.S. has a point. The fact is that, regardless of leaders’ intentions, such disputes can undermine cooperation, creating a zero-sum situation.

Abe may have to consider further Weber’s “ethics of responsibility,” which unlike the ethics of conviction, focuses on the consequences of an action, not the intention behind it.

In this sense, competing territorial claims — like those of Japan and China for the Senkaku (Diaoyu in Chinese) Islands in the East China Sea — pose a particularly intractable challenge, given the virtual impossibility of reaching a compromise. That is why the dispute is fueling rising tension between the two countries, undermining their ability to expand cooperation in ways that would benefit both.

For example, China’s territorial claim is preventing it from accessing the jobs — and the associated knowledge and technology transfers — that deeper economic cooperation with Japan would offer. Similarly Japan is missing the opportunity to provide China with tools to reduce air pollution, much of which blows toward the Japanese archipelago.

It is up to politicians and diplomats to move countries from no-win impasses to the kind of mutually beneficial outcomes that are almost always found in trade and investment.

Fortunately although Abe has been criticized for embracing nationalism, he is in a position to play an instrumental role in deepening Japan’s economic relationships with its neighbors.

In fact, it is something of an iron law of politics that only foreign policy hawks and nationalists can deliver such outcomes: Consider U.S. President Richard Nixon’s opening to China in 1972, or Charles de Gaulle’s resolution of France’s war in Algeria. Perhaps only leaders like Abe, Chinese President Xi Jinping and South Korean President Park Geun-hye — leaders whose patriotic credentials are unquestioned — can do what it takes to transform East Asia’s zero-sum games into win-win policies.

Space aliens are unlikely to arrive in East Asia anytime soon. But one can easily imagine that they, like us, would prefer to land in a prosperous region in which countries pursue mutually beneficial cooperation, rather than in a zone of simmering conflicts where competing territorial and historical claims have thwarted the inhabitants’ vast potential.

Koichi Hamada, a special economic adviser to Prime Minister Shinzo Abe, is a professor of economics at Yale University and professor emeritus of economics at the University of Tokyo. This commentary reflects the author’s personal views, not that of the Japanese government. © 2014 Project Syndicate