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The United States and Japan at 50: Remarks by Yoichi Funabashi

Speaker: Yoichi Funabashi, Editor-in-Chief, The Asahi Shimbun
Presider: Sheila A. Smith, Senior Fellow for Japan Studies, Council on Foreign Relations
October 8, 2010
Council on Foreign Relations

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This event was part of the workshop, The United States and Japan at 50: Resilience and Renewal, cosponsored by Council on Foreign Relations (CFR) and the Asahi-Shimbun. This event was also made possible by the generosity of the following corporate sponsors of CFR's Japan program: Canon USA, Mitsui & Company, Mitsubishi Heavy Industries America, Mitsubishi International Corporation, Sony Corporation of America, and Toyota Motor North America.

SHEILA A. SMITH: (In progress) -- lunchtime remarks by Mr. Yoichi Funabashi. I just on a very personal note want to say how grateful I am to Funabashi-san for all of his work with the Council on Foreign Relations. And since I've been here as the senior fellow for Japan, it's been a great pleasure for me to work very closely with Funabashi-san in thinking about how to rejuvenate the conversation, especially here in Washington, but also in Tokyo about the U.S.-Japan partnership.

Before Funabashi-san gets started, though, we have the distinct honor of having former speaker of the House and former ambassador to Japan Thomas Foley join us. He's up here. (Applause.) And I'd like -- since we are celebrating 50 years of the U.S.-Japan partnership, I'd like to invite Ambassador Foley to say a few words. There will be a microphone coming.

THOMAS FOLEY: Well, thank you very much. One of the reasons I wanted to be here today is, I've known Funabashi-san for about 50 years. And when I first knew him, he was a junior reporter and, you know, we got to be friends. And then suddenly he's the editor-of-chief of Asahi, and I think, well, he's got a little promotion. He's been doing well. Well, I hadn't seen him anytime since we first got together. So when this lunch was announced and he was a featured speaker, I had to be here.

I'm also extremely interested in the kind of changes that are occurring in Japan at a very critical time, I think, in the relationship. I'll share just one quick story.

When John Roos, the present ambassador to Japan, was appointed, everybody in Washington was counting on Joe Nye. I mean, they were practically certain that Joe Nye going to Tokyo. And suddenly out of nowhere comes a name, John Roos, which most people didn't know frankly.

I had an assistant in my office who was with my in Tokyo who said, well, you know, he's the CEO of the largest law firm in Silicon Valley. He's kind of the king lawyer of Silicon Valley and so on. And so I invited him and his wife to come to dinner with us, a wonderful evening. And the next day, Mondale called me up, and he said, you know, when I was nominated to go to Japan, Mike Mansfield came to the hearing and sat behind me. Didn't say a word, but it was the laying on the hands. And he said, why don't we do that for Roos?

I said, oh, I don't think I want to do that, Chris. He said, come on, we'll just sit behind, we won't say anything. We'll just sit there silently. And we're maybe looking at their methods that, because he is well known, we think he's qualified, et cetera, et cetera.

So my wife arranged the seats in the Foreign Relations Committee. We sat right behind where he was going to sit. Well, we didn't count on John Kerry.

Well, he said, I see in the room the former vice president of the United States, the former speaker of the House of Representatives. Please come forward to the witness table. We'll take your statements first. Delighted to see you, gentlemen. (Laughter.) And so we had to make up statements in about one and a half minutes.

But I'm glad to hear he's doing well, and I thought he would, because he's very skilled in business and very well respected. And perhaps it's good for U.S.-Japan relations to have not a professional diplomat or a has-been politician, a once-was politician like I was and Fritz was. I think we both felt that the gold standard of representing Japan was Mike Mansfield.

And I knew him of course from the Congress. And he is perhaps the lowest-key person that I've ever met. You know, he doesn't say very much. But in a way, he kind of -- and this is the end of my comments -- he kind of represents what a senior Japanese official in business does. He stays quiet, lets the juniors talk, and then he decides. And that's what Mike would do. And I thought he was going to live to be 100. He died at 98, a great figure in our country's history, and one that I remember with great pleasure.

Delighted to be here today. Glad to see you all. Thank you very much. (Applause.)

SMITH: Thank you so much for joining us.

So now without further ado, we're going to turn the microphone over to Yoichi Funabashi, who is going to explain everything that is going on in Japan. Thank you.

YOICHI FUNABASHI: Well, Sheila, thank you very much.

Ambassador Foley, I don't know how I thank you coming today. And I fondly remember you inviting me to the ambassador's residence in Akasaka at the fireside. And you have been always, you know, an inspiration to me. And always I have enjoyed you secretly sharing your gossips and anecdotes while you were speaker of the House. (Laughs.) I really have valued -- thank you so much.

Well, I'm very much delighted to be here. And once again, I would like to really appreciate, express my gratitude for Council on Foreign Relations. It's a really great honor for the Asahi Shimbun to work with the Council on Foreign Relations to initiate this workshop, singularly focusing on the U.S.-Japan relationship. As we have seen many workshops now focusing on China, a region that I believe that it's time to really initiate this workshop.

And I'm also very much delighted to have two Japanese panelists once again joining, attending this, particularly Mikitani-san. He actually flew in on his private jet. (Laughter.) And yesterday he arrived, and last night I asked him which airport, Ronald Reagan or Dulles International, you know, did he arrive? I don't know. And since he flew in the private jet, The Asahi Shimbun did not need to pay any airfare. (Laughter.)

Mikitani-san, you will continue to be invited by us. (Laughs.) Thank you. Thank you very much for coming.

Sheila first talked about the importance of the title: Resilience and renewal. Not renewal. Resilience and --

SMITH: Renewal.

FUNABASHI: -- renewal, yes, of the alliance.

After listening to that morning session, I think that we are really now confronted with the enormity of the challenges of the U.S.-Japan alliance.

First question -- this is mentioned by Richard Haas and some others -- is the alliance should evolve into more partnership? Or the alliance, the U.S.-Japan alliance, really should stick to that original design and even more so get back to the basics as we now confronted with that rise of China and its ramifications for U.S.-Japan security? This is a fundamental question.

We are confronted with two choices, whether the alliance should, we should reinvigorate the alliance, or we should transform the alliance. We should reaffirm the alliance, but we should redefine the alliance. This is nothing new. When Tomohaba and the others and Rust Deming worked on the Nye initiative and the reaffirming and redefining of the U.S. alliance in mid '90s, there was intense debates on that, a lot of discussions.

Particularly in the midst of that North Korea nuclear crisis, the U.S.-Japan alliance really acquired much new task, particularly to strengthen its operational side. And also we are faced with Futenma relocation issues in mid 1990s. So it's, you know, it's déjà vu right now. The only difference is that, I think, we are much now confronted with much more difficult and fundamental challenges, the rise of China, and the impasse over the Futenma relocation issues.

Certainly, we are now seeing that the Futenma relocation issues being once again in limbo. Even if Governor Nakaima will win in the gubernatorial election in late November, I doubt he will be even willing and able to deliver that kind of government policy of relocation, and delivering that promise. So we perhaps may end up -- we may have to end up coming up with that plan b. But to my knowledge, it has not been serious intellectual policy work on this on both sides.

The North Korean issues, I think that perhaps will be a perhaps more urgent challenge as we see a very delicate power, leadership transition, succession now ongoing. Kim Jong-un, 28-years old, is unlikely to consolidate his power base, and this regent system may not work. Kim Jong-il's sister, Jang Song-thaek's wife, was just promoted to a four-star general.

It's a really super inflation, hyperinflation of military rank in that country where we saw that country going through that hyperinflation anyway after that disastrous failure of introducing that denomination last winter. So nothing new.

But this is telling a lot, why she had to be promoted to four-star general. I think that Kim Jong-il does not simply trust Jang Song-thaek. The true color, the true nature of Jang Song-thaek will be likely revealed when Kim Jong-il passes away. And then so perhaps he may want his sister to watch him.

This is just a glimpse of all those byzantine Pyongyang palace politics. Nobody knows actual picture. But it's highly unlikely this regime, particularly after Kim Jong-un takes over, will remain in power. So it may collapse the regime.

So yes, Professor Soeya talked about the two scenarios, the collapse scenario, or peaceful unification scenario. But in my view, it's more likely that collapse scenario will pan out.

So we have to be prepared for that, coming up with contingency planning. So far, the South Koreans have not been interested in getting Japan involved in contingency planning, but I think that it is time for the U.S., Japan and South Korea to really come up with genuine contingency planning. And that I think it could put pressure on China.

China has not -- as Professor Soeya once again said, China condoned the North Korea's sinking Cheonan and Tai Ping Guo strongly supported North Korea's position. And this conservative side is determined, seems to be determined to maintain the North Korean regime as a buffer state. So I think we will see some clash between China and the U.S., Japan and South Korea in terms of that future unification vision.

From our views, we would like to unify the Koreas , remain to be democratic and civil society, maintain the security relationship with the United States and based on mechanism.

But from China's perspective, I think that China's unification vision, even though they have not touched on that because of sensitivity, is that first the United States should refrain from acting unilaterally. Second, that the unification should be handled primarily by the United Nations Security Council. Third, South Korea should be advised not to regard that unification as a national enterprise, rather they should accept it and embrace as a state interstate enterprise, because North Korea is a member to that United Nations, and that north-south unification should be based on interstate.

How to come up with that unified vision, how to accommodate, I think, will be very much critical issues in the coming years.

Second issues that we are confronted with regard to that alliance, is that regional or global? From Japanese perspectives, particularly as we see rise of China, the alliance should be more focused on regional imperative. Unless and until that U.S.-Japan alliance really sufficiently addresses the challenges from the regional dimension, the alliance will be less well received and people would support less.

But from Washington point of views, as Richard Haass mentioned, that underachiever, underperformance aspect of Japan remains to be the problem. And Japan's inability to work with the United States on a global level to address the global challenges, whether it's terrorism or others, creates, generates a lot of problems which will lead to downgrading the alliance.

But this issue, global or regional? I think in my view will be perhaps a false choice. We need certainly to strengthen that alliance function on both fronts.

And on the global level, I think that the principal complementarily will be very much useful to enhance the alliance. The United States and Japan should bring together a strength of each so as to maximize that effectiveness of that alliance. And as we see that threats becoming to be more diverse, as Dr. Yoshida Fumihiko mentioned, that military power alone simply is not well suited to cope with those new challenges, that civilian, non-military means should be mobilized, too.

And Japan, as a global civilian power, Japan's strengths lie in this civilian power. In the United States also, increasingly appreciate that non-military measures, which needs to be harnessed, so that the root cause of the terrorism, failed states, failing states, endemic, climate change and the others, nonproliferation certainly, all should be addressed and more effectively.

So I think this is a frontier, if I use Professor Soeya's terms, for that U.S.-Japan alliance.

On the regional side, I think, once again, as Professor Soeya mentioned, perhaps we should really take into account of the regional aspect, regional elements into strengthening the U.S.-Japan alliance. Certainly, we have seen that Hatoyama government in the past 10 months or so stumbling over that Futenma relocation issue, which has caused the deterioration of the U.S.-Japan alliance to such a degree.

And several Asian countries, the heads of state, have expressed their serious concerns about this plight of the U.S.-Japan alliance. This revealed how much that alliance has been appreciated for a stabilizing factor throughout East Asia. And so this stabilizing factor should be recognized and appreciated throughout Asia, but not least by the Japanese themselves.

I think that perhaps it is time to explore how to regionalize that responsibility and the burden of hosting the U.S. military presence as well, bases. Philippine and the others have been increasingly interested in re-linking and strengthening once again that alliance with the United States. I think that it's time for Japan and the United States to consult with like-minded Asian countries to discuss about how to strengthen the effect of that stabilizing effect of the U.S.-Japan alliance regionally. So this is, I think, a new frontier once again.

Thirdly, Richard Haass talked about the regional architecture. It's of critical importance, the regional architecture. And I think that the liberal international order, again, if I borrow the word from Professor Soeya, I think is a key to sustain and underwrite this regional architecture which we really should develop together between the U.S. and Japan.

China has benefited most perhaps from that liberal international order, such as Bretton Woods system, freedom navigation, maritime security, and the U.S. dollar as a reserve currency. So it's very much difficult, you know. What's most difficult to fathom about China's behavior these days is why China actually has not tried harder to support and strengthen that system on which their success has been dependent, has been based.

I think that free trade agreement, EPA, TPP, the Japan-South Korea FTA particularly, would be very much conducive to strengthening this liberal international order.

It could perhaps strengthen that like-minded democracies position vis-a-vis China, as China seems to be more interested in developing that hierarchical regional architecture in East Asia. We really should pursue more horizontal regional integration. This does not mean that we should encircle China, we should make our enemy. Of course not. I think that in case of the North Korean nuclear issues as well as free trade agreement, I think that China, ROK, Japan, trilateral cooperation, as was mentioned, also is very much important.

But from alliance management point of views, I think that the liberal international order should be that goal for both the United States and Japan to develop.

I would be remiss if I did not mention the Senkaku shock so let me briefly share some of my thoughts on this issue with you.

Sino-Japan relationship now stands at ground zero. Much-heralded, mutual beneficial relationship based on strategic interests has proven to be just rhetoric. We all know that.

I think that reluctant realism, if I borrow Mike Green's words, which have evolved in the past 10 years or so, particularly since that missile, North Korean missile Taepodong firing in 1998, seems to be now changing into hard realism in Japanese psyche and Japanese mind as well.

I was actually interviewed by National Public Radio, Tokyo correspondent last week. Actually, she wanted me to focus on the English in Japanese society as Rakuten, fast-retailing and other companies now have decided to designate English as the official language in companies.

But she also asked me my views on Senkaku shock. The first question -- her first question was, Funabashi-san, is this shock larger than Nixon shock? I think it was a really good question. Nixon shock, 1971, and Gulf War shock in 1990, 1991, perhaps the two greatest shocks, from Japanese point of views, in the past 50 years of this alliance history.

My answer was, it is clearly much larger than Nixon shock. Japan will never be the same after this shock. And I personally have raised three questions to China. Actually, I have shared this question with my Chinese friends in the past two weeks or so.

The first question, Deng Xiaoping's low profile policy, which has worked so well for the Chinese growth and development, seems to be cast away and replaced by a new doctrine, yet there's no consensus in China what doctrine should be canonized.

One of my Chinese friends told me, well, last December's central committee's special work group on the economy are having a lot of discussions. And one of the thrust is that China should not get overburdened by America and the others while pursuing that path to great power. And he said, well, it can be called free rider superpower path.

If that will be the case, that would create all the troubles probably for us. There seems to be divided views on this in China. But the maritime issues, South China Sea, Yellow Sea, China Sea clearly is the first critical test for this peaceful rise doctrine in the past 30 years.

Second question. China has allowed itself to be completely isolated on these maritime issues, particularly South China Sea. Certainly, China will not be solely responsible for these conflicts. There shall be no blame game. But it is notable that at the Hanoi ARF meeting, 12 nations expressed some concerns about Chinese activities in South China Sea. This is unprecedented.

So why China, which has pursued such a scrupulous foreign policy in the past 30 years, all of a sudden seems to be so aggressive to the extent that China allows itself to be encircled unwittingly? That's the second question.

Thirdly, Taiwan. Taiwan, after the Japanese government arrest of the captain, perhaps a drunken captain, Taiwan activists tried to get into the waters near Senkaku Islands. And Taiwan authorities dispatched 12 coast guard boats as an escort. And they were blocked by Japanese coast guard, so they returned to the port. And after that, Taiwan government made the announcement, a formal announcement, in protest, saying that the Japanese government intervenes in the fishery boats' rightful activities.

I think I'm afraid that Taiwan -- (inaudible) -- Taiwan now is playing a fire, a political fire in this case. And we really should watch Taiwan. It could really complicate the U.S.-Japan alliance. And certainly they will pose new risk to us.

Finally, I have a question about Chinese view of maritime issues. They have been talking about the near sea or off shoe core interest all being applied to the South China Sea, Yellow Sea and East China Sea and perhaps in the future the Sea of Japan. It's a sort of marginal-line strategy to claim those waters their own.

Once again, this is really mind-boggling to me, because that freedom of navigation, that U.S. Naval presence, which has provided stability for the whole region, has benefited China so greatly in the past, yet they are now challenging it.

So I think that we are getting into a new world very much different, distinctive different world we have known in the past 30 years.

So I think that U.S.-Japan alliance once again is much more crucial in face of those new challenges. And I hope that the Democrat government in Japan truly appreciate this enormity of the challenges and enormity of that new significance of a new world and the challenges to the U.S.-Japan alliance.

Thank you very much.

(Applause.)

SMITH: (Off mike) -- tour de force of regional and both Japanese and the alliance issues.

I have two questions. The first really is about Japan's response to the Senkaku shock. And you suggested that Japan is now moving -- that this would have a definitive impact on Japanese attitudes, not just about China, but, by extension, by implication, you suggested about Japanese security planning, et cetera.

You used the term "hard realism." And I think, you know, most of us who are watching Japan over the last decade and a half or so and reading Mike's book, and talking about these issues, we're somewhat worried about conservative tendencies of Japan. But I'd like you, if you could, to share with us a little bit more in fine detail.

When you're saying "hard realism," what is the Japan that we should be expecting to see as it deals with China, but also as it deals with regional security issues?

FUNABASHI: I think that Japanese public was furious, for various reasons, with the way that China exerted non-discriminate retaliatory actions, particularly since the arrest of that captain. The fact of banning of rare earth materials and arresting four Fujita employees on charges of spying, and the others, it is, I think, a diplomatic shock and awe.

And I think that the reason why current government popularity rate has not declined more -- Kato-san mentioned that it's really prominent -- but according to the other polls, the current government still enjoys more than 50 percent. It's very much, you know, high by Japanese standard.

I think the reason, in my view, is that Japanese public is rallying around the current government while Japanese businesspeople, businessmen is detained. We have not seen this before. So I think that deep down, the Japanese now have developed some kind of bitter resolve tinged with sort of resignation. They have been dreaming, you know, of Sino-Japan prosperity, cooperation and, you know, ideals particularly, you know, caused by Japan's guilt feelings over the invasion and many, you know, rosy-pictured frontier.

But I think that the Japanese now seem determined to critically examine those words and rhetoric. And I think that's the reason why I have, you know, called it hard realism emerging in the Japanese mind.

SMITH: I've heard a lot of people in Japan compare the Senkaku incident to the 1998, and I think you did, too, in your remarks, the 1998 Taepodong launch. We watched in Japan after 1998 some very widespread views of, you know, basically antagonistic sentiments towards the North Koreans, but it ended up then complicating Japanese diplomacy. Domestic politics then became a difficult component of Japanese foreign policy-making.

Do you see this as a similar impact of --

FUNABASHI: Yeah, I think it's much more complicated this time because Japanese business depends more on the Chinese market.

One difference between this Senkaku shock and 2005 anti-Japanese demonstration, Koizumi Yasukuni shock, is that in 2005 Chinese government warned the Chinese public not to chant slogan of boycott Japan, made in Japan, okay? They are very much fearful of that counterproductive aftermath shock of boycotting Japanese products. They knew at that time it would be China which will suffer more than Japan.

But this time, it is the Chinese government which actually exerts this economic card to put pressure on Japan, because they know that the Japanese business finds it too painful to have the Japanese government stand tall and confront with China.

So I think that the Japanese strategy in the coming years will emerge like China-plus-one strategy. Some people really have started to talk about that. That means that lessening their dependence on Chinese market and diversifying and transferring their investment into the other emerging countries such as India, Vietnam, Indonesia and Africa, Brazil.

I think that it will be perhaps a long-term strategy.

SMITH: I'll ask one more question before I open it to the floor. In the late 1990s, you wrote a very famous book called "Alliance Adrift." And I remember that book because it was a lot about Futenma and the post-1995 situation in Okinawa. If you were to write a book today about the state of the U.S.-Japan alliance, what would the title of that book be?

FUNABASHI: (Laughs.) Alliance adrift, part two. (Laughter.)

SMITH: Well, at least there's not an alliance at sea. Okay, we're good. A little bit more positive.

I'll open the floor now.

QUESTIONER: Funabashi-san, your talk perhaps foreshadows the historical fact that China and Japan have not ever been strong at the same time.

Today we've talked a lot about China's rise, about Japan's underachievement. But I don't think we could discount Japan as a major important economic power at least. So my question is, do you think there is room enough in Asia for both a strong China and Japan? And what would be the implications then for regional architecture?

And finally, what role, if any, does the United States have to support, to encourage Sino-Japanese coexistence, if not cooperation?

FUNABASHI: I think it is really a good question. Thank you for the question. I do not see China and Japan sharing co-leadership based on their respective strength in East Asia in the foreseeable future.

First, as Senkaku shock demonstrated, both countries, governments I should say, still not mature enough to exert sophisticated leadership to win hearts and minds from the other Asian countries. It's very much unfortunate, but that's facts of life.

We need that United States leadership, not only presence and military forces, but leadership in Asia Pacific as a stabilizer, not balance, but a stabilizer. And I think both China and Japan both appreciate this. And I think we appreciate more after this Senkaku incident.

QUESTIONER: Thank you. Thank you very much, Funabashi-san.

Two questions, if I may. One, are you -- the thrust of what you say really sort of points us to a Cold War kind of scenario in Asia. You're talking about regionalizing U.S.-Japan alliance, spreading the military burden around, but that becomes officially a contained China kind of strategy.

You're talking about a regional architecture, making it normative, getting together countries to support the liberal economic order, again, with China outside of that.

How do we reconcile that with the economic interdependence and our desire to avoid going down into a Cold War kind of confrontation?

Second question is, what is the connection between the Senkaku shocks and the new hard realism in Japan and support for the alliance, more particularly support for U.S. bases?

You mentioned earlier that even if Governor Nakaima wins, unlikely to be able to succeed in moving the Futenma facility. And there are pressures around other bases. So we're having this disconnect between Japan being much more aware of security challenges, but that not translating in support for U.S. bases in Japan, and indeed leading to more pressure to reduce our presence. Thanks.

FUNABASHI: Thank you for excellent questions.

On the first question, I am not arguing for, you know, reinventing the Cold War alliance structure. Far from it. I still believe in U.S.-China-Japan trilateral policy dialogue and Japan-Korea-China free trade agreement and policy dialogue on North Korea.

And on the question of maritime issues, I think that we should explore the ways to get China certainly involved in first nontraditional security dialogue, such as piracy issues and the others in South China Sea, Strait of Malacca and Singapore and the others.

And China certainly has been engaged in discussions with ASEAN countries with regard to code of conduct. And we should support that multilateral solution on that territorial issues in South China Sea. So I'm not arguing for encircling China at all.

But with regard to normative mechanism, I think we should not be ashamed of strengthening the liberal internationalist order so that we should get China not fully integrated into that order. And this is nothing against China, far from it. I think it will be beneficial to China, in my view. So that's my response to your first question.

Second question is very complicated. Yes, there have been -- we have seen fishermen and some islanders in remote islands -- Yonaguni, Miyako and Ishigaki -- who have been very much shaken by this Senkaku shock. And once again, I lean strongly for strengthening Japan's defense posture, and even in trying to invite the Japanese self-defense forces stationing in those islands.

And perhaps it is very much different from the mainland Okinawa islanders' views and sensitivities.

So even within Okinawan community, I think there have emerged more clear, divergent views. We have Mr. Kono in NHK -- he's an authority on this issue.

And on the national level, yes, certainly there is some gap. At the same time, those who have opposed that U.S. military bases in Okinawa basically focused on Marines. And in case of that future scenario of military confrontation between Japan and China, it's basically not about the Marines, but air-sea battle. In such a scenario, there will be no such big gap between those two thrusts.

SMITH: Funabashi-san, you said something in your remarks, and I just wanted to highlight it, because I think it's a part of the equation that we haven't spent much time talking about, and that is the trilateral between Japan, the United States and China. And you yourself have long advocated this. Jeff Bader when he was at Brookings worked on this very heavily. I think a lot of people have seen this as the missing piece of Northeast Asian regionalism.

And for reasons unknown to me, the Chinese backed off of the latest effort to promote this. Do you see, for example, the Senkaku incident as an opportunity for us to take a more proactive stance in trying to engage China on these kinds of issues?

FUNABASHI: No question about it. I think this is a golden opportunity now for the U.S., China and Japan to re-initiate some way of engaging policy dialogue. I'm not so sure why China actually has backed down from that trilateral policy dialogue initiative which at first they also endorsed last summer. First because of the emergence of the U.S.-China strategic dialogue, and they perhaps wanted to pursue the G2 first before getting into a G3.

This is all speculation, because I have known that there are some Chinese high-ranking officials who have continued to believe in this trilateral policy dialogue path.

But now I think the beauty of that trilateral policy dialogue is to overcome a security dilemma among three. So that's the only way to overcome the security dilemma. And I think it's now more important.

So I think that it is time for the U.S. and Japan particularly to initiate. And I was very much heartened to hear Kurt Campbell starting to talk about that need to have policy dialogue among all three.

SMITH: Thank you.

In the back.

QUESTIONER: Funabashi-san, very good seeing you in Washington.

With the current events in Northeast Asia, it's amazing, as you've highlighted as well, the changes in China. When we saw the Chinese reaction to the U.S.-South Korean naval exercises, what came out was different voices in China. And so as we monitor these changes that china is exhibiting, how do we deal with these different groups? It's almost as if there are certain ways to interact with China. And those traditional ways in the past have been effective. But that group seems to be overshadowed, and in this particular instance by the military, by the PLA.

To give you an example, when, again, the U.S.-ROK naval exercises occurred, the Chinese military explanation was that when you send something like the USS George Washington, you're no longer just sending a message to North Korea, but also to China. And with that type of, you know, enhanced force projection, China feels that they're justified in accelerating their military spending and their development.

So another way to examine the question is, how do we deal with this ever-expanding military industrial complex in China in ways that, you know, again, these channels don't exist in terms of engaging China at this particular point in time?

SMITH: Thank you.

Would you mind if I asked one more -- got one more question?

In the back, please. We'll get one more question. Here in the front as well.

QUESTIONER: Thanks very much. I'd like to refer back to the title of the event. Regarding alliance renewal, Funabashi-san, what are your expectations of the president's visit to Japan in November in terms of changing the tone and developing further broad agenda that we've discussed today? Thank you.

SMITH: Thank you.

QUESTIONER: Thanks. Just building on his question, I'm glad he asked it. Funabashi-san, as I listen to you talk about the hard realism and new realism, I was just asking myself how my Korean friends and my Korean clients are going to hear that. Because for years, they keep telling me, oh, those Japanese, they're coming back, you guys need to watch them.

You know, and I know really kind of how that's going to go. And yet, I think we all agree we've got to have a new realism, we've got to have these things.

So my question to you is, what are the chances of the government of Japan recognizing that if it's going to try to deal with the China rise in increasing architecture of both defense and think about defense, can it be done in concert with South Korea? Or must it be done in concert with South Korea, or all of a sudden you've got two enemies on your doorstep and not potentially just one? Thank you.

FUNABASHI: Well, thank you very much for those excellent questions.

First, it seems to me that Chinese military is becoming more independent player, and they seem to have pursued more freedom of action.

And on maritime issues as well as energy issues, I think, to some extent, they have been allowed to be more independent player and to be allowed to have more freedom of action.

And it is precisely in this parameter where we have seen this tension between China and the neighboring countries. You have not seen too much self-assertive and even aggressive posture of China in, say, other areas -- Africa, Latin America and the others. It has been concentrated in East Asia, particularly in the seafaring, you know, sphere.

How to deal with it? It's very tough. Until and unless the Chinese government will have established further civilian control over the military, we just cannot change their behavior that much. We have to be prepared their behavior.

With regard to the gentleman's question, I think it already has started to change as exemplified in President Obama's meeting with Prime Minister Kan, and the president expressed very warm feelings, sentiments towards our new Foreign Minister Maehara. I was told that when president met with Prime Minister Kan, the president praised Foreign Minister Maehara three times, which made Prime Minister Kan a little jealous. (Laughter.)

So I think that atmosphere, as you mentioned, has already started to change. And I think that Senkaku shock actually has helped both governments getting better, at least not in concrete policy terms, particularly bases issues, but overall, generally speaking.

As for his question -- hold on --

(Off mike commentary.)

Oh, yes, Korea. Korea and Japan -- Japan-Korea relationship. We are seeing the sea change of Korean perception of Japan right now. I saw a BBC global view survey which had been released recently. Sixty-four percent -- 6-4 percent -- of the Koreans now have favorable view of Japan. And it has increased by 27 or (2)8 percent point, compared to two years ago, 2008.

I think that Cheonan, I think, played a crucial role in changing. Cheonan incident, I think that that changed these Korean views of Japan indirectly because it has really intensified Korean anti-China sentiment to a great extent.

And many people really were concerned about the possible deterioration of Seoul and Tokyo in the summer of 2010 as this year was the 100th anniversary of Japan's annexation of Korea into Japan's colony. And you know, they expected a very much ugly picture, particularly from the Korean side, much demonstration, anti-Japanese demonstration. Nothing ever happened.

I think it was in no small part due to Korea's emerging anti-Chinese sentiments.

SMITH: Thank you very much. I think we have time for one or two more if there's anybody who has a question for Funabashi-san.

Everybody has asked everything you need to ask? All right then.

Well, I want you to join me in thanking Funabashi-san for an excellent presentation and discussion.

(Applause.)

FUNABASHI: Thank you very much.

SMITH: This will also conclude our U.S.-Japan at 50 discussion, where we are today and where we're headed in the future. I hope that at least some of the more optimistic views that were expressed today will plant some seeds in the effort to really build an agenda with Japan. We need to, and the Japanese government needs our support, those of us outside the government, as does our government.

And so I think it's meetings like this where the nongovernmental voices can be heard, but also the support for the relationship can best be expressed. So thank you all very much for spending so much of your day with us today. And I hope to see you the next time we have a conversation.

Thank you, Funabashi-san.

FUNABASHI: Thank you. (Applause.)

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