Does Trump Want a 19th-Century World Order?

It marked the end of an era when British Prime Minister Harold Wilson announced in 1968 that British forces east of Suez would withdraw in 1971. The United Kingdom was no longer willing and able to sustain its overseas role. While it is still too early to draw such a conclusion, President Donald Trump’s rejection of the Trans-Pacific Partnership (TPP) on Jan. 23rd, his first full day in office, seemed to have a whiff of Wilson’s announcement to it. Not by design, as in Britain’s case, but by default.

U.S. Defense Secretary James Mattis’s reassurances about U.S. security commitments to Japan and South Korea during his visit to Asia last week were an important step toward assuaging alarm and skepticism about the trajectory of U.S. regional policy. But these assurances are rivaled by another set of ideas held by members of the White House inner circle. For the moment, there are two Trump foreign policies, with little clarity about which one will prevail.

Trump’s initial moves were emblematic of an anti-globalist worldview. The Obama administration portrayed the TPP as a foundation of a U.S. “rebalance” to Asia. The deal was to be the underpinning of a deepened U.S. economic role in the Asia-Pacific region and a renewed U.S. commitment there. Complemented by an enhanced U.S. military presence and more active partnerships and alliances, it sent a strong message that the U.S. role was durable and substantive. Ash Carter, who was defense secretary at the time, said, “TPP is as important to me as another aircraft carrier.”

Yet Trump’s scrapping of TPP (with no hint of a comparable alternative) — not to mention dissing Australia, a key and loyal U.S. ally — with one signature raised anew Asian doubts about U.S. credibility. Australia’s ambassador to the United States, Joe Hockey, observed, “By ratifying the TPP, the United States will ensure it will continue to have a major leadership role in the Asia-Pacific region…. The cost of failure may well be too great to imagine.”

He is not alone in his disillusionment. Last August, Singaporean Prime Minister Lee Hsien Loong said, “For America’s friends and partners, ratifying TPP is a litmus test of your credibility and seriousness of purpose.” In an October interview with Time magazine, he went on to say, “The one big thing which you have done is to settle the TPP…. Now you say, ‘I will walk away, that I do not believe in this deal.’ How can anyone believe in you anymore?”

We have heard similar views echoing across the region, from Southeast Asia to Japan. Trump is committed to a 350-ship Navy and boosting the U.S. military presence in Asia, a part of the “rebalance” that many felt was not adequately resourced. Countries in Asia appreciate these positions. But, given that business matters first and foremost in the region, how can the United States sustain its leading role in Asia?

The logic of “America First” holds that the United States should no longer take the lead in fighting the wars of others: Every foreign policy action must bring demonstrable benefits to the United States. Will a security guarantor role be sustainable, when the United States is getting fewer and fewer economic benefits as Asian countries increasingly trade and invest within Asia, and as the United States looks inward? Trump’s periodic disparaging of alliances creates confusion in the region. The fear is that for many in Asia, “America First” sounds a lot like, “You’re on your own.” If Trump wants to sustain a leading U.S. role in the Asia-Pacific — as Mattis’s comments suggest — he has a steep hill to climb in order to undo the blows to U.S. credibility.

Negotiations for an Asia-Pacific free trade area began under President George W. Bush and were expanded into the TPP by the Obama administration. The TPP represented the critical economic element in the Obama administration’s policy toward Asia and recognition of the region’s strategic importance to American prosperity and security in the 21st century.

It’s not hard to fathom why the last two administrations wanted to increase U.S. engagement in the Asia. It remains one of the fastest growing regions in the world, with annual growth rate of 6.8 percent in 2014, accounting for about 40 percent of global growth. In 2015 U.S. trade with Asia totaled over $1.5 trillion. In 2014, U.S. exports to the Asia-Pacific region represented 27.8 percent of total exports. In 2012, 32 percent of U.S. export-related jobs —1.2 million American workers — were employed in trade with the region, an increase of 52 percent over 2002. In 2011, 68 percent of all congressional districts exported more than $500 million to the region, with 39 states sending approximately 25 percent of their exports to the region. Moreover, the United States has some $778 billion in direct investment in Asia; Asians invested another $513 billion in the United States.

While the TPP had its flaws and room for improvement, its logic was that of expanding U.S. access to these booming economies in sectors like digital commerce and services where the U.S. is most competitive, while advancing a rules-based trading order and enhancing legal protection for intellectual property and investment. Since 1945, U.S. diplomacy has sought to build international acceptance of a rules-based order, with great success. The TPP represented an Asia-oriented extension of that historic U.S. interest — one that has underpinned prosperity for seven decades.

Michael Froman, the U.S. trade representative under President Barack Obama and lead U.S. official for TPP negotiations, defined the TPP as “a critical part of our overall Asian architecture. It reflects the fact that we are a Pacific power and that our economic well-being is inextricably linked with the economic well-being of this region…” The TPP’s significance is strategic: a means of more deeply embedding the United States in the region. Across the Asia-Pacific, political as well as military leadership shared this strategic understanding — as did Beijing, which initially characterized the TPP as a central element in a containment strategy directed at China, but more recently showed an interest in joining it.

In rejecting the TPP outright, rather than seeking to revamp it, the Trump administration faces a serious credibility crisis of its own making. Yet it is not inconceivable that after the new team learns about how counterproductive its views on trade and globalization are, some variant of the trade accord — a Trump Pacific Partnership — could emerge in 2018 or 2019.

If the TPP reflects a retreat from U.S. economic leadership, will the withdrawal presage a similar strategic retreat from Asia? Is this, then, America’s “East of Guam” moment? Is Trump’s TPP rejection the first step away from a leading role for the United States in stewarding the global order and maintaining U.S. economic interests in the region? If the logic of “America First” is that the current global order is not in the country’s best interests, then the United States might be headed toward a sphere-of-influence world resembling the 19th century.

Proponents of offshore balancing have long advocated for a withdrawal to Guam, Hawaii, or even the West Coast. Yes, U.S. allies and the region survived the Richard Nixon shock (suddenly going off the Gold standard) and the Guam Doctrine, but it was a much different world then.

In the 1970s China was still in the throes of the Cultural Revolution, irrelevant to the world economy. Today, China stands as the world’s second-largest economy, and China is at present challenging the post-war, rules-based, open international order and U.S. leadership in the Asia-Pacific region. China is the largest trading partner of every U.S. ally and partner in East Asia.

Chinese President Xi Jinping has broken the code of the U.S. secret of success in Asia and is now offering to provide “public goods” to advance China’s interests. This gets at the flaw of the current “America First” approach. The United States did not fashion the Bretton Woods institutions and an economically open, rules-based system out of altruism. It was based on the calculation that after the economic disaster of the 1930s and World War II, such a stable system was in the best interest of the United States. Leading that system was not putting U.S. interests second, but the best way to advance long-term U.S. interests.

And make no mistake, that liberal, rules-based order in now under challenge by Moscow in Europe and by Beijing in Asia — see Crimea and China’s rejection of the Permanent Court of Arbitration’s ruling on the South China Sea.

Over the past decade, Beijing advanced a series of institutions that for the most part were aimed at excluding the United States and challenging U.S. economic and security leadership: The Shanghai Cooperation Organization, the initial proposal for the East Asian Summit, the Asian Infrastructure Investment Bank, the “Asia for Asians” security concept, the One Belt One Road Initiative, and the Regional Comprehensive Economic Partnership — a counterpoint to the TPP.

The demise of the TPP has opened the door to Beijing assuming a leadership role in advancing regional economic integration more on its own terms.

The challenge for the United States and the Trump administration will be as demanding over the next four years as it was when defined by then Secretary of State Hillary Clinton in 2011 when she wrote for Foreign Policy:

Asia and the world are looking for a vision of international leadership beyond “America First” — one that updates and modernizes the post World War II system. The alternative is something more like the pre-World War II world of sphere-of-interest geopolitics and protectionist trade policies. We know how that turned out.

The Nikkei Asian Review published an earlier version of this article.

Image credit: Zur Geschichte der Kostume