Chapter five: Japan.

There has been more ferment in the U.S.-Japanese bilateral security relationship in the mid-1990s than at any time since the reversion of Okinawa in 1972. Some observers reckon that only the revision of the Security Treaty in 1960 matches events in the mid-1990s for intensity and significance. The U.S.-Japan security relationship is enmeshed in a process of generational political change across the region and a fluid, turbulent Northeast Asian strategic environment. Japanese views of the alliance are shaped by the uneasy emergence of China as an military and economic power and fears of instability on the Korean peninsula. Whatever the historical comparison, the alliance is passing through a post-Cold War catharsis that will determine its future pertinence, value, and longevity.

Background and Trends

The U.S.-Japanese relationship has endured continuous challenges and fluctuations since its new beginnings after World War II. This relationship is comprised of three broad pillars--economics, politics, and security. During most of the Cold War, the security dimension carried disproportionate weight in the relationship. In the 1990s, however, the economic component has loomed larger as the three pillars have combined to create a tense, uncertain alliance. Nor has the most significant change in international relations--the end of the Cold War--left Japan untouched. Japan's interpretation of and response to international security threats remain based on a calculus of a credible U.S. nuclear/security umbrella, but in a markedly different security environment.

Japan, reliant upon the United States for security since the end of World War II, is in the process of redefining itself in the international arena. Japan has begun to develop security goals for itself, as Tokyo and its Asian neighbors search for a new security equilibrium in the region which will reflect Japan's economic stature and accommodate the strategic concerns of Japan and others in the region. The late 1990s will be a critical point in the redefinition of Japan as a global power and in the redefinition of the U.S.-Japanese alliance on all fronts.

Domestic Political and Economic Changes

Although Japan has recovered through industrial and trade successes a great deal of the power and pride lost during the Pacific war, most Japanese still remain uncertain about what their country's regional and global roles should be.

Since the late 1980s, the U.S.-Japanese security relationship has been challenged by the emergence of Japan as a major global economic and financial power, which even prior to the end of the Cold War, moved economics into a more prominent position in the bilateral relationship. This more important role for economics was further accentuated by the end of the Cold War, the collapse of the Soviet Union, and the emotional hurdles of the fiftieth anniversaries of the attack on Pearl Harbor and the end of World War II in the Pacific. Heated confrontation, such as that over the question of technology sharing in the FS-X debacle, and a seemingly endless stream of contentious trade negotiations moved such issues to centerstage.

In the early 1990s, a tilt towards East Asia--driven by deepening intra-Asian economic integration--in both Japanese economic policy and foreign policy became increasingly evident, replete with the reorganization of the Foreign Ministry and bitter trade disputes with the U.S. In intellectual exercises, and often in practice, Japan placed increased emphasis on multilateral and UN solutions to security problems. in the early 1990s, it appeared that, for the first time, Japan might be searching for an alternative to the bilateral system led by the United States.

Japanese divergence, driven by uncertainty fostered by American indecision and inconsistency as much as by Tokyo's own Asian aspirations, probably peaked in 1994 with the Higuchi Commission's recommendations on the future of Japan's security goals. It recommended increased dependence and emphasis on multilateralism and the United Nations, with reliance on the United States third in order of priority.

By 1995-96, burgeoning Japanese self-confidence had been trimmed significantly by serious and prolonged recession, endemic political scandal, and political gridlock. Assumptions regarding the decline of the United States began to appear overblown, especially in light of American leadership that resolved the Kort, an crisis, made possible progress in the Mideast peace process, and would lead to NATO action in Bosnia. At the same time, growing regional concern about Chinese military assertiveness, particularly in the South China Sea, became a focus of attention in the region.

Reflecting modest political ferment, the Liberal Democratic Party (LDP) lost power for the first time in four decades in 1993. Although in 1995 the LDP regained power in a coalition with its traditional nemesis the Social Democratic Party, Japan's political system remains in flux. Issues such as the peace constitution hold the potential to play a significant role in reshaping Japanese political alignments. The LDP strengthened its position in the October 1996 elections, the first under a new electoral system in which 60 percent of the Japanese Diet was elected in single-member districts.

As of 1996, Japan's domestic debate is driven by changing perceptions of international security challenges. There is a drift toward a more independent defense industrial base, along with a strong desire to build new structures for regional cooperation, complementing the U.S.-Japan security alliance and hedging against the future, not supplanting it.

Japan's history over the past century is one of stability and prosperity when in alliance with a leading maritime power, and one of conflict and instability when it pursues a posture of strategic independence. Earlier this century, Japan had another defense alliance with a great Western maritime power, namely Britain. When the Anglo-Japanese alliance dissolved after World War I, Japan traded absolute security on a bilateral basis for a multilateral treaty system (the Washington Naval conference) that brought just the opposite. All countries in the alliance--Japan most of all--have regretted the consequences.

Japan and Other Asian Powers

During the Cold War, the Soviet threat was sold to the Japanese public as the primary rationale for the alliance and for Japan's Self Defense Forces (SDF). Since the threat disappeared, Tokyo's explanation for the continuing military requirements in an uncertain region have been less pervasive and more vague--e.g., uncertainty, instability. After relying so long on an exclusively threat-based security rationale, it is difficult for the Japanese, having forsworn war as a sovereign right, to deal legitimately with future uncertainty and potential threats.

At this juncture, too much Japanese assertiveness would be as problematic as an inability on the part of Tokyo to do more. Tensions in 1996 -with south Korea over the uninhabited Takeshima/Tokdo islands, and a highly emotional Chinese response (including Hong Kong and Taiwan) to an assertion of Japanese claims to the Senkaku islands underscore the degree to which Japan's inability to come to terms with the legacy of the Pacific war continues to make suspicion of Japanese militarism an animating force in the region, most evident in Korea and China, as well as in Japan itself. Regional stability depends upon the perceived limits of Japan's security role. That is especially important to Beijing and Seoul, but is a factor in capitals throughout the region. A useful barometer of success will be the extent 1o which Beijing responds reflexively to Japan's changing security role and a re, invigorated U.S.-Japan alliance, which in turn will depend on the character of Sino-American relations.

Moreover, Japan faces a paradoxical predicament resulting from generational change: Those of the Baby Boom generation and younger now assuming the reins of power are far less captive psychologically to the burden of Japan's behavior during the 1930s and 1940s and that generation's denial and distortion of the past. Yet in Asian memories, this failure to come to terms with the past--punctuated by periodic, comments defending the past or symbolic visits to the Yasakuni Shrine--continues to shape perceptions of Japanese intentions.

At the same time, North Korean nuclear ambitions and its missile and chemical weapon programs along with growing concern about rising Chinese power have become increasingly tangible issues. But the Japanese government has not been able to base its planning on politically controversial potential threats. That inability makes already constrained bilateral planning almost impossible. Given the difficulty of dealing with crises such as the Gulf War, the Kobe earthquake, and the subway gas attacks, the dearth of crisis planning has become a real liability. Informed Japanese observers know that a major crisis close to home--on the Korean peninsula, for instance--could rupture the alliance if American forces were heavily committed and Japan's response was insufficient.

China

The emergence of China--both economically after a decade of double digit annual growth and in politico-military terms with its modernization program and new assertiveness--overshadows all other external factors in regard to shaping Japanese security perceptions and behavior in the bilateral relationship. Time timing of the Clinton-Hasimoto Summit in April 1996 was serendipitous. The summit's success, centering around the renewal of the U.S. Japan Security Treaty, was facilitated by the March 1996 Taiwan Straits crisis, in which the U.S. deployed two carrier task forces into the East China Sea.

Concern over Chinese actions may facilitate bilateral collaboration and resolve doubts about the future of the security relationship more than any other single factor. There is an uneasy triangular relationship unfolding in which the U.S.-Japan alliance may impact both Sino-American ties and Sino-Japanese ties in unintended ways. Prudence would seem to dictate close bilateral cooperation, regional cooperation led by Washington and Tokyo, and carefully coordinated dialogue with Beijing.

Depending upon future circumstances, the U.S.-Japanese alliance may have to deal directly with Chinese military developments, but both Tokyo and Washington clearly wish to avoid this course if at all possible. In the eyes of the Chinese, them are serious consequences to more significant U.S.-Japan security cooperation. The challenge will be to avoid actions that Beijing construes as confirming suspicions of an anti-Chinese alliance. It will be left to Beijing to determine whether China's emergence will be regarded as an opportunity or as a liability.

North and South Korea

North and South Korea each challenge Japan in different ways in the near-term; the prospect of Korean unification, possible by the early 2000s, may alter its security calculus. Scenarios of a North Korean attack across the demilitarized zone, or a collapse of authority and a refugee outflow, motivates many Japanese calculations. These scenarios have been in the mind of those who have urged Tokyo to expand its support for U.S. crisis operations. Despite modern instincts against involvement, it is increasingly difficult for Japan to deny its vital interest in stability on the peninsula, as well as responsibility for action if war or chaos were to break out.

South Korea presents a very different proposition. Seoul's behavior in the mid-1990s makes clear the propensity for long-term competition across the Tsushima/ Korea Strait. The sharp argument in 1996 over ownership of Takeshima/Tokdo island surprised many observers and was notable for its visceral character. This playing out of historic grievances between two major U.S. treaty allies puts the U.S. in a difficult position. At the same time, there are glimmers of optimism, in the intertwining of the Korean and Japanese economics and the imperatives of cooperation in managing the North Korea problem, as was prominent in the June 1996 Kim-Hashimoto summit at Cheju-do island.

North Korea is perhaps Japan's most immediate security concern, and a likely test of the contemporary U.S.-Japan alliance. Either explosion (e.g., Pyongyang invading into the South) or implosion could cause an American military response. Moreover, the deepening famine could generate a refugee flow testing the peacetime Acquisition and Cross Servicing Agreement (ACSA) arrangements agreed to last April. In any case, it is difficult envisioning the current regime in Pyongyang having a lifespan that exceeds the next decade barring radical economic reform and large-scale foreign aid and investment neither of which appear on the horizon.

Japan's Self-Defense Forces: Layers of Constraint

The legal and political context in which Japanese national security planners and military planners operate imposes severe constitutional and political restrictions upon the Self-Defense Forces. Therefore, civil-military relations are quite different from those in the West. In Japan, there is no counterpart for the ubiquitous American "rules of engagement," which are customized to fit the situation and provide general political guidance for the actions of military commanders in the field. Judgment concerning the latitude of action of the Self-Defense Forces is strictly reserved to the political leadership, which in most cases has studiously avoided applying it. Because the capability for national command and control is not well developed, effective internal direction and bilateral coordination are both difficult.

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Japan's Self-Imposed Constraints

Despite a large, if inefficient, defense budget, a number of profound constraints are imposed on Japanese security. While not universally held, Japanese pacifism has been fairly widespread legally, philosophically, and institutionally. That is one of the profound contrasts in an alliance rife with asymmetries. In the United States, war, albeit usually a last resort, is seen in Clausewitzian terms as an extension of politics. To the contrary, Article 9 of the Japanese Constitution disavows as a sovereign right the conduct of war as a means of settling international disputes. In its essence, this means that the Japanese government ascribes to the principle that it does not have the power to order its citizens to die for their country, except in the strict defense of Japan.

The SDF and the security relationship with the U.S. are accommodations to the right of strictly limited self-defense, but collective self-defense is proscribed by the definitive interpretation of Article 9 of the Constitution by the Cabinet Legal Bureau. These restrictions mean that Japan will not become involved in external disputes that do not affect the defense of Japanese territory--despite the tension such a posture creates in its Article Six commitment of the U.S.-Japan bilateral security pact to regional security. Instead, Japan takes a less-conventional approach to comprehensive security, often not noticed by U.S. observers. Tokyo blends foreign aid (overseas developmental assistance), diplomacy in the UN and ASEAN Regional Forum, confidence-building discussions with Russia, and new initiatives with Beijing and Pyongyang. Though not traditional military instruments, they enhance mutual security nevertheless.

Tokyo also has adopted a number of fundamental security approaches based on the Constitution's principles. Japan's non-nuclear principles forbid the manufacture, introduction, or possession of nuclear weapons, committing Japan instead to dependence upon the U.S. nuclear umbrella. The SDF has been assiduously controlled by extensive civilian oversight and restrictive rules of engagement. With the exception of severely constrained peacekeeping and humanitarian relief operations, the SDF has been denied the ability to operate abroad or project power. The profit motive for military expansion has been removed by preventing the export of defense equipment by Japan's defense industry. With the exception of dealing with the United States, the export of defense technology is also prohibited.

Instead, Japan has had to make its contributions to regional security and its own defense in broader terms through important unconventional means. It became a bulwark of democracy and a bastion of capitalism during the Cold War by providing access to extensive bases and facilities in Japan, and by providing financial and political support to the United States. Part and parcel of Japan's contribution was the Yoshida Doctrine, which gave national priority to pervasive economic development and helped fuel Western and regional economic development as well. These important contributions remain the basis for foreseeable Japanese efforts and increasingly are responsible for the ability of the United States to remain engaged in Asia with forward-deployed forces.

Much of the Japanese establishment--business groups, leading newspapers, opposition politicians--advocates either reinterpretation or revision of Article 9, the "no war" clause in the Constitution. This process of redefinition will take some time, probably several years.

Force Modernization

Restrictions and limitations are evident in the new National Defense Program Outline (NDPO), but so are significant political developments, in addition to an emphasis on streamlining and force modernization. Despite Japan's heritage of indirect contributions, the NDPO emphasizes SDF readiness, close coordination of the SDF with U.S. forces, and prevention of instability by maintaining the minimum necessary defense capability; and thereby avoiding a vacuum of power.

The NDPO, allows some streamlining and force structure reductions. SDF troops are authorized at 145,000 active personnel, down from 180,000. Howe, vet, budgets for modernization with state-of-the-art equipment have increased for all services. Strong R&D funding reflects the continued Japanese emphasis on quality over quantity. So far, Japan's programmatic priorities continue to emphasize forces complementary to American capabilities, rather than the development of a Self-Defense Force that is balanced across the board. However, Japan's budget reflects increasing duplication of capabilities in the defense R&D effort, especially in missiles, aircraft, satellites, and other high-tech programs.

SDF personnel are highly trained career professionals operating with high quality, advanced equipment. However, their effectiveness is constrained by a number of institutional and cultural factors. The effects of excessive civilian control and lack of useful rules of engagement are predictable. The lack of broad-based intelligence and command-and-control capabilities reflects the virtual absence of inter-service cooperation and joint doctrine. Despite the number of U.S. systems in the SDF inventory, there is only very limited interoperability where it counts, both operationally and logistically: U.S. forces and the SDF seldom operate alongside each other, much less together.

Future SDF procurement may include some reordering of priorities. Internal service pressure for improved capabilities and a balanced force are bound to continue. Resentment over playing a perennial supporting role to the United States may become more of a political factor over time. New SDF missions already include peacekeeping and humanitarian assistance and disaster relief operations.

Eventually, additional missions will be likely; including some form of theater ballistic missile defense beyond the envisioned Patriot PAC-2 upgrade. The advent of the Japan Defense Intelligence Headquarters should significantly enhance the collection, processing, and dissemination of defense intelligence. In addition, the Japan Defense Agency (JDA) appears intent on having its own surveillance satellite capability. Other capabilities are under consideration, such as aerial refueling and long range strategic airlift. These developments notwithstanding, it is unlikely that Japan will have either a plan or the capability to project substantial military power any time soon, as political constraints are firmly embedded. Those new mission areas that do develop are likely to be rationalized as part of Japan's new emphasis on SDF participation in peacekeeping and disaster relief.

The Unrealized Potential of Armaments Cooperation

Security and economics intersect in the area of defense technology in the major bilateral cooperative programs listed below. The connection can be a positive demonstration of cooperation and may be worth billions of dollars in production and jobs. It could become a two-way defense cooperation, strengthening support for the alliance, but the flow of technology back to the U.S. has so far been minimal. Equipment programs and acquisition planning continue to play important roles in shaping the alliance, albeit without much bilateral forethought or coordination. Japanese acquisition of major U.S. weapons includes state-of-the-art American systems, such as:

* F-4-, F-15-, and F-16-derived F-2 fighters

* P-3C antisubmarine patrol aircraft

* Shipboard AEGIS fleet air defense system

* AWACS early warning and surveillance aircraft

* Patriot air defense system

* MLRS rocket artillery system

* CH-47 and UH-60/SH-60 helicopters

* Naval guns, torpedoes, and surface-to-air missiles.

* AIM 7M Sparrow and AIM 9L Sidewinder air-to-air missiles

Potential future candidates for acquisition by Japan include additional units and upgrades to most or all of these systems, plus:

* Aerial-refueling aircraft

* Some variation of emerging U.S. theater missile defense systems

* Follow-on fighter aircraft such as the F-22

* AIM 120 AMRAAM missile

It will take considerable effort to channel planners toward cooperation in this myriad of programs. The most beneficial political approach would be to seek agreement on an extensive requirements dialogue in order to rationalize expectations and planning for the next several decades.

Potential flashpoints

Alliance Strains

What might cause the alliance to falter? In a relationship noted for its asymmetries, imbalance in a number of areas described below could become so lopsided as to make the partnership unsustainable:

* Continued Exclusive Emphasis on the Defense of Japan: Japanese priority over the past several decades has been given almost exclusively to the defense of Japan (Article 5 of the Security Treaty) as opposed to regional security (Article 6 of the Security Treaty). In combination with operational restrictions, this political priority has forestalled effective coordination and military planning for contingencies such as a crisis on the Korean peninsula. The effective cap on the direct Japanese defense budget of 1 percent of GNP further limits direct Japanese operational participation. Indirect Japanese contributions have been more forthcoming, and are highly valued, but they have relatively little visibly direct effect in a crisis. Tokyo contributed $13 billion to the Gulf War effort. Host Nation Support amounts to $5 billion per year, which accounts for more than 70 percent of the non-salary stationing costs of U.S. forces in Japan. Japanese political support for U.S. negotiating efforts was invaluable during the recent crisis over the North Korean nuclear program. However, indirect efforts do not satisfy critics who decry the lack of apparent Japanese commitment.

* Okinawa and Base Issues: In 1972, Okinawa and the future of the American garrison there seemed to dominate events, much as they do in the mid 1990s. Another major Okinawan crisis would be a real body blow to bilateral defense cooperation. The character and results of the Special Action Committee on Okinawa (SACO) will determine the quality of the relationship with the Okinawan populace well into the next century. After the SACO charter expires, constant attention to the management of base issues will be a high priority for both governments. Simply administering the return of Futenma Marine Corps Air Station and other facilities, and the relocation of functions elsewhere, will be an enormous challenge.

In all the activity centered on Okinawa, the strategic objective may have been obscured: in order to preserve the utility of U.S. bases in Okinawa, pressures on Okinawa are to be relieved--not by shifting capabilities around within Okinawa, but by moving forces from Okinawa to Japan's four main islands.

* Political fatigue and leadership lapses. U.S. budgetary pressures on defense spending and neo-isolationist impulses found among both traditional liberals and minimalist conservatives in the U.S. could combine to jeopardize current levels of U.S. engagement. If such a scenario becomes a military bilateral divisions of political and military responsibility between Japan and the United States would come under severe pressure.

Regional Crisis

Directly related to the exclusive concentration on the defense of Japan is the potential for a regional contingency affecting Japan's security. Foremost in the minds of most serious observers are the ramifications of a serious regional crisis, in which American troops are heavily engaged with numerous casualties. Conflict on the Korean peninsula, perhaps the most pressing near-term prospect, a real confrontation between Taiwan and China, and hostilities over conflicting claims in the disputed Northern Territories, Senkakus in the East China Sea or in the South China Sea would all challenge the U.S.-Japanese alliance. In these or any other external crises unrelated to the direct defense of Japan, two related issues would surface: what is Japan prepared to permit the U.S. to do from Japanese bases, and what is Japan itself prepared to do? The answers are changing as the security dialogue unfolds.

In this context instability on the Korean peninsula is of particular importance, where the alliance would be most sorely tested in the near- to mid-term. Insufficient response to a serious crisis could be extremely damaging. Given self-imposed and external constraints, would Japan's contribution be sufficiently robust to satisfy American critics who know little and care less about the finer points of alliance asymmetries? For the moment, this is the worst case scenario. To what extent it should drive bilateral and national conclusions and planning is an essential question for Alliance managers.

Trade And Security

In 1996, bilateral trade friction diminished, despite unresolved issues such as insurance and air flight rights. Washington and Tokyo agreed on a computer chip accord in August. Other difficult issues continue; some will be sources of bilateral friction, others may play out in multilateral fora, particularly the WTO. Furthermore, corporate alliances will ameliorate differences to some degree. The bilateral trade deficit is down, if only because Japanese production is shifting offshore. However, if abrasive economic relations once again come to dominate the bilateral dialogue, the ability to manage the alliance would be seriously compromised. That would be especially true in the late 1990s, when the quality of overall bilateral relations will affect the outcome of the defense guidelines review.

Debate over the relationship between security and economics will continue to challenge the security relationship. The firewall between Japan and the United States that was erected during the Cold War is long gone, but an emphasis on trade should not imply a decline in the importance of security relations. Nor should constructive progress on security cooperation come at the expense of sorting out key trade and economic goals.

One important component of trade and security is cooperation on arms and security technology. There is little U.S. support for bilateral technology cooperation where it counts, in government labs and corporate R&D centers. With no appreciation for potential Japanese contributions, and less incentive to displace funding or adopt new solutions, no demand exists in the U.S. for Japanese technology; despite congressional and cabinet-level direction to pursue it. And there is no support from the Japanese side for providing technology. With no discernible transfer of Japanese defense technology to the U.S., the security relationship continues to pay a political price for the lack of progress.

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The nature of this technological and equipment cooperation has several consequences. First, what is generally referred to as interoperability provides the basis (as yet unrealized) for close logistical and, ultimately, operational cooperation. Similar equipment tends to increase the potential for similar training regimes and operational doctrines, common experiences, and shared approaches. Second, fielding major American defense equipment tends to lock Tokyo and the SDF into the bilateral security system, thereby becoming as much a determinant as a product of security cooperation.

Less generally appreciated is the third consequence. Japan's increased capabilities, based in several key categories on advanced U.S. equipment, create the potential for much greater U.S. reliance on Japan, whether as a spare-parts depot, a source of replacement equipment, a repair center, a wingman, or an extension of the battle line, holding the rear echelon (or the flank) with identical equipment.

U.S. Interests and Approach

Net Assessment

U.S. interests in the Asia-Pacific are large and growing. Sustained economic growth in East Asia is vital to American prosperity and economic expansion. The U.S. politico-military role in the region, its security guarantees for Japan and South Korea and larger role as balancer of last resort underpin stability and limit strategic competition. The U.S.-Japan security alliance remains the keystone of American security strategy in the Asia-Pacific. Moreover, forward-deployed assets in Japan are an important part of the U.S. global force projection capability.

At the same time, the U.S.-Japan security alliance appears more important to Tokyo now than it was during the Cold War. Northeast Asia is and will remain a volatile security environment over the next 10-15 years. The transformation of Russia is of uncertain outcome and China's geopolitical weight will continue to increase, though its intentions and strategic direction will remain unclear. Furthermore, instability, if not conflict, will persist on the Korean peninsula. Historic suspicions of Japanese militarism make an independent strategic posture the recipe for a Northeast Asian arms race, and there is no apparent substitute for the U.S. as security partner. Thus reaffirming a modernized U.S.-Japan Security Treaty has fresh appeal.

U.S. Interests

Access to Japanese Markets

Japan is one of the largest potential markets for U.S. products, and it is one of the markets in which U.S. firms have had the most difficult time competing. The U.S. government argues that a large part of the problem lies in practices coordinated by the Japanese government. At times, this issue has assumed such importance as to overwhelm all other matters in the U.S.-Japan relationship.

As a related matter, the U.S. has an interest in free access to Japanese financial markets, including for investment in Japan, This issue has in recent years been much less contentious than trade.

Prevention of Hegemony or an Arms Race in East Asia

The U.S. does not want to see any hegemon in East Asia that could use a privileged position there to become in a few decades a true world power. The U.S. wants to guarantee its access to the East Asian markets vital for American prosperity, as well as to investment opportunities in the world's fastest growing area.

The U.S. also wants to prevent an arms race in East Asia between countries suspicious of each other's intentions. The U.S. would be ill placed to compete in such an arms race. The result of an arms race could be a decline in the U.S.' relative military position in the region, Furthermore, with larger military forces, some state in the region might be tempted to use force against a neighbor to back up its claim in one of the region's many disputes over territories at sea.

Protection of the Global Financial System, Including Exchange Rates

Japan invests more abroad each year than any other country, and its central bank has larger reserves than any other in the world. The largest foreign exchange market in the world is the market to trade yen for dollars. In short, Japan's financial system is uniquely placed to assist the U.S. in its vital interest of ensuring stable and appropriate exchange rates, a sound global financial system, and low inflation. To that end, Japan and the U.S. coordinate closely on fiscal and monetary policy.

Sharing the Responsibilities for World Leadership

The alliance between the world's two largest economies and major democracies offers the U.S. important leverage in shaping the post-Cold War system of economic and political relations. In particular, the U.S. has an interest in securing Japanese assistance in meeting the costs of world leadership, from foreign aid to security needs. The U.S. is the world's remaining superpower, but that does not mean that the U.S. can bear alone the full costs of humanitarian assistance, promotion of sustainable development, and protection of global stability. Japan's financial contributions in these areas have become vital. Since 1993, for instance, Japan has been the world's largest provider of foreign aid, outspending the U.S. by 50 percent in 1995.

U.S. Approach

Whether pacific Asia is a peaceful, stable, and prosperous region in the 21st century depends first and foremost on the relations among the three major powers: Japan, China, and the United States. Among these sets of relations, the crucial task is whether Japan and China can peacefully integrate an ascendant China into the regional and international system. That peaceful integration cannot happen without a close-knit U.S.-Japan partnership. For the United States, the alternative to a vibrant alliance with Japan is not an alliance with China, as some in Japan posit, but rather withdrawal from the region and a resignation that it can no longer play a pivotal stabilizing role. For Japan, the alternative to the bilateral relationship with American is neither the role of tributary of China, nor some notion of cooperative security such as ASEAN. Instead, the alternative is an inexorable path toward conflict between the two great Asian powers of the next millenium.

American stature and influence are enhanced in every aspect of bilateral and regional relationships by the permanent presence of American forces based in Japan, along with those in Korea and access arrangements around the Western Pacific. These forces represent the unmitigated U.S. commitment to the region, which enhances American political and economic influence.

Strategic Balance

America's presence-derived political influence begets flexibility in dealing with predictable and emerging challenges. The effects are palpable in the bilateral relationship with Japan. Never before has a primary trading partner had such extensive influence as does the United States with Japan. Cultivating close ties precludes serious bilateral differences or an alliance rupture. The security and political dialogues are aimed at foreclosing alternatives by maximizing common bilateral interests.

Cooperation with Japan provides the maximum flexibility in political as well as military options for integrating a dynamic China into the region. If there are to be three major Pacific powers, it is essential that Japan and the U.S. be on the same side of any triangle that includes China. That need not imply conflict, as triangular relationships apply to engagement as well as to other intense approaches. Cooperation with Japan also is the most salient approach to preventing possible collapse or chaos in North Korea. Should diplomacy fail, it also is the best preparation for a possible crisis on the peninsula.

Together, the U.S. and Japan have an opportunity not only for bilateral actions but also for strengthening burgeoning multilateral forums for mutual dialogue and confidence building in the region that reinforce bilateral solutions.

Mutual Military Advantage

Because they are forward deployed and ready for immediate operations, U.S. forces operating from Japanese bases contribute an essential psychological ingredient to regional stability. Effective deterrence throughout the region depends upon the presence of U.S. forces. A U.S. withdrawal is feared throughout the region because a pullback would require a conscious, and unpredictable, political commitment by the president before forces could deploy from bases in the United States.

Japan has become the focus for U.S. military operations in and around Northeast Asia and beyond into the Persian Gulf. Base access for U.S. forces in effective Asian and Pacific locations is largely limited to Japan and Korea. Because of the flexibility the locations in Japan afford U.S. forces, the importance of maintaining force structure, troop strength, and unimpeded base access there is amplified. Politically driven or budget-driven reductions would have significant operational consequences and important implications for American credibility and influence.

After Drift in the Security Relationship, Real Success at the 1996 Summit

Significant alliance drift and reduced cohesion had become apparent by 1994, with increasing antagonism over economic issues, questions in both capitals concerning post-Cold War bilateral and national roles, and Japanese moves toward an Asianization of Tokyo's economic and diplomatic goals. The rebuilding process began in earnest in October 1994 with the first of a series of intense discussions in Tokyo, Washington, and Hawaii. The agenda was set to examine jointly, the post-Cold War foundations for the bilateral security relationship, with the first phase originally scheduled to culminate in Tokyo a year later.

Focusing on bilateral, regional, and global aspects of U.S.-Japanese security cooperation, diplomats and security officials began to prepare for a November 1995 summit. They introduced the possibility of a defining security declaration to be promulgated by the president and the prime minister. This dialogue produced two key documents. The American document was the DOD's white paper on East Asia and the Pacific, the East Asia Strategy Report, released in early 1995. Tokyo's National Defense Program Outline followed in November 1995, defining Japan's defense and programmatic priorities.

Summit preparations were interrupted by the Okinawan crisis, but the alliance ultimately proved stronger as a result. Discussions and agreements had been set to culminate in November 1995. With most agreements in hand and a strong team in place, both sides were as prepared as possible for the storm clouds of protest that gathered in September 1995. The planned first-ever "2+2," the ministerial-level Security Consultative Committee meeting, was held on schedule that month in New York. Important in its own right, the "2+2" also focused the attention of the leaders involved: the U.S. secretaries of state and defense, and Japan's ministers of foreign affairs and defense.

When the November 1995 summit was postponed for U.S. domestic political reasons, the respite bought time for the ensuing cathartic domestic political debate in Japan over the future of the security, relationship. It also allowed for the crafting of a dramatic American response to Okinawan demands for base closures and land returns. The ensuing five months were spent in furiously active security discussions preparing for the ultimately successful April summit.

Ironically, the real achievements of the April 1996 summit were made possible by the rigors of the preceding crisis following the rape of a young Okinawan schoolgirl by three U.S. servicemen. The resulting furor forced an intense and uncharacteristic public debate in Japan. This debate was a necessary precursor to redefining the security relationship and otherwise would have been out of reach of bureaucrats and politicians. The resultant American response also played a significant role. Impressing Tokyo with its seriousness, Washington pledged to return Futenma Marine Corps Air Station on Okinawa, thereby galvanizing the diplomatic and political process.

The emphasis of the alliance is shifting. From the outset, the Treaty of Mutual Cooperation and Security focused on two key tenets of bilateral cooperation--"the defense of Japan" (Article 5) and "regional security" (Article 6). In practice, Tokyo has concentrated almost exclusively on the defense of Japan, avoiding broader responsibilities and thereby significantly limiting Japan's contributions to regional security. Since the rise of Japanese fortunes and the end of the Cold War, this approach has come been criticized, as American expectations of a larger Japanese role in security issues have risen steadily.

However, public enthusiasm for even existing arrangements is weak, and domestic expectations in both countries presume diminished requirements and reduced costs. Bilateral economic and trade frictions have added to the uncertainty regarding the future of the security relationship.

Article 9 of Japan's Constitution

Aspiring sincerely to an international peace based on justice and order, the Japanese people forever renounce war as a sovereign right of the nation and the threat or use of force as a means of settling international disputes. In order to accomplish the aim of the preceding paragraph, land, sea, and air forces, as well as other war potential, will never be maintained. The right of belligerence by the state will not be recognized.

Basic Guidelines for Japan's Participation in Peacekeeping Forces (The So-Called Five Principles)

1. Agreement on a cease-fire shall have been reached among the parties to the conflict.

2. The parties to the conflict, including the territorial state(s), shall have given their consent to deployment of the peacekeeping force and Japan's participation in the force.

3. The peacekeeping force shall strictly maintain impartiality, not favoring ay party to the conflict.

4. Should any of the above guideline requirements cease to be satisfied, the government of Japan may withdraw its contingent.

5. Use of weapons shall be limited to the minimum necessary to protect the lives of personnel.

U.S. Bases on Okinawa

1. Naha harbor facility

2. Futenma Air Station

3. Engineering unit office

4. Camp Kuwae

5. Yomitan Airfield

6. Chibana site

7. Binbaru training field

8. Kin Blue Beach training field

9. Okuma Rest Center

10. Makiminato fuel depot

11. Awase communications facility

12. Camp Zukeran

13. Sobe (Hanza) communications station

14. Torii communications facility

15. Senama communications facility

16. Camp Courtney

17. Camp McTureous

18. Mt. Yae communications station

19. Gesashi communications station

20. Aha training field

21. Hokubu training field

22. Henoko powder dump

23. Kadena Airfield

24. Kadena powder dump

25. Camp Shields

26. Tengan Wharf

27. Army oil storage facility

28. White beach region

29. Ukibaru Island training field

30. Tsuken Island training field

31. Camp Schwab

32. Camp Hansen

33. Red Beach training field

34. Ie Island auxiliary airfield

35. Torishima firing and bombing field (a)

36. Desajima firing and bombing field (a)

37. Kumejima firing and bombing field (a)

38. Kobi firing and bombing field (a)

39. Akao firing and bombing field (a)

40. Oki Daitou firing and bombing field (a)

(a) Firing and bombing fields are located beyond the coverage of this map.