Interview with Lee Kuan Yew/ YOICHI FUNABASHI, Editor in Chief: Maintaining balance of power in Asia requires U.S. engagement Editor's note: This is the seventh installment of an interview series that appeared in the vernacular Asahi Shimbun under the title "Brave, grave new world." * * * With his insightful analyses of trends in international politics, Lee Kuan Yew can be considered the world's 'Chief intelligence officer.' Having brought prosperity to the island-nation of Singapore during the past half century, Lee was asked for his thoughts about surviving in the 'new world.' * * * Question: Do you think the Asia-Pacific region is already in a post-America era? Answer: No. Post-America may take place in another 30 to 50 years. I do not see the Chinese being able to equal the American technology either in civilian or in military terms nor in the purchasing power of the American market. Although the numbers are with China, per-capita GDP is still low. And even after 30 years when they exceed U.S. GDP, their per capita will be low. Power is the projection of both economic strength, military capability and political influence. In the second half of this century, we have to see again. Because by then, the Chinese would have caught up by technology. Not completely, because the Americans will advance further, but they will be closing the gap. And although their per capita may be lower, their total resources for 1,400 million people will be greater than America. Therefore, they have more resources to spend on political purposes and military purposes. So, that may tip the balance, not completely to their side, but in a more equalized position for power (and influence) in the Pacific. That's my view. I may be wrong. Q: Some economic historians, like Niall Ferguson, have recently argued that once a great power starts to decline, it does not usually decline in an orderly fashion. In fact, in most cases they declined precipitously. Do you think the United States could decline precipitously? A: Well, there is an off-chance that the United States will lose confidence in itself, will not be so creative, so inventive and creating breakthroughs in new technologies and not attracting new talents from abroad. I don't see the United States in the next 10, 20, 30 years losing that capability. Talent will not go to China. Talent will go to America because Americans speak English and everybody fits in. It's a country that embraces immigrants. To go and settle in China, you have to master the Chinese language. And you must get used to the Chinese culture. And that is a very difficult hurdle to clear. Even Singapore-Chinese doing business in China find that they need about one to two years to adjust to a different way of life and a different way of thinking. So in my assessment, Niall Ferguson is spelling out an off-chance. There could be a precipitous loss of confidence of Americans in America, in which case foreign talents also lose confidence in America. I don't see that happening. Q: What role do you think the United States will likely play in the Asia-Pacific region, particularly in terms of its military commitment and military presence and its alliance structure? A: Well, it is a constantly adjusting position because although the Chinese cannot match the Americans in capabilities and in asymmetrical warfare, they can inflict enormous damage on the Seventh Fleet. And with their submarines, they may even sink an aircraft carrier. The submarines are bought from Russia. They are very silent Kilo types. They have several. In fact, we have done naval exercises with the Americans with our submarines and we showed them we had their aircraft carriers on target. So I think they had considered that. Therefore, power projections cannot depend on aircraft carriers. They will need bases. Hence, the bases in Japan, in Thailand. Pity the Subic base closed down, but that's the choice of the Filipinos. But I think Okinawa is a very important staging point for them. Nearer to Asia than Guam. Q: There are now problems between the United States and Japan on Okinawa base relocation issues. What implications do you think this tension will have for the Asia-Pacific region? A: I think it is natural for the Okinawans to want to be free of American troops because you have acts of rape and all sorts of problems. But from a national point of view, for your own security and the balance in Asia, if you removed the bases from Okinawa to the mainland or Hokkaido, which is rather cold for the Americans, it is still workable. But if you remove all bases of America, I think your position and that of Asia, that position will be weaker strategically because you cannot balance against China and your (population of about) 120 million against 1.3 billion, soon to be 1.4 billion. It's not a matter of quality. It's a matter of numbers. And the Japanese people, never mind the government of the day, will have to decide where is their longer-term interest and which is more important? Your security or your convenience of the Okinawa people? Q: Do you think that Asian people, including the people in Southeast Asia, regard the U.S.-Japan security relationship as a sort of a stabilizer? A: Absolutely. As far as I am concerned, I have no doubts it is a stabilizer. And I am sure many would not like to say so, but they think so. They know it, but we say it to make it easier for the Americans. And for the Japanese. Nobody can accuse us of being in the pay of the Americans. They don't give us any aid. We are not a satellite country. We don't have any treaties with them. We have an independent declarant. We allow them to keep their logistics here for forward actions in the Gulf region. That's all. Q: You have mentioned "balance" in relation to China in the past. Could you elaborate on this idea a little? As far as I know, you recently said it in the United States, and it stirred controversy among Chinese Netizens. So it may have been offensive to some people in China. A: Well, the Global Times, which is an offshoot of the People's Daily, translated "balance" as zhiheng, which means "to conscribe," and not pingheng, which is "to balance." So naturally, you give that interpretation, which is to conscribe China, it must have aroused Chinese anger. Why should I say that as a Chinese? But I am saying what I am saying not because I am Chinese or because I am anti-China, but because I represent Singapore, and this is in my national interest that there should be a balance in the Pacific. Without America, you can take Japan, you can put North and South Korea together, you can put the whole of ASEAN together, you can even get India together. You can't balance China. India is too far away and they can't project the forces into the Pacific. But the Americans can. Q: When you refer to this balance, is it a sort of balance of power? A: Yes, of course. Balance of power and balance of influence. Balance of economic influence. Trade, investments. Q: In some cases in history, the balance of power has led to very conflictual relationships between major powers. A: That was in Europe. In Asia, it is just between two. In Europe, the balance was a confederation of three or four countries against four or five countries. That is different. Q: Perhaps it could lead to a sort of encirclement policy against China? A: No, I don't think so. China is too big to be encircled. Japan may be able to monitor submarines coming out from north of Shanghai. But you can't stop submarines coming out from Hainan Island. I've noticed they've got a very big submarine base in Hainan. Everybody knows that. Deep water. So I don't see any encirclement as possible. But there's a balance, there's a forward base in place of an aircraft carrier because the aircraft carrier is vulnerable. Q: Do you perhaps envision the future of Asia-Pacific stability as sort of multipolar? A: No, I don't see multipolar. It is bipolar. And Japan is part of the American pole. I mean, there's no other country with the economic or military capabilities or technology capabilities other than Japan. And Japan on their own because of numbers, regardless of the quality of her technology and the capabilities of her people, just cannot balance China. It's not possible. Q:Where does ASEAN fit in? How does ASEAN come into play? A: At the moment if you asked me, ASEAN is more leaning toward America. But as time goes on, more and more of the continental ASEAN--Thailand, Laos, Cambodia, Burma--will have to consider China's view because their markets (for raw produce and minerals) will be in China. It is growing rapidly. So over time, ASEAN will be divided between archipelago ASEAN and mainland ASEAN. I think archipelago ASEAN will find it more comfortable if there's a balance. Eventually, the Chinese will have a blue water fleet with an aircraft carrier. It's a matter of time--30 years, 40 years, 50 years--definitely. So if there is a balance, we have more room. If there is no balance, there is no shade in between. We have two big trees and find some shade between the spreading branches of the two big trees. Q: You said that India was far away. But India now seems to have finally awoken from its long sleep. In what way do you think India should get involved in providing a stabilizing effect for the Asia-Pacific region? A: India's military role will be confined to South Asia and she cannot project her forces into the Pacific. She might be able to project her forces into the Straits of Malacca because it's near the Andaman Islands and she's got bases there. But to go beyond Singapore upwards will be a difficult problem for her. So militarily, I would say India is confined to the Indian Ocean and the Straits of Malacca, the Northern Straits of Malacca. Land projections across the Himalayas or across Bangladesh or Burma are very difficult. Similarly for the Chinese. So unless there's a huge deterioration of relations, I do not see a repeat of 1962. Q: Relations between India and the United States have improved very much, especially in the past decade or so. President Barack Obama even called India a "natural ally." Do you think the relationship is developing into an alliance? A: Well, I am not sure they are natural allies forever. Because for a long time, the United States favored Pakistan because India was in alliance with and buying her weaponry and trading with Russia. So she was in the other bloc. Now the Russians have lost that ability, but the Indians still maintain their military relations and supplies of military equipment and hardware, aircraft. I am not sure if submarines are also (included). But it will take some time for the Russian Republic to find the strength it had with the Soviet Union, with the whole empire. But nevertheless, their military technology is considerable and Putin has shown he is going to keep that up. And so you see they are producing updates of Sukhoi and the MiGs and selling them around the world. Q: The United States also seems to be interested in selling arms to India, but I think this seems to be evolving into something much larger. A: No, it's much larger because their interests are aligned. The Americans would want another heavyweight at the other end of the tug-of-war role. And the other heavyweight is India. It may not have the GDP, either total--its total GDP is less than one-third of China. But the number of population is not very far off China, and they may even become larger than China by 2050 or 2060. So it is useful for the United States to have a stabilizer in South Asia. And I think the United States must be realistic enough to see that, at the rate India is growing, she cannot project her military forces beyond the Straits of Malacca. The Chinese can project not their whole weight, but some weight to the Indian Ocean, routes to Myanmar. They have a seaport in Myanmar and routes to the port in Pakistan. But this is a long logistic line. Q: How can ASEAN continue to play a central role in Asia in the regional architecture? A: Well, it has to stay cohesive and not divided. And for the present phase, the Chinese want it to be cohesive and to carry the whole of ASEAN with them. So they've got this ASEAN Plus Three. They have not abandoned ASEAN. I mean, these three in military terms can easily outweigh ASEAN in total strategic terms because of the archipelago across the Indian and South China Sea, and the votes in the United Nations. It is important for (China's) total global strength to have ASEAN with them. So ASEAN finds itself an attractive partner to China, to India and to America. Where the final proximity or togetherness will be, I cannot say. It depends upon how things evolve and what benefits China can give us compared with the Americans. But as I have said, for 30, 40 or even 50 years, ASEAN will have more benefits but of course diminishing over time from America as against China. China will draw us in because of the huge market and low cost products--food, vegetables, minerals. But America has a high investment technology and she buys expensive products, which is a result of multinationals investing in these countries. The Chinese cannot equal that. I mean, we now have about 4,500 Chinese companies here (in Singapore and) 4,000 Indian companies. But none of them can equal the Americans or the Japanese or the Europeans MNCs in sophistication of the products. It will take the Chinese some time to catch up. Q: There have been so many regional architectures, whether it is ASEAN Plus Three, ASEAN Plus Six, EAS, APEC and the others. Now, Australian Prime Minister Kevin Rudd has proposed the creation of an Asian Pacific Community on top of this. Do you think we have to do something to streamline this? A: It will be decided not by the Australians but by the Chinese. If the Chinese find that it is useful to have a structure that Prime Minister Kevin Rudd has proposed, then that will be carried out. I doubt it. There is no advantage for China in this proposal. They may not openly reject it. Instead they will say, "Yes, we will consider it." They have already decided that ASEAN is important to them. It is their southern belly, strategically and economically. They want to be the major influence in ASEAN. They don't mind the Australians competing for ASEAN's loyalty. China will have to compete with America and Japan together. Q: Prime Minister Hatoyama has recently proposed an East Asia Community. It is still relatively vague but his passion is unmistakable. What do you think about this proposal? A: I prefer to wait and see what happens whether strategic thinkers in Japan will conclude that this is in Japan's interest. Q: Why the reservation? A: Japan alone cannot be a counterweight to China. You may have no counterweight if you are part of the Chinese bloc. If America supports you, you can bargain with China. Without America's support, you have no chips to play with. Let's be realistic. The Americans do not want Japan in China's bloc. You are either with America or with China, period. Q: Realistically speaking, you may be right. But at the same time, it will be a nightmare scenario in which Japan will be forced to choose between the Chinese camp or the American camp. A: No, you don't have to choose. You just stay where you are. Status quo is the best option for Singapore and maybe for Japan also. Q: But you said China is not interested in maintaining a stabilizing status quo. So it could be more difficult for us. A: Well, in 20, 30, 40, 50 years, maybe. But we will see how rapidly China develops. Q: Japan actually lost two decades. They lost one in the 1990s, and another lost decade ensued. You have observed Japan for more than 70 years since the 1940s. What went wrong with Japan in your view? A: Japan's leaders were older and they had no new thinking. The faction leaders were all older and did not allow younger Japanese to take over the leadership although they were more attuned to the present state of the world. They could have changed Japan's economic political policies and made Japan more relevant to today's world. Next, you have a fundamental problem--an aging population. So despite many stimulus packages, there was no real recovery. Old people don't change their motorcars yearly nor their television sets or buy new suits. They do not go for expensive dinners and other luxury spending. They've got all the things they need, and you have not been able to stimulate domestic consumption. Today you have about three Japanese for about one retiree. My principal private secretary has calculated that in 2030, you have two to one retiree. In 2055, you have only 1.5 working for one retiree. How is that sustainable? Yet you sent "pure-blooded" Japanese from Brazil or nurses from Philippines back because they couldn't speak or pass Japanese or for other reasons. Japanese people's demand for purity is extreme, considering your position. How can you continue that policy? Your government urges women to have more children. That is slower and more difficult than getting more immigrants. The lifestyle of your educated women has changed. They are quite happy to be single, they are traveling around the world. They are earning their own living and don't have to get married if they don't like to. Many have married foreigners because they don't want to be slaves of their husbands and their husband's parents. Many Japanese women working in SIA (Singapore Airlines) have married our air stewards. They watch how Singapore women live where husbands do not boss their wives (and) live separate from in-laws in flats bigger than in Japan. Japan will have to change its way of life. You can reverse low birthrates at high costs like France and Sweden. They give generous support for nurseries, kindergartens and office facilities for the babies of married employees. But it's a slow process. Q: In your book "From Third World To First," you said: "I discovered early in office that a few problems confronted me in government which other governments have not met and solved. So I made a practice of finding out who else had met the problem we faced. How they had tackled it and how successful they had been." I think all policymakers should be aware of this insightful perspective. What countries can we learn from or emulate in terms of addressing common challenges, new ideas and new frontiers? A: Well, each country has valuable lessons for us. America shows how an entrepreneurial culture ensures a dynamic economy. Their best do not become salarymen. Bill Gates left Harvard to start Microsoft. They have venture capitalists who support good projects and help build the management. Our GIC (Government of Singapore Investment Corp.) and Temasek put money in these venture capitalist companies, as well-established insurance companies do. If one out of 10 makes good, it would more than cover the losses on the other nine. We were conscribed by what we have inherited from the British. Secondly, they renew leaders with every generation. I don't think we can do that. Our ambassador in Washington reports every new administration revises unsuccessful policies. Singapore cannot afford to do that. Japan, you impressed us on how you train workers to strive for perfection in what they do. So Japan produces defect-free TV sets and until recently, flawless cars. But you restore your high standards. I am most impressed by the solidarity of Japanese workers, their drive to increase productivity to benefit companies and workers. And they have intense loyalty to company. So I had your chairman of the (Japan) Productivity Center, Kohei Goshi, that I have narrated in my memoirs. His thinking is deep and profound. He said productivity is like a marathon without a finishing line. * * * The founding father of Singapore, Lee Kuan Yew served as prime minister from 1965, after Singapore gained independence from Malaysia, until 1990. He helped achieve economic development and social stability by aggressively promoting foreign investment, and turned Singapore into an economic superpower in Southeast Asia by converting its industrial structure into one centered on exporting manufactured goods, transport, communications and finance. He has continued to maintain a voice in Singapore politics as senior minister and minister mentor since stepping down as prime minister. His oldest son, Lee Hsien Loong, 58, is Singapore's current prime minister.