All my life I’ve had an intense interest in foreign policy. Growing up in the shadow of the Cold War, that was hardly surprising.
As a young adult, I was a Christian pacifist and supported the Campaign for Nuclear Disarmament. Traditionally, Christians have either been pacifists or, more commonly, people who justified participation in war provided it was “just”. St. Augustine, who first developed the concept of the just war, argued that Christians could justify taking life and participating in war provided that the cause was just, those killed were military personnel and not civilians, and there was a realistic prospect of victory. And it seemed to me and many others that a nuclear war could never meet those criteria.
In my undergraduate degree, I majored in both History and Economics in the hope that I would get a position in our Ministry of Foreign Affairs and Trade after I graduated. Studying history, I learnt about some of the negatives of British rule in India; I learnt about the way in which Britain went to war against China to force that country to allow the importation of opium; I learnt that the combatants in World War I did not divide neatly into goodies and baddies; I learnt how the stringent conditions imposed upon Germany by the Treaty of Versailles contributed greatly to the destruction of the German middle class and the rise of Hitler; I learnt how the trade protectionism of the thirties contributed to the determination of Japan to build its own empire; and much more.
In other words, I learnt that God was not always on our side.
In the end, I didn’t even apply for a job in the Ministry of Foreign Affairs and Trade but instead did a PhD in Economics and went to work at the World Bank, keen to make at least a small contribution to economic development in what was then called the Third World. I arrived in Washington in 1966, the same year that Senator William Fulbright, still the longest serving Chairman of the US Senate Foreign Affairs Committee, published “The Arrogance of Power”. In that book, he expressed serious misgivings about the justification for US involvement in the Vietnam War and more generally concern about what he saw as the arrogant way in which the US had used its power in preceding years.
I lived in Washington for five years and loved it. Back in New Zealand, my first decade was spent as the CEO of an investment bank partly owned by Wells Fargo Bank of San Francisco, and that meant I was back in the US at least once a year for that decade. As the CEO of the New Zealand Kiwifruit Authority and even more as Governor of the Reserve Bank, I was in the US at least once a year for the following 20 years, including on one occasion as a guest of the US State Department.
No doubt because of that personal experience over many years, I like Americans: almost all those with whom I had contact over nearly four decades, personally and professionally, were thoroughly decent people, warm and outgoing. I admired their values and their commitment to democratic processes.
In early 2004, when I had not long become the Leader of the National Party (then in Opposition), Lockwood Smith (National’s Foreign Affairs spokesman at the time) and I met with six US Senators who were visiting New Zealand. Towards the end of a very cordial meeting, we were asked whether the ban on US naval ship visits would remain under a National Government. One of us – and there is still uncertainty about who said it, with the MFAT note-taker believing it was I and the US embassy person attending believing it was Lockwood – said that the ban “would be gone by lunch-time”. And I was comfortable with that position: while I agreed with keeping nuclear weapons out of New Zealand ports, I could see no logic in excluding all American warships particularly since at that time US surface vessels did not carry nuclear weapons.
But I am bound to admit that in recent years I have become much more uncertain about the wisdom of New Zealand’s being tightly aligned to our traditional allies, and more sympathetic to New Zealand’s having at least some measure of independence in our foreign policy. And this uncertainty has been driven by a number of factors quite apart from the recognition that the US had completely mis-read the nature of the Vietnam War.
Perhaps three American professors have had a bigger influence on my thinking than anything else.
One was Graeme Allison, the Harvard University History professor who wrote “Destined for War: Can America and China escape Thucydides’ Trap?” in 2017. That extraordinary book looks back over the last 500 years and examines 16 cases were a dominant Power was challenged by a rising Power. Allison found that in 12 of those 16 cases war was the result. The US is obviously the dominant Power at the moment, with hundreds of military bases all over the world and the quite explicit assertion of hegemony over the Americas (in the form of the Monroe Doctrine, asserted by President Monroe in 1823). China is clearly the rising Power and equally clearly resents being hemmed in, at least on its seaward side, by US naval power. Allison wondered whether China’s challenge to American dominance of the world made a war between the two inevitable and could see several potential detonators.
The second was John Mearsheimer, professor of Political Science at the University of Chicago since the early eighties. In recent speeches he has argued both that the US provoked Russia’s attack on Ukraine by encouraging the latter to join NATO (with Russia reacting to that threat with the same kind of vehemence that the US evinced when Soviet missiles were placed in Cuba in 1962) and that with the world moving to a situation where there are not one or even two major nuclear Powers but three, we are all skating on extremely thin ice. Little wonder that the so-called Doomsday Clock has been moved to 90 seconds to midnight, the closest it has ever been.
The third was Jeffrey Sachs, professor at the Centre for Sustainable Development at Columbia University, who in a series of recent lectures has been highly critical of the way in which the US handled Russia after the break-up of the Soviet Union and, more recently, highly critical of the way in which the US is handling the inevitable competition with China.
Just last month, in an article for Foreign Affairs, Hank Paulson, Treasury Secretary under Republican President George W. Bush, noted:
The United States is attempting to organize a coalition of like-minded countries, especially the democracies of Asia and Europe, to counterbalance and pressure China. But this strategy is not working; it hurts the United States as well as China; and over the long term, is likely to hurt Americans more than Chinese people. It is also clearly in Washington’s interest to cooperate or work in complementary ways with China in certain areas and to maintain a beneficial economic relationship with the world’s second-largest economy.
Although many countries share Washington’s antipathy to China’s policies, practices, and conduct, no country is emulating Washington’s playbook for addressing these concerns… Even Washington’s closest strategic partners are not prepared to confront, attempt to contain, or economically de-integrate China as broadly as the United States is.
And in recent years, the US – once a champion of open international trade – has become noticeably more protectionist. This was first and most strikingly observed after Donald Trump became President in early 2017: almost his first action as President was to pull the US out of the Trans-Pacific Partnership, an arrangement under which 12 Pacific countries were to make significant moves to free up trade between them. That was initially seen by many observers as simply motivated by jealousy – the TPP was one of Barack Obama’s most significant foreign policy achievements, and therefore, in Trump’s eyes, had to be destroyed.
But during his presidency Trump showed that he had no understanding of the benefits of international trade and seemed to believe that if the US was running a trade deficit with China, that must mean that China was exploiting the US in some way. No economist would give the time of day to such a dopey notion, but believing that, and to gain political points with some American industries, he imposed tariffs on a wide range of Chinese exports to the US. He also emasculated the World Trade Organisation – an organisation which the US had been heavily involved in creating – by refusing to approve the appointment of judges to the WTO disputes panel. And, worried that Chinese electronics company Huawei was gaining a march on US competitors, he blocked the export of key componentry from the US to Huawei.
There was some expectation that President Biden might reverse some of Trump’s anti-trade and anti-China moves. He had been Barack Obama’s Vice President when the TPP was negotiated and was alleged to have a good personal relationship with President Xi. On the contrary, as Henry Paulson observed, the US has left Trump’s tariffs in place and has also introduced sweeping moves to block a range of high-tech components being sold to China, either by American companies themselves or by foreign companies using American technology. Perhaps even worse, the President has sponsored legislation which would introduce a wide range of subsidies for American companies willing to invest in favoured industries, and many observers see this move as creating a serious risk of prompting countries in Europe to introduce similar trade-distorting measures.
What of New Zealand’s own relationship with China? As most New Zealanders know, China is, by a very large margin, our biggest export market and biggest source of imports. There is no other market which could provide a substitute market for most of our exports anytime soon. I suspect China regards us with some suspicion given that New Zealand has long been a member of the so-called Five Eyes group of countries, led by the US. But I also suspect we have won some brownie points for making it clear on more than one occasion that we make our own foreign policy decisions, with no suggestion at all for example that we should be a member of AUKUS, the defence agreement between Australia, the UK and the US. Nor did our Government go out of its way, as the Australian Government did, to question China’s explanation of the origins of the Covid virus.
Making it clear to all countries that we will make our own judgements about important international issues while endeavoring to retain a cordial relationship with both traditional friends and new ones is the only appropriate way forward for New Zealand.
12 February 2023
Note: In addition to my very frequent visits to the United States over many years, I have also visited China in a number of different capacities since my first visit there in 1986. I am currently the chairman of the New Zealand subsidiary of the Industrial and Commercial Bank of China.