KWAME HOLMAN: On his last day in Asia, Mr. Obama stood side by side with South Korean President Lee Myung-Bak, but much of their focus was on North Korea and its nuclear weapons program.
U.S. PRESIDENT BARACK OBAMA: Our message is clear. If North Korea is prepared to take concrete and irreversible steps to fulfill its obligations and eliminate its nuclear weapons program, the United States will support economic assistance and help promote its full integration into the community of nations. That opportunity and respect will not come with threats. North Korea must live up to its obligations.
KWAME HOLMAN: That statement echoed President Lee’s offer of a grand bargain, aid for the communist North in return for giving up nuclear weapons.
LEE MYUNG-BAK, president, South Korea (through translator): The North Koreans haven’t yet conveyed what they thought of the grand bargain, but, in order for the North Koreans to ensure their stability, to improve the lives of the North Korean population, to have economic prosperity, in short, for a better future for the North Koreans, it is my wish that the North Koreans adopt the grand bargain proposal.
KWAME HOLMAN: The offer came just a week after North and South Korean ships exchanged fire near a disputed border in the Yellow Sea. Neither president mentioned the sea clash today. Instead, Mr. Obama announced he will send an envoy to North Korea next month, the first direct talks between Washington and Pyongyang since he took office.
But he insisted it’s time for the North to change its ways.
BARACK OBAMA: The thing I want to emphasize is that President Lee and I both agree on the need to break the pattern that has existed in the past, in which North Korea behaves in a provocative fashion. It then is willing to return to talks. It talks for a while,and then leaves the talks seeking further concessions, and there is never actually any progress on the core issues.
KWAME HOLMAN: The president also had a warning for Iran on its nuclear program. He said, the U.S. and its allies are willing to pursue fresh sanctions soon, unless Iran starts cooperating.
There also was a point of tension between Mr. Obama and his South Korean host, a stalled free trade agreement. Opponents in the U.S. Congress have complained, such a deal would hurt U.S. manufacturers, but the president said he expects progress.
BARACK OBAMA: To strengthen those ties, President Lee and I discussed the U.S.-Korea Free Trade Agreement, which holds out the promise of serving our mutual interests. And, together, we are committed to working together to move the agreement forward.
KWAME HOLMAN: Those same themes of liberalizing trade policy and halting the spread of nuclear weapons dominated much of the president’s Asia tour, which also took him to Japan, Singapore and China. The goal was to show American re-engagement with a fast-growing and increasingly influential region.
The president’s three days in China were the centerpiece, highlighting that nation’s growing economic and military importance. Talks with Chinese President Hu Jintao yielded no new agreements, but Mr. Obama talked optimistically about improving relations with China.
BARACK OBAMA: The major challenges of the 21st century, from climate change, to nuclear proliferation, to economic recovery, are challenges that touch both our nations and challenges that neither of our nations can solve by acting alone.
KWAME HOLMAN: The two men also aired some disagreements, as when Hu criticized American penalties on imported Chinese goods.
HU JINTAO, president, China (through translator): I stressed to President Obama that, under the current circumstances, our two countries need to oppose and reject protectionism in all its manifestations in an even stronger stand.
KWAME HOLMAN: Mr. Obama heard similar complaints about U.S. protectionism at a regional summit in Singapore.
And, in Japan, the key U.S. ally in Asia, he faced new Prime Minister Yukio Hatoyama, who is pressing for a greater say in the relationship. He also wants to reduce the U.S. military presence in Okinawa.
President Obama drew his warmest welcome in South Korea, even hugging President Lee at the end of their news conference today. And, later, at Osan Air Force Base, he underscored the continued importance of a strong American presence in Asia.
BARACK OBAMA: At every step of my journey, one truth is clear: The security that allows families to live in peace in Asia and America, the prosperity that allows people to pursue their dreams, the freedoms and liberties that we cherish, they’re not accidents of history. They are the direct result of the work that you do.
KWAME HOLMAN: From there, the president boarded Air Force One for the long journey home to Washington.
JIM LEHRER: And to Jeffrey Brown.
JEFFREY BROWN: And we look at the president’s trip now with James Fallows of “The Atlantic” magazine. He recently returned from living in China. Yasheng Huang is a professor of political economy and international management at the Sloan School of Management at MIT. And David Lampton is a professor of China studies at the School of Advanced International Studies at Johns Hopkins University.
Welcome to all of you.
Reengagement with Asia
Jim Fallows, Kwame, we just heard him use the word re-engagement as a goal.
JAMES FALLOWS, "The Atlantic": Right.
JEFFREY BROWN: What's your assessment?
JAMES FALLOWS: I think that the point of the trip was mainly that it happened at all. And the re-engagement would be the crucial theme.
If we were -- I think we talked earlier this week about what could be realistically expected from this journey. And it would be, you know, impractical to think that any of the really difficult problems, economic imbalances, financial imbalances, environmental ones, would actually be solved here.
But, from this clip we just saw, you see the range and the complexity of U.S. engagement there, the military presence in Japan, and, in Korea, the issue of North Korea, the all -- all the -- the whole range. So, the fact that the president was there showing U.S. presence I think was the main point.
JEFFREY BROWN: Yasheng Huang, the fact of being there or concrete accomplishments, what did you see?
YASHENG HUANG, MIT Sloan School Of Management: I agree with James.
I think re-engagement is the critical piece of success here. If you don't reengage after eight years of unilateralism of the Bush administration, if you don't reengage with the region, you really cannot reach any solutions on these concrete political and economic issues. So, re-engagement is the purpose of the trip. And I think it has been accomplished.
JEFFREY BROWN: David Lampton, help us think a little bit about who it is that we're reengaging with or who are we talking about. I mean, is it useful to think about Asia as a region? And in what way is that useful?
DAVID LAMPTON, Johns Hopkins University School of Advanced International Studies: Well, I think, in many respects, we're now dealing with an Asia that increasingly has its own mind, if we -- it always did, but in the sense of our tight alliance in the Cold War, we could count on a degree of identity of interests with our allies, whether it was Korea or Japan.
And now you look at the reality, and South Korea has its major export market in China. Taiwan does. Japan does, all of Southeast Asia. Now, increasingly, Asia is looking at the problem of how do we balance our interests in the region with the United States, which they want to stay in the region, but, on the other hand, they have very powerful economic interests now with China.
So, we're dealing with a region with its own mind, its own -- as we saw particularly with the recent election in Japan, and as the piece said, Mr. Hatoyama now wants to distance a bit.
America's partnership with Asia
JEFFREY BROWN: You know, Jim Fallows, when you were on the program earlier this week...
JAMES FALLOWS: Yes.
JEFFREY BROWN: ... Jim Lehrer asked you, how do we think about China?
JAMES FALLOWS: Right.
JEFFREY BROWN: You know, friend, enemy, competitor, partner?
JAMES FALLOWS: Yes.
JEFFREY BROWN: Now put that same question...
JAMES FALLOWS: Sure.
JEFFREY BROWN: ... in terms of Asia as a region.
JAMES FALLOWS: I think as it comes to the region as a whole, certainly, it's much more a partner -- you know, the partner quotient is higher than it would be the case of the China relations specifically, because, with Japan, there's a different kind of political complication.
With Southeast Asia, there's not that many political or military problems. So, I think that the U.S. is in the enviable position of having very strong relationships across the Atlantic with all the countries in Europe, but also being sort of an indispensable partner in Asia, where all of the countries there, they have disagreements with the U.S., but they all would rather have the U.S. be there than not
JEFFREY BROWN: Yasheng Huang, where do you see the real pushback on this trip and more generally from -- from Asia, I mean? Is it really centered on the new economic power, for example, that David Lampton was talking about, the new economic power in China?
YASHENG HUANG: I don't quite see it that way.
China, despite the rapid GDP growth, is faced with some substantial internal challenges. Unemployment is high in some regions. The stimulus package has worked unevenly. And there's a lot of a debate whether or not it is rebalancing the Chinese economy in the right way.
China definitely needs the recovery of the United States, recovery in Europe and Japan to restart its export region -- export engine of growth. It is trying to move away from that model, but it's not going to take -- it's going to take some time for China to do that.
In the meantime, the relationship between China and the United States is one of mutual dependency, rather than China rising up, challenging the United States.
Pushback from China
JEFFREY BROWN: And yet, David Lampton, there was pushback on all kinds of issues that we saw during this trip, especially in China.
DAVID LAMPTON: Well, I think Professor Huang has a good point, but I think we have to keep two opposed things in mind at the same time.
One is, China is moving ahead in directions that I think, over the long run, represent a competitive challenge to the United States. They're rapidly increasing their higher education. They're dumping more money into R&D. They're doing things that are intelligent, building infrastructure that makes them more competitive.
So, on the one hand, they're getting stronger, but, as Professor Huang said, there are also enormous pockets, in fact, vast seas, of weakness in China. Just one is, China is becoming a rapidly aging society. And, by 2040, China's going to be an older society than we are, with all of the cost problems associated with that.
So, I think we have to, one, appreciate the competitive strengths of China on the one hand, but not exaggerate them. And I think America's fully capable of responding to these.
JEFFREY BROWN: So, then, what does that do, Jim Fallows, to our relations with, for example, Japan, where he started, which is our oldest and strongest still, but as Donald Lampton said -- David Lampton said, Japan has to look at China now, too?
JAMES FALLOWS: Sure.
I think everybody -- China will eventually be the largest economy in the world, since it has four times more people than the U.S., but that's going to take a quite a while. And I think there's an appreciation inside Asia of both the strengths of China and the weaknesses, which I think are not as often conveyed inside the U.S.
I think the U.S. press coverage of Obama's trip didn't really get that across too often. So, I think, again, it's a potential advantage for the U.S. to be a partner and a complement, which has some of the strengths that China doesn't have, militarily and in these sort of soft goods and soft power.
And, so, I think it's -- again, it gives us an advantage in dealing with Japan, Korea, Southeast Asia...
JEFFREY BROWN: You know, I can't help but notice, in the news summary, Jim had the story about spying.
JAMES FALLOWS: Yes.
JEFFREY BROWN: So, I mean, these are the kind of things that are happening, we're reporting on every day, as well as talking about the larger issue.
JAMES FALLOWS: Sure. Well, it's true that it's an inevitably complicated relationship in the long run, because China and all of Asia is both a partner and a challenge. And both those things are going to true for a long time.
The rise of Asia
JEFFREY BROWN: Yasheng Huang, you know, it's not the long ago, at the turn of the millennium, we were getting bombarded with all kinds of books and everybody is talking about the century of Asia that was upon us. So, now it's about 10 years later. Where are we at in that?
YASHENG HUANG: Well, before I get to that, let me talk about why China seems to be pushing back the U.S. on the currency issue. And some people interpret this as a signal of strength. China is able to rebuff the United States.
But the simple fact is that China has lost 20 million jobs in the export sector. They really want to protect the export sector to maintain a healthy level of employment. To appreciate, revalue the currency is going to be very detrimental to their employment prospects.
On this Asian century, again, I see the issue as one that is very complex, getting China involved in the global network of trade and foreign investment, rather than -- I mean, I agree with David that there is a competitive angle to all of that, but the competition is mainly about economic competition, trade, and investment, rather than political and military competition.
So, I don't really see the Asian century as one in which China rises up, challenging the United States' political leadership and military leadership. That may happen, you know, 20 years and 30 years from today. But it has not happened until today.
JEFFREY BROWN: What do you see? Where are we now?
DAVID LAMPTON: Well, I think, you know, we, about 15 years ago, had the China-is-going-to-collapse series of books, and now we have got a China-rules-the-world series of books coming out.
I think the next headline is really going to be, this is a very complicated relationship, both not only with China, but with Asia, that we have diversified interests. The United States is going to have to listen. We are somewhat of diminished dominance in the world and in Asia.
We're going to have to give and take. And there going to be plenty more presidential trips to Asia and elsewhere, where we have to do as much listening as talking.
JEFFREY BROWN: You know, he's going back 15 years.
I remember, 20 years back, when we were first talking about Japan...
JAMES FALLOWS: Right. Right.
JEFFREY BROWN: ... because you were reporting on Japan.
JAMES FALLOWS: Yes.
JEFFREY BROWN: That's when Japan was taking over the world.
JAMES FALLOWS: Yes. And Japan has a very, very different economic model from China's. And many of the rigidities in Japan's system have come back to haunt it. You know, its financial system is still a mess 20 years later.
China is a much more flexible system than Japan is. And the pragmatism and adaptability of the communist regime is something to marvel at. But, again, the problems they have with 500 million or 600 million peasants still there, environmental disaster really they're just courting all the time. So, I think it's going to be a very close-run thing for China to keep its momentum going.
JEFFREY BROWN: And it's -- the other countries in the region are watching that as well.
JAMES FALLOWS: Oh, yes. And they're all affected by it, too, since that has become a more -- you know, Japan is still the second-largest economy many the world, often forgotten, but China is rising and affects all on its periphery.
JEFFREY BROWN: All right, James Fallows, David Lampton, and Yasheng Huang, thank you all very much.
DAVID LAMPTON: Good to be with you.
JAMES FALLOWS: Thank you.
YASHENG HUANG: Thank you.