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108 September 26, 1990

HOW TO IMPROVE THE U.S.-JAPAN SECURITY ALLIANCE

UMODUMON

The United States-Japan military alliance is being strained. Declining Cold-War tensions between the U.S. and the Soviet Union and rising economic competition between the U.S. and Japan are placing unprece- dented pressures on it. Rather than receding in importance in the post-Cold War world, this alliance may become more important to Japan and the U.S. as the basis for long-term stability in Asia and expanding bilateral political cooperation. The Pentagon rightly calls this alliance the linchpin of American strategy in Asia. Under the 1960 Mutual Defense Treaty, the U.S. is committed to defend Japan, while Japan provides bases for American forces. Under pres- sure from Washington, Japan steadily has increased the size of its defense for- ces over the past decade. Japan now deploys more destroyers, frigates, and anti-submarine warfare aircraft in the Far East than does the U.S. Tokyo pays about $2.4 billion, or 40 percent, of the annual cost of maintaining the 50,000 American GIs based in Japan. Slow in Gulf Crisis. Japan, however, can do more - much more. This has been made dramatically clear by the current Persian Gulf crisis. Though the Gulf provides Japan with 70 percent of its oil needs, compared with only 10 percent of America's oil needs, Japan has been agonizingly slow to contribute to the joint effort to restore peace and stability to the Gulf. Only after one ' month into this crisis, and after much American pressure, did Tokyo agree to spend up to $1 billion to extend logistical support to the multinational forces in the Gul& send 100 Japanese medical personnel to the Gulf, and give emer- gency aid to countries like Egypt and Turkey. This should be only the first installment of a contribution that must reflect Japan's economic stake in Mid- dle East peace. Tokyo should be contributing at least $500 million a month. Tokyo should realize that its response to the Gulf crisis will affect future U.S. support for its alliance with Japan. Beyond the Persian Gulf crisis, Japan can afford to pay more to support American forces in Japan, purchase more American-made weapons, and im- prove its own defense logistics, communications, and air defenses. Reversing Defense Technology Flow. Japan also can improve its defense relationship with America by allowing U.S. access to Japanese technology with defense applications, like advanced semiconductors and fiber optics. This will help reverse the largely one-way flow of defense technology from America to Japan, which in part sparked U.S. congressional criticism last year of a 1988 agreement that allows Japan to work with American firms to produce the next-generation fighter for Japan's Air Force, known as the Fighter Support-Experimental (FS-X). In addition, as the U.S. military commitment to oppose Iraq grows, Japan also should be ready to provide financial support for Egypt and Turkey, key allies in containing Iraq. Japan should also consider substantially funding any post-conflict peacekeeping forces. An effective U.S.-Japan defense alliance Will continue to be necessary to ensure Asian stability. From Japanese bases, American forces are better able to deter Asian-based Soviet forces than from the American bases in South Korea. Japanese bases also will be critical to any U.S. effort to resupply South Korea should it be attacked by North Korea. Most important, perhaps, the U.S.-Japan alliance reassures the rest of Asia, where animosity toward and fear of Japan runs understandably high stem- ming from Japan's aggression and harsh occupation during the 1930s and 1940s. For one thing, the alliance directly affects the way that the Japanese improve their military capabilities. American Shield. For another, the alliance protects Japan with the American shield, thus giving Japan no reason to expand its military might to the extent that would be needed if it were Japan!s only protection. Without the alliance with America, Japan might feel compelled to launch the kind of large scale military build-up that would defend Japan but would terrify its Asian neighbors, thus destabilizing Asia. Japanese leaders realize that a rearmed Japan is neither in their country's interest nor that of its neighbors. Furthermore, the U.S.-Japanese alliance is the basis for American- Japanese cooperation in other areas, such as scientific research, finding a set- tlement to the Cambodian conflict, and aiding the Philippine economy. This alliance, for all its good, nevertheless is under strain. Declining U.S. defense budgets and Japan's stubborn denial of access to American business in Japan's industrial and service markets undermine support in America for the alliance. These strains could be increased by Japan's apparent reluctance to support materially U.S. efforts to oppose Iraq. If such strains continue, they could prompt an agonizing reappraisal of whether America should keep troops in Japan. As such, Washington must continue to press Tokyo to dis- mantle its non-tariff barriers to U.S. businesses and further reduce its $49 bil- lion trade surplus with the U.S. The Bush Administration plans to reduce the 50,000 U.S. military person- nel in Japan by 5,000 to 6,000 over the next three years. These reductions are budget driven. But it is critical to both countries that U.S. forces in Japan should be sufficient to deter potential Soviet aggression in the region and to assist in protection of sea lines of communication from Southeast Asia to the Persian Gulf. To further strengthen the U.S.-Japan alliance, the Bush Ad- ministration should: * * Stress to Japanese leaders and the U.S. Congress that a strong American-Japanese alliance must be preserved as a critical element of stability in Asia. * * Press Tokyo to increase foreign assistance to Egypt and Turkey, and to pay at least $500 million per month as Japan's fair share of the costs of the Persian Gulf peacekeeping forces. * * Urge Tokyo to complete the structural reforms that it has promised in the recent Structural Impediments Initiative (SH) agreement to remove the barriers in the Japanese market which contribute significantly to the chronic American trade deficit with Japan (in Western Europe, where such barriers do not exist, America enjoys a trade surplus)-, * * Praise Tokyo for improving its defense over the past decade, but tell Tokyo that further improvements are needed in base defense, military com- munications, and logistic support. * * Urge Japan to increase long-term support payments for American for- ces in Japan from 40 percent to 75 percent, out of a total cost of about $7.5 billion, by the end of the decade. Improve U.S.-Japanese military cooperation by increasing the number of bilateral and multinational military exercises involving Japan. * * Obtain greater access over the next eighteen months to defense-re- lated Japanese technology in computer science, missile guidance systems, armor-piercing shells, and laser technology. * * Urge Japan to increase greatly its off-the-shelf purchases of U.S.- made weapons and seek co-development of new weapons systems.

1 See also Roger Brooks, 'Me Next Step in U.S.-Japan Trade Relatim@ Heritage Foundation Backgrounder Updae No. 06, July 27,1990.

ASUN THREATS REMAIN

While Cold War tensions appear to be easing in Europe, political and military challenges in Asia continue to make the U.S.-Japan alliance a strategic necessity for both countries. Moscow remains the dominant military threat in Asia even though Soviet leader Mikhail Gorbachev has promised to reduce Soviet forces in Asia by 200,000 by 1991. In addition, he has withdrawn some Soviet naval and air forces from Vietnam's Cam Ranh Bay. These Soviet reductions, however, appear to exempt the Soviet military dis- tricts nearest to Korea and Japan. A Pentagon strategy report on Asia prepared for Congress and issued in April notes that in areas near Japan "Soviet capabilities still appear to far exceed those needed for defense."I For this reason, presumably, Japanese officials remain skeptical about Soviet military cutbacks. 3 Principal Soviet wartime military objectives in Northeast Asia likely would be to gain control of the Sea of Japan and the Sea of Okhotsk to deploy the Soviet Pacific Fleet's 34 ballistic missile submarines. The Soviets also will seek to prevent control of Pacific Ocean sea-lanes by Japanese and U.S. naval forces beyond about 500 miles from Japan, and to deny control of the Straits of Tsushima, Tsugaru and La Perouse to Japan.4 Powerful Soviet Forces. Of the 51 Soviet Army divisions in Asia, about 26 divisions, with absut 260,000 men, are in the Far East military district near Korea and Japan. These appear to be exempt from Gorbachev's promised reductions. Soviet Air Force units near Japan are being upgraded with new fourth generation fighter aircraft like the MG-29 Fulcnim and Su-27 F7,anker. These are regarded as similar to America's F-15 Eagle and F-16 Falcon fighters based in Japan. About 85 Soviet Tu-26 Backfire bombers are in this region, as are increasing numbers of Tu-95H Bear strategic bombers. A recent Japanese Defense Agency study states that by the mid-1990s, elimination of obsolete ships may reduce the Soviet Pacific Fleet by 27 per- cent. This report cautions, however, that owing to steady Soviet fleet modern- ization, the proportion of nuclear-powered submarines in the Soviet Pacific Fleet may rise from 55 percent to 75 percent, and missile-carrying com- batants will increase from 71 percent to 87 percent of Fleet strength.6 This Fleet now includes two Mev-class anti-submarine aircraft carriers, 77 other large combat ships, and nearly 120 submarines. By the mid-1990s, it is pos-

2 Department of Defense, A Svxe#c Framewarkfor the Asian Pacific R&n: Looking Toward 7he 21st Century, April 1990, p. 3. 3 "USSR Asked for'Proofof Military Scaledown@ Kyoda, Tokyo, May 22,1990, in FBIS, EastAsia, May 23, 1990, p. 8. 4 SoWet Mifitoy Power, pp. 113 to 117. 5 "A Strategic Framework...,"op. cit., p. 5; Defense AgencyWhite Paper, published as Defense ofJapan 1989, by Japan Timesincorporated, p- 38- 6 Kensuke Ebata, "Japan predicts Soviet cuW Jane's Defence Weekly, June 16, 1M, p. 1199. sible that the Soviet Pacific Fleet will receive a Tb&i-class nuclear-powered aircraft carrier, which may carry 60 to 65 modem fighters like the MiG-29 Fulcrum or Su-27 Flanker. Uncertain Soviet Intentions. Japan and the Soviet Union have yet to sip a peace treaty ending their World War H hostilities, primarily because Moscow continues to occupy Japan's Northern Territories, the islands of Etorufu, Kunashiri, Shikotan, and a smaller group called the Habomais. Tokyo wants these islands returned, but the Soviets refuse. For Moscow, these islands provide air and naval bases that complete a defensive "bastion" in the Sea of Okhotsk, which provides safe haven to Soviet ballistic missile submarines@ The Soviets heavily have fortified the Northern Territories and nearby Sakhalin Island with troops, artillery, and fighter aircraft.' This March, the Soviets held a large military exercise near Sakhalin Island involv- 9 ing 130 aircraft that simulated attacks on aircraft carriers. Gorbachev's need for Japanese trade and investment and Japanese leaders' desire to assist Gorbachevs reforms have prompted a flurry of diplomatic activity, including visits by several prominent Japanese leaders to Moscow and Soviet officials to Tokyo. Most recently, Soviet Foreign Minister Eduard Shevardnadze visited Tokyo from September 5 to 7. These visits cre- ate the impression that Japan and the Soviet Union desire a solution. Pre- vious Soviet statements, ho we ver, have indicated that Moscow is not willing to return territory to Japan. But on September 7, Shevardnadze indicated Moscow was willing to negotiate about the future of the islands." Tokyo will not give any economic aid to Moscow until the dispute is settled.12 If Gor- bachev has a proposal, it may not be revealed until he visits Japan next year. Additional Challenges. Even if the Soviet threat in Asia diminishes, the U.S.-Japan alliance is essential to enable both countries to meet other poten- tial security challenges. One possible threat is war on the Korean Peninsula. Despite the very slight thaw in relations between North and South Korea, the unpredictable and volatile North Korean government retains one million men under arms, and reports persist that Pyongyang may acquire nuclear weapons within five years.13 Another threat to peace could arise if China pur- sued its territorial claims over most of the South China Sea.

7 ]bid., p. 45. 8 Edward Neilan, "Soviets reftw to cut forces on 4 islands," Washington 77unes, December 22,1988. 9 "Japan boosts defense in north to ward off any threat by Soviets," Washington 77unes, May 9, 1990, p. A7. 10 "Says No Soviet 'Land To Spare," Kyodo, Tokyo, June 9,1990, in FBIS, EastAsia, June 11, 1990, p. 1. 11 David E. Sanger, "Soviets Say Dispute on 4 Islands Can Be. Negotiated With Japan: New Yoyk 771mes, September 8, 1990, p. 1. 12 David E. Sanger, "Tokyo Leader Bars Aid to Soviets Until Settlement of Island Dispute,"New York 7-unes, July 7,1990, p. 1. 13 "The Yongbyon Puzde,"Asiaweek, March 9, 1990. p. 17; Joseph S. Bermudez@ Jr., "N Korea -set to join the 'nuclear dub?," Jane's Defence Weekly, September 23,1989, p. 594. American and Japanese interests also might be threatened if India sought to expand its military influence beyond the Indian Ocean to Southeast Asia. And certainly, the American-Japanese alliance provides a forum for Japan to help counter aggressors, like Saddam Hussein in the Persian Gulf, who threaten the West's access to oil.

JAPAN'S IMPROVED SELF-DEFENSE FORCES

Despite unique political constraints, the Japanese Self-Defense Forces QSDF) have been improved steadily during the 1980s. Japan's Constitution, written during the U.S. occupation after World War IL renounces "the threat of force as a means of settling international disputes" and the acquisition of military strength amounting to ",war potential." This Constitution has been in- terpreted by most Japanese as prohibiting Japan from obtaining "offensive" weapons systems like intercontinental ballistic missiles and aircraft carriers, and has ingrained pacifism deeply in Japanese society. There is strict civilian control of the JSDF; for example, the highest-ranking JSDF officer, the Chairman of the Joint Staff Council, is not a member of Japan's National Security Council. The Ministry of Finance and the Foreign Ministry often have more power over military procurement decisions than does the JSDF. In the 1980s, Tokyo's eVansion of its defense roles came in response to new military minions adopted byTokyo at Washington's urging. These in- clude the 1981 decision by then-Prime Minister Zenko Suzuld to.defend Japan's sea-lanes out to 1,000 miles. This led to the 1986 decision of his suc- cessor, Prime Minister Yasuhiro Nakasone, to raise defense spending above what had been a politically sacrosanct level of I percent of gross national product. As a result, last year Japan spent 1.01 percent of GNP on defense, or $27.15 billion? Tokyo's defense expansion can be measured more in quality; the quantity of Japan's defense forces have not increased much beyond levels mandated in 1976. Between 1981 and 1989, Japanese defense forces grew only slightly in major categories: personnel, from 243,000 to 247,000; tanks, froV00 to 1,200; major warships, from 50 to 63; combat aircraft, from 350 to 362. Upgrading Air and Sea Power. The qualitative improvements in Japan's defense forces include the purchase of nearly 200 F-15 Eagle fighters in the last ten years, the best American fighter, and the modernization of 100 older F-4 Phantom fighters. The F-15s replaced 1950s-vintage F-104 Starfighters. Japanese Navy improvements include increasing the number of major war-

14 This figure is misleading given the decline of the dollar versus the Japanese yen. H 1985 dollar-yen rates are used for calculations, Japanese defense expenditure is currently about S16 billion, compared to just under $14 billion for M, seeWilliarn M. Carpenter and Stephen P. Gi1xftAgm&fbrEastAsia, United States Global Strategy Council, May 1989, pp. 80, 102. 15 international Institute for Strategic Studies, reprinted inTai Ming Cheung, -Self-defense and beyonC Far Eastem Econornk ReWew, December 21,1989, p. 29. ships from 50 to 60, almost three times as many as the U.S. 7th Fleet, which is based in Japan; acquiring three or four destroyers with the AEGIS phased- array radar; and increasing from 60 to 100 the number of P-3C Orion antisub- marine warfare aircraft, about four times as many as the U.S. 7th Fleet has. 16 The P-3 replaced the older, less capable P-2 Neptune. By the late 1990s, Japan's Air Self-Defense Force is slated to receive over 100 FS-X support fighters, now being co-developed by Mitsubishi Aircraft Inc., in Japan, and General Dynamics Corporation; it is based on the General Dynamics F-16 Falcon fighter. The 153,000-man Japanese Ground Self- Defense Force (JGSDF) is acquiring 600 new Japanese produced Type-90 tanks, armed with a West German-designed 120mm gun, U.S. designed AH-1 Cobra anti-tank helicopters, and domestically produced SSM-1 anti-ship mis- siles. In the 1991-1996 defense plan, now being drafted, Japan may purchase mid-air refueling aircraft, AWACS radar aircraft, and an "Over-the-Horizon" long-range radar system. Japan also has created a large defense industry, which can build modem weapon systems.japan builds 99 percent of its warships and 80 percent of its Army weapons.1-7 Most American-designed weapons used by the JSDF, like the F-15 Eagle and F-4 Phantom, are co-produced in Japan, but at far greater costs than in the U.S. Even Japanese-designed weapons, like the Type-90 tank, cost three times the current U.S. M-1 tank, but are only slightly better than the U.S. tank. Increased Japanese R&D. At the urging of the Keidanren, the major Japanese business association, spending on defense-related research and development has been climbing. It is expected this year to reach 2.5 percent of Javan's defense budget, or about $1.2 billion, up from 1.5 percent in 1984@8 Mlis amount pal es in comparison to the near $10 billion the U.S. spends on military research and development. However, there is concern by some in the U.S. that a self-sufficient Japanese military industry might lead to Japanese defense policies that increasingly would be independent of Washington.19 Increased military industrial cooperation between Japan and the U.S., on the other hand, might help prevent military-economic pressures from cgtributing to political cracks in the American-Japanese military al- liance.

16 James E. Auer, 'Japan's Defense Policy," Current Histwy, April 1988, p. 147. 17 Tai Ming Cheung, "A yen for arms@ Far Eastern Econornic ReWew, February 22,1990, p. 58. 18 "Tokyo Wants Its Arsenal Made In Japan,"Businas Week, September 25,1989, p. 64. 19 Kevin L. Kearns, 'A Case For The Preservation Of The U.S.-Japan Security Relationship,"Asaki Monthly Magazine, May 1990. 20 Kearns; Dov Zakheini,"Japan!s Emerging Military-Industrial Machine,"NewYoric 77unes, June, 27,1990, p. A23. Despite its recent improvements, the JSDF suffers from insufficient war- time supply stocks and logistical support. Ammunition stockpiles are enough for only a few days of combat, and reserve forces number less than 50,000. The Japanese Navy lacks the support ships to fulfill its mission of defending sea-lanes out to 1,000 miles. In addition, military facilities throughout Japan are very vulnerable to attack. The JSDF's low pay hampers recruiting; as a result, the Army is about 14 percent below normal strength. 21 A lack otlive- fire training also raises doubts about the JSDF's wartime effectiveness. zz The next five-year d gense plan is expected to address deficiencies in the logistic support system. Nationalist Urging. In addition to the constitutional constraints on the JSDF, Japanese leaders often have reaffirmed that Japan does not seek to be- come a military power. Rejecting this are nationalists like Diet member Shin- taro Isnara, who urges Japan to build a defense capability independent of the U.S. Though Ishihara's views are far from mainstream, they prompt con- cern by some Americans that Japan eventually may seek military power com- mensurate with its economic power. To do so, Japan would need a large power-projection capability and nuclear weapons. For the foreseeable future this is very unlikely. The desire by some in the Japanese Navy to build small antisubmarine aircraft carriers, like those used by the British Navy, is viewed as a sign that Japan also may want to expand its Navy. Yet, building small aircraft carriers would trigger sharp political opposition. And building a large aircraft carrier, necessary for a world-class naval capability, would be only slightly less dif- ficult politically than building nuclear weapons. Rather than increasing its defense outlays, it is more likely that Tokyo will face political pressure to cut back defense spending 2gs the Soviet global threat recedes and the U.S. cats its defense budget. The Japanese Ground Self-Defense Force reportedly is planning a cutback of 10,000 to 20,000 men?6 Increased defense spending also will be opposed by Japan's opposi- tion parties, which last year won control of the Diet's upper house.

21 Tai Ming Choung, p. 26. 22 GA. Rubinstein and LO'Connell, "Japan's Maritime Self Defense, 1990,"Naval Forces, No. 2 (1990), p. 84. 23 Mainichi Shirnbun, May 8,1990, p. 1. 24 Shintaro Ishihara, "Security treaty as viewed Erom Japw Washington 771mes, June 20,1990, p. Fl. 25 David E. Sanger, "For Japan's Military, Some Second Thoughts About Where the Enemy Is,"New York 7"Imes, July 31, 1990, p. 3. 26 "Reduction in Ground Self-DefenseTroops PlanneCSankeiShbnbun, April 28,1990, p. 1.

THE U.S.-JAPAN DEFENSE PARTNERSH[P

In several interviews inTokyo last July, government and military officials told The Heritage Foundation that Japan cannot defend itself against nuclear threats and distant threats to Japan's economic security. As such, thes@ offi- cials regard the alliance with the U.S. as essential for Japan's defense. 27 The Pentagon calls the U.S.-Japgri relationship the "critical linchpin" of American strategy -in AsiO Ile geostrategic location of Japanese bases al- lows the U.S. quickly to contain Soviet forces in Northeast Asia. Japanese bases are also a critical link in the network of U.S.-led alliances that preserve stability in Asia. Example: its Japanese bases enable the U.S. to reinforce its forces in South Korea quickly and provide logistic support for U.S. naval deployments to Southeast Asia and the Persian Gulf. U.S. forces in Japan include the 5th Air Force headquartered at Yokota Air Base, which includes two tactical air wings, together comprising about 160 aircraft. Ile 7th Fleet is headquartered in Yokosuka. Ile Fleet deploys the aircraft carrier Midway (which is to be replaced by the Independence in 1991), about eight escort ships, three attack submarines, and three am- phibious transport ships. Ile 3rd Marine Expeditionary Force is based in Okinawa; it includes one division and an air wing. The U.S. Army's 9th Corps, based at Camp Zama, primarily is responsible for logistic support. Enhanced Cooperation. In recent years, U.S. and Japanese military cooperation has been enhanced by: increasing the number of joint studies on defense plans, operations, and sea lanes defense; ensuring that Japanese and American military equipment is compatible; and improving and expanding military exercises. Japanese naval forces, for example, participate in the bian- nual RIMPAC (Rim of the Pacific) exercises, which include other Asian al- lies like Australia and South Korea. Ile most recent RIMPAC exercise was this spring. Tokyo has increased its support for the 50,000 U.S. military personnel in Japan. Support payments in 1989 amounted to $2.4 billion, or about 40 per- cent of the cost of maintaining U.S. troops. This is the most generous military support payment the U.S. receives from any of its allies. West Germany has paid about the same amount of dollars to support about five times as many U.S. troops that are based in West Germany. American officials believe that Japan can pay more, perhaps as much as 50 percent of total support costs, or about $3 billion. Contributing to Japan's Defense. But by the end of the decade, however, Japan can pay much more, as much as 75 percent of the total cost of maintain- ing U.S. troops in Japan. This contribution to maintaining U.S. forces in Japan recognizes that it would be awkward for Japan directly to offset the

27 This view is Aw eVrewd in LWense ofJapan, 1%9, p. 85. 28 Sbwqic Framework, p. 6. costs of the 7th Fleet, as well as U.S. troops in Korea and the Philippines, which also contribute to Japanese security. Japan already implicitly recog- nizes the contribution of U.S. forces in the Philippines to its security by giving generous foreign aid to the Philippines. The Bush Administration should continue to press Japan to increase its sup- port payments for U.S. forces. Pressure to cut the U.S. budget and pressure from the Congress have prompted military cutbacks in Asia. The Pentagon al- ready plans to cut 14,000 to 15,000 of the 135,000 military personnel in A2sia 9 by 1993. Cutbacks in Japan probably will reach 5,000 to 6,000 personnel . Further unspecified reductions are also planned by the Pentagon. The initial cutbacks of U.S. forces in Japan will not result in a significant reduction in U.S. capability in the region. But U.S. defense officials caution that future reductions may result in decreased U.S. capability unless they are made in conjunction with Soviet military reductions in the region.

IS T11IS ALLUNCE STILL NECESSARY?

Some in the U.S. suggest that the American security relationship with Japan has benefited Japan far more than the U.S. For example, Selig Har- rison, a Senior Associate at the Carnegie Foundation for International Peace, and Clyde V. Prestowitz, Jr., President of the Economic Strategy Institute, complain that the estimated $40 billion a year the U.S. spends to maintain defense foros in Asia reduces America's ability to compete economically with Japan.3u Others suggest that a "strategic divorce," in which Japan ends its militarily subordinate relationship to the United States, and perhaps achieves military pre-eminence in Asia, is necessary to avoid further ten- 31 sion. 71bese critics ignore the fact that the U.S.-Japan alliance allows Japan to im- prove its military forces without threatening its neighbors. Should the Soviet threat further recede, the United States and Japan then become the most powerful coalition in Asia. Political stability in Asia will then depend on the military and economic power of this coalition. In addition, it is far from cer- tain that U.S. military cutbacks in Asia will translate directly into savings at home or increased U.S. economic competitiveness. American political in- fluence in Asia rests largely on its strategic alliance network, in which Japan plays a central role. But if trade friction between Japan and the U.S. increases, then American support for the military alliance with Japan may decrease to the point where the U.S. painfully reassesses its security commitments to Japan. 7bus, the

29 Svwegc Frwnework, p. 18. 30 Selig S. Harrison and Clyde V. Prestowitz, Jr., 'Pacific Agenda- Defense or Economics?,"Foreign Policy, Summer 1990, p. 56. 31 Ronald A. Morse and Alan Tonelson, "Let Japan Be Japan,"New Yont 77una, October 4,1989. Bush Administration must convinceTokyo to open its markets to American business just as the U.S. market is open to the Japanese.

TESTING THE ALLUNCE IN THE PERSUN GULF CRISIS

The Persian Gulf crisis will test the worthiness of the U.S.-Japan alliance to both partners. The U.S. has done its share by committing over 100,000 American troops to deter further Iraqi aggression. Washington is correct to expect Japanese assistance commensurate with Japan's economic stake in Middle East stability. Japan depends on the Middle East for 70 percent of Japanese oil needs. Japan has supported the United Nations embargo against Iraq, and has promised to send 100 medical personnel to the Persian Gulf and has pledged to spend $1 billion for transporting supplies and underwrit- ing trucks and housing to American military forces in the Gulf. Yet this sup- port is a pittance for a nation of Japan's wealth. Japan's small contribution was called "contemptible tokenism"on September 10 by Senator John Mc- Cain, the Arizona Republican. McCain also called for Japan to assume half the costs of the Persian Gulf Operation Desert Shield and said, "We sincerel want Japan to shoulder the international responsibilities of a great state ...... 31 Frustrated Congress. Further U.S. congressional resentment was ex- pressed on September 12, when the House of Representatives voted 370 to 53 to pass an amendment to the Defense Department authorization bill call- ing on Japan to assume the full cost of stationing U.S. troops in Japan.33 Fol- lowing this criticism, Tokyo announced that it would contribute an additional $3 billion: $2 billion for assistance to frontline states like Egypt gpd Turkey, and $1 billion more to support the multinational military effort. This brings to $4 billion Japan's pledges to support the states trying to contain Iraqi ag- gression. The Japanese have hotly debated whether they can send military forces to support allied troops in the Persian Gulf. After the suggestion by the Pen- tagon that Japan send some military forces to the Gulf, the government of Prime MinistgrToshild Kaifu decided that doing so would violate Japan's Constitution. .5 To get around the constitutional restrictions, some in Japan's ruling liberal Democratic Party now propose to create a "Peace Cooperation Corps" to provide medical, transportation, and communication support to United Nations peacekeeping forces. But other LDP members, like Foreign Minister Shintaro Abe, oppose this idea as a half-way measure and want to send Japanese troops to the Gulf.

32 Congressional Record, September 10, 1990, p. S 12692. 33 Dan Morgan, 'House Votes Troop Pullout From Japan," Washington Post, September 13,1990, p. A10. 34 Steven R. Wiseman, "Japan Defends Aid To U.S. In Mideast,"New York 7-unes, September 14,1990, p. Al. 35 Steven R. Weisman, "Japan Sending Off-Road Vehicles for Military Effort in the Gulf,"New York 771mes, September 3,1990.

If Tokyo is unwilling to contribute military forces to the Gulf, Washington should urge Japan to make alternative contributions. Specifically, the Bush Administration should urge Japan to: Offset at least $500 million per month of the cost of deploying American peacekeeping forces in the Gult This could be in the form of airlift- ing and sealifting U.S. military personnel and equipment or by paying for the transport of that equipment. Quickly disburse its pledged economic assistance to Egypt and Turkey, key countries whose economies must be kept stable so they can assist in containing Iraq. This should then enable the U.S. to reduce its economic as- sistance to those countries. Use civilian airliners and ships to transport supplies to U.S. and al- lied forces to the Gulf. This does not exceed Japan's constitutional limits on the use of its military forces overseas. Substantially fund any post-conflict peacekeeping forces mandated by the United Nations.

INCREASING DEFENSE TECHNOLOGY COOPERATION

Just as important, Tokyo can reverse the nearly one-way flow in defense technology. Since the 1950s, this flow has been from America to Japan. Ex- ample: Japan has co-produced under license major U.S. weapon systems like the F-15 Eagle jet fighter. In the 1989 dispute over the co-development of Japan's FS-X support fighter, many members of the U.S. Congress expressed concern that transfer of U.S. defense technology, based on the design of the F-16 Falcon fighter, could increase Japan's industrial competitiveness. Whether or not these congressional concerns were warranted, they exposed the unacceptable one-way flow of technology transfer. Because of congres- sional pressure, provisions of the FS-X agreement allowing greater U.S. ac- cess to Japanese technology were strengthened. The agreement provides the U.S. access to Japanese technology used to improve the aircraft, like com- posite material wings and miniaturized phased-array radars. The final FS-X agreement should be the model for U.S.-Japan defense technology cooperation. While the experience of the FS-X dispute has made Tokyo reluctant to consider co-development projects as large as FS-X several Japanese defense and government officials suggested to The Heritage Foundation last month, duringTokyo discussions, that Japan is willing to proceed on much smaller defense co-development projects, such as com- ponents of surface-to-air missiles. Slow Progress. In addition to co-development agreements, Tokyo should meet Washington's requests for U.S. direct access to Japanese technology that has defense applications. In January 1983, Tokyo exempted tran fer of military technology to the U.S. from Japan's ban on weapons exports. This led to a November 1983 agreement designed to achieve such transfers. Progress, however, has been slow. This February, for example, Washington asked for ac- cess to Japanese developments in large scale integrated semiconductors, gal- lium arsenide semiconductors@ fiber optics, phased-array radars, composite materials, and biotechnology. Tokyo has yet to give its okay. Japan, however, seems more willing to agree to a U.S.proposal to conduct joint research on missile en!Qes, magnetic field analysis, missile guidance systems, and anti- tank shells. To improve the process of defense technology transfer from Japan to the U.S., the Pentagon must make the acquisition of Japanese defense-related technology a top priority. Primarily responsible for this is the Office of the Undersecretary of Defense for International Security Programs; it has been vacant since last October. The Pentagon, therefore, has not been able to exer- cise sufficient leadership on promoting technology flow-back from Japan.37 For its part, Tokyo must convince private Japanese companies to allow Washington access to new technology. Strategic Defense Opportunities. Tokyo's 1986 decision to participate in re- search under the U.S. Strategic Defense Initiative (SDI) offers an additional opportunity for the U.S. to increase access to Japanese defense-related tech- nology. Two industrial consortia involving American and Japanese com- panies, one led by Japan's hfitsubishi Heavy Industries and the other led by the TJ.S. UIV Corporation, are conducting research on possible missile defen- ses.38 U.S.-Japan cooperation in SDI eventually should lead to cooperation in establishing missile defenses. For the U.S., such cooperation would be ad- vantageous, given Japan's proximity to Soviet ballistic missile submarine operating areas in the Sea of Japan and the Sea of Okhotsk. Missile defense systems in Japan would be better able to intercept Soviet submarine- launched missiles that might be targeted on the U.S. This July, a Japanese defense official suggested toThe Heritage Foundation the possibility of U.S.- Japanese co-development of a successor to Japan's Hawk anti-aircraft mis- siles. He suggested that the new missile would be able to intercept North Korean ballistic missiles.

HOW TO IMPROVE THE ALLUNCE

The value of U.S.-Japan alliance to each partner can be increased by ad- dressing specific political, economic, and military concerns. To improve the U.S.-Japan alliance the Bush Administration should: * * Stress to the Congress the need to preserve the U.S.-Japan alliance. The Administration should emphasize that Japan's geostrategic location is

36 "DefenseTechnologyTalks Planned With Pentagon,"Nd'm Kea= Slumbun, March 19,1990, p. 2; Kensuke Ebata, "TJSA asks Japan for technolooW Jane's Defence Weekly, Much 24,1990, p. 542. 37 Andy Pazstor and Jacob M. Schlesinger, Titchanges of DefenseTechnologyWith Japanese Plagued by Del4M" Wall Soreffountal, August 13,1990, p. 6. 38 Peter Buhl, -SDI-vital to Japanese industry,' Jane's Defence Weekly, July 15,1989, p. 79. best suited to block Soviet naval forces in the Pacific. Just as important, the al- Hance provides a framework for Japan to increase its self-defense capability without being perceived as a threat by its neighbors. Should the Soviet threat recede further, the U.S.-Japan alliance would become the most powerful coalition in Asia, able to provide military and financial assets that would be necessary to promote long-term stability in Asia. Stress to Tokyo the continued need to press ahead with internal struc- tural reforms that will give American goods and services fairer access to Japanese markets. Japan has promised to raise fines to deter cartels, reduce complexity in the Japanese distribution system, and abolish government restrictions on foreign investment as part of the recently concluded Structural Impediments Initiative (SH) talks. The U.S. must ensure that Tokyo fulfills these promises. Too oftenTokyo makes commitments that it almost immedi- ately ignores. * * Urge Japan to improve the effectiveness of its defense forces. The U.S. should urge Japan to build better base defenses, better communications networks, improve logistic support for naval forces by building more at-sea replenishment ships, and improve realistic training for Japanese forces. These improvements should enhance the JSDF's capability to fulfill its mission of defending its sea-lanes out to 1,000 miles. * * Reduce the number of U.S. forces in Japan only as the Soviet threat in Northeast Asia is reduced. Washington should maintain in Japan the air and naval forces needed to deter Soviet attack In particular, the U.S. should deploy at least one aircraft carrier battle group in Japan, as it gives U.S. military planners the greatest flexibility in responding to future threats. * * Urge Tokyo to increase its off-the-shelf purchases of weapon systems. For example, systems that Tokyo may seek to acquire, like AWACS and tanker refueling aircraft, and additional Aegis naval radar systems, should be purchased in the U.S. These purchases are an important way for Japan to reduce its trade surplus with the U.S. * * Increase the realism of U.S.,Japan military exercises. Only recently, for example, have U.S. and Japanese forces held multi-service exercises in- volving land, naval, and air forces. And only recently have Japanese naval for- ces participated in merchant convoy escort exercises. These exercises are closer to realistic wartime scenarios, and they should be increased.

CONCLUSION

This June 23 marked the 30th anniversary of the 1960 U.S.-Japan Security Treaty.ThisTreaty remains the linchpin of U.S. strategy in Asia.TheTreaty also has provided the defense shield behind which the Japanese economy has prospered enormously. This defense relationship could weaken as the Soviet Union diminishes as a global and regional threat and as suspicion builds in Washington that Tokyo continues to deny access to its markets. If Americans perceive that Japan's support for U.S. efforts in the Persian Gulf is inadequate, the partnership could weaken further. George Bush must tell Prime Minister Toshild Kaifu that a strong U.S.-Japan defense relationship will require continued Japanese economic structural reform, and added Japanese willingness to contribute to opposing global threats, like that now posed by Iraq. Contributing to Global Stability. A strong military alliance can benefit America economically by providing a forum for increased U.S. access to defense technology. Most important, the U.S.-Japan alliance can provide a foram for Japan to contribute to global stability should Cold War tensions recede. But how Japan decides to assist the American effort to stop Iraq now presents the most serious test of the value of this affiance to both partners.

Richard D. Fisher, Jr. Policy Analyst