The Lexus Runs Over the Olive Tree

Confucius was asked, “What say you of the remark, ‘Repay enmity with kindness?”’ And he replied, “How then would you repay kindness? Repay kindness with kindness, and enmity with justice.” Lun Yu (The Book of Analects).

A few years ago, Thomas L. Friedman penned a book about globalization entitled The Lexus and the Olive Tree. The title embodies a metaphor. The Lexus represents the wealth and prosperity brought on by the relentless forces of markets, capitalism, and free trade associated with globalization. The olive tree represents “everything that roots us, identifies us, and locates us in the world … a family, a community, a tribe, a nation, a religion or, most of all a place called home.” The olive tree can represent the values and institutions we wish to nurture with the wealth represented by the Lexus.

While wealth and connectedness symbolized by the Lexus and the olive tree can both be part of a healthy society, the forces of global markets often bring these values into conflict. The economic and regulatory walls erected by societies to protect communities and cultures make it difficult to partake in the growth and wealth production made possible by global markets. Modern markets depend on rapid communications and travel and the free flow of trade and capital. To reap the benefits of globalization requires that societies open themselves up to the world. Openness and market transparency are important values, but they can also overwhelm local cultures as McDonald’s restaurants, Disney World, and the cell phones replace local cultural symbols and practices. What pleases global markets is not always what is culturally, morally, or religiously uplifting.

Nonetheless, globalization is a moderating influence between nations. Economically interdependent nations entwined in trade are less likely to begin wars with each other. Even the forces of nationalism and cultural exclusivity, values associated with the olive tree that sometimes lead to war, are often modulated by economic imperatives. War is bad for business.

Those who support free trade with a brutal authoritarian regime like the People’s Republic of China (PRC) do so with the faith, borne out by some empirical evidence, that the requirements of global trade, the rule of law, financial accountability, and open communications, serve to undermine the Communist regime there. Even though authoritarian structures may appear solid on the surface, economic freedom eats away at the foundation of authoritarian regimes.

Others are less sanguine about the salutary benefits of trade. They recall Lenin’s prediction that the capitalist will sell you the rope with which you will hang him. However, the regime that Lenin begat is as dead as he is. It turns out that people are not particularly anxious to hang people with whom they can conduct profitable business.

In an important way, last week’s release of the 24 American crewmen from the reconnaissance plane, which was forced to land after a collision with a Chinese fighter jet, is evidence of the effect of trade. If the United States and the PRC were not engaged in extensive trade, the 24 crewmen would probably still be in China. When the North Korean government seized the reconnaissance ship the USS Pueblo in 1968, they held the crew for eleven months. Of course, the North Koreans to this day have an impoverished and insular economy. There was little economic incentive for the North Koreans to be accommodating.

In this case, the Chinese government realized that a prolonged incident would decrease the likelihood they would be admitted to the World Trade Organization. The US represents a large fraction of the export trade of China. If this trade were reduced it could cause economic turmoil in the PRC, which in turn could lead to political instability. It is probably not entirely coincidental that the day before the crewman were released Kmart informed the Chinese that American consumers were intent on boycotting goods from China.

By the same token, the US reaction was also modulated. Part of the restraint on Americans was the fact that the PRC held Americans in custody; part was an unwillingness to see the matter escalate to the point of affecting trade. Many of us Americans love commerce more than we hate communism.

Although we did not explicitly apologize, we said “very sorry” in such a way that the Chinese could deliberately misinterpret it as an apology. The US got the crewmen back through the use of what diplomats call “constructive ambiguity.” The imperatives of globalization overwhelmed other considerations. The Lexus mowed down the Olive Tree.

However, it is in the American parochial interest and in the interest of international trade and global economic prosperity if this incident is not simply forgotten in the service of economic amicability. Lawlessness and mendacity are not appropriate character traits of those who wish to be part of the world economic community. As Jim Hoagland of the Washington Post pointed out the lie that the American’s caused the plane collision “is a reflexive act of pride and pride is driving force for [the Chinese President] Jiang as he draws an even clearer line in the sand for Bush.” Trade may have restrained China’s hand, but the PRC is still intent on politically dominating the Pacific region.

Now that the American crewmen rest comfortably on American soil, the PRC government, particularly the Chinese military whose incompetence and intransigence was the cause of the aircraft collision and protracted detention of 24 Americans, needs to learn there are importance consequences to unlawful behavior. A price needs to be extracted so that similar actions by the Chinese in the future are discouraged. However, using trade as a weapon may be counterproductive, harming the Chinese people as opposed to the Chinese government. We want to drive a wedge between the Chinese people and their government, not push them together in common cause.

First, Americans should resume reconnaissance flights along the same flight paths they previously used. At least in the near future, we should devote the resources necessary to accompany to the aircraft with fighter escorts. The Chinese should be warned they within a mile of these reconnaissance it will be considered an attack on the plane and defensive action will be taken. The right to fly in international airspace needs to be asserted if it is to be maintained. International bullies should not be accommodated.

Secondly, the US needs to sell Aegis cruisers to the Taiwanese. The anti-missile defenses of the ships will partially offset the buildup in southern China of missiles capable of reaching Taiwan. Moreover, it must be privately made clear to the Chinese that the decision to make the sale was cemented by their illegal actions.

Globalization has made the world safer. However, the world is not yet given over entirely to commercialization. Sometimes more traditional responses remain necessary.

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