OBISCO Associates Managing Director Joe O’Brien is an international management consultant based in Little Rock, Arkansas. Toshio Motoya, APA Group CEO, spoke with O’Brien about circumstances leading to Donald J. Trump’s presidency and the potential for future strategic developments in East Asia.
(M) Thank you for joining me on Big Talk. I previously met you during the American presidential election when it was still unclear whether Donald J. Trump or Hillary Clinton would win. I predicted a Trump victory, but you expected Clinton to win because she is a friend of yours.
(O) I lost that bet with you (laughs). Clinton and I are both from Arkansas, so my prediction about the election seems to have been biased.
(M) Have you known Clinton for a long time?
(O) Yes, since 1985. I was thinking about taking my business to Japan and needed trademark protection, so I hired Hillary for that purpose. Some people think of her as a rigid or difficult person, but when I actually met with her, she was customer oriented and professional.
(M) President Barack Obama plunged the globe into chaos by declaring that the United States would no longer be the policeman of the world. The world is now in a new era of imperialism ruled by power, which is exactly why I thought the American people would want a strong president. Republican candidate Trump ended up matching that description.
(O) I believe that Obama meant well, but had an inadequate or near-sighted perspective of global dynamics. As you noted, the perception of strength is required to avoid being out-maneuvered in today’s global affairs. The reasons for Hillary’s loss include: 1) a disenchantment with Obama, 2) frustration of a large segment of the U.S. electorate over the outsourcing of jobs, 3) an overemphasis on political correctness, and 4) she did not connect emotionally to much of the electorate.
(M) Trump also provided most of his own campaign funds. By considering how to win with these limited funds, he used a strategy of rash statements that would be covered in the news and make him more well known.
(O) Yes, Trump started the campaign using his own funds, but as his movement grew, he received significant contributions from the people and from corporate America.
(M) Trump is also thoroughly familiar with the Electoral College, in which candidates must win electoral votes rather than the popular vote, so he focused his efforts on swing states. That is why Clinton won the popular vote while Trump won the Electoral College.
(O) Clinton’s popularity centered on the East and West Coasts. Their fight was close in the so-called “flyover states” between New York and California, specifically Wisconsin, Michigan, Ohio, and Pennsylvania where Trump focused
(M) Trump also effectively repeated his campaign slogan of “Make America Great Again,” which captured the hearts of people left behind by globalism and the online society. His next goal is to be re-elected, so he cannot break the promises he made amidst his rash statements during his campaign. He issued a series of executive orders right after his inauguration because he thought he had to make an effort to keep his promises during his first 100 days, putting aside whether this is possible or not. However, the first 100 days are coming up soon and Trump’s approval rating is falling, so I think this might be the timing at which he switches to a pragmatic approach.
(O) President Bill Clinton’s approval rating in his first 100 days also fell dramatically. Rather than focusing on jobs and economic issues, he focused on changing social policy, such as gender issues in the military and in society at large and a national healthcare reform initiative. Trump’s start was also very rocky due to three reasons: 1) a steep learning curve from having never held public office, 2) the extreme bias of “official” Washington and the media led by The New York Times and The Washington Post, and 3) Trump’s lack of consistency and limited policy knowledge. I think he can make a turnaround with popular policies such as tax reform and improving America’s infrastructure. The turning point could be how much he can improve the outlook for jobs.
(M) I feel that Trump is looking to President Ronald Reagan, who used military expansion to defeat the Soviet Union in an armaments race and end the Cold War. I suspect Trump will also implement military expansion to affect the collapse of China, which has a single-party rule by the Communist Party. The Obama administration cut annual military spending by five trillion yen, weakening its presence in the areas that China has advanced into.
(O) There is a parallel to Reagan in tax reform and emphasis on the private sector rather than government spending. As you say, the Obama administration allowed the Chinese expansion into the South China Sea without confronting China. Unlike Reagan’s policies that brought the Soviet Union to an end, I think China, for better or worse, is here to stay.
(M) I think Trump is correct in trying to redress this situation. Peace is ensured by a balance of power and destroyed by war. If Trump is in office for two terms (eight years), the next four years will overlap with the nine years of Prime Minister Shinzo Abe’s three terms of office. During this time, Japan should form a closer relationship with the U.S., revise its constitution to cooperate with the U.S., and become a country that can shoulder its military obligations in a proper way. I have big expectations of Trump from here on out, but his approval rating is declining and there was a reactionary fall in stock prices, which looks rather like the end of the temporary “Trumpnomics.” As you pointed out, today a leader’s approval rating will not grow unless his or her country’s economy is bettered.
(O) Economic growth was not bad at 2% to 3% during the eight years under Obama, but never exceeded 3%. Trump promised growth would at least exceed 3% and mentioned a 5% target. The stock market will always fluctuate with a long-term upward trend, but it did reach an all-time high in the first 60 days of the Trump administration. As to the military component of the U.S.-Japanese relationship, the timing could be appropriate to reassess the interpretation of the Japanese constitution.
(M) Enlarging military spending is the easiest way to create demand. Trump has already set forth a policy for increasing the military budget by six trillion yen. The important thing is to prevent war by expanding armaments in a way that maintains balance, so that other countries are not inspired to wickedness or, conversely, made to feel extreme fright.
(O) I agree about the need for balance, but believe that expansion of military spending should be for peace through strength rather than just to stimulate the economy.
(M) Peace was maintained during the Cold War because of the sense of tension and power balance that could not be easily violated by the East or West. However, Obama’s eight years of weak-kneed diplomacy resulted in China becoming an incarnation of the desire for expansion. If Hillary Clinton were president, I think the U.S. might have returned to the “Japan bashing” of the Bill Clinton era, which would have been a huge disadvantage to Japan. Trump stated that it is strange for the U.S. to protect Japan in the event of an attack although the opposite is not true. We should take this opportunity to revise the constitution for a bilateral Treaty of Mutual Cooperation and Security between the United States and Japan, and so that Japan can gain defensive weapons. Nonaggressive defense will not protect Japan.
(O) I cannot address what other countries might have thought about Clinton and Obama’s foreign policies, but the perception in the U.S. is that our countries had good relations. In fact, Arkansas is the leading rice producing state in America, but Bill Clinton did not try to force open the sacred Japanese rice market. As far as the Japanese constitution goes, given that China is increasingly aggressive and the tensions with North Korea are at a 30-year high, I believe the military clause needs to be re-evaluated.
(M) In this world, nonaggressive defense is not a valid military theory. The Constitution of Japan was written by the occupying army under the Supreme Commander for the Allied Powers (GHQ) and has been constantly upheld by the Japanese left wing ever since. It deceives the Japanese people. To fix this, we must amend the constitution while there is a close Japanese-American relationship formed by Trump and Abe.
(O) Perhaps the model for Trump and Abe will evolve to mimic the “Ron and Yasu” first-name friendliness of Reagan and Yasuhiro Nakasone in the 1980s.
(M) No matter which missile defense systems are put in place, it would be impossible to intercept all missiles if many were launched simultaneously as a saturation attack. From the standpoint of military strategy, it makes no sense to think that interception systems alone can guard against ballistic missiles. The only possible measure is deterrence provided by the ability to return any attacks. Discussions on this ability to strike back – the capability to attack enemy bases – are finally starting in the National Diet. If we don’t have weapons like cruise missiles and bombers, Japan will simply be subjected to one, two, or three waves of strikes.
(O) I think Japan should have greater ability to protect itself against missiles. This is particularly relevant given the unpredictable and seemingly irrational behavior of the isolated hermit country, North Korea.
(M) If the U.S.-Japan Security Treaty were made into a bilateral treaty in the future, that would happen. I always write essays of this tone in Apple Town, and I was recently singled out and criticized by the Chinese government. But people across the world learned APA Hotel’s name thanks to the scandal about my book.
(O) I read the article in The Wall Street Journal. I appreciate that you stood your ground when the Chinese government tried to impede APA Hotel’s business.
(M) In fact, now the Chinese government can no longer play the Nanking Massacre card. I said it should point out which of my claims were wrong, but there was no response.
(O) A resilient attitude is the only way to cope with criticisms from the ethnocentric Chinese.
(M) Yes, that’s what I did. Besides China, the Japanese media also attacked me, asking why I didn’t remove the books from the hotel rooms. The enemy of the Japanese people is the Japanese people.
(O) You and Trump are alike because you both refuse to compromise on your core values regardless of political fallout (laughs).
(M) Well, we are from the same industry (laughs).
(M) Due to this outcry, Fusosha Publishing will publish a new, expanded version of Theoretical Modern History. In it, I point out the truth while including photographs and other materials. For instance, the Huanggutun Incident was the work of the Soviet secret service, not Colonel Daisaku Komoto. Nanking, a 1938 documentary film from Toho that was shot behind the front lines, can be described as decisive proof that the Nanking Massacre is a total fabrication. It was filmed over the 44 days after the fall of Nanking, which was said at the Tokyo Trials to be the time when the Nanking Massacre took place. This film shows the calm environment of Nanking as well as posters hung in the city by the Chinese Army, such as, “If you catch a Chinese traitor, kill him without mercy” and “Arrest the traitors – don’t obey laws, start rioting.” Thousands were executed in one day. To conceal this massacre of civilians that occurred when Chinese traitors were hunted down, the story about plain-clothes soldiers being executed was embellished to create the Nanking Massacre story, a fact that I state logically in my book. The Japanese mass media does not report these truths because the media companies – spearheaded by The Asahi Shimbun newspaper – still abide by the Press Code created by the American occupation army. That is why the media ends up becoming leftist.
(O) I have not studied the Nanking Incident with the depth that you have, so I cannot speak to this issue. Currently, in the U.S., most American media outlets are considered to be strongly left leaning, particularly by Trump and his supporters.
(M) Commercial media requires many viewers and readers, and the population of poor people is overwhelmingly large. As a result, the media becomes progressively leftist in tune with their views. Still, Fox News supported Trump, and I think the state of the Japanese media would be even worse without the Sankei Shimbun.
(O) In contrast, China recognizes economic freedom, but there is no freedom in politics or the press.
(M) There was an incident in which Hong Kong booksellers were kidnapped by the authorities and told they would be released if they stated they would abide by the views of the Chinese government. Perhaps one factor in the recent APA Hotel incident was our publishing of information in English, and I think another factor was how the Ministry of Foreign Affairs has not taken a strong stance against China. Trump has a policy of “America first,” and the Japanese government and public offices should have one of “Japan first.”
(O) I totally agree that a “country first” attitude is necessary to effectively collaborate with other countries
(M) Japan’s circumstances are changing radically. China is stepping up its expansion and advancing into the ocean while North Korea continues launching missiles. Kim Jong-un probably heard that the U.S. and South Korea were holding joint military exercises on a “decapitation tactic” that involved his assassination, which made him think seriously about how to protect himself. That is why he assassinated Kim Jong-nam, who could have been installed in his place. Trump talked about recognizing Taiwan’s independence, but he suddenly supported the “One China” policy after his telephone call with Chinese President Xi Jinping in February. I suspect that Trump made a deal to recognize One China in exchange for Xi Jinping approving the removal of Kim Jong-un.
(O) I was surprised by Kim Jong-nam’s assassination because I thought he would have been useful to install as president by China as a backup. As to an agreement between the U.S. and China…I believe China will get an easing of trade restrictions in exchange for blocking coal imports, as well as other pressures on Kim Jong-un. It seems apparent that North Korea is trying, without success so far, to put a nuclear warhead on an intercontinental ballistic missile that could reach the U.S. mainland.
(M) North Korea simultaneously launched four ballistic missiles in March, which was probably a threat showing that it could attack the U.S. Forces in Japan at any time. North Korean missile technologies made remarkable progress during Obama’s eight-year presidency. If the Obama administration had dealt with North Korea at an earlier stage, I doubt this would have happened.
(O) For thirty years, starting with Bush #1 and continuing through Obama, the U.S. has had a policy of “strategic patience” with North Korea. This has been done in part because of South Korea’s fear of a land invasion and Japan’s understandable worry about a missile attack and a large influx of North Korean refugees. However, this has allowed the North Koreans the time required to improve their missile technology. They are now working on development of a solid-state fuel that would reduce the timing advantage of U.S. satellites in anticipating a launch.
(M) Still, the conflict around North Korea is very complex. There was a major explosion at North Korea’s Ryongchon Station in 2004. One theory says this was orchestrated by Chairman of the Chinese Central Military Commission Jiang Zemin to assassinate Kim Jong-il, who refused to abandon nuclear development. Kim Jong-il did not board the train and narrowly escaped death, probably because North Korea was given this information by the U.S. (which intercepted it through wiretapping) or a Russian spy. If Kim Jong-il had died as Jiang Zemin expected, it is highly possible that the Chinese Army could have advanced at once to the Military Demarcation Line. The U.S. or Russia leaked this information to prevent that. In any case, the worldwide media has a mistaken awareness of these issues; both Russia and North Korea feel the strongest sense of wariness towards China. That is why Kim Jong-un purged his uncle Jang Song-thaek, who had connections with China, and assassinated Kim Jong-nam, who was supported by China as a successor. These were all acts of self-preservation. Only the Japanese fail to recognize that the world is replete with plots and information strategy warfare. I express myself in various ways to convey this information, including by publishing Apple Town, this magazine.
(O) It is certainly true that the world is full of conspiracies. After all, Trump always wears a bulletproof vest. As you say, plots by various nations are rampant across East Asia, which is why Japan – a trustworthy nation – is growing in standing. Trump has abandoned multi-country negotiations like the Trans-Pacific Partnership (TPP) and is attempting to carry out one-on-one negotiations. I think this is because he is a businessman who is transactional rather than a historical strategist. I also feel that he trusts Japan the most of the countries he negotiates with in Asia.
(M) I think Trump’s protectionist policies are merely forcing the American people to buy expensive goods. With free trade, countries across the globe buy and sell inexpensive, superior products and manufactured goods that are their specialties. The U.S. should have been the leader of free trade. Trump’s approval rating will fall if people aren’t able to buy cheap, excellent products, and I feel he will change his protectionist policies sooner or later. However, illegal immigrants, criminals, and narcotic drugs are flowing in from Mexico, with which the U.S. shares a border. He may continue to deal differently with Mexico.
(O) We need to remember that Trump introduced the idea of border tariffs as a negotiating ploy. When it comes to the depth of the U.S.-Japan interconnectivity, it is important to note that Japan employs two million people in the U.S., primarily in automobile plants, whereas China has created a fraction of that number.
(M) Japanese automotive manufacturers make great contributions to the U.S., so I hope they will be given the same treatment as GM, Ford, and other American manufacturers. Trump has declared that the U.S. will withdraw from TPP negotiations, but I think he might take part if the treaty’s name were changed. The TPP was originally advocated by the U.S. as an economic area to oppose China. The TPP should be started without the U.S., negotiations should be opened again with the U.S., and the name should be changed with the provisions slightly altered to reflect some American requests.
(O) I see, that would be one way to do it. Perhaps after the Trump administration is firmly established in a year or two, then the TPP concept can be resurrected under a different name.
(M) Chinese economic statistics are unreliable, so in essence the collaboration between Japan and the U.S. is between the number-one and number-two economic powers. After the bankruptcy of Lehman Brothers, the global economy was helped by Chinese economic growth focused on official demand, but I think Chinese economic growth has reached its limits. That is why China is trying to expand its territory using military power. This must be contained by the U.S.-Japan security arrangements. Xi Jinping is recently referring to himself as the “core leader,” a title previously applied only to Mao Zedong and Deng Xiaoping. Perhaps this denotes Xi Jinping’s intention to not step down after the traditional 10-year term – the advent of the Empire of Xi Jinping. However, I think most Chinese leaders want Japan to gain military strength. If Japan is weak, China will be forced by pressure from the citizens to start a war that it doesn’t want.
(O) Japan is currently protected by the American nuclear umbrella, but eventually a sharing agreement could make sense.
(M) However, the nuclear umbrella doesn’t exist against countries possessing nuclear weapons that can reach the U.S. Namely, there is no nuclear umbrella to guard against China and Russia. If North Korea develops ballistic nuclear missiles that can strike the U.S., I think the nuclear umbrella against North Korea will disappear as well. Japan will be the victim of a third nuclear attack if it optimistically believes in the nuclear umbrella. Japan should have its own nuclear weapons, but the U.S. will definitely oppose this. Therefore, I have constantly asserted that Japan should take part in nuclear sharing with the U.S. for the “rental” of nuclear weapons, which the U.S. allows for Germany and Italy. Japan is a country that only changes because of external pressure, so I hope Trump will say he will allow nuclear sharing and pressure Japan into changing its constitution.
(O) I can see Trump evolving to a balance as with Germany and Italy.
(M) You also give many seminars and speeches. When you have the opportunity, will you state that Japan should amend the constitution, gain offensive weapons, and introduce a nuclear sharing arrangement?
(O) I always attempt to offer a multi-faceted perspective that takes into account current realities.
(M) At the end of the interview, I always ask for a “word for the youth.”
(O) On this trip, I have gotten deeper into the history of Japan starting with the Jomon, the hunter-fisher early settlers, as well as the Yoyoi farming and rice people. I have seen where East met West on Dajima Island in Nagasaki, followed by the Jesuit missionaries. Then to bring it to the 20th century, I visited the Kanoya Air Museum from which the kamikaze units took off. I was overwhelmed by the sacrifice of these kamikaze pilots, who gave up their lives while thinking of their families and their country rather than self-preservation. For Japanese youth, I hope two things. First, do not believe everything you read in the official textbooks. The truth in history is deeper and more nuanced than conventional wisdom. Read widely. Find your own understanding of a balance between the reason for kamikaze pilots and a Tokugawa era of 270 years of peace. Second, beware of this cultural rule: “the nail that sticks out gets hammered down.” This is good for group peace, but bad for entrepreneurship and innovation. Listen to your inner voice. Pursue your dream even if the group tells you it cannot succeed. For American youth, I say two things. First, put down your iPad, engage with people, and become a part of the larger community. Avoid the isolation of identity politics, now common in U.S. life. Second, you are not entitled to anything. America was built upon a dream and hard work. The dream is for an ever better future. You will not achieve that if you think you are a part of a disenfranchised group. The society or the government is not a “mother;” it does not exist to take care of you. In life, it is not about what bad things have happened to you, it is about how you react to what happens to you.
(M) Young people are full of potential, so the important question is how to cope with any misfortunes they experience. Thank you for joining me today.
Joe O’Brien is managing director of OBISCO Associates, based in Little Rock, Arkansas. OBISCO provides strategic analysis of geo-political relationships and advises clients who are expanding outside of the United States. O’Brien has a B.A. in Economics and History from Vanderbilt University and an M.B.A with honors from the University of Alabama. He is a published author and past president of the Supplier Division of the International Franchise Association, Washington, D.C. In his corporate career, he was managing director of TCBY, International, where he served on the Board of Directors of TCBY Japan and was responsible for operations in Taiwan, Singapore, Thailand, and Malaysia. His consultant work has included service for numerous Japanese corporations and a large government ministry.