US and Japan agree to $3.1 billion Guam transfer costs. Was this a fair price?

From the Mainichi Shimbun, courtesy of a reader.

According to Mainichi, Kurt Campbell, who I remember formerly being based in Japan, sought to have the number announced as part of the big Obama-Noda meeting in over several days. It says that Japan didn’t want to pay a higher figure (probably the more realistic figure), and that they didn’t want the money featured at the meeting. The blame was put on having the consumption tax hike as part of the domestic agenda in Japan. Even though everyone understands that the consumption tax is part of reforming (or fully implementing) Japan’s pension system, and has nothing to do with defense, the Japanese signaled that mentioning Guam and money might jeopardize things. I am not sure I buy that.

This kind of issue is off the American government spending radar, and I feel that’s a big mistake.

We here, of course, have our own budgetary problems. In that environment, a billion dollars matters. If the actual cost to do the Guam transfer was more like $4 billion, then we are being taxed $1 billion by the Japanese for our mutual defense. Without putting these numbers out there for a broader discussion, we really don’t know. I feel that when the governments are negotiating what is going to be emphasized, and what isn’t, at joint appearances, we really can’t get a sense of whether the deals are in our favor.

During the Cold War, it was easy to say things like “we’d rather have the Japanese in our camp, than with the Reds.” But practically, that was never going to happen. China and Japan have quite a history between them. It would have been more like either waking up to an American presence in the region, or waking up to the concentration camp gong at 5 am. Like North Korea. But the American public never questioned the money the U.S. was spending for military in the Pacific in those days.

Now, the Cold War has been replaced by aggressive-and-up-and-coming China. The Obama Administration is looking to fortify our contacts with the various countries in the region. I wonder, though, if we come off as too eager to make these contacts. We spend a lot of money in the region to make sure that other people can do business there without worrying about whether China is going to assert itself more into what their countries do. Maybe we worry too much?

Someday, America’s growing China lobby will make the current trans-Pacific arrangement more debatable. Maybe the world will be very different by then. It would be good, in the meantime, to know how exactly America benefits from some of its arrangements with Japan. Something more than, “we just do.”

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