Korea needs soccer to beat out Japan ?

Japan must again be absolutely furious at Korea again being closer to the center of the world that just happens to not just be the center of Asia.It must be Japan's fate that a powerful farm lobby was the one that pushed the KORUS(Korea United States Free Trade Treaty) forward and from the view of misguided nationalists of Korea (Democratic Party of Korea) one that was not powerful enough in South Korea to prevent the ratification of American Beef to South Korea or Japanese capital and American machinery sales into and to South Korea(KORUS) rather than the opposite way around as has come to characterize the Korea-United States relationship in or, equivalently, small car expertise for China, has come to symbolize.

After 2009 and 2010, It's high time the United States began exporting F-22's to Japan...

In light of the United States Air Force ending procurement of additional F-22's and with the Chinese still manipulating its currency amidst years of trade surpluses with both the United States and Japan, it's high time the United States began exporting the high tech F-22s to the super loyal Japanese. The Chinese have sped up plans to procure an aircraft carrier and are deep in their development of a counterpart to the U.S.A.F.'s F-22.

Global Security:

Chinese Stealth Fighter

J-X / J-XX / XXJ

J-12 / J-13 / J-14 / J-20

(Jianjiji - Fighter aircraft)

On 29 December 2010, the right estimable China Defense Blog published the first no-kidding photographs of the long rumored J-XX Chinese stealth fighter. Unambiguous confirmation of the existence of this program will require re-evaluation of aircraft modernization efforts in a number of countried, including Taiwan, South Korea, Japan, and the United States. Chinese combat aviation has made remarkable strides in recent years, moving from a collection of obsolete aircraft that would have provided a target-rich environment to potential adversaries. Today China flies hundreds of first rate aircraft, and even flies more Sukhoi Flankers [the aircraft the American F-22 was designed to counter] than does Russia. The Chinese stealth fighter has arrived right on schedule. Chinese military technology is generally rated about two decades behind that of the United States. while the advent of a Chinese counterpart to the F-22 fighter might be disconcerting, the first flight of the prototype American F-22 stealth fighter came on September 29, 1990.

 

January 1st, 2011 brings a new year after China has condoned North Korean acts of aggression against South Korea, bullied Japan over the Senkaku Islands, and driven the United States to defend Vietnamese interests over the Spratly Islands.

To ensure both the security of the United States and our East Asian ally, Japan and keep highly skilled Americans employed as unemployment and underemployment rates remain sky high, F-22s should be made for our super loyal Japanese allies by our countrymen.

There seems to be a problem with the Economist's Map...

In an article outlining heightened tensions between China and Japan (again), the map on the article by the Economist seems to label the Liancourt Rocks (Dokdo/Takeshima) as part of Japanese territory or being part of Japan's exclusive economic zone. The Senkaku/Diaoyu island chains are demarcated as such, whereas the Kuril Islands -- including the lower two --  are marked as Russian territory. So, it's a bit puzzling that the Liancourt Rocks are labeled to be a part of Japan. Clearly this is a matter of grave concern as, well, heaven forbid if fifty years later Japanese -- or for that matter any nationalist "historian"-- were to say, look here, we found an old map by the Economist clearly showing that Takeshima is a part of Japan.

And, by the way, a quick look at the second map shows exactly why the Liancourt Rocks seem to be so important. It takes up such a huge chunk of the seas east of the Korean peninsula.

Anyways, here's the map over at the Economist:

And, here's a map that shows the area of the East Sea (Sea of Japan) that is disputed. 

Source: www.dokdo-takeshima.com:

(disputed waters in the East Sea/Sea of Japan)

[U.S. Capitulation to the Chinese] Japanese Currency Intervention

For the first time since 2004...

Economist's Free Exchange:

AMONG today's big news items is the word that Japan is now actively selling yen in order to improve its exchange rate against other major currencies. The yen has risen sharply in recent months, dealing a blow to Japanese exporters and slowing Japanese recovery.

The columnist looks at the development in a positive light.

Doom and gloom, but I feel more positive about this development. Consider Buttonwood's take:

As David Bloom of HSBC points out in a note responding to the move, the costs of intervention to the Japanese are not great. Selling yen and buying dollars results in more yen being created, which might be inflationary, but a bit of Japanese inflation wouild be a good thing.

My thought concerns the general tendency of countries to want their currencies to depreciate. Everyone would like to boost their growth by letting their currencies slide and increasing exports. Of course, not all can succeed. Someone must increase net imports and let their currency appreciate. The obvious candidate is the Chinese, but they are unwilling to let it happen (at least at a pace desired by the rest of the world).

The result is like a game of deflationary pass the parcel in which the countries with appreciating currencies eventually feel the pressure, and try to reverse the trend.

But, I wonder if this development is in fact simply the realization that China will not fairly value its currency -- irrespective of what this may or may not do with respect to the U.S. trade deficit -- and that rather than waiting for a time that will not come, Japan has decided the country could wait no longer.

Consider the South Korean Won. South Korean exports compete directly with many Japanese exports, and South Korean exporters have historically looked at a 10 KRW : 1 JPY ratio as the level where South Korean exports would still remain competitive with Japanese exports. However, this changed in 2008 as the South Korean Won collapsed. (Its performance was the second worst that year after, well, Iceland's currency.) Since that time, rather than the South Korean Won tracking the performance of the Japanese Yen -- which it historically has, the currency now seems to be tracking the performance of, well, the Chinese Yuan. Until the just announced Yen Intervention, the currencies have been trading at about 14 KRW : 1 JPY. (The link to a chart is here.) The story seems to be the same with respect to the New Taiwanese Dollar (TWD). (The link to a chart is here.)

So, doesn't it seem to be the case that the Japanese have decided that the expense of waiting for the Chinese to revalue is just too great? In this sense, it's hard to be optimistic when it seems to be a capitulation on the part of the U.S. to Chinese mercantile practices, which in the process seems to have dragged the rest of East Asia along with Beijing. What will it take before the U.S. "takes action"? (By the way, in this sense, I miss President George W. Bush. His ability to "take decisive action" -- whatever the costs or logic may be -- seems to be ostensibly missing right now. (I think with respect to defense issues I'm a huge supporter of current U.S. policy of re-engaging the East Asia region, but I think this would be there regardless of who is in power. e.g. Consider the Guam naval buildup since 2006.)

Senkaku/Diaoyu Islands

Recently, it appears that Japan has taken into custody Chinese fishermen in disputed waters as Japan and both Chinas all claim a string of islands called the Senkaku (Diaoyu) Islands. The funny thing about these islands is that, well, after the Second World War -- or the second Sino-Japanese War -- they were first occupied by Americans not unlike the Liancourt Rocks (Dokdo/Takeshima), which Japan and both Koreas also claim as their own. This is East Asia...

I understand that North Korea and much of the rest of the world likes to say that Americans are a crazy nation that likes war, but I find it interesting in what America did with the "islands" when they were under U.S. control -- both became places that American planes would bomb. 

Anyways, Japan has recently released most of the fishermen except for its captain as, well...

BBC News: 

The fishing boat reportedly rammed Japanese coast guard patrol boats which had been trying to intercept it.

And, in another example of Beijing's respect for her East Asian neighbors, BBC News also reports:

On Sunday Chinese diplomat State Councillor Dai Bingguo warned Tokyo to make a "wise political decision" over the matter.

and

The Chinese foreign ministry said any evidence collected by Japan on the collision would be "illegal, invalid and in vain".

Of course, it's interesting to see this considering recent naval exercises in the region by the United States Navy and, of course, the magnanimous decision of the U.S. to facilitate territorial disputes between China and Vietnam. Maybe, the talks, if they ever materialize, could also include the Philippines, the other China (Taiwan), and maybe Japan as well, to make for new round(s) of six party talks. I'm sure they would have a better chance at arriving at a solution than those talks held in Beijing or even those talks of having the talks in the first place.

Drama in Japan *add*

add: 08/27/10 the Japanese PM has vowed to take "bold" action against the Yen's appreciation.

I stumbled on this post as I read that Ichiro Ozawa will challenge the current Japanese Prime Minister, Naoto Kan -- they are both of the same ruling DPJ party. Naoto Kan became prime minister just two months ago as the previous DPJ prime minister resigned over the base relocation issue. Apparently, Ichiro Ozawa is very gaffe-prone and Andrew Joyce over at a blog at the WSJ online writes about this.  

Excuse the almost entire cut and paste. 

Andrew Joyce:

Step forward, Ichiro Ozawa, the kingpin of the ruling Democratic Party of Japan (under investigation for his role in a funding scandal): according to Japanese media (in Japanese), Mr. Ozawa Wednesday referred to Americans as — brace yourselves — “simple-minded”.

“I like Americans, but they tend to be simple-minded,” he said during a speech in the capital, using a Japanese idiom that literally means ‘monocellular’. He also offered some back-handed praise for U.S. democracy: ”I don’t think (Americans) are very wise,” he said, “but I highly rate their ability to put their choices into practice.”

Mr. Ozawa, who may stand for the DPJ presidency (and hence the job of prime minister) in elections next month, also said the election of Barack Obama as the first black U.S. president was something he previously thought “impossible” as he thought a black president “would have been assassinated”.

The U.S. Embassy in Tokyo declined to comment on the remarks.

This isn’t the first time the party heavyweight has put his foot in it. In November last year, he called Christianity “exclusive and self-righteous” and said that U.S. and European societies were at a “dead end”.

But Mr. Ozawa has some way to go before he can rival some of Japan’s most gaffe-prone politicians from years past, including former prime minister Yoshiro Mori, who used the panic surrounding the mooted millennium computer bug to highlight the differences between Japan and its key ally.

“When there was a Y2K problem, the Japanese bought water and noodles. Americans bought pistols and guns,” Mr. Mori said. “If a blackout happens, gangsters and murderers will come out. It is that kind of society.”

I forget that at times Japan is a pretty large, insular country and that Japan is after all a part of the colorful neighborhood that is Northeast Asia. By the way, I wouldn't at all be surprised if South Koreans made this statement say up until a decade ago. This is after all Northeast Asia. Nonetheless, this entry doesn't mention anything about the super crass former Japanese Prime Minister Junichiro Koizumi. I'm guessing the National Organization for Women -- was probably not his biggest fan.

Anyways, Michiyo Nakamoto of FT writes:

The last thing Japan needs with a surging currency and waning economic recovery is more political turmoil. But that is what it is faced with after Ichiro Ozawa, the heavyweight Democratic party politician, decided to challenge prime minister Naoto Kan for the premiership.

It's remarkable that Japan hasn't had a revolution yet. It must be difficult for a country that suffered unimaginable humiliation at the end of World War II and which thereafter prided herself on her economic prowess has just been eclipsed by China recently after two lost decades. The country also, probably out of deference to the West, has also refrained from actively managing her currency in the manner that say China has accorded herself as people seem to see the Japanese Yen as one of the safer currencies left in the world.

(Though it seems this may change)

Takahashi Hirokawa at Bloomberg:

Quiet Since 2004


Japan hasn’t intervened in the currency market since March 2004, when the yen was around 109 per dollar. The Bank of Japan, acting on behest of the Ministry of Finance, sold 14.8 trillion yen ($175 billion) in the first three months of 2004, after record sales of 20.4 trillion yen in 2003.

The pressure on Shirakawa comes as Kan faces intra-party competition from his most powerful rival. Ichiro Ozawa, whose campaign funding scandals forced him to step down in June as the DPJ’s No. 2 official, yesterday said he will run against Kan in the Sept. 14 election for party president. The party’s majority in the lower house of parliament ensures that its leader becomes prime minister.

Anyways, as the country has real (territorial) as well as imagined grievances with all her neighbors and lacks a peace treaty with both Russia and North Korea, let's hope the country does not move towards say how Japan was a century ago. The country has an enormous nuclear stockpile and an indigenously built rocket program.

Unification Tax

edit: for clarity
 
August 15th is a good day to be in East Asia, unless well, you're in Japan, where it's a day of national humiliation; it's the day Japan surrendered. South Korean President Lee Myung Bak's proposed Unification Tax on August 15th was noteworthy in that it forward looking. It was announced on a day when usually there would be calls for Japan to apologize for deeds that occurred more than half a century ago.

I think the statement reflects better bilateral relations with Japan more so than it actually has anything to do with unification at all. By the way, I did find the statement pretty funny in the sense that it just completely ignores North Korea existing as an independent actor and speaks as if the country has already gone under -- which in a sense it has.

Link to KCNA statement via One Free Korea. There seems to be no link that posting...

[A Paradox or Mere Contradiction?] Korean Economic Dependence with China, but Security Reliance with the United States

Joshua Stanton:

I certainly do not suggest that Peter Lee speaks for Beijing, but I do suppose his writing probably reflects the way Beijing hopes to use this incident to advance its hegemonic ambitions and divert its suppressed domestic rage toward foreign demons.

But, in Peter Lee's lenghty article's, he goes on to write that the U.S. decision to support South Korea in the Cheonan incident was in part a response to Japanese efforts to move the U.S. base off of Okinawa. He goes on further to write that "it encouraged Lee's ambitions to boost South Korea's global profile, arranging for the Group of 20 Summit and 2011 Nuclear Security Summit to be held in Seoul." U.S. President Barak Obama also pledged to support the KORUS free trade pact that was signed during the last administration and which has yet to be ratified by the Senate -- both President Barak Obama and Secretary Hillary Clinton had reservations against KORUS in the last presidential campaign race. 

Nonetheless, there's also another aspect of this article that I find to be interesting at least with respect to a certain state owned Chinese publication. 

I previously wrote about how the People's Daily Online -- a Chinese state owned newspaper -- fabricated claims about a fictitious South Korean Professor's research and a South Korean agenda to register Chinese script as a Korean cultural treasure. Well, interestingly enough, Peter Lee documents the several "other" times this publication has lapsed into questionable journalistic practices.

In an indication of the convoluted path of content across the Chinese Internet, the People's Daily English-language post was an uncredited cut-and-paste of an EastSouthWestNorth (ESWN) post.

Apparently, the publication also published pictures of a bombed U.S. aircraft carrier before it retracted it. 

However, with respect to the main aspect of Peter Lee's article, he suggests that increasing South Korean economic dependence on China makes it difficult for South Korea to remain dependent on the United States for security. And, I believe this is what Joshua Stanton was addressing when he writes that he "suppose[s] his writing probably reflects the way Beijing hopes to use this incident [...]" 

However, it hasn't really yet been shown whether China can effectively transfer economic ties into political leverage-- I'd say consider Scott Snyder's book, China's Rise and the Two Koreas: Politics, Economics, Security. This seems to be true for both halves of the peninsula, but it remains to be seen if this will continue to hold, even as South Korean trade with China now is greater than combined trade figures with the United States and Japan and North Korea is kept on life support by China. 

Still, even as China keeps North Korea afloat, China doesn't really have that much leverage with North Korea. 

Andrei Lankov writes:

A senior South Korean diplomat described this problem in a private conversation by a good allegory: "China does not have leverage when it comes to dealing with the North. What China has is a hammer."

[Japan & Korea Missing Another Generation?] What does Apple's iOS and Google's Android OS mean for Japan and Korea?

edit: for clarity, 07/18

It seems every other day or so, there's some article that compares the sales of Apple iPhones with Apple's iOS to that of smart phones powered by Google's Android.

Seth Weintraub at CNNMoney.com:

However, in phones, Google seems to have a winner on its hands. It will be hard for Apple to catch Android's numbers if the company can't even surpass their competitor's running weekly total at its yearly iPhone launch.

Anyways, I just ordered an iPhone 4 for my mother this past weekend and I'm sure in due time I'll have my hands one of my own as well -- preferably a white iPhone 4. And, no, white isn't a girl's color; it does require more maintenance though. But, anyways, as these articles continually compare sales, for some reason it reminds me of the original operating system war between Microsoft and Apple (and IBM among others) for personal computers. It seems Google is the Microsoft for phones this time around by commoditizing phones, whereas the Apple iOS is only on products with the Apple logo on it. (The best example here would be the Samsung Galaxy-S phone. The phone has the very same processoras that inside Apple's iPhone 4.)

But, unlike personal computers though, it seems the nice thing is that the apps for mobile platforms don't require all that much money to develop. So, regardless of which platform sells more the concern that my phone will become obsolete just isn't there. I guess this is something that is clearly in Apple's advantage as whereas Mac computer owners are stuck -- less so now than in years and decades before and particularly as Microsoft sells its Office productivity suite on Macs now -- with a much smaller choice of software, I doubt that the difference will be as noticeable if at all when Android powered phones inevitably leap frog Apple iPhone's in sales. So, as long as iPhones do keep selling, stories such as which phones powered by which platform really aren't that important with exception to the general trend that Microsoft's mobile platform seems to be dying.

What is interesting though is that once again it seems that Asian manufacturers are once again stuck manufacturing commodities again for another generation perhaps for perpetuity. Even if Microsoft's phone platform dies, Apple and Google seem to be marginalizing East Asian companies once again as chips, memory, LCD screens, flash memory, etc seem to just be nothing more than high tech commodities... I believe even Softbank -- the Japanese company that made a great deal of money by investing in Yahoo -- is profitting by selling iPhones in Japan. Of course, Research in Motion is Canadian and there's Symbian by Finland's Nokia.  

Japan and South Korea both had protected cell phone markets with super fast networks for quite some time now, but it seems the only types of companies that emerged to compete globally were hardware manufacturers. With exception to companies that catered to making cheap games and the like, where is the Japanese or Korean Apple or Google? Why isn't there one? It's all the more remarkable when considering that the United States has by far probably the most fragmented network -- competing CDMA and GSM networks -- deployed over an area that is very lightly populated compared with eitehr Europe or East Asia. With all the boasting about how consumers in Northeast Asia have for years been able to watch television or video chat on their phones, what has come of it?

[Japan] A Japanese Model with a PhD in History Offers Sex as Compensation for Japanese Wartime Atrocities

This has got to be one of the strangest stories I've ever heard -- even of those that relate to Japan. Apparently, a female Japanese model with a doctorate in history is offering sex as compensation to Chinese students at her school for historical atrocities committed by Japan against China:

ROK Drop:

Talk about a way to recruit foreign students to your school. I wonder if anyone has inquired on whether the bombing of Pearl Harbor counts for Americans to get this benefit?

Actually, I think if this were the case, then we would probably lose a substantial portion of the U.S. female population. I think Japan got the raw end of World War II. I mean they were basically beaten down in every possible way -- oh yeah and nuked as well. But, I do believe in the post-war period the U.S. has done more than enough -- such as sacrifice entire industries to the Japanese -- to make up for what happened in World War II.

[World Cup & North Korea] North Korea in a nutshell

This has got be one of the funniest things North Korea has ever done. North Korea will for the first time since 1966 make an appearance in the World Cup and has been put in the "Group of Death" with Brazil and Portugal Euro Cup champions Spain. (Yes, it is the NBA Finals right now, but the World Cup is about to begin shortly after the Lakers take care of the Celtics.) I've never counted gambling as one of my vices -- except when College Football season comes about, but, well, North Korea is just getting some terrible odds. Currently, the odds of North Korea winning the World Cup are set at 2000:1 -- or +200,000.

But, incredibly, it seems, well, North Korea tried to pack their final 23-man squad by only putting two real goalkeepers on the lineup and naming a forward as their third goalkeeper.

Russel Kempson:

It is, though, a third Kim — Jong Hun, the North Korea coach — at whom the finger of suspicion was pointed yesterday because it was he who had named Kim Myong Won, the Amrokgang forward, as a third goalkeeper in his 23-strong squad. It would, Kim No 3 perhaps believed, give his tournament underdogs an extra option up front.

Fifa was not amused, pointing to its labyrinth of rules and regulations. “The three players listed as goalkeepers can only play as goalkeepers during the World Cup and cannot play outfield,” it said. “And Kim Myong Won will not be allowed to play as an outfield player if he has been put on the list as a goalkeeper.”

This development hasn't yet been factored into the odds yet as I don't know how many people would bet on North Korea, but let me tell you something. Joe indeed plans on putting down a nice, crisp, and, real (not a counterfeit) $20 on North Korea taking it all and probably another $20 for South Korea, who are being given a 250:1 (+25,000) shot at winning the World Cup. Of course, for some reason, the more technically proficient, higher ranked, and richer Japanese soccer team is being given a 600:1 shot. I am not putting down money on Japan, of course, which brings me to my next post. I'd like to put down money on the United States as well, but for a country that already considers herself to be the most powerful, richest, and technologically advanced nation in the world -- international sports doesn't really mean as much. The same doesn't hold for Japan, whose coach is aiming to make the semi-finals (what North Korea did in 1966 and South Korea did in 2002). South Korea is humbly hoping to make it the round of 16 -- the second round of the finals.

No, it's not that I like to donate money, but it's the fact that, well, I would want a Korean team to win. And, of course, if it's a only a dream I'd like to be compensated with some money as well -- it appears to be at least $40,000 if North Korea wins. But, anyways, North Korea trying to bend the rules -- and not use the rules in its favor -- seems to very much describe the rogue nation that is, well, North Korea or the DPRK.

[A Rising South Korea] More on the handling of the Cheonan disaster/fiasco

When thinking of the Cheonan disaster/fiasco, probably a couple things that some people might think include whether the whole thing is a conspiracy -- as in why would North Korea do something so self-destructive and it seems to extremeley convenient for the Japanese  Prime Minister to renege on his campaign promises of moving U.S. bases off Okinawa-- and, also, whether South Korea unlike during previous administration has been doing the right thing by internationalizing the incident. But, of course, there is the evidence conducted by experts from South Korea, the United States, Japan, Australia -- and Sweden. (I wonder if they chose Sweden out of their expertise or because the name is not too different from Switzerland.)

Anyways, consider the recent announcement of combined U.S. - ROK naval exercises.

Peter Grier:

US-South Korean naval exercises tend to be smaller scale. Last week, the US cancelled a previously scheduled annual event called “Courageous Channel,” a naval exercise intended to practice the evacuation of noncombatants from the Korean peninsula. At the time, US military officials said that they did not want North Korea to think that the exercise, set to run from May 20-24, was a response to the Cheonan incident.

Now the US apparently wants to make the opposite impression, by announcing naval exercises billed as a direct response to the Cheonan’s sinking. According to a White House statement, President Obama has ordered his military commanders to coordinate closely with South Korea “to ensure readiness and to deter future aggression” by North Korea.

But, anyways, back to earlier posts, it's interesting to see the stark difference between what the U.S. is saying and what China is not saying.

U.S. Secretary of State Hillary Clinton:

I will be discussing these issues with my counterparts in Beijing next week, and then I will travel to Seoul, to consult with our South Korean partners about the way forward. But let me be clear. This will not be and cannot be business as usual. There must be an international -- not just a regional, but an international -- response (US-Japan Joint Press Conference).

This suggests that the U.S. has not and will not simply be able to trade away a new round of UNSC sanctions on North Korea in exchange for China's announced support -- on the same day -- for a new round of sanctions against Iran. So, for a country such as South Korea that seeks so much prestige and respect as an independent and powerful country -- e.g. U.N. Security General, G-20 presidency, and the strange usage of trying to sound out Chinese names rather than use the Korean characters associated with each Chinese character. I simply cannot understand why some would like to go back to the Sunshine Policy.  

On a side note, with respect to Iran what is with upstart Brazil? Out of nowhere Brazil, which sits comfortably in South America, is naively complicating things that's in the best interest for the rest of the world.

Anyways, I believe what the U.S. Secretary of State was referring to when she used the term "not just a regional but an international response" is the trilateral meetings between China-Japan-South Korea in Gyeongju, South Korea (May 15th) -- home to the historical capital of Silla, which has symbolic imporance as Pyongyang was also the historical capital for a rival state on the Korean peninsula, Gogouryeo and those to be held at the end of the month in Jeju Island again at the foreign minister/secretary of state level. By the way, anybody take notice of how strange it is that while they take this to the United Nations, what nationality the U.N. Security Security General holds?

Anyways, consider U.S. remarks next to that of the Chinese...

But while expressing condolences for the South Korean sailors who died aboard the Cheonan, Chinese Foreign Minister Yang Jiechi merely reaffirmed Beijing's stance that "a scientific and objective investigation is important." Yang did not mention the possibility of a link between North Korea and the shipwreck (Chosun Ilbo).

This was before proof of North Korean involvement was put on display. A very big difference how this incident is being handled and, say, the kidnapping of South Korean fishermen and the shoooting of a civilian in Mount Geumgang.

With respect to arguing directly against the rather ridiculous positions -- blame the South Korean President?! -- taken by the South Korean left recently, I'll defer to the regular Korea bloggers.

Correction and commentary on U.S. Military Spending, Of Japan, the F-22

I earlier wrote that defense spending is roughly at 7% of U.S. GDP, but just googling it, puts it at 4.16% (including the two on-going wars) in 2008 and simply wikipedia-ing it shows that military spending shrank in absolute terms (along with the size of the economy) from 2008 to 2009. And, of course, 7% of about $13 trillion or so is about $900 billion (it's less than $700 billion), so that 4% figure looks right.

Note: I took the chart on the right from wikipedia, but I'm not a big fan of the other graphs that look at U.S. defense spending in terms of  per-capita spending on income defense in fixed U.S. dollars which does not take into account a richer U.S. economy (a better graph would be that as  % of GDP per year)...

U.S. military spending as a share of GDP does not at all seem that high (I think 7% would have been fairly close to historical peace time highs of the Reagan years, but 4% while we are still "fighting" two wars does not seem at all that bad), but I'd think it's unfair to criticize the level of military spending whether domestically or from an international perspective.

In fact, California has lost a lot of jobs because of reduced military spending back in the 90s -- (I believe) Southern California has traditionally had a hi-tech aerospace industry that had traditionally maintained a lot of high paying jobs -- until well Northman-Grumman formed (I believe the merger did away with the largest U.S. defense contractor headquartered in Southern California... And, on a side note, it's been a while since Los Angeles stood as the corporate headquarters for any major U.S. corporation --  the last major one to have been headquartered in L.A. was Atlantic Richfield Corporation (ARCO), which is now a part of good ol' BP or which was until recently known as British Petroleum).  

But, in the aggregate, the defense industry continues to be a huge exporter to the rest of the world. For example, Japan's airforce has nice F-15J's (I'm guessing J stands for Japan). And, South Korea has some nice, well, F-15K's (again, I'm guessing K stands for Korea). And, on a side note, I'd think it'd be a good idea to export those F-22s to Japan as the U.S. looks set to be unable to afford to build anymore F-22s unless, well, a rich Japan, which is eager to buy these planes, does indeed buy them and, of course, it'd be a nice way to "reward" the Japanese and re-affirm the U.S.-Japanese alliance while the U.S. doesn't have to close down the F-22 assembly line...

The current administration, which has done a fantastic job regarding North Korea (and South Korea, if they send Secretary of State Clinton within the next month or so and pass the KORUS FTA) , seems to be doing a rather feeble attempt to tell the Japanese how important they are to the United States (of course, not as feeble as the Japanese Prime Minister looked as he rather meekly explained the necessity of having U.S. troops stay in Okinawa). And, it looks like they are the only major country the U.S. would eventually be willing to sell the F-22 to and the only country with the means to purchase them).

But, anyways, the point is, well, I don't think military spending is at all too high and it ensures the U.S. will continue to be at the forefront of the sciences (e.g. the two national labs - Lawrence Livermore/Los Alamos that is behind the U.S. nuclear weapons program are managed by University of California -- well, at least, partially -- as a result of espionage by Chinese scientists at Los Alamos). In fact, if anything should be done, well, the U.S. should continue to encourage allies to spend more (e.g. Japan(~0.9% of GDP or so), South Korea (~3% of GDP is still not that high as, well, let' see North Korea spends about a quarter on defense)).  

Now, I think it's a bit unfair to criticize "rising" U.S. military spending, which when set as a moving average looks pretty constant as a share of GDP (3% to 4%) even as you leave in the two wars from 2000 to 2011 in the above graph (consider that the U.S. economy has been in recession during most of 2008-10). Moreover, that graph that I link to makes the U.S. spend a lot more than it does, but it should considered that the Chinese do not at all leave fully disclose their military spending).

North Korea, Koreas Update

On the North Korean front:

Nothing exciting to speak of as North Korea really is running out of things to do, firing missiles on July 4th has been done before and no missile came close to Hawaii. Kangnam I safely returned back to North Korea. But, what has recently begun appearing on the news is if the North Korean succession story is for real or just to grab Hillary Clinton’s (United States) attention. More on this later.

South Korea – Japan held a summit. Of course, nothing came of it since still the dominant relationships in East Asia are still the bilateral relationships with the United States. Of course, what should be interesting for Korean nationalists, whose national psyche or “han” has not fully healed yet, is how they react to the trilateral meeting between the United States-China-Japan that will be held shortly. Previous overtures by China on such a meeting were declined on the part of the United States to assuage South Korean insecurities. However, with the financial crisis the United States consented this time.

With this in mind, South Korea’s foreign policy priority number one should still solely be on unification and nothing else. Ideas such as being a neutral or balancing party (former South Korean President Roh Moo Hyun) or of building closer ties with ASEAN (South Korean President Lee Myung Bak’s New Asia Initiative) might seem great, but it’s just fanciful(wishful) thinking on the part of a confused half nation. This has been a repeated theme in this blog. Zhiqun Zhu writes:

“Korea's dream to become a leading player in international affairs will also likely be wishful thinking if the nation remains divided. Nevertheless, Lee, just like Roh, is commendable for his attempts to enhance South Korea's international profile and to contribute to peace and development in Asia” (South Korea in a new Asia initiative Asia Times).