Reuben W. Hills Conference Room
In the past fifty years, two factors have led to global population aging: a decline in fertility to levels close to—or even below—replacement and a decline in mortality that has increased world average life expectancy by nearly 67 percent. As the population skews toward fewer young people and more elderly who live longer postretirement lives, demographic changes—labor force participation, savings, economic growth, living arrangements, marriage markets, and social policy—are transforming society in fundamental, irreversible ways.
Nowhere are these effects of aging and demographic change more acute—nor their long-term effects more potentially significant—than in the Asia-Pacific region. How will these developments impact the economies and social protection systems of Japan, South Korea, China, and, by extension, the United States?
To assess this question, Aging Asia showcases cutting-edge, policy-relevant research. The first section focuses on demographic trends and their economic implications; the second section approaches select topics from a global comparative perspective, including social insurance financing, medical costs, and long-term care.
Desk, examination, or review copies can be requested through Stanford University Press.
The Economic and Social Implications of Rapid Demographic Change in China, Japan, and South Korea
Prevailing opinion assigns the Tibetan Plateau a crucial role in shaping Asian climate, primarily by heating of the atmosphere over Tibet during spring and summer. Accordingly, the growth of the plateau in geologic time should have written a signature on Asian paleoclimate. Recent work on Asian climate, however, challenges some of these views. The high Tibetan Plateau may affect the South Asian monsoon less by heating the overlying atmosphere than by simply acting as an obstacle to southward flow of cool, dry air. The East Asian "monsoon" seems to share little in common with most monsoons, and its dynamics may be affected most by Tibet's lying in the path of the subtropical jet stream. Although the growing plateau surely altered Asian climate during Cenozoic time, the emerging view of its role in present-day climate opens new challenges for interpreting observations of both paleoclimate and modern climate.
This paper aims to demonstrate the relationships between ENSO and rice production of Jiangxi province in order to identify the reason that ENSO might have little effect on Chinese rice production. Using a data set with measures of Jiangxi's climate and rice production, we find the reason that during 1985 and 2004 ENSO's well correlated with rainfall did not promote Chinese rice production. First, the largest effects of ENSO mostly occur in the months when there is no rice in the field. Second, there is almost no temperature effect. Finally, the monthly distribution of rainfall is almost the same in ENSO and neutral years because the largest effects are during months when there is the least rain. In addition, due to the high irrigation share and reliable and effective irrigation facilities of cultivated land, China's rice production is less climate-sensitive.
How do military allies come to find each other more dependable on security issues, instead of less comfortable with mutual reliance? How do rival nations manage to build confidence and shared expectations for a collaborative future, rather than fall into a spiral of suspicions over each other's strategic intentions? Leif-Eric Easley, the 2010-11 Northeast Asian History Fellow at the Walter H. Shorenstein Asia-Pacific Research Center (Shorenstein APARC), addresses these key questions in his recently completed dissertation, Perceived National Identity Differences and Strategic Trust: Explaining Post Cold-War Security Relations Among China, Japan, South Korea, and the United States. Examining post-1992 Northeast Asia, and drawing from a broad range of source materials in four languages, Dr. Easley argues that differences in how the policymaking elite in two countries perceive the national identity of one another determines the level of strategic trust between their governments. This ultimately affects patterns of cooperation on national and international security matters.
With a background in both political science and mathematics, and paying close attention to historical issues in East Asia, Dr. Easley earned his Ph.D. in Government from Harvard University in 2010. While at Shorenstein APARC, he is revising his dissertation into a book and will teach a course about nationalism and security relations in Northeast Asia. In a recent interview, Dr. Easley discussed his research and future plans.
What is one of the most interesting and timely case studies that you examined?
Japan and China have had
a very difficult time improving the level of strategic trust between them. The
reasons for this are numerous. There are, of course, the historical legacies of
Japanese colonialism, the Pacific War, and indeed hundreds of years of
disagreements between China and Japan.
Even though those were largely papered over in favor of normalizing relations
in the 1970s and then building up an economic relationship—China is now Japan's
largest trading partner—a lot of that historical baggage was not fully
unpacked. The Chinese say there are a lot of things the Japanese have not
apologized for. The Japanese say that Beijing tends to use anti-Japanese
nationalism for its own domestic purposes. At various points of time in the
post-Cold War era—whether it has to do with the way that textbooks are being
revised or how the Japanese prime minister periodically pays homage to Japan's
war dead at the Yasakuni Shrine—Chinese nationalism has found expression in
anti-Japanese protests.
My argument is that such historical antagonisms, among other things, bring to
light the perceptions of identity difference between the two sides. The more
severe the perceptions of difference, the more of a gap that elites in one
country see between their national identity and the national identity of the
other side, and the less trust the two sides are going to have. So these
historical issues really weigh down on the level of strategic trust between
Tokyo and Beijing. This is problematic—not just for dealing with pressing hard
security issues like North Korea or trying to advance regional security
architectures like the ASEAN Regional Forum—but also because strategic trust is
very important for facilitating cooperation and avoiding conflict. Without a
decent measure of trust, you do not have much margin for error when some
unforeseen things happen, such as the recent incident over the Senkaku/Diaoyu
Islands.
Based on your dissertation, what steps
would you recommend for governments to build strategic trust?
A lot of work in both academic and policy circles has pointed to mechanisms
like increasing exchanges and trying to cooperate on so-called "easy" issues to
establish a pattern of cooperation. Meanwhile, politicians and diplomats tend
to be concerned with different forms of political theater to produce positive
headlines.
My theory suggests that if trust-building efforts do not actually change the
deeply-held perceptions that each side maintains about the other's national
identity, then you are not going to see a meaningful and lasting effect on the
level of strategic trust. That is not to say that exchanges and trying to rack
up points on easy issues is not worth doing or will not ultimately have some
positive effect. But the sorts of events and actions that really change
perceptions and then can allow for meaningful changes in strategic trust are
those that help redefine the relationship or the way that one side looks at the
other.
For example, if Japan were to have an entirely different memorial site where
its leaders could remember and honor Japan's veterans, separate from a shrine
that has a certain view of history associated with it that is very
objectionable to its neighbors, this could be something that would help change
perceptions. Contrast that to a carefully worded speech by a prime minister.
Japan has actually apologized dozens of times and yet the problem is still
there. Those apologies, as well-meaning as they may be, have not significantly
changed identity perceptions and hence we do not see much improvement in
strategic trust between Beijing and Tokyo.
Another example would be dealing with some of the recent maritime disputes. If
the China-Japan relationship had more strategic trust, it might be able to
encapsulate those issues and not let them derail the relationship. But this is
not yet the case. Coming to a greater level of agreement about how to deal with
economic zones and how to pursue joint development of underwater gas deposits
could really do a lot to improve perceptions on both sides. This would ameliorate Japanese
perceptions of an aggressive Chinese identity, and help resolve a hot-button
nationalist issue between the two populations. Real improvement in identity
perceptions, such that each side thinks better of the other's international
role and national characteristics, would allow Japan and China to realize a
more stable, trusting relationship.
What is the course that you will offer at Stanford and what approach will you
take to teaching?
The course will be about
nationalism and security relations in Northeast Asia. I am hoping to engage
these issues with some fresh perspective. What I want to do is provide students
with background on the different forms of nationalist conflict in Northeast
Asia to help them understand where these historical legacies and identity
frictions come from. These are really contemporarily relevant issues. I will
ask students to write on a very specific topic—a nationalist issue of their
choice—and develop not only their own analysis, but also some of their own
suggestions. This is a lot to expect, but I anticipate that the students are
going to be up to the challenge. The students will probably come from different
fields—including political science, history, sociology, and Asian studies. I
think that with their diverse backgrounds, they will benefit from the
environment here at Shorenstein APARC.
Shorenstein APARC is really special among centers—nationally and even
internationally—in the way that it brings together academic rigor, policy
relevance, and policy experience. We have top-flight academics, and we also
have very distinguished policymakers, who bring a wealth of experience to the
table. With more exchange between the academic and the policymaking
communities, both sides stand to benefit tremendously. Shorenstein APARC is one
of the few places that is doing this, and doing it so well.
Do you hope to work in academia or
government, or serve in both fields?
I plan to pursue an academic career, but at the same time to produce
research and publications with policy relevance. Teaching is incredibly
important because there is more and more demand among students with interest in
Asia, and increasing demand across sectors for people who have expertise in
Asian history and political economics. Teaching is an opportunity, not only to
help prepare the next generation of experts, but also to improve my research
and writing through interaction with students. Likewise, being able to take a
sabbatical to serve in an advisory role at the U.S. Department of State, the
Pentagon, or National Security Council would be a great opportunity to have
real-world impact on the incredibly pressing issues in U.S.-Asia relations.
Policy work is also a chance to expand one's own skillset and basis of
research.
Take for example, Thomas Christensen of Princeton University and Victor Cha of Georgetown University. Both are strong academics, who publish in top academic journals and produce academic books. They also served in the State Department and National Security Council respectively. After making positive contributions on the policy side, they returned to their universities with firsthand knowledge of the complex relationship between theory and practice. I hope to one day have an opportunity for public service and then return to academia with experience that is of value to my research and of value to my students.
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Eric Huang is a visiting scholar at CDDRL (Oct. 2010- June 2011) from Taiwan and is currently serving as the Secretary in the Ministry of Foreign Affairs, Republic of China (Taiwan). Prior to his current assignment in San Francisco, he served as the Unit Chief in the International Security Unit Research and Planning Committee at the Ministry. His previous oversea posts were in Hawaii and Cape Town, South Africa.
Mr. Huang received his B.A. from the Department of Diplomacy at National Cheng Chi University and a M.A. from American University.
From 2007 to 2010, a financial and economic crisis gripped the United States, Europe and the world. 7 million Americans lost their jobs, 10 million were pushed below the poverty line, thousands of families lost their homes, and many lost their savings. Somewhat lower numbers were reported from Europe, although the structural mechanisms behind the crisis were seemingly similar, eventually affecting not only the West, but the whole world. It is foreseen that the effects of the crisis will last for years, and it is still uncertain if a full recovery will be possible.
Given that a variety of highly speculative practices put into place by the banking and finance sector during the "neoliberal“ decades between the early 1990s and 2007 allegedly played a role in triggering the crisis, the request for more down-to-earth and sustainable ways of dealing with money and finance has surfaced to international attention. Particularly in Europe, social banks were among the most successful financial institutions during the crisis years, with annual growth rates of up to 30%, factually doubling their assets between 2007-10. This unprecedented success was supposedly due to the fact that many European savers shifted their assets from mainstream banks to social banks, driven by the hope that the latter would handle their money in less abstract and egoistic, and more realistic and community oriented ways. In recent years, social banks have forged influential global networks such as the Global Alliance of Banking on Values and the International Association of Investors in the Social Economy, which pursue the ambitious strategy of reaching out to 1 billion people by 2020.
Given that, not least as a result of the crisis, increasing numbers of people are improving their financial literacy and are taking a growingly critical stance towards the mainstream international banking and finance sector as we knew it before the crisis, the seminar poses the questions of whether (and how) social banking and social finance may concretely contribute to improving the current financial system, and how they might help to restore confidence in capitalism by providing “best practice” examples in selected fields.
The seminar will try to provide some answers to these questions by examining the pros and cons of contemporary social finance and by outlining perspectives of structural complimentarity and cooperation between speculative and sustainable finance.
Audio Synopsis:
In his seminar, Professor Roland Benedikter argues that too little has been done to reform the banking and financial sectors in the wake of the recent crisis, then presents social banking and social finance as an alternative system. First, he argues that the widespread bank bailouts of the past few years have "saved the wrong system" and points out that many of the largest US banks, for example, have actually grown since the crisis despite calls by the Obama administration for these banks to downsize or break in to smaller pieces. He acknowledges that new measures initiated by both the Obama administration (establishing a consumer protection bureau; imposing limits on fees by financial intermediaries) and by European countries (banning high-risk transactions in Germany; reducing public liability for private bank bailouts) are steps in the right direction. He adds his own suggestions, including increased regulation, better international agreements on regulating capital flows, a fee on high-risk speculative transactions, and a preventative tax on banks to protect against future crises. Many of these reforms, however, have faced enormous opposition from the major players in the banking and finance sectors in Britain, the United States, and China. Progress seems to have stalled, with popular figures like Niall Ferguson, who once led calls for dramatic reform, now insisting that the system is too resistant to change, and that simpler goals such as a new hippocratic oath for the financial sector will suffice.
Benedikter then presents social banking and social finance as an answer to the seemingly intractable problems of the traditional system. He first describes the industry in terms of what it is not. Traditional banks, he argues, made three major mistakes leading up to the crisis: irresponsibility (loans that were too high, too much derivative investment); lack of transparency; and unsustainability (by participating in speculation and contributing to market bubbles). The current economy, he explains, is based on a tripolar system: a "real" economy of manufacturing and tangible goods; and two "side economies" of real estate and financial derivatives, which have steadily drawn capital away from the real economy since 1989. A breakdown of this unsustainable system was predicted by multiple think tanks before 2007, based partly on the frantic growth of the derivatives market (from $100 trillion to $516 trillion annually between 2001 and 2006 - for perspective, Benedikter cites the annual world GDP figure of approximately $50 trillion).
Social banks, on the other hand, invest 100% of their capital toward responsible, transparent, and sustainable ventures such as green technology and social initiatives. Banks emphasize knowing their customers, which requires them to operate on a smaller scale than traditional banks, and conversely customers know where their money is invested and can even participate in making investment decisions. These decisions are meant to take the potential social as well as financial return on an investment into account. Benedikter describes this as a "Triple Bottom Line" approach, emphasizing profit, people, and the planet.
A discussion period following the presentation addressed questions including: What are the mechanisms available to enforcing the triple bottom line approach in social banking and social finance? Are social banks guided by a common charter? What are the details of the proposed high-risk transaction fee? Why have some US social banks been successful while others have struggled?
Reuben W. Hills Conference Room
Studies show high levels of anemia, nearsightedness, intestinal worms, and poor health and sanitation among children in China’s rural boarding schools. This project will measure initial health and nutrition levels of students in a randomized control setting, and deploy a set of affordable and sustainable interventions in treatment schools that includes multivitamins, eyeglasses, deworming medication, and nutrition and sanitation training. The project will then assess what works and what does not by comparing improvements in academic performance in treatment and control groups. The results of this experiment are intended to inform education and nutrition policy in China at the central and provincial levels.
Co-Principal Investigators on the project include Paul H. Wise, professor of pediatrics, FSI senior fellow, and Patricia Foo, MD/PhD student, economics. The grant, one of six offered by FSI, is intended to jumpstart early-stage multidisciplinary research projects that tackle the persistent problems of global under development.
Relations between the United States and South Korea today are stronger than ever, as reflected in President Barack Obama's recent announcement of his commitment with President Lee Myung-bak to ratifying the Korea-U.S. (KORUS) free trade agreement, the United States' largest free trade agreement since NAFTA. At the same time, the North Korean government's increasing aggressiveness amidst an impending leadership change in Pyongyang poses a serious challenge to the U.S.-South Korean longstanding alliance. Just one week after North Korea attacked the South Korean island of Yeonpyong, killing four people, Northeast Asia experts from the Walter H. Shorenstein Asia-Pacific Research Center (Shorenstein APARC) met in Seoul with scholars and former senior officials from the United States and South Korea to discuss the alliance, policy toward North Korea, and regional dynamics within Northeast Asia.
The Stanford scholars and experts visited Seoul in connection with two Shorenstein APARC initiatives by director Gi-Wook Shin, the Korea-U.S. West Coast Strategic Forum and the New Beginnings policy study group. Not surprisingly, their discussions focused on how to interpret and counter North Korea's recent heightened belligerence, including not only the Yeonpyeong attack but also the sinking of a South Korean navy vessel in March of this year with the loss of 46 sailors.
David Straub, associate director of Shorenstein APARC's Stanford Korean Studies
Program, notes that this was the first time since the Korean War
ended in 1953 that North Korea has attacked South Korean territory. "This
[attack on Yeonpyeong Island] is something that frightened the South Koreans,"
he says, "It was unexpected and unprecedented. With North Korea moving toward
putting Kim Jong-il's son in place as his successor, people in South Korea
assume there is a lot of potential instability in the North and that this may
be driving some of North Korea's actions. There is a lot of concern among the
average South Korean now about what North Korea might do."
Shin initiated the West Coast Strategic Forum in 2006 to give greater voice to
the many prominent Korea experts on the U.S. West Coast on Korea-related
issues, and to serve as an ongoing forum for the exchange of views on issues of
significance to the U.S.-South Korea alliance. This most recent meeting of the
Forum was the fifth session. Strategic Forum workshops are held semi-annually,
alternating between Stanford and Seoul. The Sejong Institute is Shorenstein
APARC's Korean counterpart organization. In addition, American and Korean
participants maintain frequent contact among themselves via telephone and
e-mail, and they travel individually to each other's country on a regular basis
to keep abreast of alliance developments.
The New Beginnings policy study group was
established in 2008, after a decade of rocky U.S.-South Korea relations, with
the promise of new presidential administrations in both countries. "We were
optimistic that relations could be improved and wanted to contribute to that effort,"
says Straub. The ten members of New Beginnings, leading scholars and experts on
Northeast Asian affairs throughout the United States, usually meet as a group
for workshop discussions once or twice each year, and travel together
occasionally for on-site discussions in Seoul, Washington, D.C., and New York.
Shorenstein APARC has partnered with The Korea Society of New York City on this
project. The group annually prepares a report for the U.S. administration with
recommendations for strengthening its alliance with South Korea.
During the meetings in South Korea, discussions about the alliance focused, in
part, on how to deter future attacks from North Korea, and how to better
respond-individually and jointly-in the event of another assault. The intended
ratification of the KORUS FTA was also discussed. According to Straub, the
KORUS FTA is generally viewed favorably in South Korea and is likely to be
ratified despite resistance from South Korea's opposition party. With South
Korea's total future trade with China soon expected to amount to more than its
combined trade with the United States and Japan, the FTA will not only
significantly bolster U.S.-South Korea trade, it will also broaden and deepen
the alliance relationship. "From a South Korean perspective it helps to
maintain some balance in overall relations between the United States and
China," states Straub, "It also serves as a precedent for South Korea's
intended negotiations with other countries for free trade agreements. In the
United States, President Obama has linked it to his plan to double export
growth by 2015."
Shorenstein APARC plans to continue holding meetings of both the West Coast Forum and New Beginnings. "Even though overall government-to-government relations are at their best ever," says Straub, "there are continuing political divisions in South Korea on issues of importance to the relationship and North Korea's behavior is getting increasingly worse. We think that there is reason to continue the New Beginnings project for some time to come." In addition to better informing policymakers in the United States and South Korea, the meetings of the Forum and of the New Beginnings policy group strengthen the scholarship of the participants, and all public documents, including the annual reports to the U.S. administration, are published on the Shorenstein APARC website.
