'Bimbogate' diverts U.S. attention

'Bimbogate' diverts U.S. attention

As the financial turmoil afflicting Asia has developed over
the last six months, the role played by the United States has
been critical. The Jakarta Post Asia correspondent Harvey
Stockwin attempts an overview of the U.S. posture towards Asia's
crisis, and how it will be affected by the alleged scandal
arising from President Bill Clinton's attempt to clear himself of
charges of sexual transgressions.

HONG KONG (JP): President Bill Clinton's so-called "bimbo
eruption" could not have come at a worst time for East or
Southeast Asia. "Bimbo eruption" sounds like a boil that needs to
be lanced -- and politically, that is precisely the situation
which Clinton faces.

The alleged scandal arises when Asia, by contrast, is faced by
a situation in which the world's fourth largest nation,
Indonesia, seems close to financial collapse, as a result of the
free fall of the rupiah, and a seemingly inevitable partial
default on its foreign borrowings.

Even before the world outside the American Middle Kingdom ever
heard of Ms Monica Lewinsky, the Clinton administration appeared
to be giving less than its full attention to what is arguably the
most serious Asian crisis since the Vietnam War.

Now, as what will probably be called "Bimbogate" threatens
Clinton's effectiveness and durability, and attains cyclonic
force in the frenzied world of the sensation-seeking U.S. media,
it appears that the Americans are in real danger of joining the
Japanese: instead of providing and sustaining a solution to the
East and Southeast Asian financial crisis, the Americans, too,
may become part of the problem.

They were in danger of becoming that anyway. Ever since the
great Southeast Asian stock and currency slide began last July,
to be quickly followed by the great East Asian Economic setback,
the Clinton administration has been faced with a delicate
diplomatic problem.

On the one hand, the Clinton administration was bound, by the
very nature of the crisis, to take positions which the super-
sensitive would misconstrue as inconsiderate at best, or
neocolonial at worst -- as some sections of South Korean opinion
already have done.

On the other hand, the Americans simply had to take a fairly
firm stand, even if they did intend to visit the Asian crises
mainly on the coattails of the International Monetary Fund (IMF)
and the World Bank.

The obvious answer was to combine a firm posture with a policy
of careful consideration and empathy for its friends and allies
on the other side of the Pacific. The U.S. had no choice, for
example, but to insist repeatedly to the South Koreans that their
lack of openness to the outside world lay near the heart of their
economic crisis and must be rectified. It would have been easier
to stress this if it had been accompanied by some high-level
visits to convey reassurance, thereby trying to undermine
predictable Korean xenophobia.

Leaving aside what Clinton really does accomplish inside the
Oval Office, in the real world it has been a case of "none of the
above".

U.S. policy towards South Korea has mirrored the self-
defeating softness of past U.S. policy towards Japan -- thereby
implicitly accepting essentially mercantilist policies which are
neither in the American nor the East Asian longterm interest.

Unable to pay enough attention to Korea, until events on the
money markets forced it to do so, the administration soft-
pedaled its justifiable demands for a more open economy. But
that soft-pedaling has still been enough to enable xenophobia to
take firmer hold. The Americans are in the unenviable position of
being damned if they do, and damned if they don't.

Meanwhile Koreans are writing articles lauding the success of
their "campaign" to radically reduce the "enemy" of foreign
imports as a triumph of economic good sense. Nowhere is it
pointed out in such articles that if Americans, Asians and
Europeans felt the same way about curtailing Korean imports, the
Korean crisis would become unimaginably worse, and South Korea
would never have achieved its present level of development.

It is difficult to escape the conclusion that, at the heart of
the trouble with they have handled the regional crises, the
Americans have failed because they did not take the creeping
crisis seriously enough as early as they should have done.

Clinton himself illustrated this as he attended the Asia
Pacific Economic Cooperation forum summit in December in
Vancouver and was reported as referring to the crisis as merely
being a "glitch" in regional progress -- far too sanguine a view
in view of what had already happened at that stage.

There may have been some U.S.-Singapore interaction at work in
Clinton's remark. Singapore had also tended towards a far too
relaxed view of the crisis, possibly because its stock and
currency have been less badly affected than any other nation.
Prime Minister Goh Chok Tong had long called the crisis a mere
"blip" on the ASEAN radar screen. Goh and Clinton played golf
together prior to Clinton making his "glitch" remark.

Be that as it may, the lack of an American sense of urgency,
regarding Asia's financial woes, has been well illustrated in
relation to Thailand. On the one hand, if an appropriate degree
of toughness early on had emanated from Washington DC in relation
to regionally damaging procrastination in Bangkok, it might have
helped to bring about the earlier fall of the excessively corrupt
Chavalit government.

On the other hand, now that there has been a democratic change
to an administration which at least faces up to Thailand's
difficulties, the U.S. seems only inclined to support it with
words. This seemed to be the pattern as the Thai Minister of
Finance Tarrin Nimmanahaeminda visited Washington just before
Bimbogate burst upon the scene.

Given the Thai perception of themselves as longtime allies of
the United States, as well as being a nation seeking to
strengthen both its democracy and its economy, it really was
essential for the Clinton administration to give some tangible
sign of support. As far as can be seen it was not forthcoming and
the Thai sense of disappointment was palpable. Washington was
seen, in Bangkok, as favoring far-from-democratic Indonesia.

In point of fact, the America-centric nature of current U.S.
foreign policy was almost certainly illustrated by the treatment
accorded to Finance Minister Tarrin, even before Bimbogate.
Having already failed to get Congress to renew Clinton's ability
to "fast-track" trade agreements (a crucial failure as far as
Asia is concerned), the Clinton administration is also far from
certain about securing Congressional approval of an American
replenishment of its pledges to the IMF.

This replenishment, involving renewal of periodic pledges plus
support for a new emergency fund, is absolutely vital if the IMF
is to fulfill the role being allotted to it in the current
crises.

Anxious to demonstrate its toughness to Congress, Clinton and
Treasury Secretary Rubin no doubt felt they could not afford to
"replenish" the Thais. Hence they could only give Tarrin verbal
support, as domestic political considerations took precedence
over what should have been an important foreign policy
imperative.

Put another way, the Clinton administration was on the
defensive in its Asia policy before Bimbogate broke -- and now
that the alleged scandal and its accompanying media frenzy has
broken, it will probably be even more on the defensive.

The sorry tale was superbly illustrated as Rubin finally got
around to delivering a lengthy and substantial speech about the
Asian financial crisis on Jan. 21 at Georgetown University.
"Simply put," Rubin said, "we cannot afford to stand back and
gamble that the crisis will resolve itself".

But that is precisely what the U.S. has appeared to do for far
too long. Rubin's speech itself should have been delivered months
ago -- then his articulation of American views and policy
regarding the crisis might have had greater impact.

Given the delay in delivering the U.S. crisis assessment, it
would have been better if Clinton himself had now delivered the
speech. But Clinton's mind was almost certainly elsewhere.
Ironically, Rubin's articulation of U.S. aims was drowned out in
the American media by the breaking scandal.

Ironically, too, Asian leaders beset by financial woes will
probably not be carefully reading the Rubin speech as they should
be doing.

Much more likely, they will be eagerly absorbing cables from
their ambassadors in Washington assessing whether or not a second
U.S. presidential resignation is in the offing, or whether a
distracted Clinton presidency is likely to have the effect of
deepening Asia's ongoing crisis.