[Senate Hearing 111-135]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 111-135
 
         MARITIME DISPUTES AND SOVEREIGNTY ISSUES IN EAST ASIA

=======================================================================

                                HEARING

                               BEFORE THE

                      SUBCOMMITTEE ON EAST ASIAN 
                          AND PACIFIC AFFAIRS

                                 OF THE

                     COMMITTEE ON FOREIGN RELATIONS
                          UNITED STATES SENATE

                     ONE HUNDRED ELEVENTH CONGRESS

                             FIRST SESSION

                               __________

                             JULY 15, 2009

                               __________

       Printed for the use of the Committee on Foreign Relations


 Available via the World Wide Web: http://www.access.gpo.gov/congress/
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                COMMITTEE ON FOREIGN RELATIONS         

             JOHN F. KERRY, Massachusetts, Chairman        
CHRISTOPHER J. DODD, Connecticut     RICHARD G. LUGAR, Indiana
RUSSELL D. FEINGOLD, Wisconsin       Republican Leader designee
BARBARA BOXER, California            BOB CORKER, Tennessee
ROBERT MENENDEZ, New Jersey          JOHNNY ISAKSON, Georgia
BENJAMIN L. CARDIN, Maryland         JAMES E. RISCH, Idaho
ROBERT P. CASEY, Jr., Pennsylvania   JIM DeMINT, South Carolina
JIM WEBB, Virginia                   JOHN BARRASSO, Wyoming
JEANNE SHAHEEN, New Hampshire        ROGER F. WICKER, Mississippi
EDWARD E. KAUFMAN, Delaware
KIRSTEN E. GILLIBRAND, New York
                  David McKean, Staff Director        
        Kenneth A. Myers, Jr., Republican Staff Director        

                         ------------          

         SUBCOMMITTEE ON EAST ASIAN AND PACIFIC AFFAIRS        

                  JIM WEBB, Virginia Chairman        

CHRISTOPHER J. DODD, Connecticut     Republican Leader designee
RUSSELL D. FEINGOLD, Wisconsin       JOHNNY ISAKSON, Georgia
BARBARA BOXER, California            JOHN BARRASSO, Wyoming
ROBERT P. CASEY, Jr., Pennsylvania   ROGER F. WICKER, Mississippi
KIRSTEN E. GILLIBRAND, New York

                              (ii)        

  
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                            C O N T E N T S

                              ----------                              
                                                                   Page

Blumenthal, Daniel, resident fellow, American Enterprise 
  Institute, Washington, DC......................................    26
    Prepared statement...........................................    30
Cronin, Dr. Richard, senior associate, The Henry L. Stimson 
  Center, Washington, DC.........................................    34
    Prepared statement...........................................    37
Dutton, Peter, associate professor of strategic studies, China 
  Maritime Studies Institute, U.S. Naval War College, Washington, 
  DC.............................................................    17
    Prepared statement...........................................    21
Marciel, Hon. Scott, Deputy Assistant Secretary of State, Bureau 
  of East Asian and Pacific Affairs, Ambasssador for ASEAN 
  Affairs, Department of State, Washington, DC...................     3
    Prepared statement...........................................     6
Scher, Robert, Deputy Assistant Secretary of Defense for South 
  and Southeast Asia, Department of Defense, Washington, DC......     8
    Prepared statement...........................................    11
Webb, Hon. Jim, U.S. Senator from Virginia, opening statement....     1

                                 (iii)

  


         MARITIME DISPUTES AND SOVEREIGNTY ISSUES IN EAST ASIA

                              ----------                              


                        WEDNESDAY, JULY 15, 2009

                               U.S. Senate,
    Subcommittee on East Asian and Pacific Affairs,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 2:35 p.m., in 
room SD-419, Dirksen Senate Office Building, Hon. Jim Webb 
(chairman of the subcommittee) presiding.
    Present: Senator Webb.

              OPENING STATEMENT OF HON. JIM WEBB,
                   U.S. SENATOR FROM VIRGINIA

    Senator Webb. Good afternoon. The hearing will come to 
order.
    In this first oversight hearing of the East Asian and 
Pacific Affairs Subcommittee, in the 111th Congress, we will 
examine maritime territorial issues in Asia, and how 
sovereignty issues are impacting the region and United States 
interests.
    No other topic brings into light the enormous and complex 
challenges facing the United States in Asia. At the pinnacle of 
this issue is China's growing military, diplomatic, and 
economic power, not only in the region, but also worldwide. 
China's evolution has changed the regional economic balance, 
has enabled China to expand its political influence. Across the 
East Asian mainland, from Burma to Vietnam, we have heard 
statements of concern about the impact of China's reach.
    As the United States continues its attempt to isolate 
Burma, due to the human rights policies of its military regime, 
China's influence has grown exponentially, including the recent 
announcement of a multibillion dollar oil pipeline project that 
would enable the Chinese to offload oil obtained in the Persian 
Gulf and pump it to Yunnan province without having to transit 
the choke point of the Strait of Malacca.
    In Vietnam this past January, General Vo Nguyen Giap, 
commander in chief of the Vietnam People's Army during the 
Vietnam war, and former Defense Minister, sent an open letter 
to the Vietnamese Government. He called for a halt to a huge 
multibillion dollar Chinese bauxite mining project in Vietnam's 
Central Highlands, citing environmental damage, harm to ethnic 
minorities, and, most importantly, his view that it was a 
threat to Vietnam's national security.
    Importantly, China has sought not only to expand its 
economic and political influence, but also to expand its 
territory. China's military modernization has directly 
supported this endeavor. The PLA Navy is developing blue-water 
capabilities that will enable it to project power into the 
region and beyond. China today has 241 principal combatant 
warships in its navy, including 60 submarines, and the 
Department of Defense reported earlier this year that the PLA 
Navy is considering building multiple aircraft carriers by 
2020.
    In addition to the construction of aircraft carriers, the 
PLA Navy has been rapidly modernizing its submarine fleet and 
surface combatants to enhance its ability to project power from 
its coast. This poses a significant threat to the current 
geostrategic balance in Asia.
    Of particular concern are China's sovereignty claims in the 
East China Sea and South China Sea. At the forefront of these 
disputes is Taiwan. However, the attention to this potential 
conflict has obscured attention to other disputes in the 
region. China also lays claim to the Senkaku Islands, the 
Spratly Islands, and the Paracel Islands.
    Despite Japan's control over the Senkaku Islands since the 
end of World War II, and the recognition of others, including 
the United States, of Japan's sovereignty over these islands, 
China still claims publicly its sovereignty over the Senkakus.
    Furthermore, the Chinese Communist Party has, to my 
understanding, never officially recognized Japan's sovereignty 
over the Ryukyu Islands, which includes, importantly, Okinawa.
    In the South China Sea, myriad unresolved disputes involve 
several island groups claimed in whole or in part by China, 
Vietnam, the Philippines, Taiwan, Malaysia, and Brunei. Key 
claims focus on the Spratly Islands, composed of 21 islands and 
atolls, 50 submerged land atolls, and 28 partially submerged 
reefs. Their total land mass is small, but they spread out over 
340,000 square miles. China and Vietnam also claim the 
Paracels, a smaller group of islands located south of China's 
Hainan Island.
    These disputes seriously impact third countries in the 
region, and it is important to point out that only the United 
States has both the stature and the national power to confront 
the obvious imbalance of power that China brings to these 
situations. And in that regard, we have an obligation to 
maintain a geostrategic balance in the region that ensures 
fairness for every nation in Asia and protects the voice of 
every country seeking a peaceful resolution to their disputes.
    The participation of the United States in these disputes 
also affects how these countries perceive threats in their 
regional environment, and what options they may have available 
to them as they seek to protect their interests. China has 
demonstrated its willingness to display new military 
capabilities, and at times to use force to claim maritime 
territory. In response, other countries in the region are 
modernizing their naval capabilities, such as Vietnam's recent 
decision to purchase Kilo-class submarines from Russia.
    Additionally, many observers note that China's pattern of 
intimidation may hinder free and fair economic development in 
the region. As one example, China's recent detention of 
Vietnamese fishermen near the Paracel Islands, and its overt 
threats to United States oil companies operating in the South 
China Sea, highlight the increased risks to shipping and 
fishing, and the limited prospects, resource exploitation. 
These actions, left unanswered, may threaten the well-being of 
the region.
    These disputes also significantly affect the United States 
by endangering regional peace and security. As the 1995-96 
Taiwan Strait missile crisis demonstrates, the United States is 
the only world power capable of responding to aggressive and 
intimidating acts by China. In looking at recent events, it 
appears that the United States is responding to maritime 
incidents as singular tactical challenges, while China appears 
to be acting with a strategic vision. These troubling incidents 
include, but are not limited to, the EP-3 crisis in 2001, the 
surfacing of a Chinese submarine in the midst of the USS Kitty 
Hawk carrier battle group in 2006, the harassment of the USNS 
Impeccable, in March of this year, and the collision of a 
Chinese sub with the USS John McCain sonar cable, just last 
month.
    I'm interested to hear our witnesses' thoughts on how the 
United States should be responding to these sorts of incidents. 
As a maritime nation, the United States should maintain the 
quality and strength of its sea power. The recent trajectory of 
American sea power is, quite frankly, not encouraging. When I 
first entered the Marine Corps, in 1968, there were 931 
combatant ships in the U.S. Navy. When I served as Secretary of 
the Navy, 20 years later, this battle force numbered 569 ships. 
At present the U.S. Navy has 284 deployable battleforce ships; 
42 percent of them underway on any given day. And, although the 
quality of China's 241 ships cannot match that of the United 
States, that quality gap also is closing.
    If the United States is to remain an Asian nation and a 
maritime nation, our Nation's leaders have a choice to make. 
Our diplomatic corps and our military, and especially our Navy, 
must have the resources necessary to protect American interests 
and the interests of our friends and our allies.
    To reflect the complexity of maritime disputes in Asia, 
today's hearing will have two panels. I'd like to extend my 
thanks to the administration for having Deputy Assistant 
Secretary Scot Marciel, who also serves as the Ambassador to 
ASEAN, and Deputy Assistant Secretary Robert Scher, of the 
Defense Department, to provide the administration's perspective 
on those issues.
    In addition, we have three highly qualified witnesses in 
our second panel to expound upon the strategic and economic 
impacts of these disputes.
    I thank all of you for appearing today, and look forward 
very much to hearing your remarks, and also having your 
insights.
    With that, I would like to welcome our first panel, and in 
whichever order you gentlemen would like to proceed. I would 
ask that you could summarize your remarks in 10 minutes or so, 
and your full statements will be entered into the record.

 STATEMENT OF HON. SCOT MARCIEL, DEPUTY ASSISTANT SECRETARY OF 
STATE, BUREAU OF EAST ASIAN AND PACIFIC AFFAIRS, AMBASSADOR FOR 
       ASEAN AFFAIRS, DEPARTMENT OF STATE, WASHINGTON, DC

    Ambassador Marciel. Thank you very much, Mr. Chairman.
    Chairman Webb and members of the subcommittee, I'm pleased 
to testify before you today on maritime and sovereignty 
disputes in East Asia. The sea-lanes that run through East Asia 
are some of the world's prime arteries of trade. Over half the 
world's merchant fleet, by tonnage, sails through the South 
China Sea each year, for example.
    These sea-lanes are of great strategic importance to the 
United States. We have an abiding interest in maintaining 
stability, freedom of navigation, and the right to lawful 
commercial activity in East Asia's waterways. We've used 
diplomacy, commerce, and our military presence, especially that 
of the U.S. Navy, to keep the peace and protect our interests. 
Our policy has aimed, also, to support respect for 
international maritime law, including the U.N. Convention on 
the Law of the Sea. As you know, Mr. Chairman, this 
administration supports ratifying the Convention, and in 
practice our vessels comply with its provisions governing 
traditional uses of the oceans.
    Mr. Chairman, I'd like to focus my remarks on three topics. 
First, the multiple sovereignty disputes in the South China 
Sea. Second, recent incidents involving China, and the 
activities of U.S. naval vessels in international waters, 
within China's Exclusive Economic Zone, or EEZ. And finally, 
the strategic contexts of these distinct topics, and how the 
United States should respond.
    China, Vietnam, Taiwan, the Philippines, Malaysia, 
Indonesia, and Brunei--each claims sovereignty over parts of 
the South China Sea, including the 200 small land features that 
make up the Paracel and Spratly Islands chains. Despite the 
competing claims, the South China Sea is largely at peace and 
has avoided sustained military conflict.
    In 2002, the ASEAN countries and China signed the 
Declaration on the Conduct of Parties in the South China Sea. 
While nonbinding, it set out some useful principles, such as 
peaceful resolution, self-restraint, and freedom of navigation, 
and signaled a willingness among claimants to approach this 
dispute multilaterally. A multilateral solution that builds on 
this agreement could offer the best way to preserve the 
interests of all parties.
    The United States does not take sides on the competing 
legal claims over territorial sovereignty in the South China 
Sea. In other words, we do not take sides on the claims of 
sovereignty over the islands and other land features in the 
South China Sea, or on the maritime zones that derive from 
those land features. We do, however, have concerns about claims 
to territorial waters or any maritime zone that does not derive 
from a land territory. Such maritime claims are not consistent 
with international law, as reflected in the Law of the Sea 
Convention. We've urged all claimants to exercise restraint. 
We've made clear that we oppose the threat or use of force, and 
any action that hinders freedom of navigation. We would like to 
see a resolution in accordance with international law, 
including the U.N. Convention on the Law of the Sea.
    We remain concerned about tension between China and 
Vietnam, as both countries seek to tap potential oil and gas 
deposits that lie beneath the South China Sea. Starting in the 
summer of 2007, China told a number of United States and 
foreign oil firms to stop exploration work with Vietnamese 
partners in the South China Sea, or face unspecified 
consequences in their business dealings with China. We object 
to any effort to intimidate U.S. companies.
    During a visit to Vietnam last September, then-Deputy 
Secretary of State John Negroponte asserted the right of United 
States companies operating in the South China Sea and stated 
that we believe that disputed claims should be dealt with 
peacefully and without resort to any type of coercion. We've 
raised our concerns with China directly. Sovereignty disputes 
between nations should not be addressed by attempting to 
pressure companies that are not party to the dispute.
    Aside from the South China Sea, there are various other 
maritime disputes in East Asia, which, Mr. Chairman, you've 
already mentioned. I'd be happy to address these further if you 
wish. We continue to monitor all disputes, as quarrels over 
sovereignty can escalate quickly.
    I would like to briefly discuss the recent incidents 
involving China and the activities of U.S. vessels, although my 
colleague will go into that in more detail. In March 2009, the 
USNS Impeccable was conducting routine operations, consistent 
with international law, in international waters, in the South 
China Sea. Actions taken by Chinese fishing vessels to harass 
the Impeccable put ships of both sides at risk, interfered with 
freedom of navigation, and were inconsistent with the 
obligation for ships at sea to show due regard for the safety 
of other ships. We protested these actions to the Chinese, and 
urged that our differences be resolved through dialogue, not 
through ship-to-ship confrontations that put our sailors at 
risk.
    Our concerns centered on China's conception of its legal 
authority over other countries' vessels operating in its 
Exclusive Economic Zone, or EEZ, and the unsafe way that China 
sought to assert what it considers its maritime rights. China's 
view of its rights on this point is not supported by 
international law. We have stated that clearly to the Chinese, 
and underscored that United States vessels will continue to 
operate lawfully in international waters.
    In closing, I'd like to look at both of these topics, the 
EEZ concerns and the overlapping South China Sea claims, in a 
broader strategic context. Specifically, what do these issues 
signify for international law and for the evolving power 
dynamics in East Asia, and how should the United States 
respond?
    The Impeccable incident and the sovereignty disputes in the 
South China Sea are distinct issues that require distinct 
policy responses. On a strategic level, however, both issues 
highlighted growing assertiveness by China in regard to what it 
sees as its maritime rights. In some cases, we do not share, or 
even understand, China's interpretation of international 
maritime law. We do believe there are constructive ways to 
tackle these difficult issues.
    On the freedom of navigation in the EEZ by United States 
naval vessels, we've urged China to address our differences 
through dialogue. China has now agreed to hold a special 
session of our military and maritime consultative agreement to 
take up the issue. In the case of the South China Sea 
sovereignty dispute, we've encouraged all parties to pursue 
solutions in accordance with the U.N. Convention on the Law of 
the Sea, and to build on the 2002 agreement between ASEAN and 
China.
    There is ambiguity in China's claims to the South China 
Sea, both in terms of the exact boundaries of its claims, and 
whether it is an assertion of territorial waters over the 
entire body of water, or only over its land features. In the 
past, this ambiguity has had little impact on U.S. interests. 
It has become a concern, however, with regard to the pressure 
China has put on our energy firms, as some of the offshore 
blocs that have been subject to Chinese complaint do not appear 
to lie within China's claim. It would be helpful to all parties 
if China provided more clarity on the substance of its claims.
    We need to be vigilant to ensure our interests are 
protected. When we have concerns, we will raise them candidly, 
as we have done over the pressuring of our companies. We know 
that China has taken a more conciliatory approach to resolving 
some disputes over land borders, reaching a demarcation 
agreement last year, for example, with Vietnam. China's 
diplomacy toward South East Asia has generally emphasized good-
neighborliness. China's antipiracy deployment to the Gulf of 
Aden has been a positive contribution to a common international 
concern.
    We're encouraged by these steps, and hope that China will 
apply a similar constructive approach to its maritime rights 
and boundaries. We have a broad relationship with China, Mr. 
Chairman, as you know. It covers many issues of strategic 
importance to both countries. We agree on some issues. On some 
others, we, frankly, have differences. Our bilateral 
relationship can accommodate those differences and address them 
responsively through dialogue.
    Thank you for the opportunity to testify, and I look 
forward to answering your questions.
    [The prepared statement of Ambassador Marciel follows:]

 Prepared Statement of Deputy Assistant Secretary Scot Marciel, Bureau 
 of East Asian and Pacific Affairs, Department of State, Washington, DC

    Chairman Webb and members of the subcommittee, I am pleased to 
testify before you today on maritime and sovereignty issues in East 
Asia. The sea-lanes that run through East Asia are some of the world's 
busiest and most strategically important. They serve as the prime 
arteries of trade that have fueled the tremendous economic growth of 
the region and brought prosperity to the U.S. economy as well. Billions 
of dollars of commerce--much of Asia's trade with the world, including 
the United States--flows annually through those waters. Over half of 
the world's merchant fleet by tonnage sails through the South China Sea 
alone each year.
     The United States has long had a vital interest in maintaining 
stability, freedom of navigation, and the right to lawful commercial 
activity in East Asia's waterways. For decades, active U.S. engagement 
in East Asia, including the forward-deployed presence of U.S. forces, 
has been a central factor in keeping the peace and preserving those 
interests. That continues to be true today. Through diplomacy, 
commerce, and our military presence, we have protected vital U.S. 
interests. Our relationships with our allies remain strong, the region 
is at peace, and--as you know well--the U.S. Navy continues to carry 
out the full range of missions necessary to protect our country and 
preserve our interests.
     Our presence and our policy have also aimed to support respect for 
international maritime law, including the U.N. Convention on the Law of 
the Sea. Although the United States has yet to ratify the Convention, 
as you know Mr. Chairman, this administration and its predecessors 
support doing so, and in practice, our vessels comply with its 
provisions governing traditional uses of the oceans.
     Issues surrounding maritime and sovereignty disputes in East Asia 
are multifaceted and complex. With your indulgence, Mr. Chairman, I am 
going to focus on three topics:

--First, the multiple sovereignty disputes in the South China Sea;
--Second, recent incidents involving China and the activities of U.S. 
    naval vessels in international waters within that country's 
    Exclusive Economic Zone (EEZ);
--And finally, the strategic context of these distinct topics and how 
    the United States should respond.

    China, Vietnam, Taiwan, the Philippines, Malaysia, Indonesia, and 
Brunei each claim sovereignty over parts of the South China Sea, 
including its land features. The size of each party's claim varies 
widely, as does the intensity with which they assert it. The claims 
center on sovereignty over the 200 small islands, rocks, and reefs that 
make up the Paracel and Spratly Islands chains.
    Sovereignty disputes notwithstanding, the South China Sea is 
largely at peace. Tensions among rival claimants rise and fall. To 
date, the disputes have not led to sustained military conflict. In 
2002, the ASEAN countries and China signed the ``Declaration on the 
Conduct of Parties in the South China Sea.'' While nonbinding, it set 
out useful principles, such as that all claimants should ``resolve 
disputes . . . by peaceful means'' and ``exercise self-restraint,'' and 
that they ``reaffirm their respect for and commitment to the freedom of 
navigation in and overflight above the South China Sea, as provided for 
by the universally recognized principles of international law, 
including the 1982 U.N. Convention on the Law of the Sea.''
    More importantly, the 2002 document signaled a willingness among 
claimants to approach the dispute multilaterally. We welcomed this 
agreement, which lowered tensions among claimants and strengthened 
ASEAN as an institution. It has not eliminated tensions, nor has it 
eliminated unilateral actions by claimants in the South China Sea, but 
it's a start, and a good basis on which to address conflict in the 
region diplomatically.
    U.S. policy continues to be that we do not take sides on the 
competing legal claims over territorial sovereignty in the South China 
Sea. In other words, we do not take sides on the claims to sovereignty 
over the islands and other land features in the South China Sea, or the 
maritime zones (such as territorial seas) that derive from those land 
features. We do, however, have concerns about claims to ``territorial 
waters'' or any maritime zone that does not derive from a land 
territory. Such maritime claims are not consistent with international 
law, as reflected in the Law of the Sea Convention.
    We remain concerned about tension between China and Vietnam, as 
both countries seek to tap potential oil and gas deposits that lie 
beneath the South China Sea. Starting in the summer of 2007, China told 
a number of U.S. and foreign oil and gas firms to stop exploration work 
with Vietnamese partners in the South China Sea or face unspecified 
consequences in their business dealings with China.
    We object to any effort to intimidate U.S. companies. During a 
visit to Vietnam in September 2008, then-Deputy Secretary of State John 
Negroponte asserted the rights of U.S. companies operating in the South 
China Sea, and stated that we believe that disputed claims should be 
dealt with peacefully and without resort to any type of coercion. We 
have raised our concerns with China directly. Sovereignty disputes 
between nations should not be addressed by attempting to pressure 
companies that are not party to the dispute.
    We have also urged that all claimants exercise restraint and avoid 
aggressive actions to resolve competing claims. We have stated clearly 
that we oppose the threat or use of force to resolve the disputes, as 
well as any action that hinders freedom of navigation. We would like to 
see a resolution in accordance with international law, including the 
U.N. Convention on the Law of the Sea.
    There are various other maritime-related disputes in East Asia. 
Japan and China have differences over EEZ limits in the East China Sea, 
and sovereignty over the Senkaku Islands. These disputes have drawn 
less attention than those in the South China Sea. We continue to 
monitor developments on all of these maritime disputes, as quarrels 
over sovereignty can escalate quickly in a region where nationalist 
sentiment runs strong.
    I would now like to discuss recent incidents involving China and 
the activities of U.S. vessels in international waters within that 
country's Exclusive Economic Zone (EEZ). In March 2009, the survey ship 
USNS Impeccable was conducting routine operations, consistent with 
international law, in international waters in the South China Sea. 
Actions taken by Chinese fishing vessels to harass the Impeccable put 
ships of both sides at risk, interfered with freedom of navigation, and 
were inconsistent with the obligation for ships at sea to show due 
regard for the safety of other ships. We immediately protested those 
actions to the Chinese Government, and urged that our differences be 
resolved through established mechanisms for dialogue--not through ship-
to-ship confrontations that put sailors and vessels at risk.
    Our concern over that incident centered on China's conception of 
its legal authority over other countries' vessels operating in its 
Exclusive Economic Zone (EEZ) and the unsafe way China sought to assert 
what it considers its maritime rights.
    China's view of its rights on this specific point is not supported 
by international law. We have made that point clearly in discussions 
with the Chinese and underscored that U.S. vessels will continue to 
operate lawfully in international waters as they have done in the past.
    I would note that there have been no further incidents of 
harassment by Chinese fishing vessels since mid-May.
    In closing, I would like to look at both these concerns--the EEZ 
concerns with China and the overlapping South China Sea claims--in a 
broader strategic context. Specifically, what do these issues signify 
for international law and for the evolving power dynamics in East Asia, 
and how should the United States respond?
    The Impeccable incident and the sovereignty disputes in the South 
China Sea are distinct issues that require distinct policy responses 
from the United States. On a strategic level, to an extent, both issues 
highlight a growing assertiveness by China in regard to what it sees as 
its maritime rights. In some cases, we do not share or even understand 
China's interpretation of international maritime law.
    We believe that there are constructive ways, however, to tackle 
these difficult issues. With respect to freedom of navigation in the 
EEZ by U.S. naval vessels, we have urged China to address our 
differences through dialogue. Last month at the Defense Consultative 
Talks in Beijing, Under Secretary of Defense for Policy Michele 
Flournoy raised this issue, and the Chinese agreed to hold a special 
session of our Military Maritime Consultative Agreement (signed in 
1998) to take up this issue and seek to resolve differences.
    In the case of the conflicting sovereignty claims in the South 
China Sea, we have encouraged all parties to pursue solutions in 
accordance with the U.N. Convention on the Law of the Sea, and other 
agreements already made between ASEAN and China.
    The assertions of a number of claimants to South China Sea 
territory raise important and sometimes troubling questions for the 
international community regarding access to sea-lanes and marine 
resources. There is considerable ambiguity in China's claim to the 
South China Sea, both in terms of the exact boundaries of its claim and 
whether it is an assertion of territorial waters over the entire body 
of water, or only over its land features. In the past, this ambiguity 
has had little impact on U.S. interests. It has become a concern, 
however, with regard to the pressure on our energy firms, as some of 
the offshore blocks that have been subject to Chinese complaint do not 
appear to lie within China's claim. It might be helpful to all parties 
if China provided greater clarity on the substance of its claims.
    We need to be vigilant to ensure our interests are protected and 
advanced. When we have concerns, we will raise them candidly, as we 
have done over the pressuring of our companies.
    We note that China has taken a more conciliatory approach to 
resolving some disputes over its land borders. Last year, for example, 
China and Vietnam concluded a land border demarcation agreement. 
China's general diplomatic approach to Southeast Asia has emphasized 
friendship and good-neighborliness. Likewise, China's antipiracy 
deployment to the Gulf of Aden has been a positive contribution to a 
common international concern. We are encouraged by these steps, and 
hope that China will apply the same constructive approach to its 
maritime rights and boundaries.
    We have a broad relationship with China, Mr. Chairman, which 
encompasses many issues of vital strategic importance to both 
countries. We agree closely on some issues; on others, we frankly have 
differences. Our bilateral relationship can accommodate and respect 
those differences, and address them responsibly through dialogue.

    Senator Webb. Thank you very much, Ambassador Marciel.
    Mr. Scher.

   STATEMENT OF ROBERT SCHER, DEPUTY ASSISTANT SECRETARY OF 
 DEFENSE FOR SOUTH AND SOUTHEAST ASIA, DEPARTMENT OF DEFENSE, 
                         WASHINGTON, DC

    Mr. Scher. Mr. Chairman, thank you for inviting me to 
appear before your subcommittee today to provide testimony on 
maritime territorial disputes and sovereignty issues. I'm 
honored to be here with Deputy Assistant Secretary Scot 
Marciel.
    As you have noted, I've submitted written testimony for the 
record, so I will try to keep my opening remarks relatively 
brief, to just highlight some of the key issues.
    I do want to commend the subcommittee's continuing interest 
in this important topic. These issues are central in the Asia-
Pacific security equation, and ones that we, in the Department 
of Defense, are paying very close attention to. I look forward 
to sustaining an ongoing dialogue with you as dynamics evolve.
    The Asia-Pacific region, for the past two decades, has 
largely been at peace. It has been stable, and that stability 
has redounded to the benefit of all. Despite this stability, 
one of the factors that we see potentially challenging the 
Asia-Pacific security environment--and it is, in fact, the 
subject of today's hearing--is a series of persistent 
territorial disputes, particularly disputes over maritime 
territories in Southeast Asia and the South China Sea.
    As I note in my written testimony, the sources of the 
rising frictions are varied. But clearly China has played a key 
role in this evolving strategic environment. In analyzing 
China's activities, I think it's important to draw a 
distinction between the harassment of United States naval 
auxiliary vessels near China and, by extension, China's 
interpretation of the rights of vessels in Exclusive Economic 
Zones, and China's behavior as it relates to the sovereignty 
disputes in South China Sea, in general. While it's important 
to draw this distinction in China's behavior, the basis for the 
United States response applies equally to both.
    As I've noted in the written testimony, the Department of 
Defense views Chinese behavior in its EEZ, and more broadly in 
the South China Sea region--an area, by the way, claimed as 
China territorial waters, but not recognized as such by the 
international community--as having two basic premises. First, 
there's the strategic issue of China's claim to sovereignty 
over the entire South China Sea. This plays out mainly in 
political and economic fronts, which have been discussed in 
detail by Scot, and involve many countries within the region. 
Many, if not most, of these claims are conflicting, notably in 
areas around the Spratly and Paracel Islands.
    Second, to support the growing strategic and political 
emphasis in this region, China has increased, and is likely to 
continue to increase, its force's military posture in the South 
China Sea. As the PLA has upgraded its facilities on Hainan 
Island, for example, we see a direct correlation with PRC 
assertiveness in its reaction to U.S. surface and air activity. 
It is this issue I'd like to address first.
    To be clear, the Department strongly objects to 
provocative, reckless, and unsafe behavior that puts at risk 
the safety of our vessels and is a clear violation of 
international norms of behavior in ocean waters outside of 
territorial seas. Our concerns have been raised at multiple 
levels, and we continue to leverage all available channels to 
communicate this position to our PLA counterparts. I will note 
that, since we have raised these concerns, there have been, in 
fact, no additional incidents of the kind we saw earlier this 
year.
    We will continue to reject any nation's attempt to place 
limits on the exercise of high-sea freedoms within Exclusive 
Economic Zones. Customary international law, codified in the 
U.N. Convention of the Law of the Sea, guarantees to all 
nations the right to exercise high-seas freedom of navigation 
and overflight, as well as the traditional uses of oceans, 
related to those freedoms within the EEZ.
    Our military activity in this region is routine and in 
accordance with this customary international law. We will 
continue to conduct operations in the South China Sea, and 
United States activity will be based on our interest in the 
region and our desire to preserve security and stability 
throughout the western Pacific.
    Overall, we do recognize that China is taking an assertive 
position in regard to their rights in Exclusive Economic Zones 
which they have been projecting through their recent actions. 
Our policies have not changed, and we will continue to operate 
our forces based on what we believe is needed to address our 
interests and the interests of stability in the region. We will 
look for ways to work with Chinese authorities to minimize 
tensions around these operations and, as I said, have had 
discussions that have resulted in better communication between 
our nations.
    Taken together, these events also demonstrate the rightful 
importance we place on solidifying our military presence in the 
region and working with our friends and allies to ensure we 
address and promote our shared interests.
    In terms of the South China Sea sovereignty disputes, ably 
covered by my colleague, I will note that Secretary Gates has 
said, as recently as the Shangri-La Dialogue in May 2009, that 
the United States does not take sides in the sovereignty 
disputes, and supports a peaceful resolution that protects 
freedom of navigation.
    In addition, however, Secretary Gates stated, ``Whether on 
the sea, in the air, in space, or cyberspace, the global 
commons represents a realm where we must cooperate, where we 
must adhere to the rule of law and other mechanisms that have 
helped maintain regional peace.'' The United States clearly has 
an interest in keeping sea lines of communication open, 
avoiding being drawn into regional conflict, encouraging 
resolution of territorial disputes through multilateral 
frameworks, and protecting the United States reputation in 
Southeast Asia.
    In support of our policy, the Department has embarked on a 
multipronged strategy that includes clearly demonstrating, 
through both word and deed, that United States forces will 
remain present and postured as the preeminent military force in 
the region, conducting deliberate and calibrated assertions of 
our freedom of navigation rights by United States Navy vessels, 
building stronger security relationships with partners in the 
region--at both the policy level, through strategic dialogues, 
and at the operational level, by building partner capacity--and 
strengthening the military diplomatic mechanisms we have with 
China to improve communications and reduce the risk of 
miscalculation.
    As I know you have discussed on other occasions, we see the 
movement of Marines, and the soon-to-come installations on 
Guam, as a key part of solidifying our presence in the western 
Pacific, as I noted in my written testimony. All of this effort 
is designed to reduce volatility. We believe that the South 
China Sea claimants assess that the United States is a 
stabilizing regional influence. While we do not propose to 
arbitrate or remediate the underlying conflicts between 
competing claims, our presence does provide a sense of 
stability, and a modicum of breathing room for the claimants to 
pursue political means to resolve these issues.
    Mr. Chairman, thank you, and I am prepared to answer any 
questions you may have.
    [The prepared statement of Mr. Scher follows:]

   Prepared Statement of Robert Scher, Deputy Assistant Secretary of 
Defense, Asian and Pacific Security Affairs, Office of the Secretary of 
             Defense, Department of Defense, Washington, DC

    Mr. Chairman, thank you for inviting me to appear before your 
subcommittee today to provide testimony on Maritime Territorial 
Disputes and Sovereignty. These issues are central in the Asia-Pacific 
security equation, and ones that we in the Department of Defense are 
paying very close attention to. I commend the subcommittee's continuing 
interest in this important topic and I look forward to sustaining an 
on-going dialogue with you as these dynamics evolve.
    In a speech that Secretary of Defense Robert Gates delivered on May 
30, 2009, at the Institute for International Strategic Studies (IISS) 
annual defense conference in Singapore, he outlined the remarkable 
changes that have taken place in the Asian security environment since 
the end of the cold war. More specifically, in highlighting the growing 
wealth and improving living standards of the peoples of Asia, Secretary 
Gates stressed the correlation between stability and economic 
prosperity, one of the defining characteristics of Asian security 
dynamics during this period. The Asia-Pacific region for the past two 
decades has largely been at peace; it has been stable, and that 
stability has redounded to the benefit of all.
    Despite this stability, one of the factors that we see potentially 
challenging the Asia-Pacific security environment--and the subject of 
today's hearing--is a series of persistent territorial disputes, 
particularly disputes over maritime territories in Southeast Asia and 
the South China Sea, among a number of regional actors. In recent 
years, we have observed an increase in friction and tension over these 
disputes, frictions that stand in contrast to the relatively peaceful 
and cooperative focus on diplomatic solutions that characterized the 
issue following the landmark 2002 Declaration on the Conduct of Parties 
in the South China Sea.
    The sources of the rising friction are varied--increased demand for 
oil and natural gas naturally increases the perceived stakes among 
claimants in securing resource rights; increased attention to the 
question of sovereignty claims in the runup to the May 2009 deadline 
for filing extended continental shelf claims under the U.N. Convention 
on the Law of Sea; rising nationalism, which increases the sensitivity 
among governments and peoples to perceived slights and infringements 
related to territory and sovereignty. In addition, China's growing 
military capabilities have become a factor affecting the tone and tenor 
of dialogue on regional maritime disputes.
    In analyzing China's maritime activities, I think it is important 
to draw a distinction between the harassment of U.S. naval auxiliary 
vessels near China and China's approach to its South China Sea claims 
in general. While it is important to draw this distinction, the basis 
for the U.S. response applies equally to both.
    Harassment by Chinese fishing vessels of United States naval 
auxiliary ships conducting routine and lawful military operations in 
China's Exclusive Economic Zone (EEZ) reemerged this year as an 
irritant in the United States-China relationship. I will note, however, 
that since May, there have been no further incidents of PRC-flagged 
fishing vessels harassing U.S. naval vessels.
    While any incident at sea is of concern, the decline of these 
incidents after a brief spike underscores the commitment of the 
leadership of our two countries to deal with these issues peacefully 
and through diplomatic channels.
    The Department of Defense views Chinese behavior in its EEZ and 
more broadly in the South China Sea region--a large section of which 
China claims--as having two basic premises.
    First, there is the strategic issue of China's assertion of 
sovereignty over the bulk of the South China Sea. This plays out mainly 
on the political and economic fronts which have been discussed in 
detail by my colleague from the State Department, but suffice to say 
that China actively opposes any activity by other claimants to assert 
their own sovereignty claims. Vietnam, Taiwan, the Philippines, 
Malaysia, Indonesia, and Brunei each claim sovereignty over portions of 
the South China Sea (SCS); many of these claims are conflicting--
notably in areas around the Spratly and Paracel Islands.
    Second, to support the growing strategic and political emphasis in 
this region, China has increased, and will continue to increase, its 
force posture in the South China Sea. As the PLA has upgraded its 
facilities on Hainan Island, for example, we see a direct correlation 
with PRC assertiveness in its reaction to U.S. surface and air 
activity.
    Understanding the strategic premise does not imply that the 
Department accepts the manner in which China has asserted itself in 
this region. We strongly object to behavior that puts at risk the 
safety of our vessels and is a clear violation of international norms 
of behavior in ocean waters outside territorial seas. The Department 
will continue to leverage all available channels to communicate this 
position to our PLA counterparts. Indeed, at the recent Defense 
Consultative Talks in Beijing held on 23-24 June, this topic was on the 
agenda. The two sides agreed to convene a Special Meeting under the 
provisions of the United States-China Military Maritime Consultative 
Agreement (MMCA) (1998) in the coming weeks to review ways to 
invigorate the MMCA process, improve communications, and reduce the 
chances of an incident or accident between our two forces as they 
operate near each other.
    Further, we reject any nation's attempt to place limits on the 
exercise of high seas freedoms within an exclusive economic zone (EEZ). 
Customary international law, as reflected in articles 58 and 87 of the 
1982 United Nations Convention on the Law of the Sea, guarantees to all 
nations the right to exercise within the EEZ, high seas freedoms of 
navigation and overflight, as well as the traditional uses of the ocean 
related to those freedoms. It has been the position of the United 
States since 1982 when the Convention was established, that the 
navigational rights and freedoms applicable within the EEZ are 
qualitatively and quantitatively the same as those rights and freedoms 
applicable on the high seas. We note that almost 40 percent of the 
world's oceans lie within the 200 nautical mile EEZs, and it is 
essential to the global economy and international peace and security 
that navigational rights and freedoms within the EEZ be vigorously 
asserted and preserved.
    As previously noted, our military activity in this region is 
routine and in accordance with customary international law as reflected 
in the 1982 Law of the Sea Convention. We have consistently reiterated 
our basic policy toward the competing claims in the South China Sea--
most recently at the Shangri-La Dialogue in May 2009, where Secretary 
Gates stated that the United States does not take sides in the 
sovereignty disputes and supports a peaceful solution that protects 
freedom of navigation. In his speech at that event, Secretary Gates 
stated, ``whether on the sea, in the air, in space, or cyberspace, the 
global commons represents a realm where we must cooperate--where we 
must adhere to the rule of law and other mechanisms that have helped 
maintain regional peace.''
    As Secretary Gates has said, ``we stand for openness, and against 
exclusivity, and for common uses of common spaces in responsible ways 
that sustain and drive forward our mutual prosperity.'' The United 
States has an interest in keeping sea lines of communication open; 
avoiding being drawn into a regional conflict; encouraging resolution 
of territorial disputes through a multilateral framework that avoids 
any precedent setting acquiescence; and protecting the United States 
reputation in Southeast Asia.
    In support of our strategic goals, the Department has embarked on a 
multipronged strategy that includes: (1) Clearly demonstrating, through 
word and deed, that U.S. forces will remain present and postured as the 
preeminent military force in the region; (2) deliberate and calibrated 
assertions of our freedom of navigation rights by U.S. Navy vessels; 
(3) building stronger security relationships with partners in the 
region, at both the policy level through strategic dialogues and at the 
operational level by building partner capacity, especially in the 
maritime security area, and (4) strengthening the military-diplomatic 
mechanisms we have with China to improve communications and reduce the 
risk of miscalculation.
    Force posture is perhaps the most important component of the first 
element of our policy outlined above. In this regard, the military 
buildup on Guam is viewed as permanently anchoring the United States in 
the region and cementing our ``resident power'' status. We believe this 
will have a stabilizing influence on the policies and strategies of 
South China Sea claimants. The alternative--a power vacuum caused by a 
U.S. security withdrawal from the region--would leave very little 
strategic maneuver room for the least powerful among them.
    As for the second element of our strategy, U.S. Pacific Command 
will continue to assert freedom of navigation rights in the region. U.S 
Pacific Command will continue to conduct operations in the South China 
Sea, in strict compliance with customary international law as reflected 
in the U.N. Convention on Law of the Sea. The United States activity 
will be governed by our interests in the region, and our desire to 
preserve security and stability throughout the western Pacific.
    The third element of our strategy will focus on expanding and 
deepening our defense diplomacy and capacity-building programs in the 
region as important supporting efforts to prevent tensions in the South 
China Sea from developing into a threat to U.S. interests. To that end, 
we have recently established high-level defense policy dialogues with 
Vietnam and Malaysia that complement our already strong consultative 
mechanisms with Philippines, Thailand, and Indonesia. Through a variety 
of security cooperation activities ranging from seminars to 
multilateral exercises, we are also helping the countries of the region 
overcome longstanding historical and cultural barriers that inhibit 
multilateral security cooperation.
    Finally, we need to invigorate the mechanisms that we have in place 
to engage China on this and other security issues, namely the United 
States-China Defense Consultative Talks, the United States-China 
Defense Policy Coordination Talks, and the United States-China Military 
Maritime Consultative Agreement process. These mechanisms provide open 
and sustained channels of communication to build greater confidence and 
mutual understanding, discuss candidly our differences, and improve 
understanding and application of safety standards and rules of the road 
for operations that improve the safety of sailors and airmen of all 
countries in the region.
    All of this effort is designed to reduce volatility. We believe the 
South China Sea claimants assess that the United States is a 
stabilizing regional influence. While we do not propose to arbitrate or 
mediate the underlying conflicts between competing claims, our presence 
does provide a sense of stability and a modicum of breathing room for 
the claimants to pursue political means to resolve these issues.

    Senator Webb. Thank you very much, Deputy Assistant 
Secretary Scher, for those comments.
    I want to start just by asking for one clarification from 
your written statement, then I'd like to go to this chart and 
ask both of you some questions that you might react from.
    When you mention the relocation of American military from 
Okinawa to Guam in your statement, you say in your statement, 
``This military buildup on Guam is viewed as permanently 
anchoring the U.S. in the region, and cementing our resident 
power status.''
    We've been in this region for a very long time and, in 
fact, the relocation, should it fully occur, actually will be 
downsizing, in terms of the number of Americans in the region, 
although centrally locating. I wrote about this, 1973, as I 
recall--1974. But, how, in your view, would that change our 
status in the region?
    Mr. Scher. I think--we believe that the movement to Guam 
solidifies our presence from a couple of respects. One, it does 
more centrally locate our presence, and shifts our presence out 
of simply a northeast Asia presence, and makes it more 
appropriately positioned for the entirety of the East Asia-
Pacific region. Also, the movement has to be seen, I think, as 
part of the continuing alliance with Japan, and putting that 
alliance on the right footing, so that we can continue to 
maintain our close cooperation in Japan, with the forces we 
have there, and the security presence, as well.
    Those two pieces, I think, are the center of that. The 
resident remark, obviously, is building upon Secretary Gates' 
remarks at the Shangri-La Dialogue last year, making the point 
and trying to reassure our allies--that in fact we have been 
resident in the western Pacific, and have territory in the 
western Pacific, and have been there for, as you say, for an 
extended period of time.
    So, we see that movement helping in those respects.
    Senator Webb. Would you say that the idea that Guam is 
American soil is a part of this permanent anchoring? I'm not 
quite sure where you're going in your statement, here.
    Mr. Scher. Absolutely. I think we're trying to draw 
attention to counter an argument that, I think--I know I hear 
occasionally in East Asia, the fact that we aren't a part of 
East Asia, and so it is too easy for the United States to pull 
back from East Asia. And, in fact, while that was never our 
intention, regardless, Secretary Gates was trying to make the 
point that, in fact, we are a resident--a territorial--we have 
territory in the western Pacific, and we are a resident power. 
And so, there's not a question of pulling back. It is 
impossible for us to do so. And Guam is one clear manifestation 
of that.
    Senator Webb. Plus, I would venture, an appropriate sea 
power presence that comes from a properly configured navy.
    Mr. Scher. Without a doubt, sir.
    Senator Webb. Gentlemen, I don't know if you can see this 
map. Are you able to see this map?
    I had my staff put this together, there are lines on it--we 
may have to pull it further forward. But, the purpose of the 
map, was to, in the first instance, illustrate the region, and 
second, through the red lines, to show what happens when you 
combine, on the one hand, sovereignty claims, with, on the 
other, the concept of the EEZ, which is basically rights of 
control in terms of movement. And when you put the two together 
on the map, what you basically have is a pretty good percentage 
of the South China Sea that would be under some sort of claim 
by China. Would you agree with that?
    Mr. Scher. I would agree that that is a reasonable 
representation of what the effect might be if you agreed with 
all of the----
    Senator Webb. The situation in the region, as it respects 
the current Chinese claims is to the effect that almost all of 
the South China Sea is in some way claimed by China.
    Ambassador Marciel. Mr. Chairman, let me try to respond.
    Senator Webb. Would you push the button?
    Ambassador Marciel. I'll try to respond and hopefully 
address this.
    Part of the problem here is that this so-called ``cow's 
tongue'' that's been on maps since, I think, the 1940s. On 
Chinese maps, it shows the nine dashes going around most of the 
South China Sea. The Chinese have not really firmly delineated 
the proposed boundary or explained exactly what their claim is. 
They've referred to it as a ``territorial sea.'' But, there is, 
I think, still a lot of questions about exactly what that claim 
is. China has, as I said, never formally explained the basis of 
its claim, nor delineated its boundaries, other than by this 
referent. So, it's one of the reasons we've asked the Chinese 
to clarify, what do they mean by this, what exactly are they 
claiming here in terms of this so-called ``cow's tongue''? 
Because it's not 100 percent clear to us, and, I think, to 
other parties.
    Senator Webb. But if you proceed from the sovereignty 
claims that are current, from the Chinese perspective, and the 
delineation and EEZ, et cetera, you would pretty much have that 
``cow's tongue,'' would you not?
    Ambassador Marciel. I think that's right, sir.
    Senator Webb. And I appreciate the observation that both of 
you made several times that the United States does not take 
sides in issues of sovereignty for many, many reasons. And 
also, there was a phrase in one of your testimonies, we don't 
propose to arbitrate or mediate in these instances. But, on the 
other hand, there is a question as to whether neutrality, in 
and of itself, is a position that might encourage greater 
activity, simply because of the imbalance in power between 
China and some of these countries, particularly when you look 
at the Spratlys and the Paracels.
    So, what signals should we be sending? How should we be 
reassuring these other countries, that may be feeling 
intimidated by this increase in activity, that we actually are 
being neutral?
    Ambassador Marciel. Mr. Chairman, I think there's a couple 
things that we are doing, and that we should continue to do. 
One, as Bob Scher said, our naval activities are continuing 
normally through these international waters, and we've made it 
clear that they will continue, based on our interpretation of 
international law.
    Two is, although we've been neutral in the sense of not 
taking sides, saying, ``Yes, this country is right and this 
country is wrong,'' we can still be active diplomatically. Not 
as mediators, so much, but in terms of, certainly, discouraging 
any provocative acts, or any acts that increase tension, but 
also, urging that China sit down with ASEAN as a group to 
resolve this.
    I mean, I think, it would be sort of logical to assume that 
the Chinese would prefer to deal one on one with individual 
members of ASEAN. I think, for the ASEANs, it makes sense to 
deal more as a group, for obvious reasons. And, the third point 
I would make is that, although it's not directly tied to 
disputed areas, part of what we need to do is to show that we 
remain very committed and engaged in this region, overall. 
We're not doing it, as I said, for the purposes of dealing with 
these disputes, but the fact that we remain engaged, committed, 
very active, I think, is very important, and something that the 
countries of Southeast Asia very much want.
    Senator Webb. Mr. Scher, would you have anything----
    Mr. Scher. Absolutely. And I would only add that I think 
part of our alliances and friendships in the region help to 
bolster the ability of countries to feel as if they are 
playing--potentially that they have the ability to play--on a 
somewhat more even playing field. Although we obviously agree 
that multilateral action, and unity of action amongst the ASEAN 
claimants, is probably the best way to approach it.
    Senator Webb. Would you agree that the response of the 
United States to incidents in this region that we've been 
discussing is heavily tactical, while Chinese activities are 
arguably strategic?
    Mr. Scher. I won't venture a guess as to China's tactics 
and desires and interests. I think we have a clear strategy and 
what we are trying to achieve with our operations, our 
alliances, et cetera, given that we are seeing tactical efforts 
to harass--or, did see tactical efforts to harass our--those 
operations, we have responded tactically, and think that's 
appropriate. I'm not willing to venture a guess as to, 
necessarily, broader strategic vision for China, but I know 
that--I don't think that we may be reacting tactically, but we 
have a strategic view as to what we need to do to ensure peace 
and stability in the region, and maintain our----
    Senator Webb. But here's the actual observation. Just as, I 
think, Ambassador Marciel's comment was, ``Things have been 
quiet since May.'' We tend to take these incidents as isolated 
incidents, and we resolve the incident, and then we dismiss it, 
and we say things are fine. And yet, if you tie activities 
together--not only with respect to the United States--if you do 
the datapoints, and put it over a timeline, what you have is a 
clear example of incrementalism, which has not been properly 
responded to. That's the difference between tactical resolution 
of a specific problem, but a continuum over time that actually 
enlarges the problem.
    Mr. Scher. I take your point, Senator. I think that we are 
willing to see, and to accept for now, until proven otherwise, 
that the issues that we've discussed with China, we have a 
reasonably effective resolution, and are not willing to say 
that they'll necessarily occur again, obviously.
    From our strategic point of view, what we are trying to do, 
we are continuing to do. And no action that China has taken 
will stop us, or has stopped us, from continuing to pursue 
those activities that we see in our strategic interests. So, I 
certainly accept that we are responding tactically to 
operations that, from the Chinese, that are intended to change 
what we are doing and--but I think that strategically we have 
not adjusted what we've--the overall purpose--in our 
operations. We may have adjusted some of how we've done them, 
but we're maintaining that which is part of our long-term and 
strategic efforts.
    Senator Webb. Have we had any clear indications that 
China's been willing to compromise on any of these sovereignty 
issues? Have there been any signals from them to that effect?
    Ambassador Marciel. As I think I mentioned in my testimony, 
there have been some--particularly on the land border with 
Vietnam--where they have worked out agreements with the 
Vietnamese. And I think they've been willing to have more 
serious discussions and some compromises also in the Gulf--
parts of the Gulf of Tonkin.
    In the dispute over the so-called ``cow's tongue,'' or the 
Spratly Islands and the Paracels, I don't--the closest you 
could--one could suppose--I make the argument that their 
proposals for joint development could be seen as a compromise. 
I think, as you know, the Vietnamese don't really view them as 
compromises by the Chinese, but generally less willing to 
compromise in those areas.
    Senator Webb. Has there been a collective viewpoint, from 
the ASEAN countries, on these activities in the South China 
Sea?
    Ambassador Marciel. Not that I've heard. The Vietnamese, as 
you know, are the most focused, as they've been facing the most 
pressure. There have been discussions in ASEAN meetings about 
this. It's not clear to me that--as you know, in ASEAN, you 
require all 10 countries to have a consensus to take any 
action. I haven't seen any indications that there's a 
consensus.
    We have suggested to the ASEANs that them working together 
on this makes a lot of sense, following up on the 2002 
Declaration of Principles. But I think there may not be 
consensus yet.
    Senator Webb. Gentlemen, I appreciate your coming today, 
your testimony was very valuable, and we will be following this 
issue very closely over the coming months. Thank you for 
coming.
    Ambassador Marciel. Thank you, sir.
    Senator Webb. We'll now go to the second panel. Let me see, 
here.
    We'll have the second panel: Professor Peter Dutton, Mr. 
Daniel Blumenthal, and Dr. Richard Cronin.
    Mr. Dutton is associate professor of strategic studies in 
China Maritime Studies Institute at the U.S. Naval War College. 
In 2006, he retired from the U.S. Navy, having served as a Navy 
judge advocate, and naval flight officer. His current research 
focuses on American and Chinese views of sovereignty, and the 
strategic implications to the United States and the U.S. Navy 
of Chinese legal and policy choices regarding sovereignty. He 
has published a wide variety of articles on this subject.
    Daniel Blumenthal is a resident fellow at the American 
Enterprise Institute, and is a current commissioner and former 
vice chairman of the United States-China Economic and Security 
Review Commission. Previously he was senior director for China, 
Taiwan, and Mongolia in the Secretary of Defense's Office of 
International Security Affairs.
    Richard Cronin heads the Southeast Asia Program at the 
Henry L. Stimson Center, where he's currently researching 
China's relations with the Mekong Basin countries, United 
States-ASEAN relations, and issues concerning Japan and 
Southeast Asia. Dr. Cronin joined the Stimson Center after a 
long career with the Congressional Research Service, as a 
senior Asian affairs specialist in the Foreign Affairs Defense 
and Trade Division, and also was a United States military 
veteran of the Vietnam war.
    Gentlemen, I appreciate all of you coming today. We have 
some extraordinary breadth of experience at the table. And 
again, I would ask you to summarize your--don't feel like you 
have to summarize it too far, but take 10 minutes or less to 
summarize your statements. Your full statements will be entered 
into the record.
    And, let's see. Mr. Dutton, welcome.

  STATEMENT OF PETER DUTTON, ASSOCIATE PROFESSOR OF STRATEGIC 
   STUDIES, CHINA MARITIME STUDIES INSTITUTE, U.S. NAVAL WAR 
                    COLLEGE, WASHINGTON, DC

    Professor Dutton. There we go, thank you. Thank you very 
much, Senator, and thank you for inviting me to appear today.
    I do have to say two things first. One is that I actually 
retired as a commander. And second, that I am speaking in my 
personal capacity, and not necessarily for the Department of 
Defense or the Department of the Navy.
    Senator Webb. The record will so note.
    Professor Dutton. Thank you.
    With my testimony today, I'd like to make the following two 
points. I've elaborated more in my written testimony. Be happy 
to answer any questions you have, related to that. The first 
essential point is that China's East and South China Sea 
territorial claims are weakly grounded in international law, as 
they--as it exists today, as are China's antiaccess legal 
perspectives. And together they pose a challenge to America's 
regional and global maritime interests, in my view.
    The second is that China sees its sovereignty claims in the 
South China Sea as fundamentally nonnegotiable, yet they seem 
to feel they are close to being able to grasp and consolidate 
those claims. In the East China Sea, China appears to be 
willing to wait for more favorable circumstances in order to 
press its claims more assertively.
    Concerning China's official claims in the South China Sea, 
I have a different perspective from some of those who have 
testified already today, which is that they do not actually 
claim sovereignty over the waters of the South China Sea, per 
se. Their claim is based on an assertion of territorial 
sovereignty over the islands, themselves, in the South China 
Sea, which is articulated in China's law on the territorial sea 
and contiguous zone. They're very specific in enumerating the 
islands in the South China Sea that they claim.
    Additionally, China's EEZ law asserts its claim to an EEZ 
extending 200 nautical miles from all of its coastlines. Since 
all the islands in the South China Sea are claimed as Chinese 
territory, the effect of the combination of these laws is to 
claim a Chinese EEZ covering nearly the entire South China Sea. 
This is problematic for all maritime user states because of 
another set of Chinese domestic laws, and their perspective on 
some international law, that expresses the right to limit, or 
prohibit, foreign military activities in their EEZ. Such 
control becomes tantamount to the control a sovereign exercises 
over its zones of maritime sovereignty, but not an actual claim 
to sovereignty.
    While pointing out this distinction may seem like splitting 
hairs, it's important for a fuller understanding of the broader 
implications of China's policies for international Law of the 
Sea, generally. Had China claimed the right to exercise control 
over military vessels because it claimed sovereignty over the 
South China Sea, the legal impact of the dispute would have 
been limited to the waters of the South China Sea, as was the 
case with Libya's claim to the authority to control foreign 
military activities in the Gulf of Sidra, based on it's 
excessive claim of sovereignty over those waters.
    What makes the Chinese case so significant for United 
States interests is that, because of the nature of 
international law, the impact of China's somewhat unique 
characterization of its EEZ could affect how all EEZs are 
characterized around the world. Thus, inasmuch as EEZs cover 
more than one-third of the oceans--world ocean space, China's 
legal perspectives undermine the interests of all maritime 
powers and the United States, as a primary guarantor of 
maritime security, in particular.
    America's determination to protect traditional freedoms of 
navigation for military purposes by maintaining a commitment to 
globally dominant sea power will have important consequences 
for the East Asian region and beyond. Indeed, in my view, a 
maritime arc of antiaccess is developing across the Southern 
Asian land mass from the Arabian Sea to the Sea of Japan. Of 
the handful of remaining states that officially maintain legal 
perspectives that challenge traditional military freedoms of 
navigation in and above the EEZ, a concentration of these 
states is situated along the southern coast of Asia astride 
some of the most critically important sea lines of 
communication in the world. In this region, Iran, Pakistan, 
India, Bangladesh, Burma, Malaysia, China, and North Korea all 
maintain laws that assert some right of control over foreign 
military activities in the EEZ. I would add that there are 
more, but they're just not on the Asian Continent.
    Vietnam, too, can be added to this list, although it has 
chosen to draw grossly excessive baselines rather than assert 
EEZ control as its antiaccess legal method of choice.
    This is, in addition to the occasional tacit approval that 
I personally have heard from representatives of the governments 
of other countries in the region, that is somewhat approving of 
the antiaccess approach to the Law of the Sea in the region, in 
part because it would enable them to keep China at bay.
    Some of these countries have been building strong regional 
navies, while others have been actively seeking nuclear 
capacity or conventional antiaccess technologies similar to 
China's in order to provide teeth to their legal perspectives. 
China's territorial claims over all of the islands in the South 
China Sea is weak, in that it actually controls relatively few 
of them and may never, in its long history, have actually 
maintained effective administration and control over most of 
them.
    While effective administration and exclusive control over 
territory are the two elements international law generally 
requires to recognize a sovereign's authority over territory, 
Chinese scholars also assert a historical right to the islands 
of the East and South China Sea, based on a longstanding 
historical perspective. For various reasons, historical claims 
to sovereignty are legally much weaker than the current 
occupation and control.
    Thus, to the extent that Japan, the Philippines, Vietnam, 
and Malaysia all occupy islands over which the Chinese claim, 
``indisputable sovereignty,'' international law tends to 
strengthen the hands of the occupier.
    Accordingly, China is building a maritime force structure, 
including its aircraft carrier program, which is shifting the 
balance of military power in the South China Sea. This may soon 
effectively prevent its neighbors, many of them U.S. friends 
and allies, from protecting their own island claims. At the 
same time, China has become emboldened to use its increasing 
military and naval power to attempt to disrupt United States 
naval operations in and above the South China Sea.
    Why is China pursuing this course? In my view, China sees 
itself as on the verge of achieving its long-sought 
geostrategic dominance of the South China Sea. Perhaps one of 
the reasons China has increased its activities against American 
naval vessels in the South China Sea is that it considers among 
the few things to be standing in its way of consolidating its 
island claims to be the United States Navy and the American 
political will to support freedoms of navigation, and the 
claims of American regional friends and allies.
    I suspect that China has identified the latter as the most 
vulnerable and susceptible to its influence, especially during 
these challenging economic times, a national military focus, 
which the United States has, on ground wars in Iraq and 
Afghanistan. This, in my view, is one of among several reasons 
that China has embarked on its recent campaign to harass United 
States naval operations in the region. If they can undermine 
the political will to continue active United States naval 
operations in the South China Sea, they do not need to confront 
the power of the American Navy head-on in order to achieve 
their objectives. They can erode the American Navy's 
effectiveness indirectly and achieve the same result. This 
would be in keeping with China's military doctrine of the three 
new warfares: Legal warfare, public opinion warfare, and 
psychological warfare.
    Indeed, some thoughtful analysts and academics have 
suggested that Chinese calculations of American power determine 
how aggressively it pursues its claims in the South China Sea. 
According to this line of thinking, China has, for decades, 
taken advantage of small shifts in their favor in the local 
power dynamics in the South China Sea. Some Chinese actions can 
be characterized as opportunistic, such as China's sea battle 
in 1974 with the Republic of Vietnam beleaguered naval forces 
to wrest control of several of the Spratly Islands as the 
United States was completing its withdrawal from South Vietnam. 
And again in 1976, when China took control of the Paracels from 
a recently united Vietnam. Then in the spring of 1988, when, in 
the midst of the tanker wars, American naval power was 
primarily focused on escorting oil tankers safely through the 
Strait of Hormuz. China, at that time, engaged in naval battles 
with Vietnam in the Spratlys and won control of several more 
islands. Finally, in late 1994, nearly 1995, about 2 years 
after the United States withdrew its forces from nearby Subic 
Bay Naval Base in the Philippines, China quietly occupied 
Mischief Reef, a small coral feature in the South China Sea, 
close to the Philippine Islands of Palawan, that had previously 
been administered by the Philippine Government. Chinese naval 
vessels remained in the vicinity of Mischief Reef long enough 
for China to consolidate its gain by building military 
reinforcements on the small island.
    More recent shifts in the South China Sea power dynamics 
could not be characterized as opportunistic. Instead, they are 
the product of years of Chinese research, development, and 
investment in military technologies designed to challenge 
outside access--outside naval access, in particular--to East 
Asian waters. China's submarine force is steadily improving, as 
we've mentioned, and augments China's already substantial sea-
mine antiaccess capabilities. Additionally, China appears to be 
developing an antiship ballistic missile program. Thus, given 
the strength of China's antiaccess technologies and the 
intensity of its campaign against the legitimacy of four naval 
activities in the East and South China Sea, China probably 
perceives that its opportunities for a settlement of the South 
China Sea claims are in its favor and increasing.
    In its maritime dispute with Japan in the East China Sea, 
China seems to be willing to live with the ambiguity generated 
by Japanese control over the Senkaku Islands, even as China 
occasionally takes provocative actions designed to maintain its 
claim of sovereignty and to wait for some future circumstance 
in which China is in a stronger position in relation to Japan 
to press its claim. Additionally, China has made a continental 
shelf claim that extends to the footsteps of Japan's 
southernmost island chain near American bases in Okinawa and 
Sasebo. This claim has many facets. It is, in part, based on 
Chinese nationalism, partly it is based on international law 
that allows coastal states to claim the entire continental 
shelf as a matter of coastal state sovereignty, and partly it 
is based on the desire to assert military control over the full 
extent of these waters in time of conflict or crisis. In any 
case, China's claims are of deep concern to Japan, and China's 
intentions regarding its claims are of deep concern to American 
forces in the Pacific.
    Thank you, Mr. Chairman.
    [The prepared statement of Professor Dutton follows:]

Prepared Statement of Peter Dutton, Associate Professor, China Maritime 
       Studies Institute, U.S. Naval War College, Washington, DC

    I would like to thank the chairman and this committee for the 
opportunity to appear before you today.
    With my testimony today I hope to make the following points:
    1. China's South China Sea legal claims and the activities it has 
undertaken to enforce them pose a challenge to America's regional and 
global maritime interests.
    2. China sees its sovereignty claims in the South China Sea as 
fundamentally nonnegotiable, yet close to being within its grasp to 
consolidate.
    3. China is a developing maritime power, but its maritime 
development is best characterized as a maritime enhancement to China's 
continental strategic focus, rather than as a rising expeditionary 
maritime force.
    4. The United States should exercise renewed maritime leadership to 
ensure the regional and global access necessary to our national defense 
and to the security of the global maritime system generally.
    Beginning with China's actual claims in the South China Sea, 
contrary to what some commentators have suggested, the Chinese 
Government has not claimed sovereignty over the water space of the 
South China Sea per se. China's claims of legal control over the sea 
space of the South China Sea are based in part on its assertion of 
territorial sovereignty over all of the islands in the South China Sea 
articulated in China's 1992 Law on the Territorial Sea and Contiguous 
Zone--under which China claims sovereignty over Diaoyu (Senkaku) 
Islands in the East China Sea, and in the South China Sea, China claims 
sovereignty over the Dongsha (Pratas) Islands, the Xisha (Paracel) 
Islands, the Zhongsha (Macclesfield Bank) Islands and the Nansha 
(Spratly) Islands.\1\ Added to the claims of sovereignty over the 
islands themselves, China's 1998 Exclusive Economic Zone (EEZ) law 
asserts its claim to an ``exclusive economic zone . . . extending 200 
nautical miles from the baselines from which the breadth of the 
territorial sea is measured.'' \2\ Since all of the islands in the 
South China Sea are claimed as Chinese territory and included in the 
baselines section of the 1992 Territorial Sea Law, the effect of the 
1998 law is to claim an exclusive economic zone around each of them. In 
combination, therefore, the two Chinese laws effectively claim a 
Chinese EEZ covering nearly the entire South China Sea.
---------------------------------------------------------------------------
    \1\ Law of the People's Republic of China on the Territorial Sea 
and the Contiguous Zone, February 25, 1992.
    \2\ Law of the People's Republic of China on the Exclusive Economic 
Zone and the Continental Shelf, June 26, 1998.
---------------------------------------------------------------------------
    Thus, the Chinese Government does not claim that these waters are 
territorial seas, internal waters, or archipelagic waters, or any other 
sort of coastal state zone that would confer the rights of sovereignty 
over broad swaths of the region's oceans. That said, the combination of 
their territorial claims over the islands of the South China Sea and 
China's ``unique'' interpretation of international Law of the Sea 
relating to coastal state authorities to limit or prohibit foreign 
military activities in the exclusive economic zone,\3\ does appear to 
be part of a Chinese plan to achieve in the South China Sea exclusive 
military control over the water space within their
U-shaped, nine-dashed line. Such control is tantamount to the control a 
sovereign exercises over its zones of maritime sovereignty.
---------------------------------------------------------------------------
    \3\ Peter Dutton, Testimony before the U.S.-China Economic and 
Security Review Commission, June 11, 2009, www.uscc.gov/hearings/
2009hearings/written_testimonies/09_06_11_wrts/
09_06_11_dutton_statement.pdf.
---------------------------------------------------------------------------
    Pointing out this distinction may seem like splitting hairs, but it 
is important to a full understanding of the broader implications for 
international law generally of China's policies. China does not claim 
sovereignty over the water space of the South China Sea and the 
concomitant right to exercise control over foreign military activities 
as the prerogative of a sovereign--China claims the right to restrict 
and even to prohibit foreign military activities in these waters as a 
matter of a coastal state's right to make laws governing its EEZ, which 
is a nonsovereign zone of special jurisdiction over resources and 
environmental preservation. Had China claimed the right to exercise 
control over military vessels because it claimed sovereignty over the 
South China Sea, the United States would certainly have objected to the 
claim, primarily on factual grounds, but we could both agree upon the 
general legal proposition that only with full sovereignty over water 
space comes the right to control foreign military activities. As such, 
the legal impact of the dispute would have been limited to the waters 
of the South China Sea, as was the case with Libya's claim to the 
authority to control foreign military activities in the Gulf of Sidra 
based on its excessive claim of sovereignty over those waters.
    What makes the Chinese case so significant for U.S. interests is 
that the impact of our dispute with China over characterization of its 
EEZ could affect how all EEZ's are characterized everywhere around the 
world. By tying their legal perspective to the legal characterization 
of the EEZ generally, were China's perspective to become accepted, it 
could affect the way international law views EEZ's everywhere. Thus, 
inasmuch as EEZs cover more than one-third of all the world's oceans 
and, of course, 100 percent of all coastal regions, island regions, and 
many of the world's strategic chokepoints and sea lines of 
communication, China's legal perspectives undermine the interests of 
all maritime powers and the United States, as the primary guarantor of 
maritime security, in particular.
    China's territorial claims and its claim to possess EEZ rights over 
nearly the entire South China Sea is alone controversial enough, since 
at least four other countries plus Taiwan also claim sovereignty over 
at least some of the islands, but even more so because many of the 
islands in the South China Sea are too small to legitimately claim an 
EEZ under the rules and terms as laid out in the United Nations 
Convention on the Law of the Sea (UNCLOS). However, in addition, 
through its domestic law and interpretations of international Law of 
the Sea China claims the legal right to broadly limit or regulate 
foreign military activities in and above its EEZ.\4\ That, for the 
United States, is the most problematic and challenging aspect of 
China's legal claims, since China is building a maritime force 
structure that will soon effectively prevent its neighbors--many of 
them U.S. friends and allies--from protecting their own island claims 
and because China has become emboldened to use its increasing military 
and naval power to attempt to disrupt U.S. naval operations in and 
above the South China Sea.
---------------------------------------------------------------------------
    \4\ See, e.g., ``Surveying and Mapping Law of the People's Republic 
of China,'' August 29, 2002, and ``Regulations of the People's Republic 
of China on the Management of Foreign-Related Marine Scientific 
Research,'' October 1, 1996. For an authoritative articulation of the 
Chinese perspective on the legal rationale for coastal states to limit 
foreign military activities in the EEZ, see Ren Xiaofeng and Cheng 
Xizhong, A Chinese Perspective, 29 Marine Policy (2005), p. 139.
---------------------------------------------------------------------------
    In my view, China sees itself as on the verge of achieving its 
long-sought dominance over the South China Sea. Perhaps one of the 
reasons China has increased its activities against American naval 
vessels in the South China Seas is that it considers among the few 
things to be standing in its way of consolidating its island claims to 
be the United States Navy and the American political will to support 
freedoms of navigation and the claims of American regional friends and 
allies. I suspect that China has identified the latter as the most 
vulnerable and susceptible to its influence, especially during these 
challenging economic times and national military focus ground wars in 
Iraq and Afghanistan. This, in my view, is one among several reasons 
that China has embarked on its recent campaign to harass U.S. naval 
operations in the region: If they can undermine the political will to 
continue active U.S. naval operations in the South China Sea, they do 
not need to confront the power of the American Navy head on in order to 
achieve their objectives. They can erode the American Navy's 
effectiveness indirectly and achieve the same result.
    Indeed, some thoughtful analysts and academics have suggested that 
Chinese calculations of American power determine how aggressively it 
pursues its claims in the South China Sea. According to this line of 
thinking, China has for decades taken advantage of small shifts in 
their favor in the local power dynamics in the South China Sea.\5\ Some 
Chinese actions can be characterized opportunistic, such as China's sea 
battle in 1974 with the Republic of Vietnam's beleaguered naval forces 
to wrest control over several of the Spratly Islands as the United 
States was completing its withdrawal from South Vietnam, and again in 
1976 when China took control of the Paracels from a recently united 
Vietnam. Then in the spring of 1988, when in the midst of the Tanker 
Wars American naval power was primarily focused on escorting oil 
tankers safely through the Strait of Hormuz, China engaged in naval 
battles with Vietnam in the Spratlys and won control over several more 
islands. Finally, in late 1994 and early 1995, about 2 years after the 
United States withdrew its forces from nearby Subic Bay Naval Base, 
China quietly occupied Mischief Reef, a small coral feature in the 
South China Sea close to the Philippines Island of Palawan that had 
previously been administered by the Philippines Government. Chinese 
naval vessels remained in the vicinity of Mischief Reef long enough for 
China to consolidate its gain by building military reinforcements on 
the small island.
---------------------------------------------------------------------------
    \5\ See, e.g., Bonnie S. Glaser and Lyle Morris, ``Chinese 
Perceptions of U.S. Decline and Power,'' Jamestown Foundation, July 9, 
2009 (on line); and Richard Fisher, Jr., ``South China Sea Competition: 
China Contemplates More Mischief,'' International Assessment and 
Strategy Center, June 28, 2009 (on line).
---------------------------------------------------------------------------
    More recent shifts in South China Sea power dynamics could not be 
characterized as opportunistic. Instead they are the product of years 
of Chinese research, development, and investment in military 
technologies designed to challenge American naval access to East Asian 
waters. The work of Lyle Goldstein and William Murray documents China's 
steadily improving submarine force and substantial sea-mine 
capabilities,\6\ for instance, and Andrew Erickson and David Yang's 
research documents China's developing antiship ballistic missile 
program.\7\ In addition to changing the military balance, China's 
sustained campaign to try to undermine the legality and legitimacy of 
routine U.S. naval operations in the South China Sea also appears to be 
an attempt to change the regional political dynamics. This observation 
is made with China's doctrine of ``Three New Warfares'' in mind. The 
three new warfares articulated under this Chinese military doctrine are 
legal warfare, public opinion warfare, and psychological warfare. The 
focus of each of these activities is fundamentally to create and to 
advance international and domestic legitimacy for China's viewpoint of 
its sovereignty over the South China Sea islands and its authority to 
control military activities throughout the South China Sea. An article 
in Renmin Haijun (People's Navy) a couple of years ago stated that the 
purpose of legal warfare, for instance is to ``be far-sighted . . . to 
discern any problems before they actually arise,'' in order to 
``provide a legal pretext for military action,'' and to ``engage in 
legal contests to vie for the legal initiative'' in order to 
``safeguard national sovereignty and territorial integrity.'' \8\ Thus, 
these ``new'' methods of warfare are designed to achieve strategic 
objectives without having to actually use force by leveraging public 
opinion alongside the implied threat posed by China's growing military 
power.
---------------------------------------------------------------------------
    \6\ Lyle Goldstein and William Murray, ``Undersea Dragons, China's 
Undersea Submarine Force,'' International Security, Vol. 28., No. 4, 
Spring 2004, pp. 161-196.
    \7\ Andrew S. Erickson and David D. Yang, ``On the Verge of a Game-
Changer,'' Proceedings of the U.S. Naval Institute, May 1, 2009.
    \8\ Jin Hongbing, ``Legal Warfare: Sharp Tool to Seize the 
Opportunity to Grab the Initiative,'' People's Navy [Renmin Haijun, in 
Chinese], May 29, 2006.
---------------------------------------------------------------------------
    China appears to perceive its opportunities to be increasing for a 
favorable settlement of its South China Sea claims. The one existing 
bilateral dialogue on South China Sea disputes of which I am aware 
seems to be making no progress. The China-Vietnam Steering Committee on 
Cooperation released a statement after its second meeting in 2008 that 
both sides had ``agreed to solve disputes through negotiations and 
safeguard peace and stability in the South China Sea.'' This statement, 
however, remains at odds with China's repeated insistence that it has 
``indisputable sovereignty'' over the South China Sea Islands, 
including as recently as May 2009 when it submitted a statement to the 
United Nations in response to regional claims by the Philippines and 
Vietnam.\9\ If China remains unwilling to concede any of the islands to 
other claimants, it is hard to imagine what there is to negotiate. In 
its maritime dispute with Japan in the East China Sea, China seems to 
be willing to live with the ambiguity generated by Japanese control 
over the Senkaku (Diaoyu) Islands, even as China occasionally takes 
provocative actions designed to maintain its claims to sovereignty, and 
to wait for some future circumstance in which China is in a stronger 
position in relation to Japan to press its claim.\10\ In my view, China 
is likely to take the same approach to its claims in the South China 
Sea. If it is not in a strong enough position today to gain acceptance 
of its sovereignty over the islands, rather than negotiate a partial 
result China will likely wait until such future time as its position is 
suitably strengthened to finalize all of its claims.
---------------------------------------------------------------------------
    \9\ Brian McCarten, ``Roiling the Waters in the Spratlys, Asian 
Sentinal,'' February 4, 2008; and ``China Tells Neighbors to Keep Off 
Disputed Islands,'' Reuters, May 12, 2009.
    \10\ Xiong Qu, ``China Starts Examination of Navigational Safety of 
East China Sea,'' CCTV, July 3, 2008.
---------------------------------------------------------------------------
    Nonetheless, with active U.S. involvement it may be possible to 
bring together all parties to at least open multilateral discussions to 
manage friction and prevent escalation of competing sovereignty claims, 
EEZ and continental shelf claims, security claims, and access rights. 
In the context of such discussions, it might be helpful for the United 
States to make clear that it supports peaceful resolution of 
territorial disputes as provided for in the South China Sea Code of 
Conduct, that we will honor our commitments to our friends and allies 
in the region by supporting them in case of attack, and that recent 
increases in Chinese military and armed maritime law enforcement 
patrols are not helpful. Likewise, all sides must be expected to 
exercise restraint. The end result could be a historic opportunity for 
China to demonstrate that its military buildup is indeed part of its 
larger policy of Peaceful Development and that its intentions toward 
its neighbors are indeed benign.
    On this latter point, there is some regional skepticism, especially 
in Japan. Indeed, there exists a robust debate within academic and 
analytical circles in China itself concerning the extent to which 
China's growing navy should strive to develop ``blue water'' 
capabilities. However, in my view there is no indication that Chinese 
decisionmakers have been persuaded to create a Navy that will challenge 
the U.S. Navy for command of the seas in the near to medium term. The 
inevitable result of China's rapid military development over the past 
two decades, and especially after a Chinese flotilla deployed to the 
Gulf of Aden to support regional antipiracy operations, is concern that 
perhaps China's naval buildup could portend Beijing's intention one day 
of moving beyond development of a maritime defense zone in East Asia to 
challenge America's global command. However, in my view this would be a 
highly unlikely development for three reasons.
    First, China is unlikely to build a large, expeditionary navy 
because it is not in the geostrategic interests of a fundamentally 
continental power to put too much attention and resources into global 
control of the seas, especially when a maritime superpower exists and 
provides the service free of charge.\11\ Second, others have suggested 
that China has too many internal economic, political and demographic 
challenges that will compete for resources and political attention 
during the remainder of this century for China to be able to afford 
such an undertaking.\12\ To these observations I add a third reason why 
I do not foresee China becoming an expeditionary sea power: If China 
intended its growing naval capacity to be used to challenge American 
sea power outside of the East and South Chinese Seas, a leading 
indicator of this intention would be a shift in perspective on 
international Law of the Sea from antiaccess to access, because the 
capacity to wield naval power without the international law authorities 
to use it would be an expensive investment with little practical 
utility. As such, paradoxically, it may be in America's best interest 
to accept the friction that attends our differing perspectives on 
international Law of the Sea as one of the manageable costs of 
separating the fundamental interests of a strong continental power from 
the fundamental interests of a strong maritime power.
---------------------------------------------------------------------------
    \11\ See, e.g., Robert S. Ross, ``The Geography of the Peace: East 
Asia in the 21st Century,'' International Security, Vol. 23, No. 4, 
Spring 1999, pp. 81-118.
    \12\ See, e.g., Susan Shirk, ``Fragile Superpower: How China's 
Internal Politics Could Derail its Peaceful Rise,'' Oxford University 
Press (2007).
---------------------------------------------------------------------------
    That is not to say that the United States should in any way 
compromise its values or perspectives related to the international law 
rights to naval access to the world's oceans for missions related to 
international peace and security or to missions related to security of 
the seas from nontraditional threats. Although American perspectives on 
the Law of the Sea are shared by approximately 140 of the current 157 
members of UNCLOS, with the remainder agreeing with China to one degree 
or another that as coastal states they have the right to impose legal 
restrictions on foreign military activities in their EEZ's, we cannot 
take the current state for granted. Indeed, the Chinese perspective 
holds some attraction even among China's neighbors. Despite the fact 
that their governments remain among those that are on record as 
accepting traditional military freedoms in the EEZ, representatives 
from the Philippines, Indonesia, and other regional states sometimes 
quietly express general support for the Chinese perspective, if for no 
other reason than it could help them hold rising Chinese naval power at 
bay. This unsettling development suggests that our regional partners in 
Asia also sense the shift in power dynamics in the South China Sea and 
may need more reassurance than we are currently giving them that the 
United States remains fully committed to our regional security 
commitments and to maintaining a dominant naval presence in the region.
    Protecting traditional freedoms of navigation for military purposes 
by maintaining a commitment to globally dominant sea power will have 
important consequences for the East Asian region and beyond. An arc of 
antiaccess is developing across the southern Asian landmass from the 
Arabian Sea to the Sea of Japan. Of the handful of remaining states 
that officially maintain legal perspectives that challenge traditional 
military freedoms of navigation in and above the EEZ, a concentration 
of these states is situated along the southern coasts of Asia astride 
some of the most critically important sea lines of communication in the 
world. In this region, Iran, Pakistan, India, Bangladesh, Burma, 
Malaysia, China, and North Korea all maintain laws that assert some 
right of control over foreign military activities in the EEZ. Vietnam 
too can be added to this list, although it has chosen to draw grossly 
excessive baselines, rather than to assert EEZ control as its 
antiaccess legal method of choice. This is in addition to the 
occasional tacit approval for antiaccess perspectives sometimes 
expressed by scholars and officials from the few remaining regional 
states not already listed here. Some of these countries have been 
building strong regional navies, while others have been actively 
seeking nuclear capacity or conventional antiaccess technologies 
similar to China's in order to provide teeth to their legal 
perspectives.
    In countering the antiaccess concerns of these coastal states, the 
United States will need to make it a priority to promote and 
demonstrate the maritime security benefits that can be provided by 
strong sea-power capacity combined with broad authorities to access 
ocean space. Specifically, the United States will need to find 
opportunities to undertake with China and other in the region 
cooperative international action to secure the seas from both 
traditional and nontraditional destabilizers. Additionally, since China 
clearly aspires to play a more important role in global leadership, as 
evidenced for instance by its increased commitment to international 
peacekeeping efforts, working together with China on an equal footing 
wherever possible will be helpful to the overall relationship.\13\ 
Inviting Chinese naval vessels to participate in future maritime 
security operations--even as we disagree about some of the applicable 
legal authorities--should become routine. Achieving a common maritime 
objective by either operating in separate sectors or operating in the 
same sector while performing different tasks are approaches 
demonstrated in current Gulf of Aden operations that deserve close 
study as models for future cooperation at sea where parties do not 
necessarily agree on the relevant authorities.
---------------------------------------------------------------------------
    \13\ Peter Dutton, ``Charting A Course: U.S.-China Cooperation at 
Sea,'' China Security, March 2009.
---------------------------------------------------------------------------
    Indeed, China's decision to participate in antipiracy operations in 
the Gulf of Aden has been an encouraging opportunity to demonstrate the 
power of a global maritime partnership to bring about the order and 
stability necessary for the well-functioning of the global system on 
which the economic health and political strength of all major countries 
relies. Additionally, such operations enable China to participate 
meaningfully in the provision of the ``global goods'' that come from 
maritime humanitarian and constabulary operations, which are supported 
by reasonable, access-oriented interpretations of international Law of 
the Sea.
    A final point about United States-China cooperation at sea: Because 
the East and South China Seas represent strategically important zones 
for both China and the United States and friction in the region is 
therefore likely to continue, cooperation is more likely to occur 
between Chinese and American naval forces the further away they operate 
from the East Asian coastal regions. The challenge for the United 
States in interacting with China will be to manage tensions in East 
Asia while encouraging greater global cooperation. China's aspirations 
to play a global role as a responsible major power and its willingness 
to undertake security operations in parallel, if not exactly in direct 
cooperation, with the United States and other maritime states in the 
Gulf of Aden suggests that future such opportunities will present 
themselves and should be welcomed. The more that China works with the 
United States and like-minded states away from East Asian shores, the 
greater the chance that the essential factor of trust will begin to 
enter into the equation of United States-China relations in East Asia. 
Should opportunities arise for cooperation in East Asia, such as 
humanitarian assistance or disaster relief, China should be welcomed as 
a partner. China's new hospital ship may provide opportunities in this 
regard, and joint regional deployments of U.S. and Chinese hospital 
ships should be considered in order to bring the benefits of modern 
medicine to underserved areas of Southeast Asia. Ultimately, such 
activities could begin to build the essential factor of trust, based on 
increased military to military contacts, which will help develop the 
strategic stability that all parties desire.
    In conclusion, perhaps the two most important leadership actions 
the United States could undertake to preserve the navigational freedoms 
that are of strategic importance to U.S. national security, are first 
to reassert our position as the global advocate for access-oriented 
approaches to international Law of the Sea. For too long we have 
neglected this fundamental pillar of American security. We have either 
taken for granted that the benefits of our perspective are self-evident 
and expected that other reasonable state actors would be eventually 
persuaded to our perspective, or we have simply relied on the strength 
of our national power to do what is in our maritime interest to do 
without much regard for what others thought. Today, however, there is 
not even complete unity of perspective across the various federal 
agencies that have a hand in oceans policy. The Federal Government 
would benefit from a comprehensive national oceans policy, and flowing 
from that policy, a comprehensive strategic communications plan to 
explain the benefits and strengths of the American perspectives on the 
oceans.
    Second, since October 2007 the United States Navy has been 
operating under a maritime strategy that reflects international 
cooperation as one of the most important foundations of global maritime 
security against both traditional and nontraditional threats. As 
Admiral Willard recently testified, ``our current nonparty status 
constrains'' us in forming partnerships to achieve national and 
international security. Admiral Willard also observed that UNCLOS is 
important because it provides a ``robust legal regime for global 
operations'' to counter both traditional and nontraditional threats. To 
these reasons I would add that China's active promotion of its 
antiaccess perspectives--and the receptive audience the message is 
reaching in some critical parts of the world--reminds us that the 
current level of freedoms of navigation for military purposes that we 
currently enjoy cannot be taken for granted. Additionally, China is 
exercising leadership on these issues from institutional positions 
inside the Convention. The United States is not. A Chinese judge sits 
on the International Tribunal for the Law of the Sea. There is no 
American judge. When negotiations are undertaken to consider changes to 
the Convention, China will have a seat at that table and a vote; the 
United States will not. In order to enhance our global leadership 
position on Law of the Sea issues, and to preserve our national 
security interests in the oceans from encroachment, it is my view that 
the United States should join the 157 other states that are currently 
members and accede to the United Nations Convention on the Law of the 
Sea at our earliest opportunity.
    In conclusion, international Law of the Sea is important and the 
United States needs to be vigilant to see that our interests in access-
oriented approaches to Law of the Sea are preserved. However, strength 
speaks louder than words. In my view it is essential to our own 
national security and to the security of many other states that our 
maritime power be protected from erosion. Power is currently shifting 
in East Asia, not equalizing, but shifting. America's best chance to 
preserve peace in the region is to show respect for China's newfound 
regional position by extending the hand of maritime cooperation. 
However, in order to preserve our own fundamental interests and those 
of our friends and allies, we must also retain our dominant maritime 
strength.

    Senator Webb. Thank you. Thank you very much.
    Do you prefer ``Professor'' or ``Commander''?
    Professor Dutton. Professor is fine.
    Senator Webb. Professor. OK, fine. Thank you very much, 
Professor Dutton.
    Mr. Blumenthal, welcome.

   STATEMENT OF DANIEL BLUMENTHAL, RESIDENT FELLOW, AMERICAN 
              ENTERPRISE INSTITUTE, WASHINGTON, DC

    Mr. Blumenthal. Thank you very much, Senator Webb. And it's 
very much my honor to appear before you today and applaud you 
for holding this important hearing, paying attention to China's 
rise and growing assertiveness along its maritime periphery.
    It has been well over a decade--I understand you've been 
writing about this for longer than a decade, but writings I've 
seen a decade ago, when you started writing about this topic, 
and Chinese naval modernization has outpaced even the most 
extravagant predictions within that decade.
    I think--at the risk of boring some people, I think it's 
useful to go through some of the details of this modernization 
program up front, because it's actually quite alarming.
    In the past decade, China has deployed 38 new diesel and 
nuclear submarines at a deployment rate of 2.9 subs per year. 
It has also deployed about 10 new classes of indigenously built 
destroyers and frigates equipped with lethal antiship cruise 
missiles. And very germane to what we're discussing here today, 
it has, in addition to the over 1,000 ballistic missiles its 
deployed across from Taiwan to the Nanjing military region, it 
is getting ready to deploy and innovating a land-based antiship 
ballistic missile equipped with maneuverable reentry vehicles 
whose sole purpose could be to hit our mobile surface ships, 
including the very symbol and cornerstone of our power, the 
carrier battle group. And I believe they will probably test 
this capability in the next couple of years.
    The reason that I ran through some of these details is 
because we haven't seen anything like this naval--a naval 
buildup of this kind since the early cold war, nor has our Navy 
ever faced a threat of ballistic missiles capable of hitting 
mobile targets at sea.
    And I think you are quite correct when you wrote recently 
that the Communist Party is making a concerted and calculated 
attempt to expand China's regional strategic space. This is not 
just tactics or--it's incrementally doing so, but it is doing 
so.
    One has to question what drives this military buildup, 
since, indeed, China faces no military threat that anyone can 
discern. In fact, since the end of the cold war and in the past 
30 years since the end of the Sino-Vietnamese war, the region 
has been, by and large, at peace. Instead, I think that the 
drivers of this military buildup are very much domestic, a 
desire for national prestige, and an insecurity by the Chinese 
Communist Party. Beijing wants to make good on unsettled 
territorial claims, push out its maritime periphery, and 
develop alternative pathways to break out into the open ocean.
    China is behaving exactly as one might expect of great 
powers. The only surprise is that anyone thought they would do 
otherwise. But, that doesn't make their actions any less 
destabilizing. And here's why. Since the end of World War II, 
Asia has enjoyed relative security, underwritten, in large 
measure, by our own military power and set of security 
commitments. It is within that security cocoon that most Asian 
nations, including China, have enjoyed peace, prosperity, and 
increasing internal development.
    Asia, by any measure today, is fast becoming the center of 
gravity of international politics. Yet, China's rise is 
beginning to change the sense of stability and security that 
has allowed all of these positive changes to take place.
    I will note that, just recently, our great Australia ally 
issued a defense white paper that, not only raised concerns 
about China's rising power, but also about our staying power in 
the region. We, as a nation, want to see an Asia that continues 
to grow and prosper peacefully, and our allies are looking to 
us, as they always have, to ensure the peace, given the 
potential for intense regional security competition. We must, 
then, I think, not for any reasons of wanting to be overly 
dominant, but we have to remain Asia's chief guarantor of 
security for the near future.
    And I think we have to view the disputes we're talking 
about in this context, because both the dispute with the 
Japanese, which I'll start with, and with the ASEANs, is about 
much more than just commercial energy interests, although 
energy interests come into play. This is about great power 
competition, historical animosity, and the strategy of the 
Chinese to find alternative resources and alternative supply 
routes for energy, as well as breaking out into the open ocean.
    First, national pride and suspicion of the United States 
drive China to seek alternative sources and routes of oil 
supply, preferably closer to the mainland in areas where China 
can project military power. They no longer want to, over the 
long term, rely upon our goodwill to protect their sea lines 
that supply so much of their oil and gas.
    Second, the Senkaku/Diaoyu chain resides within what China 
calls the ``first island chain,'' a demarcation that runs from 
the Yellow Sea near South Korea, through the South and East 
China Seas, an area that includes Taiwan, the Ryukyu, as you 
mentioned, and waters near Vietnam. China increasingly acts, at 
least, as if they want to dominate this island chain for 
defensive and offensive purposes--defensively, because they 
don't like the activities of the United States and Japan so 
close to their shorelines, offensively in the sense that they 
want to--they see that as a way to break out into the Pacific.
    Many Chinese believe that the United States-Japan alliance 
operates too close to the PRC shoreline and is a part of a 
containment strategy. This partly explains China's recent 
harassment of the Impeccable, as well as its downing of the 
United States surveillance aircraft at Hainan Island, that you 
mentioned. Basically, China is asserting expansive territorial 
claims as a part of a strategy to push us back. And I think 
geopolitics and Chinese maritime strategy hold greater purchase 
in China over the law. This is only adding to the Japanese 
sense of security and a sense that they'll be economically 
strangled and isolated.
    Finally, I would say, about the Senkakus, that the dispute 
over the EEZ claims also shed some lights about Japanese 
concerns over the final disposition of Taiwan. For Japanese 
strategists, Chinese control over Taiwan would put--potentially 
put Chinese bases even closer to Okinawa and the Ryukyu 
Islands, and extend the Chinese EEZ out even further, only 
heightening Japan's sense of insecurity.
    The South China Sea, I think, can be viewed in similar 
ways, geopolitically. Also, it impinges on the interests of the 
three great Asian powers--Japan, India, and China.
    Let me move--since I'm running out of time, let me move--we 
know Japan's concerns--let me move to India.
    I think, last year, when it was revealed that China, in 
fact, had built a base at Hainan Island that can both support 
submarines, as well as surface combatants, and provide stealthy 
outlet to the waterways, particularly the Strait of Malacca, 
the Indians were very vocal, and have been very vocal since 
then, that the Chinese are trying to find ways to enter into 
the Indian Ocean and constructing a string of maritime bases 
and facilities that include Burma, Sri Lanka, and Pakistan. So, 
in my view, at the core of these disputes are the growing 
Chinese might. In many ways, the disputes are a symptom of that 
and a strategy to push out their maritime periphery.
    We've talked a little bit about the U.S. position. I think 
it's fine to stick to general principles regarding peaceful 
resolution of territorial disputes and freedom of navigation, 
it--even prudent, given that we want a cooperative relationship 
with China, and the historical sensitivities involved. But, we 
also have to be aware of the apparent desire of China to 
dominate these seas and extent out its freedom--and extend its 
freedom of action and impede our own. We must ensure that our 
allies and friends have the strength and backing to stand up 
against potential coercion. And we, ourselves, have to make 
good on our diplomatic commitments. While we should intensify 
our alliance to diplomacy and our diplomacy with China to 
reassure them about our own intentions, there is no getting 
around the fact about something that you mentioned in your 
opening remarks, which is, we must properly resource our 
military. There's almost a perfect symmetry between the Chinese 
naval buildup and our own--that I described before--and our own 
naval drawdown.
    I have been asked to say a few words about the role of U.S. 
sea power in maintaining the balance of power, and I do so 
humbly, speaking before a former Secretary of the Navy and 
entering into debates about force posture, which are always 
contentious. But, let me first make this point, and that is, 
our defense strategy in the Pacific should not be solely 
focused on futuristic warfighting scenarios, or thought of even 
as some kind of science-fiction scenario. Rather, given that 
China has already changed the regional balance of power, 
rebalancing should be a day-to-day task of our forces in the 
Pacific.
    One way to conceptualize this is, we need a force--a more 
robust presence and engagement force in the region, and then a 
surge force in case of conflict. And I'll speak about the 
former, because I'm running out of time.
    Our fleet, as you mentioned, has not been this small since 
the early 20th century. While our capabilities are better than 
the Chinese are, fleet size, given the tasks we have in the 
region, everything from responding to humanitarian disasters to 
building up partnership capacity to balancing China, our tasks 
are just great.
    Let me give a rough estimate of some naval requirements 
that may be necessary in the Pacific, as we move forward. 
Certainly, an increase in our submarine force so we can 
maintain a near-constant presence in the East and South China 
Seas, as well as the Sea of Japan. More submarines are 
necessary to protect our carrier strike groups and patrol and 
conduct ISR, as well as other types of antisubmarine warfare 
capabilities.
    Our missile and fleet defenses are currently inadequate, in 
my view, to the growing Chinese innovations and ballistic 
missile production, over-the-horizon targeting. Unfortunately, 
we have come to a point where, if we want to keep our forward-
deployed carriers relevant, we need to focus more on protecting 
them; and for that, we need all sorts of ISR assets in space, 
as well as on board. While we need a layered missile defense, 
the most promising defense in this regard is the directed-
energy type of weapons. Littoral combat ships can potentially 
play an important role in maintaining a robust ASW presence, as 
well as antisurface warfare capability in the littorals.
    I'd close by saying you were quite correct when you noted 
that we are in an odd position--you said this in some 
statements I saw earlier--where the defense budget 
announcements have been made before the administration has been 
able to undergo its Quadrennial Defense Review. My fear--and I 
urge the Congress to take a look at this--is that the 
Quadrennial Defense Review will become just a matter of fitting 
into the already-decided-upon budget cuts and program cuts.
    Finally, I'd say I'm confident that diplomacy can succeed 
in Asia and we can enjoy 30 more years of peace and prosperity, 
as long as everyone knows that we can back up our commitments.
    [The prepared statement of Mr. Blumenthal follows:]

    Prepared Statement of Dan Blumenthal, Resident Fellow, American 
                  Enterprise Institute, Washington, DC

    Senator Webb, members of the committee, it is my honor to appear 
before you here today. You should be applauded for holding this 
important hearing and for paying attention to China's rise and growing 
assertiveness along its maritime periphery.
    It has been over a decade since you, Senator Webb, began writing 
about this topic, and Chinese naval modernization has outpaced even the 
most extravagant predictions. In the past decade, China has deployed 38 
new diesel and nuclear submarines, a deployment rate of 2.9 subs per 
year. In addition to its purchase of four Russian Sovremenny-class 
destroyers it has deployed nine new classes of indigenously built 
destroyers and frigates, equipped with lethal antiship cruise missiles.
    Moreover, in addition to its extant deployment of over a thousand 
ballistic missiles, the PLA has been developing a land-based antiship 
ballistic missile equipped with maneuverable reentry vehicles whose 
purpose is to hit our own mobile surface ships, including the linchpin 
of our power projection capability--the carrier battle group. We have 
not seen anything quite like this naval buildup since the early cold 
war. Nor has our Navy ever faced the threat of ballistic missiles 
capable of hitting mobile targets at sea. And you are quite correct 
when you write that the Chinese Communist Party is making concerted, 
calculated attempts to enlarge China's ``regional strategic space.''
    What drives this military buildup? It is not driven by threats to 
China--by any objective measure, China does not face a military threat. 
With the fall of the Soviet Union, China no longer must concern itself 
with protecting its land borders from invasion. Since the end of the 
cold war the region has, by and large, been at peace.
    Instead, I would argue that China's military buildup is driven by 
domestic factors, the desire for national prestige, and the insecurity 
of the Chinese Communist Party. China is exhibiting behavior that we 
would expect from a rising great power. The only surprise is that we 
expected them to behave differently. The American public has been told 
time and again by successive administrations and many experts that 
China's rise would differ from the rise of all other great powers in 
history. But this is simply not happening.
    As China grows stronger and dedicates ever-more resources to its 
military forces, Beijing wants to settle territorial disputes in its 
favor, push out its maritime periphery, and develop alternative 
pathways to break out into the open ocean. Indeed, one of the more 
interesting developments within Chinese strategic circles is the 
ongoing debate about the importance of Alfred Thayer Mahan, the 
theorist of our own rise to international prominence, about which Mr. 
Dutton's colleagues at the Naval War College have written so much.
    Chinese navalists are beginning to grapple with how such concepts 
as ``command of seas'' and the link between maritime power and 
international commercial interests apply to the People's Republic.
    We should not be comforted by the fact that China is behaving as 
all rising powers do. Here is why: Since the end of World War II, Asia 
has enjoyed relative security, underwritten in large measure by our own 
military power and set of security commitments. It is within that 
security cocoon that most Asian nations have enjoyed peace, prosperity, 
and increasing democratization. Asia today, by almost any measure--
economic, political, demographic, and military--is fast becoming the 
center of gravity of international politics. Yet China's rise is 
beginning to change the sense of stability and security that has 
allowed for increasing peace, prosperity, and democratization. As a 
resident Pacific power, we want to see an Asia that continues to grow 
and prosper peacefully. An Asia in which the United States is not seen 
as the clearly predominant military power will inevitably be a less 
stable Asia. An insecure region will be more concerned with security 
competition than with trade, internal reforms, and regional 
cooperation.
    It is within that context that I wish to speak about the maritime 
territorial disputes in the South and East China Seas. Let me begin 
with Japan and the Senkaku/Diaoyu Islands dispute, since Japan has long 
been, and remains, our key ally in the region.
    Of all the regional territorial disputes, the Sino-Japanese quarrel 
in the East China Sea is the most vexing, and perhaps most dangerous. 
The dispute is grounded in great power competition, historical 
animosity, the desire to exploit potential energy resources beneath the 
sea, and concerns over the ultimate disposition of Taiwan. This 
combination of issues is particularly volatile.
    Both countries claim sovereignty over the Senkaku/Diaoyu Islands, 
and both include the islands in their EEZ/Continental Shelf claims. 
From the Chinese perspective, the islands are important for reasons of 
energy security as well as their expanding maritime ambitions.
    Let me begin with energy security. Both countries make claims to 
the Chunxiao gas field which China claims is 5km away from the Japanese 
median line in the East China Sea. Currently, the Chinese energy 
company CNOOC is the operator of the field, and energy experts estimate 
that the Chunxiao could have as much as 250 trillion cubic feet of 
natural gas and between 70-160 billion barrels of oil.
    Since both Japan and China are committed to diversifying their 
sources of their energy supplies, the natural gas and oil in the East 
China Sea is of utmost importance to both.
    An additional concern for China is the maritime distance between 
its ports and its main oil suppliers in the Persian Gulf. Beijing is 
increasingly uncomfortable about relying on U.S. goodwill to patrol 
those waters. Both national pride and suspicion of the United States 
drive China to seek alternative sources and routes of supply, 
preferably closer to the mainland in areas where China can project 
military power. The Chunxiao field is thus an important piece of 
Chinese energy security strategy.
    Another concern for Chinese strategists is that the Senkaku/Diaoyu 
chain resides within what the Chinese call the ``first island chain,'' 
a somewhat arbitrary demarcation that runs from the southern Japanese 
island of Kyushu, through the East and South China Seas. This area 
includes Taiwan, the Ryukus of Japan, and virtually all of the South 
China Sea. The Chinese increasingly act as though they want to dominate 
this island chain. For Chinese strategists, there are defensive and 
offensive purposes behind these claims.
    The Chinese write of being boxed in by a United States-Japan 
alliance that operates too closely to their own shoreline. Once 
designed to hem in the Soviet Pacific fleet, the alliance is now, 
Chinese strategists believe, part of an active containment strategy 
aimed at China. This partly explains China's recent harassment of the 
USNS Impeccable, as well as its downing of a U.S. surveillance aircraft 
at Hainan Island in 2001. While the United States and China dispute 
provisions of the Law of the Sea and what constitutes lawful operations 
in China's EEZ, I doubt these issues will be resolved in the near 
future. Geopolitics and Chinese maritime strategy hold greater purchase 
over China's position than the law. Simply put, China wants to push the 
United States back further and further away from its shoreline and its 
claimed spheres of influence.
    Many Chinese strategists believe that the PRC cannot be a great 
power as long as the country is held within the maritime box 
constructed by Tokyo and Washington. The alliance, which also protects 
Taiwan, prevents the Chinese from projecting sea power into the Western 
Pacific. From a defensive perspective, Chinese strategists are 
committed to impeding U.S. access to this ``first island chain'' should 
there be a conflict over Taiwan.
    From the Japanese perspective, the Senkakus have been part of Japan 
throughout modern history--Tokyo never ceded that territory, including 
after losing World War II when it ceded much territory under the San 
Francisco Treaty. As it stands, Japan administers the Senkakus--while 
both China and Taiwan claim the island grouping to be theirs.
    Japan has leased part of the island grouping from private owners, 
intending to control any sale of territorial rights. Both Taiwan and 
China protested this action. Around the same time in 2003, CNOOC 
entered into a partnership to produce natural gas at Chunxiao.
    Japan protested and demanded China turn over seismic data. While 
Beijing remained intransigent, Japan granted the right to one of its 
own oil companies to begin drilling in the East China Sea. China 
responded by sending a naval flotilla, including a Soveremmeny to the 
site and issuing a stern warning to Japan to stop any energy 
exploration within ``China's'' territory. Japan did cease its work.
    The Chinese flotilla sent to the East China Sea in 2005 has not 
been the first show of China's maritime might. The Japanese 
declassified documents demonstrating that Chinese military and civilian 
research vessels and submarines had entered the Japanese EEZ over a 
dozen times in 2004 and 2005. The purpose of these maritime incursions 
included mapping for oil and gas exploration in disputed areas, showing 
force to pressure Japan in the ongoing dispute, and conducting research 
on submarine routes into and out of the Pacific.
    We and the Japanese were quite concerned as well when a Chinese 
Song-class diesel submarine surfaced a little too close for comfort 
near the USS Kitty Hawk  during an American exercise near Japan in 
2007. The submarine had apparently been shadowing the Carrier Strike 
Group undetected.
    From the Japanese perspective, then, the Senkaku/East China Sea 
dispute is about much more than energy interests and international law. 
It is a manifestation of growing Chinese strength and assertiveness. 
Japan has a long history of fearing economic strangulation and 
isolation. Growing Chinese maritime power and shows of force are only 
heightening these fears.
    Finally, the dispute over EEZ claims and the Senkaku/Diaoyu Islands 
sheds some light on Japanese concerns over Taiwan. For Japanese 
strategists, Chinese control over Taiwan would put China's naval bases 
even closer to Okinawa and the Ryuku Island chain, and extend the 
Chinese EEZ even further out toward the Pacific. The Japanese sense of 
insecurity--already high given the instability on the Korean 
Peninsula--would only heighten.
    While the two sides came to some agreement in 2008 to jointly 
explore for energy resources and shelve territorial disputes for the 
time being. But given the dynamics I just explained, both sides are 
keeping their powder dry.

                          THE SOUTH CHINA SEA

    The South China Sea disputes, including those over the Spratleys 
and Paracels, must be similarly analyzed in a geopolitical context. The 
dispute impinges upon the security interests of three great Asian 
powers--Japan, India, and China--as well as some of our less powerful 
allies and partners such as Vietnam and the Philippines.
    In essence, China claims sovereignty over all of the South China 
Sea. Vietnam, the Philippines, Brunei, and Taiwan dispute such claims, 
particularly those of sovereignty and rights of exploration over the 
islets around the Spratleys and the Paracels. As in the East China Sea, 
all claimants to territory within the South China Sea believe that it 
also holds significant oil and gas reserves. China has sparred with 
Vietnam and with the Philippines over islands in the Spratlys and with 
Vietnam over the Paracels. While China signed the Declaration on the 
Conduct of Parties in the South China Sea in 2002, regional actors do 
not trust that China will abide by its commitments. Arguably, growing 
Chinese power and assertiveness in this area were major drivers behind 
Vietnam's desire to build closer security ties with us, and the 
Philippines' desire to sign a Visiting Forces Agreement with us in 
1999.
    The South China Sea is also a pathway to the all-important Strait 
of Malacca, considered to be one of the world's most important maritime 
choke points and waterways for seaborne trade. Some 50,000 ships 
carrying a quarter of the world seaborne trade, and half of the world's 
seaborne oil pass through Malacca annually. Since 90 percent of China's 
and most of Japan's oil comes by sea, it is natural that both countries 
have abiding interests in their own definition of security in the 
strait and the South China Sea.
    Last year anxiety heightened in Southeast Asia, Tokyo, and Delhi 
when the press reported on a new naval base that the Chinese have 
constructed at Hainan Island; the base can accommodate attack and 
ballistic missile submarines as well as a variety of surface 
combatants. The People's Liberation Army Navy (PLAN) can use the base 
to deploy stealthily into the South China Sea and access international 
waterways.
    Southeast Asians are concerned about the potential for China to put 
military pressure on them to settle their territorial disputes. Tokyo 
is concerned about the Chinese potential to dominate the waterways and 
coerce and isolate Japan.
    The Indians are concerned for two reasons. First, the discovery of 
the Hainan Island base adds to a growing Indian perception that the 
Chinese are finding ways to enter the Indian Ocean and constructing a 
string of maritime bases and facilities along the Indian Ocean--in 
Burma, Sri Lanka, and Pakistan--that it will use to project power 
closer to what India defines as its own sphere of influence.
    Second, India has been playing a larger economic role in Southeast 
Asia in particular and wants unimpeded maritime access to the region. 
It is concerned that what we are seeing develop for the region is the 
Chinese-equivalent of a Monroe Doctrine.

                           REGIONAL REACTIONS

    For now, all the concerned parties are attempting to balance 
against China's growing power. Both Hanoi and Manila have sought closer 
ties with us. Tokyo, a great power constrained in military matters only 
by its pacifist constitution, has also energetically sought and 
received an upgraded bilateral alliance. The breakthrough with India 
was in no small part driven by shared Indian-American perceptions of 
the maritime security environment.
    In short, we share with our regional partners a desire that China 
not become the hegemonic power. The question that many in the region 
are beginning to have is whether we have the long-term will and power 
to match China's rise.
    And that leads me to my concluding remarks.

                    CONCLUSIONS AND RECOMMENDATIONS

    We have not had a clear policy on competing claims within the South 
and East China Seas, nor have we taken a clear position with respect to 
the disposition of disputed islands. What we have said is that we will 
protect freedom of navigation and rights in EEZs consistent with 
international norms.
    Sticking to general principles regarding peaceful resolution of 
territorial disputes and freedom of navigation may be prudent given the 
historical sensitivities involved and our desire to have a cooperative 
relationship with China.
    But at the same time we must be aware of China's apparent desire to 
dominate the South and East China Seas, extend its maritime periphery 
and freedom of action, and impede our access to these seas.
    We must also ensure that our friends and allies have the strength 
and backing to stand up against potential coercion, and that we 
ourselves can make good on our diplomatic commitments.
    We neither want to see a costly arms race in Asia nor an Asia 
dominated by China to our exclusion. To accomplish these objectives we 
should intensify our alliance diplomacy to reassure our allies that 
they will not be coerced. We should demarcate clear redlines to China 
regarding core principles of maritime behavior.
    But there is no getting around the fact the we must properly 
resource our military.
    There is an almost perfect symmetry between China's naval buildup 
and our own drawdown. China has deployed dozens of new submarines just 
as we let our Anti-Submarine Warfare capabilities atrophy. As China 
deployed dozens of new subs we reduced our submarine force by about 25 
boats.
    The Chinese have not only noticed the imbalance, they are counting 
on a continued decline in our naval power. China's Rear Admiral Yang Yi 
gloated that ``China already exceeds the United States in [submarine 
production] five times over . . . 18 [U.S. submarines--the amount 
resident in the Pacific] against 75 or more Chinese submarines is 
obviously not encouraging [from a U.S. perspective].'' The Chinese 
admiral is spot on. U.S. boats are superior, though the quality gap is 
closing. And the gap in quantity makes keeping track of the Chinese 
fleet even more difficult.
    I have been asked to say a few words about the role of U.S. sea 
power in maintaining the balance of power. I do so humbly, both because 
I am speaking to a former Secretary of the Navy and because I am aware 
that entering into force posture debates is a perilous endeavor.
    My institute convened a group of security and military experts to 
take a close and comprehensive look at our global force requirements 
ahead of the administration's QDR.
    We examined Pacific requirements, and let me share some of our 
findings.
    First let me stress that our defense strategy in the Pacific should 
not be solely focused on possible war-fighting contingencies. Given 
that China has already changed the regional balance of power, 
``rebalancing'' should become a day-to-day task of our forces. One way 
to conceptualize our Pacific force requirements is to think about a 
more robust presence and engagement force, and a surge force in case of 
conflict. I will speak mostly about the former.
    Our fleet size has not been this small since early in the 20th 
century. While we have better capabilities and seamen, given the vast 
expanse of the Pacific, fleet size matters. Our Pacific forces have 
many tasks besides maintaining the balance of power--they build 
partnership capacity, respond to natural disasters, and conduct 
antipiracy missions, for example.
    But let me focus on the China mission. A very rough estimate of 
naval requirements in the Pacific would include an increased presence 
of fast attack submarines (SSNs) to maintain a near constant presence 
in the East and South China Seas as well as the Sea of Japan. More 
submarines are needed to protect our Carrier Strike Groups, monitor 
Chinese submarines on patrol, and conduct ISR operations. Additional 
capability requirements include P8s and undersea sensors.
    Our missile and fleet defenses are inadequate to the growing 
Chinese innovations in ballistic missile production and over-the-
horizon targeting. Unfortunately, we have come to a point where, if we 
want to keep our forward deployed carriers relevant, we need to focus 
more on protecting them.
    Useful capabilities to protect maritime assets include satellite-
launched detection systems linked to tracking radar; a near constant 
presence of forward deployed ships capable of ballistic missile 
defense; and intelligence capabilities to provide to at-risk ships 
real-time indication and warning of anticarrier missile launches.
    While we need a layered missile defense system, directed energy 
remains the most promising means of defeating these threats, 
particularly the ASBM. More forward deployed Littoral Combat Ships can 
potentially play an important role in maintaining a robust ASW 
capability and Anti-Surface Warfare capability in the littorals.
    All of these capabilities will help us surge if we need to. If our 
forces need to send more carriers to the region, measures to enhance 
their survivability will render them more effective. More robust ASW 
capability will provide us better freedom of action to execute 
operations. I would say that we should equally emphasize the 
survivability of our fixed land bases. We should create more logistical 
hubs in more friendly countries to enable our air forces to surge into 
the region. And, we must ensure that we have adequate stealthy aircraft 
and tankers for missions that are sure to be some of the most complex 
and stressing that we have ever faced.
    You were quite correct, Senator Webb, when you noted that we are in 
an odd position: Our defense budget has been announced before the Obama 
administration has undergone its own QDR. I would urge the Congress to 
make sure the administration's defense review is not simply a budget 
cutting exercise.
    Finally, I am confident that diplomacy can succeed and Asia can 
enjoy more peace and prosperity as long as everyone knows that we can 
back up our commitments. What is required is good old fashioned 
American statecraft--speaking softly but carrying a big stick.

    Senator Webb. Thank you very much, Mr. Blumenthal.
    Dr. Cronin, welcome.

STATEMENT OF DR. RICHARD CRONIN, SENIOR ASSOCIATE, THE HENRY L. 
                 STIMSON CENTER, WASHINGTON, DC

    Dr. Cronin. It's a privilege to address the committee--the 
subcommittee on this issue, which is very close to my own work 
and interests.
    I would just preface my remarks with a point, after hearing 
the discussion, that I'm suggesting a kind of two-pronged 
approach. And one, of course, is military preparedness and 
being ready to deal with whatever China has militarily, but 
also that there is a need to engage with China and in a way 
that tries to persuade China that its own long-term self-
interest is in playing by the rules of the game.
    I think the Vietnam war, United States policy, United 
States decision to get into Vietnam, did--it should have taught 
us a lesson that we need to understand the psychology of our 
adversaries, if you want to put it in that way, if we want them 
to--and particularly if they want to change--we want them to 
change their own behavior.
    Now, that said, China's unilateral assertion of its 
maritime claims that are contrary to principles of Law of the 
Sea and its willingness sometimes to resort to force and 
intimidation to achieve its goals have, indeed, become matters 
of serious concern in Asia and the Pacific.
    In terms of understanding where China may be coming from, 
you know, and psychologically and otherwise, it is important, I 
think, to keep in mind that, first, China does still feel the 
humiliation of how the Western powers--Russia and India and 
Japan occupied and alienated Chinese territory, and even some 
of its South Asian--smaller Southeast--China Sea neighbors 
encroached on China's position during the chaos of the Mao's--
Chairman Mao's cultural revolution.
    But then, second, we should see China's actions in regard 
to its--the spillover effect of being, until recently, the 
fastest growing economy in the world, and its seemingly 
insatiable demand for raw materials and energy.
    I should also add that China's approach to territorial 
disputes in the South China Sea follows the same pattern as in 
disputes with Japan and its current moribund disputes with 
North and South Korea. And I would like to add, for a personal 
note, the same attitude also drives China's determination to 
exploit the hydroelectric potential of the Mekong River without 
regard to the interests of 60 million people, or more, in five 
downstream countries for whom the river is their lifeblood and 
main source of food security. That happens to be the main focus 
of my work right now at the Stimson Center.
    The United States isn't a party, of course--and we've gone 
over this already, that--not a party to any of these 
territorial disputes, but it does have strong interests at 
stake.
    The other--most of them have been mentioned, but I'd 
particularly--I think you're interested--or expressed an 
interest in issues like our commercial interest in regional 
trade and investment, as well as just for general desire to 
support peace and security--peace and stability in the region.
    Also, the USA has other important interests in the region 
that don't, sometimes, get mentioned, but in which China is a 
real factor, and they include issues of climate change, global 
warming, cooperative and environmentally sustainable 
exploitation of migratory fish stocks, the protection of coral 
reefs.
    The fish-stocks issue is critically important, because it 
affects food security, it has provoked clashes at sea, in some 
cases, and it's very hard to have any kind of regional 
agreement on managing fisheries, so long as the territorial 
claims are unresolved.
    The other witnesses have already talked about the Law of 
the Sea Convention and the 200-mile Exclusive Economic Zones 
and the problems that are caused by China's not playing by the 
same rules in this regard.
    What I would like to mention, primarily, in terms of the 
Law of the Sea Convention, is that there was a deadline of May 
13, this year, for countries to submit claims. And there was a 
land rush, or a sea rush, if you will. Everybody jumped in with 
their claims. And that has put a higher--generated a higher 
level of interest and tension about these issues.
    The most controversial Chinese actions have been in the 
Gulf of Tonkin and neighboring parts of the South China Sea, 
where China repeatedly has drilled for oil and gas in areas 
claimed by Vietnam, by historical occupation--which are 
likewise claimed by Vietnam, both by historic occupation and 
under the Law of the Sea rules.
    Chinese ships also have forcefully prevented Vietnamese and 
other neighboring countries' fishing boats from operating in 
waters claimed by China.
    We've talked about the challenge to the U.S. Navy. I won't 
get into that, the incident with the Impeccable. But, obviously 
that's an important issue for us.
    I do want to mention other Southeast Asian disputes--
maritime disputes, which also use competing--also involve 
competing claims. Thailand and Cambodia are now very active--in 
a very active dispute over ownership of the Preah Vihear Temple 
on a mountain that straddles their mutual border, as well as a 
dispute over the boundaries of each other's territorial waters. 
Troops of both countries have been involved in armed clashes.
    The maritime disputes involves overlapping claims to oil 
and gas reserves that Chevron and ConocoPhillips, among others, 
are seeking to develop.
    Thailand and Vietnam also have conflicting claims to parts 
of the Gulf of Thailand, which is rich--has rich oil and gas 
deposits. The gulf is particularly difficult to delineate 
because it is bounded by Cambodia, Malaysia, Thailand, and 
Vietnam. Everybody can't have a 200-mile EEZ in a curving 
coastline.
    Malaysia, on Borneo, also has a claim to part of the South 
China Sea that is also claimed by Thailand, Vietnam, the 
Philippines, and China.
    A joint submission by Malaysia and Vietnam to the Law of 
the Sea--we call it UNCLOS, for short, the U.N. Convention on 
Law of the Sea--earlier this year provoked an angry response by 
China and a counterclaim, which, however, was not supported by 
reference to the provisions of the Law of the Sea, but, again, 
by China's historical claim.
    So, thus far, the direct and indirect impact of China's 
behavior has mainly affected the opportunities for American and 
other multinational countries for oil and gas exploration and 
development, and blocks--and particularly blocs offered by 
Vietnam.
    Numerous claims report that China has--reports claim that 
China has told American and other multinational companies that 
if they want to do business with China in their oil and gas 
business, they should not drill in areas in the Tonkin Gulf and 
South China Sea that are claimed by Vietnam. This is a real 
issue, as you know, in China-Vietnam relations.
    For understandable reasons, United States multinational 
energy companies are reluctant to publicize the problems 
created by China's attitude toward contested claims. But, there 
have been reports that in 2007 and 2008, China coerced 
ExxonMobil, as well as BP, to suspend drilling in waters 
claimed by Vietnam.
    Part of my--important part of my testimony, I would say, 
deals with environmental, social, and economic impacts, but I'm 
going to skip by those to just try to identify some things that 
the United States might do in regard to this issue and in 
support of our allies and friendly countries.
    There are several ways that the United States could serve 
its and Southeast Asia's interests, especially through 
diplomacy, science, and technology support, and capacity-
building to deal with the rising destruction from storms, 
climate change, and climate change adaptation.
    But, to pursue these issues in the context of China's 
claims and role, it's important for the United States to be on 
the scene, again. And I won't go into the long story of at 
least the perception that the United States has been absent 
from Southeast Asia for a long time, but it has come back, even 
during the George W. Bush administration. In fact, Ambassador 
Scot Marciel--or Deputy Assistant Secretary Marciel was our 
first Ambassador appointed to ASEAN back in 2007. And it 
apparent--at present, the Obama administration, and especially 
the State Department, appear to be stepping up the pace of 
constructive U.S. involvement in the region. All Southeast 
Asian capitals will be listening closely to what Secretary of 
State Clinton has to say when she attends the ASEAN post-
ministerial conference between ASEAN and its dialogue partners 
and the ASEAN Regional Forum in just a couple of days.
    The United States would also help the region and itself by 
responding to requests for material support to ASEAN's Coral 
Triangle Initiative. I won't get into that now, but it's 
another issue where ASEAN has had a lot of talk and no action. 
But, part of that problem is a lack of financial resources and 
other resources.
    Just to conclude, I'd like to say that, at the end of the 
day, China can't be pushed around. We have to engage with 
China, and we are engaging with China, including at this high-
level United States-China Strategic Economic Dialogue issue. 
And the important thing for us, I think, is to provide moral 
support to our friends and allies in the region, but also, 
again, to work on China to try to make China realize that we 
can't be pushed around, either, and that its long-term 
interests lie in the kind of neighborly relations that it 
always insists that it desires with the ASEAN countries.
    Thank you.
    [The prepared statement of Dr. Cronin follows:]

 Prepared Statement of Dr. Richard P. Cronin, Director, Southeast Asia 
              Program, The Stimson Center, Washington, DC

    Senator Webb and other members of the Subcommittee on East Asia and 
Pacific Affairs, I thank you for this opportunity to address the 
subcommittee about some issues in East Asia and the Pacific which are 
critical to peace, stability, and balanced development in a part of the 
world that matters greatly to the United States. For reasons you have 
implied in your invitation to testify at this hearing, China's 
unilateral assertion of maritime claims that are contrary to the 
principles of the Law of the Sea, and its willingness sometimes to 
resort to force and intimidation to achieve its goals, have become 
matters of serious concern in Asia and the Pacific.
    Nonetheless, if we hope to gain greater Chinese acceptance of the 
rules and principles of global governance--none of which are completely 
embraced by any major economic power--we should keep in mind at least 
two important factors that have influenced China's approach. First, 
China still feels the humiliation of how the Western colonial powers, 
Russia, and Japan occupied and alienated Chinese territory. Even some 
of its South China Sea neighbors encroached on China's position during 
the chaos of Mao's Cultural Revolution, when Chinese attention was 
focused inward. Thus, China remains determined to redress what it sees 
as past injuries and reclaim what it views, rightly or wrongly, as its 
own. This includes the position it once held as the dominant power in 
what the world still calls the South China. Second, much of China's 
assertive behavior is a spillover effect of what until just recently 
had been the world's fastest growing economy.
    Among other goals, China seeks to make its energy and mining 
companies global players in terms of capitalization, technology, and 
access rights to important national resources. It would be better for 
China and its trading partners and competitors if its leaders 
understood the efficiency of global markets and were not wedded to a 
mercantilist approach to locking up energy and other natural resources 
through long-term contracts, but China is not alone in this 
competition.
    Still, China's recent behavior does affect legitimate American and 
Southeast Asian interests, including freedom of navigation, access to 
rich undersea oil and gas deposits, and the cooperative and sustainable 
development of other seabed resources, fisheries, and estuaries. The 
consequences of China's behavior in the South China Sea in particular 
jeopardize regional peace and stability, economic development, 
traditional subsistence livelihoods, and food security among the other 
countries of the littoral.
    China's approach to territorial disputes in the South China Sea 
follows the same pattern as in disputes with Japan and its currently 
moribund disputes with North and South Korea. The same attitude also 
drives China's determination to exploit the hydroelectric power 
potential of the Mekong River without regard for the interests of 60 
million people or more in five downstream countries for whom the river 
is their lifeblood and main source of food security. From its own 
developmental perspective, Chinese policymakers appear to believe that 
the outward expansion of the Chinese economy is beneficial to all, but 
in this case the reality is far different. In any event, its behavior 
toward its downstream neighbors is cavalier and unilateralist. I would 
be glad to address those issues if you wish, but for now I will 
concentrate on the South China Sea.
    The United States itself is not party to any territorial disputes 
in Asia, but we have a strong interest in the issues at stake. Also, 
the while the United States has signed the Convention but has not 
ratified it. Nonetheless, the United States adheres to the broad 
principles of the Convention, which it played an important role in 
drafting. Somewhat ironically, China has ratified the Convention but 
appears to be seeking to impose its own interpretation as regards its 
maritime territorial claims.
    U.S. interests include the most basic ones such as regional peace 
and stability, the right of innocent passage of U.S. warships, and 
important commercial interests in regional trade, investment. China's 
rejection of accepted international principles also extends to the air, 
and contributed to the 2001 mid-air collision between a U.S. 
reconnaissance plane and a Chinese fighter, and the crash landing of 
the U.S. aircraft on Hainan Island.
    At the global level we have a very important interest in the South 
China Sea with regard to climate change and global warming, the 
cooperative and environmentally sustainable exploitation of migratory 
fish stocks and the protection of coral reefs. In fact, the U.S. 
Government has been deeply and constructively engaged with China on 
these issues.
    With regard to maritime territorial disputes, I will address 
primarily on so-called ``nontraditional security interests'' (NTS) such 
as the impact of territorial disputes on economic development, food 
security, livelihoods, and on American business interests in the South 
China Sea and adjacent Southeast Asian waters.

            IMPACT OF THE LAW OF THE SEA CONVENTION OF 1994

    The importance and tenaciousness of conflicting claims to disputed 
territories has grown steadily since the adoption in 1994 of The United 
Nations Convention on the Law of the Sea (UNCLOS), the ``Law of the 
Sea,'' which provides for 200 nautical mile Exclusive Economic Zones 
(EEZs) extending beyond a country's shore. The Convention also conveys 
exclusive rights to the seabed resources of a nation's continental 
shelf, subject to a 350-nautical-mile limit from the ``baseline'' (most 
commonly the mean low water line on the shore) and 2,500 meters depth.
    The growing tensions over conflicting territorial claims are being 
driven by presumed seabed resources such as oil and gas and fisheries. 
The energy sources have become increasingly valuable and easier to 
extract because of technological advances in drilling and related 
activities. The rapid decline open water fish stocks and resultant rise 
in prices has threatened food security in some countries and made 
jurisdiction over fisheries a source of actual conflict.
    Most of the territorial disputes are more heated at this moment 
because the UNCLOS required countries to submit formal claims by May 
13, 2009. Several countries have already made formal complaints to 
other countries' submissions, most notably by China.
    Realistically, it is not possible to draw lines that would give 
every country a 200-mile EEZ. This means that most of these disputes 
will have to be settled by negotiations or unilateral actions.

  CHINA AS THE COMMON DENOMINATOR IN SOUTH CHINA SEA DISPUTES AND THE 
                              MEKONG DELTA

    Beijing has repeatedly asserted its sovereignty over almost the 
entire South China Sea, and has acted forcefully to enforce its claims. 
In 1974 China took advantage of the failing South Vietnamese Government 
to attack islands in the Paracels group, which had been garrisoned by 
South Vietnamese troops. The reunified Government of Vietnam maintains 
the claims of the former Saigon government. In 1998 more than 70 
Vietnamese sailors died in a clash between Chinese and Vietnamese ships 
near Johnson Reef in the Spratlys in 1988. The Spratly Islands incident 
of 1995 involved China's occupation of small reefs that are 130 
nautical miles from the nearest Philippines land mass--well within the 
Philippines internationally recognized EEZ, and 620 miles from China.
    The 1995 incident at Mischief Reef provoked a collective reaction 
among the ASEAN countries that appears to have taken China by surprise. 
In response, China proposed joint development of undersea resources 
until the issues are resolved. In fact, however, China still resolutely 
refuses to enter into substantive multilateral discussions and has used 
its superior power to enforce its claims unilaterally.
    The most controversial Chinese actions have been in the Gulf of 
Tonkin and the surrounding parts of the South China Sea, where China 
has repeatedly drilled for oil and gas in areas claimed by Vietnam by 
historical occupation and under UNCLOS rules. Chinese ships have also 
forcefully prevented Vietnamese and other neighboring countries' 
fishing boats from operating in waters claimed by China.
    China is now directly challenging the U.S. Navy's rights to operate 
in what it considers its EEZ. In March 2009, five small Chinese vessels 
interfered with operations of a U.S. Navy survey ship, the Impeccable, 
some 75 miles from the shore of China's Hainan Island. China claimed 
that the Impeccable was violating its EEZ by conducting seabed survey 
operations. Even when the U.S. ship turned fire hoses on the Chinese 
boats they kept interfering with its forward movement. China also 
threatened to send an armed patrol boat to protect the smaller craft 
harassing the U.S. ship and support its jurisdiction over the Paracel 
and Spratly islands.

                     OTHER SOUTH CHINA SEA DISPUTES

    A number of unresolved disputes include those between the countries 
of the Association of Southeast Asian Nations (ASEAN). Many of these 
disputes involve competing claims on both land and sea. Some of the 
more contentious ones include:

   Thailand and Cambodia, including a now very active dispute 
        over ownership of the Preah Vihear Temple on a mountain that 
        straddles their mutual border as well as a dispute over the 
        boundaries of each other's territorial waters. The Preah Vihear 
        dispute is on the front boiler in both countries because of 
        Cambodia's stated intention to unilaterally request the site 
        and its surroundings as a World Heritage protected site. Troops 
        of both countries have been involved in armed clashes. The 
        maritime dispute involves overlapping claims to oil and gas 
        resources that Chevron and ConocoPhillips, among others, are 
        seeking to develop. The handling of this issue by the previous 
        Thai Government played a significant role in Thailand's ongoing 
        political turmoil.
   Thailand and Vietnam also have conflicting claims to the 
        parts of the Gulf of Thailand, which has rich oil and gas 
        deposits. The Gulf of Thailand is particularly difficult to 
        delineate because it is bounded by Cambodia, Malaysia, 
        Thailand, and Vietnam. Cambodia objected to a settlement 
        between Thailand and Vietnam.
   Malaysia (on Borneo) also has a claim to part of the South 
        China Sea that is also claimed by Thailand, Vietnam, the 
        Philippines, and China. A joint submission by Malaysia and 
        Thailand to UNCLOS earlier this year provoked an angry response 
        by China and a counter claim which, however, was not supported 
        by reference to the provision of the Law of the Sea.

IMPACT OF CHINA'S BEHAVIOR ON THE ABILITY OF U.S. COMPANIES TO OPERATE 
                           IN CONTESTED AREAS

    Thus far the direct and indirect impact of China's behavior has 
mainly affected the opportunities for American multinational companies 
in oil and gas exploration and development in blocs offered by Vietnam 
and other countries. This includes the direct operations of U.S. 
multinationals as well as joint ventures with other multinational 
companies and national oil and gas companies in Southeast Asia. 
Numerous reports claim that China has told American and other 
multinational companies that if they want to do business with China 
they must not drill in areas of the Tonkin Gulf that are claimed by 
Vietnam.
    Vietnam's oil and gas production has flattened out and probably 
cannot be increased without the participation of multinational 
companies. Unless Vietnam and China reach some kind of agreement, 
Vietnam has little prospect of exploiting some of the most promising 
oil and gas fields in areas that it claims as territorial waters or 
EEZs. Beijing has the upper hand, and has been able to pressure 
multinational oil companies operating in China to stop their survey and 
drilling operations in valuable leases given by Vietnam.
    For understandable reasons U.S. multinational energy companies are 
reluctant to publicize problems created by China's attitude toward 
contested claims, but Beijing reportedly has successfully intimidated 
multinational energy companies from drilling in contested areas. In 
2007 and 2008 China reportedly coerced ExxonMobil as well as BP to 
suspend drilling in waters claimed by Vietnam.
    Piracy also remains a problem for U.S. and other countries' 
shipping companies. As in the case of Somalia, the destruction caused 
to coastal fisheries by large commercial factory-scale fleets may be 
contributing to the piracy in the South China Sea and the Strait of 
Malacca. In recent years, entire ships with cargoes have disappeared 
and reappeared under different names and flags, and pirates have 
boarded ships in the Strait of Malacca and held hostages for ransom. 
Beginning with a 2004 agreement between Indonesia, Malaysia, and 
Singapore, and support to sea-lane monitoring by the U.S. Navy, these 
incidents have been trending downward in the last few years.
    Still, there is a long history of piracy among the Indonesian and 
Philippine Islands, and parts of Malaysia's coastline on Borneo. As the 
potential for legitimate fishing declines, and as the rampant 
destruction of tropical forests reduces valuable timber cargos, groups 
with a history of involvement in piracy could return to their previous 
occupations.

        ENVIRONMENTAL, SOCIOECONOMIC, AND HUMAN SECURITY IMPACTS

    Among many negative consequences of these unresolved territorial 
disputes, they pose a significant obstacle to the cooperative and 
sustainable management of the resources of the South China Sea. Various 
proposals for cooperative efforts to manage fisheries, protect coral 
reefs, and control the negative impacts of deforestation, mining and 
urban runoff thus far have been nonstarters.
    The rampant overexploitation of fisheries throughout the South 
China Sea and adjacent waters of the Pacific and Indian Oceans 
threatens the collapse of important food species. Littoral states 
cannot control what happens on the high seas but if these disputes 
could be resolved, countries would have at least the right, even if not 
the power, to manage their own EEZs.
    A number of maritime disputes directly hinder economic development 
and, at least the possibility of responsible and environmentally and 
sustainable development. The disputes between Thailand and Cambodia and 
between China and Vietnam harm the development interests of the weaker 
parties. Moreover, if Cambodia, for instance, could develop offshore 
and inshore oil and gas deposits, its government might not feel the 
same compulsion to resort to destructive hydropower dam projects in 
currently protected forests in the Cardamom Mountains and on the Mekong 
mainstream. At present, the high cost of electricity in Cambodia is one 
of several major obstacles to development.

         POTENTIAL U.S. ROLE IN SUPPORTING PEACE AND STABILITY

    Even though it is not a direct party to these maritime disputes, 
there are several ways that the United States could serve its own and 
Southeast Asia's interests, especially through diplomacy, science and 
technology support, and capacity building to deal with rising 
destruction from storms and climate change adaptation. The means to 
pursue these objectives can include:
    More regional involvement, especially in support of ASEAN. It is 
widely viewed in the region and among observers and policy analysts 
both here and elsewhere that with a few important exceptions the United 
States has been conspicuously absent from the main currents in 
Southeast Asia for several decades. Thanks in particular to the 
sometimes unpopular efforts of the officials at our embassies and 
consulates in the region to get greater attention from Washington, this 
has been changing since the last years of the Bush administration. The 
appointment concurrently of Deputy Assistant Secretary of State for 
East Asia and Pacific Bureau, Scot Marciel, as our first Ambassador to 
ASEAN in 2007 is a good example of the positive trend in U.S. attention 
to Southeast Asia.
    At present, the Obama administration and especially the State 
Department appear to be stepping up the pace of constructive U.S. 
involvement in the region. All Southeast Asian capitals will be 
listening closely to what Secretary of State Clinton has to say when 
she attends the ASEAN Post-Ministerial Conference (PMC) between ASEAN 
and its ``dialogue partners'' and the ASEAN Regional Forum, in just a 
couple of days. The expectation is that she will bring a new U.S. 
initiative, probably regarding support to climate change adaptation and 
related issues that affect human and food security.
    The United States could also help the region and itself by 
responding to requests for material support to ASEAN's Coral Triangle 
Initiative. The ``Coral Triangle'' covers a vast area of sea between 
Indonesia, Malaysia, the Philippines, Papua New Guinea, Timor Leste, 
and the Solomon Islands. Host to thousands of fish species worth many 
billions of dollars a year, the Coral Triangle is under increasing 
assault from destructive methods used by large commercial fishing 
fleets--including those of China, South Korea, and Japan and other 
major seafaring countries--as well as deforestation, and pollution 
runoff from the land. As with many ASEAN projects, this one has seen 
more grand commitments than action, but none of the countries have the 
necessary resources to carry out their commitments. This would be an 
appropriate project for cooperation with Australia, which has major 
concerns about this issue and has special relationships with Papua New 
Guinea (PNG), Timor Leste and the Solomons.
    The United States can help resolve maritime disputes between 
willing nations through support to research on undersea structures and 
resources, and the collection of data. Initiatives such as these might 
possibly help countries make a better case to China, and even help it 
make concessions without appearing to lose face.
    Directly Asserting U.S. Rights and Interests. Above all, the Obama 
administration should abandon its predecessors' passive attitude since 
1995 toward Chinese behavior in the Spratlys and elsewhere that is not 
supportable under the principles of the Law of the Sea. The Obama 
dministration should lend at least moral support to Southeast Asian 
countries which are subject to intimidation, and be resolute in 
asserting its own rights to free passage in the face of Chinese 
provocations.
    It can do this in the framework of the United States-China 
Strategic and Economic Dialogue. The upcoming meeting in Washington 
during July 27-28 follows closely the annual ASEAN Ministerial Meeting 
and the PMC and ARF meetings in Phuket, Thailand, during July 17-23. 
Secretary of State Clinton should return from that meeting after 
getting firsthand knowledge of the concerns of China's neighbors.
    Unfortunately, in regard to maritime disputes in the South China 
Sea, Beijing has put itself on the wrong side of international law and 
norms. For U.S. and other diplomacy to have any chance of positive 
impact, however, China's perspectives on maritime territorial disputes 
and its power in most cases to enforce its claims need to be kept in 
mind. The only approach that realistically has a chance to succeed is 
for China to realize that a more flexible approach is in its own long-
term self-interest as well as that of its neighbors.
    The U.S. Congress can play an important and constructive role by 
holding hearings such as this one to highlight these issues and by 
authorizing and funding, after due deliberation, important new U.S. 
initiatives toward ASEAN and Southeast Asia more generally. U.S. 
attention need not, and should not, be polarizing, or aimed at 
stigmatizing China. That simply will not work. Instead, we should make 
every effort to respect China's aspirations for leadership and major 
power status, but within the internationally recognized rules and 
norms, and support those of our Southeast Asian allies and friends as 
well.
    Thank you very much for the privilege of testifying at this 
hearing. I would be happy to try to answer any questions you may have 
or respond subsequently for the record.

    Senator Webb. Thank you very much, Dr. Cronin.
    And that was actually a very good way to end the testimony 
of all three of the panelists, all of which I appreciate very 
much.
    I'd like to comment about something you said, about 2 
minutes ago, and then clarify my view of what this hearing is 
all about, and then maybe we can have a discussion. We've got 
three very divergent sets of experience that we can draw on.
    One of the worries that I personally have had for a number 
of years goes into what you just said, Dr. Cronin, and that is, 
if we don't have enough discussion in the United States 
Congress about East Asia--whether it's Northeast Asia or 
Southeast Asia--in a proactive way--we have fallen into big 
notions, either reacting to crises, like we saw in Burma last 
year, or talking about the economic relations with China, which 
seems to dominate the discussion, and every now and then we 
kind of talk around the edges. And it's very important, I 
think, to have the kind of discussion we're having today. This 
is not a hearing that is designed to bash China; it's a hearing 
that is designed to raise issues that aren't being discussed. 
And you cannot resolve problems if you don't discuss them. And 
that particularly goes for the United States Government in the 
situation where we find ourselves in with respect to our 
relations with China, and also with East Asia.
    And this is more than the situation of the United States 
and China, it's very much a question of how we are able to 
resolve our relationship in a way that maintains a proper 
balance in this region----
    Dr. Cronin. Right.
    Senator Webb [continuing]. And in a way that all the 
countries in the region can have the opportunity to grow at 
their own pace and to interact without fear of retribution. And 
it's a delicate balance. East Asia has always been a delicate 
balance. The interests of China are there, Japan are there, the 
United States, and Russia. It's very unique in the world, in 
that sense. So, I want to clarify, really, what we're after, 
today.
    I'd like to throw something to the panel, to have all of 
you react to, and I would start by--this is kind of a segue 
from what I just said, but it comes from Professor Dutton's 
testimony. When you mentioned that, ``With respect to what's 
been going on, this unsettling development suggests that our 
regional partners also sense a shift in power dynamics in the 
South China Sea, and may need more reassurance that we are 
currently giving them that, that the United States remains 
fully committed.'' This, to me, is sort of a--the jugular 
issue, from my perspective, with the subject matter of these 
hearings today. And I'd like to hear from all three of you with 
respect to that.
    And, Professor Dutton, you may as well start.
    Professor Dutton. Well, thank you, sir.
    In my line of work, I do a fair amount of traveling 
throughout East Asia, and we have students of the Naval War 
College throughout East Asia. And two things are common in 
almost every conversation. One is the sort of dominating 
presence of China in all aspects of East Asian society, and 
sort of questioning American--the continued American commitment 
to East Asia in light of our current challenges--economic and 
military--and then also in light of the fact that our 
relationship with China is, in many ways, very cooperative. I 
want to emphasize that, as well. It's very cooperative and also 
very entwined. We are linked in many ways with China, and so, 
there--leads, frequently, to questioning whether we would 
prioritize the interests of our friends and allies in the 
region as highly as they would if chips were down and if we had 
to essentially stand behind them in a controversy with China.
    That's the kind of talk that I hear in--with relative 
frequency.
    Senator Webb. Thank you.
    Mr. Blumenthal.
    Mr. Blumenthal. I noted two things in my oral remarks. One 
was that possibly our greatest ally in the world, besides 
Britain, Australia, is becoming much more public about their 
very deep concerns with respect both to China's military 
modernization, as well as our staying power and our presence in 
the region. And those things came out very clearly in the 
Australian white paper. And I would take that as a barometer, 
as an indicator, because a few years ago in Australia, things 
weren't--things were the opposite, where we were--we were more 
concerned about a hypothetical situation in Northeast Asia, 
where Australia wouldn't be at our side because of Australian 
commercial interests. Again, the change in Canberra is just 
dramatic, and, I think, exacerbated by the fact that the head 
of Rio Tinto in China has been arrested this week, and I think 
you get the same--you get the same reactions in Tokyo. You've 
seen the way the Vietnamese--I would say one of the drivers 
that lead us back into a Visiting Forces Agreement with the 
Vietnamese was Chinese behavior with respect to the Spratlys 
and Paracels, as well as--sorry, the Visiting Forces Agreement 
with the Philippines and--but, the Vietnamese reach out to us. 
But, again, I think that there is a sense--I think there is a 
sense, based on looking at our fiscal situation and based--
looking at our budgetary situation, and based on the fact that 
we already have had to cut down on some military-presence 
activities, there is a sense of who's going to be in the region 
longer, China or the United States? And I think countries are 
already starting to make that calculation.
    And that's why I also wanted to stress that, sometimes when 
we talk about China and Chinese military modernization, we talk 
about it as if it's some kind of scientific, futuristic 
scenario, next-door-itis or something like that. For our allies 
in the region, it's very much a today problem, a daily problem. 
And therefore, I would start to think about it in terms of what 
we need to do day to day to keep the balance of power in Asia 
in order to avoid conflict, and then conceptually put aside 
what would happen if we actually got into conflict.
    So, we do tend to think that it's unthinkable that 
something could happen in Asia, and our allies are not on the 
same page about that. And I think we really need to start to 
show them that, you know, we're serious, and not only through 
diplomacy and through other means, but also through the 
military presence to back it up.
    Senator Webb. Thank you.
    Dr. Cronin.
    Dr. Cronin. Yes, thank you, Senator Webb.
    Frankly, for openers on this, your question, I don't think 
the real issue right now, and even in the fairly distant 
future, is about the ability of the U.S. Navy to, you know, 
deal with the Chinese Navy, if it comes to that, and as Dan 
says, you know, the sort of unimaginable situation. That's not 
true of our allies and friends in the region, who are, you 
know, much weaker in that particular sphere.
    But, I want to go back to your issue--the point you made 
about the need for balancing. And I think there are two aspects 
to this, some of which I think you were perhaps alluding to 
already--one is this issue of, you know, maintaining a proper 
military balance. And I think--I sort of trust that the U.S. 
Defense Department and the Navy and the Obama administration 
will take care of that without too much difficulty. But, 
there's the other issue of balance, and that has to do with 
this economic crisis, the economic crisis, and the need to 
rebalance the economies--the United States economy and the 
Chinese--China's economy and those of Southeast Asia, which are 
more export-oriented, and we're more import-oriented. And we've 
now seen that this is an unsustainable kind of situation so 
that each side has to make some painful adjustments. And these 
adjustments that are needed are going to create difficulties in 
our relations with China. But, on the other hand, they will 
strengthen us, in time, I believe, if we can make this 
adjustment. It's also a problem for our allies and friends, 
trading partners in Southeast Asia, a bigger problem, perhaps, 
than it is for China, although politically, it's maybe a bigger 
problem for China, in terms of internal politics.
    So, I think what's--the big picture here is that the United 
States and China's roles are--we're still interdependent--
economically interdependent, and actually interdependent in a 
lot of other areas; for instance, we need China to help us deal 
with North Korea through the six-party talks. We need China to 
help keep peace in the Strait of Taiwan. There are a lot of 
reasons why China, you know, is an important country to us.
    So, it goes back to the issue of engagement, and then it 
goes back to the issue of--particularly of rebalancing our 
economies and rebalancing our political relations.
    And to go back to an issue of my interest, which wasn't 
exactly the South China Sea, but--take, for instance, this 
Mekong River issue and China's monster dams it is building in 
Yunnan, which are very threatening to Vietnam and other 
countries in the region. You know, the Chinese need to ask 
themselves, and we need to help the Chinese ask themselves, 
``If you turn the Mekong into the Yangtze, is that going to 
help your interests in the longer term?'' No, I think there's 
an enormous prospect for blowback. I just spent 3 weeks--just 
came back a week and a half ago from almost 3 weeks in 
Thailand, Cambodia, and Vietnam, and had a number of high-level 
meetings. And I also got down to the Vietnam Delta for the 
first time, to Can Tho, where I gave a presentation. And, you 
know, this is an issue that is alarming all of these 
governments. Maybe the Cambodian Government less so, but there 
are people in the Cambodian Government who are quite alarmed 
about it. So, it's an issue where we can engage with China, and 
we can also engage with these regional countries to help them 
in various ways to deal with this concern.
    Senator Webb. Let me, if I may, offer a quick reaction to 
your comment about balance, because I think that's really what 
we need, in many different ways, here. In terms of military 
balance, a long time ago, a mentor of mine said that, 
``Strategy is like birth control, that the possibility of an 
incident increases if you cease to take the necessary 
precautions.''
    Dr. Cronin. Exactly. [Laughter.]
    Senator Webb. And this is really----
    Dr. Cronin. Yes.
    Senator Webb [continuing]. Where we are with the sizing of 
our military. And a big part of a military presence is the 
credibility that it implies. It's been written many, many 
times, that there's a difference between a maritime presence 
and a sea-power presence, which----
    Dr. Cronin. Right.
    Senator Webb [continuing]. Creates a credible deterrence--
in fact, I see Professor Dutton rolling his eyes. There's a 
great piece in the ``Naval Review.'' I'm going to really date 
myself here. The ``Naval Review'' in 1972, there was a German 
admiral, named Wegner, who wrote a wonderful piece defining 
``sea power.'' If you can ever dig back in the archives and get 
it, it's one of the best strategic pieces I've ever read.
    The other part, in terms of economic balance, we have a 
serious vulnerability in our relationship with China that feeds 
a lot of the anxieties on these other issues, but there's also 
an issue of economic balance in the region. And this is one of 
the things that I'm concerned about. And we don't discuss it 
enough here in the United States. And we are the only guarantor 
to provide some sort of a credible umbrella under which these 
other countries in the region can successfully grow their 
economies without intimidation. So, that's really one of the 
things that has been a concern of mine.
    Dr. Cronin, you mentioned in your testimony, ``The United 
States is not a party to any territorial disputes in Asia, but 
several allies and important friendly countries are.'' Could 
you--or, have you covered that in your testimony? If not, I'd 
like to hear more about it.
    Dr. Cronin. Well, I didn't go into the United States angle, 
in particular, but I talked about Thailand----
    Senator Webb. So, you're talking about----
    Dr. Cronin [continuing]. Cambodia----
    Senator Webb [continuing]. Countries in the region----
    Dr. Cronin [continuing]. Vietnam----
    Senator Webb [continuing]. Rather than----
    Dr. Cronin. But, you know----
    Senator Webb [continuing]. External----
    Dr. Cronin [continuing]. Japan--if you go to Northeast 
Asia, Japan and Korea. Thailand's an ally. Australia has an 
interest in these issues. But, I'm just saying that the actual 
seabed claims are--or, EEZ claims--are of interest--deep 
interest to us. But, they're not our claims.
    Senator Webb. You're not aware of any of those external 
countries having specifically stated a position on issues like 
the Spratlys and the Paracels? I'm personally not. I was 
wondering if you had heard----
    Dr. Cronin. No, I think most countries, apart from the 
claimants----
    Senator Webb. Right.
    Dr. Cronin [continuing]. Take the same position we do. I do 
feel, though, that--and I think someone else mentioned this 
earlier--that we had been too passive in 1995 about that issue. 
We did the same thing with the assertion by Japan, in this 
case, that the disputed islands with China were part of 
Okinawa. In fact, we handed them back to Japan. Before we 
handed back Okinawa, we had to actually use them, ourselves, 
for some minor purposes, you know, military exercises, et 
cetera. That--when it came down to it, the State Department 
initially said, when this came up several years ago, that, yes, 
we--we didn't have a--we didn't have an opinion on this issue, 
but we actually--in practice, we had actually handed back these 
islands as part of the Okinawa return.
    I'm not sure if I've gotten to your--all of your question, 
but----
    Senator Webb. You did. I'm----
    Dr. Cronin. OK, thank you.
    Senator Webb. I was just curious as to--maybe I was missing 
something, in terms of parties external to the conflict----
    Dr. Cronin. Yes.
    Senator Webb [continuing]. That were allies of ours, that 
had taken a specific position. But, I'm not aware that there 
are any----
    Dr. Cronin. No, I'm not----
    Senator Webb. I don't think there are.
    Dr. Cronin [continuing]. I'm not, either. Thank you.
    And the other thing I should mention, related to this, 
though, is that whether you're talking to the Vietnamese or the 
Thais or other people--other countries in the--Southeast Asia, 
yes, they want the United States to be there, they want the 
United States to maintain balance, military balance in the 
region, but they don't want the United States to get into a 
confrontation with China that leads them to--you know, puts 
them in a position of being the mouse that gets trampled by the 
elephants. I mean, that's an exaggeration. But, the main point 
is, what the Vietnamese are looking for is advice from us, 
``How can we engage China in a nonprovocative way and actually 
get some headway with them? How do we get their attention in a 
way that just doesn't get''----
    Senator Webb. I would say that--frankly, I think there's a 
great concern in the Vietnam Government about this. It's been--
--
    Dr. Cronin. Yes.
    Senator Webb [continuing]. Communicated to me directly. And 
they believe they have economic issues that are at risk because 
of the imbalance. I think that's----
    Dr. Cronin. But, if I could----
    Senator Webb [continuing]. Something that would be----
    Dr. Cronin [continuing]. Mention, also, that--sorry.
    Senator Webb. That's OK.
    Dr. Cronin. Prime Minister Abhisit, from Thailand, and 
Prime Minister Dung, from Vietnam, just met, last weekend, and 
one of the main points in the communique was concern about 
peace and stability in the region, but particularly, in this 
case, the Mekong issue. And I think that there's a growing 
concern, both about the South China Sea and about some of the 
other areas where China, you know, flexes its muscles in a way 
that makes a lot of people worried.
    Senator Webb. I don't think there's any doubt about that. 
And as Mr. Blumenthal mentioned, the Burma situation--I think 
it was Mr. Blumenthal, I think, on the--in testimony, about the 
perceived activities of--naval activities of China in the 
Indian Ocean and beyond. I mentioned, in my opening remarks, 
the more than a billion-dollar oil pipeline deal that the 
Burmese just entered into with the Chinese, which would obviate 
the need to go through the Strait of Malacca and would increase 
an already dramatic economic presence of China in Burma.
    At least two of you have something of a disagreement in 
terms of future growth of the Chinese Navy. Professor Dutton, 
you're--as a naval officer, you basically are fairly saying 
what about that? You were saying you don't see that the Chinese 
Navy has a reason to expand. And I think, Mr. Blumenthal, you 
had a different view. Would the two of you like to clarify 
that?
    Professor Dutton. Well, it's kind of a qualified statement 
that they don't have a reason to expand. But, I--fundamentally, 
I see China as what the great geostrategist Mackinder would 
call it, an ``inner crescent'' power. And what that means is 
essentially a continental power with a naval--with a need for a 
navy to support its continental presence. And its naval power 
will develop in order to meet the needs of its growing trade 
and regional interests, but probably not developed to the 
extent to challenge a truly maritime power from the ``outer 
crescent,'' like the United States, Britain, Japan once was. 
These states, like ours, are fundamentally maritime in nature, 
and we must, in order for our security--maintain the size and 
quality of the navy to exert global influence in the maritime 
commons.
    China, because of its continental situation, will always 
have weaknesses on its land front. As we've seen recently, some 
of them are even internal, others are the potential rise of 
other powers on the continent, that they have to be concerned 
about. They cannot afford to put the kind of resources into a 
navy that we can afford to put into it, we must afford to put 
into a navy, in order to maintain our national security, would 
be my essential argument in that regard.
    Senator Webb. Mr. Blumenthal.
    Mr. Blumenthal. One of the most interesting debates going 
on in China has been well documented by Peter Dutton's 
colleagues at the Naval War College, and that's the fascination 
with Alfred Thayer Mahan, which is gaining great currency in 
Chinese naval circles. And we can, as Americans, debate what 
command of the sea means, or maritime versus sea power, but 
more interesting is that the Chinese are debating that. And 
what you get out of--what you get out of them on that is that--
for reasons of national prestige and national pride, as well as 
deep-felt insecurity, partly for the reasons that Richard 
Cronin mentioned about humiliations and depredations of the 
past, and a mistrust of the United States, they believe, 
however--you can interpret Mahan however you want, but they 
believe that they must look seaward. Most of their oil and gas 
comes from the sea. Shanghai and so many of the other seas that 
are at least close to the sea get most--export and import most 
of their goods in and out of the sea. And you'll get writings 
that are serious and authoritative from Chinese navalists, that 
they must break out of this box that they call the ``first 
island chain'' that the United States and Japan are 
constructing around them. That's part of the reason driving 
them toward their claims on Taiwan. That's part of the reason 
driving them toward their claims in the Senkakus. Again, 
defensively, they feel boxed in, and they feel that they have 
to deny us access to that area, in case of a conflict, Taiwan. 
But, there are also offensive purposes behind that.
    They have--you mentioned the surfacing of the Song near the 
Kitty Hawk. But, there has been mapping and service--and other 
oceanographic and maritime activities all the way up to Guam. 
Now, again, part of that is defense. I think Admiral Keating, 
the head of PACOM, made the comment to you about the Chinese 
joking, ``Ha, ha, ha, let's divide up the Pacific. We take up 
to Hawaii, and you can have the rest.'' But, you know, the 
Chinese Navy aren't a bunch of jokers. I mean, they're serious 
people. And this is--you know, this is--at least informs their 
decisionmaking.
    On the other side, because so much of their--of the other 
ocean, the Indian Ocean, because so much of their sea and--so 
much of their oil and gas and trade comes from the Persian Gulf 
and Africa, they want to--they want to project military power; 
meaning being able to protect convoys, if need be, meaning 
being able to retaliate, in case their supply is disrupted. 
They want to be able to project military power into the Indian 
Ocean. And they're actually quite clear about that. And the 
Indians--and I'll just conclude by saying that, while the 
Indians don't take a particular position on any of the claims 
we're talking about, if you believe that these disputes are 
symptomatic of a Chinese strategy and a growth in power rather 
than the problem itself--and I think the Indians do--then they 
do take a position with regard to growing Chinese activity in 
the South China Sea. A base at Hainan Island from which--from 
where they could get into the Malacca Strait and out into the 
Indian Ocean, and these naval facilities from Sri Lanka to 
Burma and Guam--to Burma and Pakistan.
    Senator Webb. I would say the jury is probably out, but the 
data points seem to be there. If you look at other continental 
powers that wanted to become world powers--you look at the 
German model, you look at the Soviet model--both of those 
countries consciously decided to grow a navy, even though all 
their lines of communications were internal at the time they 
did. The Soviet Union didn't--I think, if you go back to 1946, 
and you look at the size of the Soviet Navy, it was basically 
whatever they had taken from the Germans at the end of World 
War II. They didn't have a navy. And by the time I was 
Secretary of the Navy, they had a huge navy, but most of it--
the preponderance of its power being in Northeast Asia. The--I 
think, obviously, the thing to watch is whether China intends 
to develop a carrier force, the concept of a carrier battle 
group, and what it intends to do with it. We can accept the 
emerging economy of China, and hopefully deal with that in a 
very positive way. They're very active in South America, 
they're active in Africa. But, it'll be interesting to watch 
that.
    Let me ask one final question for the panel. We haven't 
really discussed this, but, with the activities of China 
recently in the relocation of the United States--or the planned 
relocation of much of the United States military into a Guam/
Tinian access, how do you see Japanese defense policy evolving?
    We can let Mr. Blumenthal start, and I'd be happy to----
    Mr. Blumenthal. Yes. Japanese defense policy is evolving in 
a certain direction, for many reasons, the first of which is 
probably the failure to resolve to their liking the North Korea 
nuclear question and the fact that there's now another nuclear 
power close to them. And so, I would point out that there's a 
lot of work that went into upgrading the alliance over the last 
8 or 9 years, much of it focused on ballistic missile defense. 
The Japanese certainly showed that, when the alliance is going 
well, they can do things that otherwise they would claim their 
constitution prohibits them from doing, whether it was 
supporting our forces in Operation Enduring Freedom or 
Operation Iraqi Freedom, in the Indian Ocean it's actually 
having some troops in Iraq, to doing peacekeeping missions. 
But, in terms of the China-North Korea question that they're 
very much focused on BMD right now, and they do have a question 
of fiscal resources--I would note that, for the first time, 
they've openly, inside the Liberal Democratic Party, started a 
working group and a study group on independent conventional 
strike. It's well known that they're interested in the F-22, if 
that remains alive. Obviously, there's a lot of questions as to 
whether their system can handle that. But, you know, frankly, 
the fact that North Korea's tested ballistic missiles around 
them has prompted this.
    And the fact--one thing that we didn't talk about is--and 
I'll close on this--is the fact that the Chinese have not only 
made claims in the Senkakus, but have, in fact, sent maritime 
vessels, including a submarine, I believe, a Sovremenny class 
destroyer, where the Japanese actually had to chase them out. 
So, both of these--the sense of threat is rather high, the 
sense of assurance in the alliance is not where it used to be, 
and the Japanese can turn, as we've seen, historically, pretty 
quickly into a much more militarized country.
    Senator Webb. Thank you.
    Dr. Cronin, would you like to----
    Dr. Cronin. Well, yes, I actually would, Senator, because I 
was in Tokyo in the runup to the first North Korea's missile 
launch, and I must say, it reminded me of Henny Penny, ``The 
sky is falling.''
    Senator Webb. You mean in 1998, you're talking about?
    Dr. Cronin. No, the last----
    Senator Webb. Oh, this last one?
    Dr. Cronin. This last one.
    Senator Webb. I was actually there in 1998, when the North 
Koreans fired the first one. But----
    Dr. Cronin. Yes, OK. And the thing that I found so much 
dismaying was to hear Japanese politicians posturing on that 
issue, but not really having anything concrete to say. I think 
Japan's own defense planning is very reactive, and obviously, 
as Dan has already pointed out, you know, BMD will be a big 
area that they'll continue to work--to press on in. But, you 
know, why they want an F-22, I--it just--it's--it makes you 
wonder what the basis for a lot of their planning is.
    And I think the bottom line, ultimately, is--well, first of 
all, to go to your question, I don't think our moving from--
Marines from Okinawa to Guam will make any difference, in terms 
of China's role and perceptions of the alliance, particularly 
since those forces were always earmarked for other things, I 
think, than that.
    But, the other thing is, look at the--you know, I look at--
go look at the money. Where's the money? And----
    Senator Webb. If I may, on that point----
    Dr. Cronin. Yes.
    Senator Webb [continuing]. My point really was to the 
effect of how it would impact Japan, the----
    Dr. Cronin. Oh, yes.
    Senator Webb [continuing]. Relocation, not having the 
American forces there, rather than China. But----
    Dr. Cronin. I think, in a very mixed way. I mean, the--a 
lot of people would be glad to see the Marines go, particularly 
in Okinawa. But, at the same time, yes, it does make--it may 
make the Japanese more anxious, in general, but I'm not sure, 
because of the nature of the forces that are being moved, that 
I think the issue for the Japanese now is ballistic missile 
defense, air--control of the air, and sea--and defense against 
submarines, that sort of thing.
    But, the--I guess the dismaying thing is simply that 
they're still hovering around 1 percent of GDP. GDP is falling 
now. And----
    Voice. We're heading there ourselves.
    Dr. Cronin. Yes, right. So, they don't seem to be able to 
prioritize in a--what I would say is a very systematic way, and 
particularly with--in terms of--I think cooperation between the 
United States and Japanese military is great. I mean, there's 
no question about that. But, in terms of their own planning, in 
terms of their own concept of their national defense, I'd defer 
to others who have more insight into that than I do. I'm kind 
of bewildered.
    Senator Webb. Professor Dutton, you get the final word.
    Professor Dutton. Yes, I think so, thank you.
    I do want to point out that it is the technology edge that 
we maintain, both naval technology and airforce, space 
technology, et cetera, that is the strategic balancer in East 
Asia. And so, to follow up on the point about--it is the type 
of the forces that matters, I think, in that it will not be 
that big of a strategic shift, from the perspective of the 
Japan and China, is important. But, it does underscore our need 
to maintain the strength of our fleet, the strength of our air 
power, and the strength of our cyber and space power in East 
Asia, because technology is our edge.
    The strategic balancing is provided by two things, by 
strategic mass and strategic maneuver, and the way we do that 
in the region is through technology.
    Senator Webb. Gentlemen, I thank you all for your 
testimony. I think it was a great hearing. And I hope we're all 
on the same page, in that what we're after here is the proper 
communications in the region and maintaining the kind of 
balance that'll allow the United States to remain involved, but 
also to allow third countries, who we don't discuss often 
enough, to have the right kind of economic growth and balance, 
themselves.
    And the hearing record will be open until tomorrow night in 
case any Senators would like to ask any questions.
    Senator Webb. But, now the hearing is closed.
    [Whereupon, at 4:25 p.m., the hearing was adjourned.]

                                  
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