America Not Isolated without Asian Infrastructure Investment Bank

The Asian Infrastructure Investment Bank has confirmed a starting line-up of 46 countries. The United States and Japan did not join. Several of the AIIB’s founding members are old allies of the U.S. that a lot of media make out to be defectors who left the U.S. all alone.

Such an interpretation pleases China’s patriots. However, the United States might be unwise not to enter the AIIB. It will definitely make an impact on U.S. diplomacy, but the U.S. is not necessarily isolated. According to Scott Kennedy, a Chinese studies scholar at the Center for Strategic and International Studies, most countries do not see joining the AIIB as a matter of choosing sides between China and America, but as being in two organizational structures at once. In sum, they are getting the best of both worlds. Harmony brings wealth, and lonesome America is out of the picture.

Even with its reluctance, the U.S. government is certainly embarrassed about preventing its allies from earning money, and of course cannot turn on its allies because of their cooperation with China. It would actually be a victory for America to join the AIIB. In this day and age, stubborn pride does not work in international interaction; it is more practical to see the benefits of things.

Today’s international financial setup is completely different from what it was decades ago.

Two of the largest international financial setups, the International Monetary Fund and the World Bank, were established at the end of 1940, the former designed for boosting international currency cooperation and the latter for helping the poor. One could say that they are financial organizations with “feelings.” The Asian Development Bank was established in 1966 when Japanese people who became rich and reformed followed the U.S. in “efforts” to help the poor in exchange for international discourse.

Feelings are nice and all, but what about results?

The IMF would ask the countries it has saved from financial crises to be more careful and expand marketization. At that time, people controlling the IMF understood that more money was not enough to save a country’s finance system. Give a man a fish, feed him for a day; teach a man to fish, feed him for a lifetime.

In recent years, however, the IMF has forgotten its tradition of boosting the financial market. It goes everywhere shouting “stimulate the economy” and “quantitative easing” with every country’s government, but with the world’s financial crisis being this widespread, how much money does the IMF have to stimulate the economy? Thus, naturally, its status has fallen.

The IMF has changed similarly to the United States. In Reagan’s time, the U.S. government had a vivid ideology, and that was promoting marketization. After Reagan, though, each U.S. president was worse than the last. Obama, for example, talks “change,” but in what direction? He doesn’t know either, and in reality, he did a lot of things that hurt the market.

America itself has no “feelings.” Its international financial setup has also lost its “feelings.” What else is new?

The AIIB makes it clear: Wouldn’t America like us to help it build basic facilities? What right does the heartless U.S. have to ask its Asian allies to say no? Now that its European allies have grasped the opportunity to join the AIIB, there is nothing that the U.S. can say about the issue. All it can do is plead not to be left alone, but this is actually nothing for it to worry about. In this age of “no permanent friends, and only permanent interests,” what do you do when someone is isolated?