Anti-Japanese riots in China last week led preeminent Japanese companies – Mazda, Nissan, Honda, Panasonic and Canon – to temporarily shut down their Chinese factories. Teppanyaki restaurants were attacked, and sushi shops closed their doors. Japanese schools cancelled classes. Even Japanese-made cars were vandalized and overturned.
Protests have been staged in over 70 Chinese cities so far, involving over 100,000 people. Japanese citizens in China are being advised by their embassy to avoid the demonstrations and not to speak Japanese loudly or to draw attention to themselves.
Chinese demonstrators burn the Japanese flag outside the embassy of Japan in Oslo Tuesday, Sept. 18, 2012. Old wounds amplified outrage over a burning territorial dispute Tuesday as thousands of Chinese protested Tokyo's purchase of islands claimed by Beijing and marked the 81st anniversary of a Japanese invasion that China has never forgotten. China marks every Sept. 18 by blowing sirens to remember a 1931 incident that Japan used as a pretext to invade Manchuria, setting off a brutal occupation of China that ended only at the close of World War II.
Underlying this resurgence of anti-Japan hysteria in China is an ongoing territorial dispute that has festered in recent months between Beijing and Tokyo. A small cluster of uninhabited islands, known as Senkaku in Japan and Diaoyu in China, has become a serious obstacle in the ongoing relations between the two largest Asian economies. Bilateral trade between the two countries amounts to more than $300 billion a year. As a result, any prolonged period of sanctions or boycotting could have serious detrimental effects to both Japan and China.
The question now is whether this long-standing diplomatic conflict will eventually escalate into an actual military confrontation. "Misjudgment on one side or another could result in violence," said U.S. Defense Secretary Leon Panetta. Panetta shuttled between Tokyo and Beijing last week to convince his Japanese and Chinese counterparts to favor restraint and compromise over further incendiary rhetoric. The U.S. has a long-standing treaty with Japan committing it to come to Japan's defense if it were attacked, which Panetta has publically reaffirmed, although he said that Washington does not take a view on the actual dispute over the islands.
With the anniversary of Japan's 1931 invasion of China also being celebrated this week, emotions are running high among Chinese nationalists. Many Chinese still harbor a deep sense of anger against the Japanese for atrocities during World War II.
Japan is also wrestling with its own nationalists at home. The stridently anti-Chinese mayor of Tokyo, Shintaro Ishihara, had made moves to buy the islands himself to force the national government to take a more forceful position against Beijing. A significant majority of Japanese back Ishihara's confrontational approach, in opinion polls.
Earlier this month, the Japanese government took the controversial step of buying the disputed islands itself, so they would no longer be in private hands. Rather than dampening the debate over the future of the islands, the move inflamed sentiment across China.
While Japan has lingered in the economic doldrums since the 1990s, and is still wrestling with the financial consequence of last year's devastating earthquake, China has benefited from years of stratospheric growth. As a result, many Chinese believe that they hold the higher ground in the region when it comes to achieving their policy priorities.
Unfortunately, the Chinese economy is slowing, and the generational transfer of power is still gradually unfolding in Beijing. As a result, should this war of words with Japan eventually lead to lost jobs and real economic pain for significant numbers of Chinese workers, leaders in Beijing could risk seeing the anger and frustration currently aimed at Japan eventually being redirected at them.
With Chinese police resorting to tear gas and water cannons to disperse angry crowds, Beijing must take decisive steps to calm its citizens and ensure that Japanese property and lives are protected. Some demonstrators are even resorting to chants that war should be declared against Japan to reclaim the Diaoyu islands for the "motherland."
Patriotism is an important component of citizenship, and the growth of China as an economic power in recent decades has necessarily meant that its diplomatic and military status has increased as well. Beijing has demonstrated in the past a deep-seated concern over street protests in their country. So, as much for domestic reasons as any other, Chinese leaders will want to ensure a return to normalcy as quickly as possible.
However, the underlying concerns will remain. The balance of power in Asia has shifted to China. Its neighbors must continue to adapt to these changes, and the United States is left in its postwar role as a guarantor of stability and security in this region. Secretary Panetta's high-priority diplomatic mission demonstrates how important it is to the U.S. that these conflicting claims to be settled peaceably and amicably.
The anti-Japanese protests last week have been the worst in China for decades. Despite strong arguments in favor of mutual economic self interest, the possibility that these disputes could explode into actual military conflicts is real and growing. Simply hoping that "cooler heads prevail" is not enough.
The Obama administration must be able to demonstrate to both Asian governments and the American electorate that it has a comprehensive strategy for ensuring the long-term stability of this region. If it fails to do so, the consequences will not be limited to Asia. At the very least, a collapse in international trade would further stall the tentative economic recovery in America. Should an actual military conflict erupt, the lessons from World War I are clear enough – that what begins as a regional dispute can quickly escalate into something much more terrible.