PERSPECTIVE ON ASIA : The Penalties of Paralyzed Policy : A Cold War-era approach in a changed world commits the U.S. to dangerous goals with obsolete tools.

Despite the unconfirmed reports this month of U.S. determination to use sanctions rather than bluster to open Japanese automotive markets, the Clinton Administration remains deeply--perhaps fatally--divided over East Asia strategy. Unless the President throws his weight behind new ideas, U.S. influence could erode dramatically in this rapidly growing but still protectionist and militarily dangerous region.

For all the noise made by officials about eliminating Japanese and other regional trade barriers, U.S. policy so far has been dominated by a coalition of standpatters: macroeconomic policy-makers terrified that a vigorous trade policy will spook the financial markets and depress the dollar further and national security officials convinced that maintaining America’s 50-year-old Asian military alliances is the key to defending both our national security and burgeoning economic interests in the region.

Their case has been detailed in a Pentagon report in March titled “United States Strategy for the East Asia-Pacific Region.” According to its authors, the U.S. alliance system and the regional military presence serve two essential purposes:

* They buttress stability and thus ensure prosperous Asian economic partners for America by protecting the region’s major non-communist countries and particularly by pacifying Japan.

* They give Washington valuable clout in trade and other economic negotiations.

Thus, the study declares that American regional military cutbacks deemed prudent even by President Bush should be halted and the troop presence frozen at 100,000. And although it endorses continuing negotiations to resolve trade disputes with Japan and others, the report specifically warns, “We must not allow trade frictions to undermine our security interests.”

But this is Cold War-era advice. In the post-Cold War world, it will lock U.S. policy into pursuing confusing, needlessly dangerous goals with increasingly obsolete tools.

In the first place, America’s military role in Asia has never given Washington significant negotiating leverage. During the Cold War, our potential clout as alliance leaders was always negated by our determination to frustrate communism by promoting Asian prosperity. Thus for decades Washington tolerated pervasive protectionism, first by Japan and then by its neighbors, while keeping the U.S. market wide open to their products. Convinced that America needed a free Asia at least as much as Asia needed American protection, how could U.S. leaders do otherwise?

The latest Pentagon warnings about trade frictions show that the same logic is at work today. The results so far: a U.S. merchandise trade deficit with Asia of about $115 billion (75% of our world total); investment and technology flows nearly as one-sided, and a U.S. auto negotiating team that has been seriously undercut.

Worse, even if Washington tried to play its military card in economic talks, the U.S. military role in Asia is a wasting asset at best. Although most Asian countries still value an American presence, in the post-Soviet-era, U.S. alliances lack a clear-cut enemy and American forces lack a clear-cut mission. Therefore, U.S. power has become excruciatingly difficult to actually use in the region, and Asian governments plainly know that they can no longer count on automatic American rescue operations.

In particular, the Pentagon report’s expressions of resolve cannot overcome the inherent problems of centering credible military strategies around goals as nebulous as “stability.” How, for example, do we define stability? Is it needed everywhere in the region? How much is it worth in terms of lives and budget resources? How does ensuring stability translate into military priorities? Until U.S. officials can answer these questions, they often will lack both the strategic guidance and the domestic political support needed to act effectively when threats arise.

This is why America has responded so passively to Chinese incursions in the Spratly Islands in the South China Sea. This is why America’s North Korea policy has been so inconsistent. This is why so many Asian governments have dramatically boosted their military spending. And this is why they are unlikely to pay for protection with major economic concessions.

Asian stability is still important for America and worth reinforcing with modest forces. But absent a Soviet-style rival with dreams of global expansion, Washington should spend far more time learning to live with a new post-Cold War Asia and to wield influence in it. Contrary to the standpatters, achieving this goal depends mainly on American economic power, not security alliances.

As apparently understood by some Administration economic and trade policy officials, Asians may doubt America’s military credibility, but they still urgently need American capital, technology and, above all, markets. Thus, tightly regulating Asian access to these assets is America’s best bet for expanding its access to Asian markets and helping to shape Asia’s future.

But this strategy would require America to work much harder to enhance its relative and absolute economic power. After all, a country with low investment rates and massive budget deficits will not easily remain a premier Asian financial and technology player. A population with stagnating real incomes will not easily remain Asia’s leading national market. An economy whose companies compete on tilted playing fields will not easily remain world leaders. And a superpower that clings to outmoded alliances will only wind up subsidizing its fiercest economic rivals.

Avoiding hard choices in Asia will remain the most tempting course for President Clinton. But the longer our Asian deficits last, the longer U.S. economic growth and job creation will lag, the weaker the dollar will become--and the lower his reelection chances will sink.