Summary

There’s been a bit of delusive thinking on the North Korea crisis of late. The Trump administration believes that China can be counted on to ‘play hardball’ with the North; China on believes it can keep on playing the Trump administration indefinitely; and the new administration of Moon Jae-in believes that it can achieve greater security by dusting off the old playbook of positive engagement. For its part, the North is either deceptively rational in maximizing its take at the negotiating table, or the most deluded of all in seeking to trigger an armed, possibly nuclear, conflict with the United States and its allies.

But then there’s an event that threatens to reshuffle the geopolitical deck. Yesterday’s ICBM test illustrates an uncomfortable truth for the United States: the North’s missile program is more advanced than previously thought. By some estimates, it’s already capable of hitting Alaska.

Impact

The Xi-Trump partnership has been put on notice.  Early diplomatic skirmishes between US President Trump and China President Xi Jinping have been heavily weighted in the latter’s favor. Whether it’s the death of the TPP, US ambivalence in the South China Sea, silence on currency and trade manipulation, or simply the general wane of US soft power worldwide – China’s position has strengthened on many fronts over the past six months.