The People’s Liberation Army’s chief of general staff, General Chen Bingde (right), with the Chairman of the US Joint Chiefs of Staff, Admiral Mike Mullen.

There is a new sheriff in town in Asia and the United States, in a last gasp at preserving its influence in the region, is attempting to cement old alliances while forging new ones. Confronted by a China that has eclipsed the economy of Japan, thus achieving the distinction of being the world’s second-largest economy, the days of the United States acting as a major powerbroker in Asia is coming to an end.

Because Japan no longer trusts the quality of United States intelligence, it has embarked on creating its own foreign intelligence service, modeled on Britain’s MI-6. U.S.-Japanese intelligence cooperation has existed since the end of World War II, but Japanese officials do not believe the United States has shared with Japan the type of intelligence that is seen as important for Japan’s own national security interests in Asia.

The new and expanded Japanese foreign intelligence agency reports to the Cabinet Intelligence and Research Office or “Naicho.” Naicho had been Japan’s main intelligence-collection agency but its small size and restricted charter resulted in poor intelligence gathered mainly from documents translated from English, Chinese, and other languages into Japanese. However, translations of foreign documents and reliance on carefully filtered intelligence from the United States has convinced Japan that it must build up an intelligence capability much like Japan possessed in the years prior to and during World War II. Imperial Japan’s Kempeitai mastered such tradecraft as psychological warfare operations, as witnessed by the wartime propaganda broadcasts of “Tokyo Rose” to U.S. troops and sailors in the Pacific theater, and counter-intelligence and the use of non-official cover intelligence activities.

A return to the proactive intelligence methods of the Kempeitai would be a game-changer throughout East Asia and the Pacific. South Korea, China, Taiwan, North Korea, and Russia would respond by beefing up their own intelligence activities, devoting more resources to the northeastern Pacific where the region is just one maritime incident away from a shooting confrontation and even a wider war.

The twin decline of the economies of the United States and Japan has prompted China to exercise a more aggressive stance, especially with regard to Taiwan and disputed maritime boundaries and islands in the waters of the eastern Pacific, including the South China and East China Seas.

Chinese naval fleet legitimately crossing Okinawa waterway towards the Pacific caused backlash from Japan. (June 2011)

This summer, China has maintained a massive naval presence ringing the Japanese island of Okinawa, where the United States has a large military presence. The Chinese conducted their naval exercise to demonstrate to the Americans that China can interdict the transport of U.S. Marines and aircraft to Taiwan in the event of a Chinese military attack on the island, which China claims as part of the People’s Republic of China. The United States is committed, under the Taiwan Relations Act of 1979, to provide defensive weapons to Taiwan and to “resist any resort to force or other forms of coercion that would jeopardize the security, or the social or economic system, of the people on Taiwan". Under the terms of the Taiwan Relations Act, the Pentagon has crafted a policy of rapidly deploying U.S. Marines and aircraft to Taiwan in the event of a Chinese assault. However, China’s top military officer, General Chen Bingde, recently warned outgoing U.S. Chairman of the Joint Chiefs of Staff, Admiral Mike Mullen, to stay out of Taiwan’s affairs.

In order to back up its words with military force, China is also building a fleet of super-modern aircraft carriers, with the first expected to be deployed in 2015. China has also become more aggressive in interdicting U.S. spy flights conducted near its waters, especially in the Taiwan Strait.

Military tensions between China and Japan are also increasing. The two nations are facing each other down over the disputed Senkaku Islands in the East China Sea, with Japanese Coast Guard vessels keeping a close eye on Chinese “research vessels” that periodically deploy to waters off the Senkakus, islands that are currently controlled by Japan. Adding to the dispute, Taiwan also lays claim to the Senkakus.

Not only are Japan and China disputing the ownership of islands in the East China Sea, but Japan and South Korea are currently locked in a bitter dispute over some rocky and practically uninhabited specks of land in the Sea of Japan called the Liancourt Rocks. Japan claims what it calls the Takeshima islands but South Korea, which calls the islets Dokdo, also claims ownership. South Korea has upped the ante by announcing plans to build an “oceanographic research” base on the islands, a move that is bound to trigger a response from Japan. North Korea also claims the Liancourt Rocks. China and South Korea both claim Socotra Rock, a submerged rocky mass in the East China Sea. Without the United States as a referee between its allies of Japan and South Korea, new alliances are developing. South Korea is drawing closer to Russia while North Korea, perhaps sensing itself vulnerable to the new political situation developing in the region, has renewed peace feelers to the United States.

Rival claims to the Spratly and Paracel islands in the South China Sea, has nations seeking to enforce their claims scrambling to build up their own military forces and forge new alliances. The United States and Vietnam are establishing new military links. With Vietnam locked in a war of words with China over rival claims to the Paracels, its navy recently conducted joint naval exercises with the U.S. Navy, the first since the end of the Vietnam War.

Tensions have also increased between the Philippines and China over sovereignty of disputed Spratly islands, as well as Scarborough Shoal. Taiwan, Malaysia, and Brunei have also staked claims to the islands. There have been a series of sea and land incidents between China and Vietnam and China and the Philippines. The Philippines has re-named the South China Sea the "Western Philippines Sea." China’s claims of sovereignty into the southern reaches of the South China Sea also include waters around Indonesia’s Natuna islands, a situation that has Jakarta nervously eyeing China’s moves into the area.

The waters surrounding the Spratlys, Paracels, and Natunas are rich in oil and natural gas – the necessary ingredients for conflicts among nations vying to gain access to critical energy resources.

Currently, the maritime boundary and island disputes have been relegated to wars of words and military "show of force" and political "name changing" exercises. However, with American influence receding, it is only a matter of time before the chest beating between the rival regional powers escalates into something more dangerous to the overall peace of the region.