Pacific Security Depends on Funding the New COFA Agreements with 3 Pacific Island Nations

Do you think America's tail-between-its-legs departure from Afghanistan was bad? Something even worse is coming in the Pacific, albeit more quietly.

US defenses in the Asia Pacific center on a defense line running from Japan to the Philippines to Taiwan and on to Borneo. The so-called "first island chain."

Try defending against China along the first island chain without a secure "rear area" in the Central Pacific. And imagine it's the Chinese in the rear.

American control of the Central Pacific depends on three treaties with three nations: Palau, the Federated States of Micronesia, and the Republic of Marshall Islands. They are known as Compacts of Free Association (COFA). These nations and their huge maritime territory comprise most of an "east-west corridor" from Hawaii to the western edge of the Pacific. That corridor is essential for American control and military operations in the region.

Invaluable Relationship Secured by Compacts of Free Association

The COFAs give the United States the legal authority to operate freely and to keep other nations' militaries out. In other words, military access and control.

As part of the agreements, the three nations receive financial and other support from the US. These include the right of citizens to reside and work in America. And one should never forget that COFA state citizens serve in the US military at higher per-capita rates than almost all US states.

The COFA agreements are up for renewal. They have passed the tortuous dozen or so committees and now the agreements just need to be voted on and passed. However, that is very much in doubt.

One issue is $2.3 billion USD in offsets. That means that to fund the COFAs, $2.3 billion has to come out of the federal budget from elsewhere.

The $2.3 billion is over twenty years so it averages out to about $40 million a year for each country. Yes, $40 million. That amounts to a half-hour of Medicaid fraud.

We blew a trillion or two in Afghanistan. And we're complaining about $120 million a year?

Everyone is blaming everyone else.

Congress blames other parts of the Congress and the White House. The White House blames Congress.

Finding the Money

The White House can find the money if it wants to. It doesn't. There was in fact an Asia Tsar at the White House National Security Council, Kurt Campbell, who should have made passage of the COFAs his mission. He was the "Tsar" after all. Instead, he bailed out and has failed upwards ー just confirmed as Deputy Secretary of State. That's par for the course in Washington.

Congress could find the money too, if it wanted. It doesn't, or it is distracted by "the border," Ukraine, Gaza, and any number of things.

Maybe the Department of Defense (DOD) could show some initiative and imagination. After all, the COFAs have to do the hard work of defending the Asia-Pacific. Dod could offer to redirect the money from elsewhere in its large budget.

$120 million a year? That's easy.

Cut DEI programs in DOD and anyone connected with them.

Cut 10% of FOGOs ー that's "flag officers, general officers." That'd easily get your money ー and nobody would notice the "flags" were missing.

*Map of EEZs in the Central Pacific showing significance of Palau, Micronesia and the Marshall Islands. (© Cleo Pascal. Reprinted with permission.)*

Making China Happy

Worse, in spite of widespread bipartisan support, the COFA agreements were in fact opaquely removed from consideration the other day. No one is sure why, though one rumor is it was by a "budget conscious" Senator, even though the bill it was in wouldn't even have required an offset.

Now a large group of other Senators, led by Senator James Risch (ID) and Senator Mazie Hirono (HI), are fighting against the clock and trying to convince their leadership to put it back in.

Lose the Central Pacific and we'll be defending from Hawaii and Southern California. Meanwhile, every country that was counting on us, Japan, South Korea, Taiwan, the Philippines, Australia, and others, will start to hedge their bets.

China will love it.

The PRC already has a strong commercial and political presence in the COFA states. (And just about every other Pacific island nation.) Plus, it's aiming to pry them away from the United States. And it's succeeding.

AUKUS China Okinawa — *The Chinese Navy aircraft carrier Liaoning and its fighters were deployed in the Pacific Ocean off Okinawa in May 15, 2022. (© provided by the Ministry of Defense Joint Staff Office)*

The Price of Not Renewing COFAs

Among the common approaches are financial payments, economic aid, bribes to officials, facilitating the entry of Chinese organized crime, and even encouraging secession movements to weaken recalcitrant federal governments.

The president of each COFA nation is said to have a blank check from China on the desk. They haven't been cashed – such is their deep attachment to the United States.

But their patience is not unlimited ー and they notice when their erstwhile friend is giving them short shrift. Indeed, they are darn angry, though they won't show it.

Imagine you're the president and you've spent much of your term negotiating a deal with the United States that you and Washington finally signed. Then, you have to tell your citizens, months later, Congress's leadership cares so little it stripped it out of a bill without debate and we aren't sure if it will ever be put to a vote. So, we don't have money for post offices, schools, pensions, or medicine. And taxes are going to have to go up. Meanwhile, China is offering to solve all your problems.

This is serious. The price of not renewing the COFAs ー and continuing to do the necessary to maintain our ties with these nations ー will be paid be many dead American service personnel.

*PM Fumio Kishida met with leaders of the Pacific Islands forum in February 2023. (©Prime Minister's Office)*

In Japan's Interest

One wishes the commander, USINDOPACOM, Admiral John Aquilino would put his stars on the table, and resign over this clown show.

Will he? Of course not. That sort of thing doesn't happen anymore. The current crowd is not the same as Nimitz, Halsey, and Spruance.

And speaking of our friends in the Asia Pacific, would Japan perhaps step in and offer to pay?

It wouldn't be the first time Japan Inc got out its checkbook when it saw its interests at risk.

It pays close to $2 billion a year to support the American military presence in Japan. The nation's security depends on that.

And as the US financial system was imploding in 2008, a major Japanese bank ー presumably at the request of the Japanese government ー wrote a $9 billion check to keep Morgan Stanley (and the US financial system) afloat.

$120 million a year for 20 years ($2.3 billion total) would be an even better deal for Japan.

If the US government can't get this done, maybe Tokyo will help. Otherwise, we deserve to lose.

Author: Grant Newsham

Grant Newsham is a retired US Marine officer and former US diplomat. He is the author of the book When China Attacks: A Warning To America. Find his articles on JAPAN Forward.