*WARNING: In-depth interpretation/theory ahead. Read and enjoy but please know I don't take it too seriously haha, just expressing my thoughts!
What if Red actually represented the threat of Communism in Japan? That would play nicely into Gen I lore on many levels. First of all, a historical note: Japan and Russia never officially signed a peace treaty post-WW2. Also, the Japanese Communist Party (JCP) can be considered a debilitating force in Japan due to their anti-military development and anti-American diplomacy policies. Check out this Wikipedia article for more details: http://en.wikipedia.org/wiki/Japanese_Communist_Party.
Anyway, let's say Red represents Communism (even Russia, to an extent). He dominates the Pokémon League, going as far to usurp Blue, who in this interpretation represents the Japanese identity (a homegrown hero and the heir of Prof Oak, the most paternal - read: governmental - figure in the Kanto region). Basically, Red the Communist upsets the Japanese identity by dominating its biggest industry and field of activity, Pokémon battling.
Red is a silent protagonist - truly neutral, an important characteristic of JCP politics. Also, the JCP wishes to isolate Japan (in some measure) and promote national sovereignty. What do we see in Gen I? An isolated region. Seriously, the only way out is aboard the S.S. Anne, correct?
Oh yeah, and the JCP promotes military debilitation/reduction. What happens once Red becomes the Pokémon Champion? The game ends. One by one, he defeats all the Trainers and Gym Leaders that cross his path. No rematches. No more opposition. There is a true sense of finality once those credits roll, a sense that Red has fully conquered the Kanto region and all who opposed him. No more military power left to snuff out, if you will. In fact, the only true challenge that remains is to catch Mewtwo, the living embodiment of foreign interests exacting a toll on Japanese soil.
*Phew* Thanks for reading. Haha, I don't subscribe to this theory per se but it was fun to think up. Has anyone else ever mentioned something like this?