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  • Writer's pictureMike Lyons


Australia Throws down the Gauntlet

Australia’s aim during recent years has been to convince Washington that we are supporting it against China, and at the same time, to convince Beijing that we are not. It has been a policy of “systematic duplicity”[i].

That duplicity ended in May 2020 with a call by Australia’s Foreign Minister, Marise Payne for an independent enquiry into the origin of the Covid-19 pandemic. China responded angrily accusing Australia of pandering to America (which had already called for an investigation). China’s response included a ban on Australian beef imports and an 80% tariff on imports of Australian barley. Then, Beijing discouraged Chinese students from studying in Australia, and its people from travelling to Australia as tourists. Australia accused China of “economic coercion” with Scott Morrison telling China that he would not be intimidated by these threats.

In June 2020, Dave Sharma MP suggested that to “manage” the rise of China, Russia should be brought into the G7 saying this “would encourage the behaviour of China to moderate”. Why should President Putin even consider such a proposal? Russia has a stable relationship with China which works for both countries in geo-economic, as well as geopolitical terms. Sharma’s call for a new accommodation with Russia was made, not for bona fide reasons but rather, cynically to manage the rise of China ignoring the fact that China and Russia are strategic allies. Seeking to drive them apart would inevitably antagonise China even further.

Australia has previously irritated China by introducing its foreign interference laws, thinly disguised, but clearly aimed at China. Australia went further, falling into line with USA, refusing to participate in China’s BRI (more than 150 countries worldwide have signed up) and then banning China’s leading technology company, Huawei from participating in Australia’s 5G network.

On 1 July 2020, Scott Morrison announced a $270 billion, 10 year defence plan for Australia which includes the development, together with the US, of a missile defence shield against ballistic missile attacks, warning of the deterioration in the strategic situation in the Indo-Pacific, which Morrison referred to as the epicentre of rising strategic competition. Analysts see China as the obvious target of this defence spending with Australia’s warmonger in chief, Peter Jennings (director of the Australian Strategic Policy Institute) saying that there is really only one country which is doing that (annexation of territory, coercion, influencing of domestic politics and using cyber-attacks) and that is the Peoples Republic of China. Morrison’s invoking the 1930s analogy renders the China debate even more toxic- it was surely unnecessary to further inflame an already difficult situation with such inflammatory language.

Later in July, the Chinese embassy condemned Mr Morrison’s announcement to recruit entire companies from Hong Kong, and offering Australian visas to 10,000 students and workers, accusing Australia of hypocrisy and gross interference.

Strategic Issues for Australia

The USA finds itself pitted against China and Russia. China is already outpacing America economically and arguably, Russia has outpaced it militarily, having established itself as a global resource for weapons and systems. China is preparing for a dynamic digital future spending multi trillions of Yuan building its high-tech industry, comprising big data, cloud computing, artificial intelligence block chain and the Internet of Things, all backed by 5G.

Recently, retired US Army Colonel, Lawrence Wilkerson made the statement that America exists to make war, adding “How else to do we interpret 19 straight years of war and no end in sight? – We’re going to lie, cheat and steal to do whatever it is we have to do to continue this war complex.”[ii]

In 2014 Malcolm Fraser described Australia’s relationship with the United States as a paradox, saying: “Our leaders argue that we need to keep our alliance with US strong in order to ensure our defence in the event of an aggressive foe. Yet the most likely reason that Australia would need to confront an aggressive foe is our strong alliance with the United States. We need America for defence from an attacker who is likely to attack us because we use America for defence”[iii]

It was in May 2019, that Former Australian Prime Minister, Paul Keating accused Australia’s national security agencies of undermining the country’s relationship with China. He argued that agencies like ASIO had lost their strategic bearings, saying (in classic Keating fashion) that “when the security agencies are running foreign policy, the nutters are in charge”. Keating also suggested that the Australian security agencies had failed to grasp the magnitude of the shifting power in the Asia-Pacific, saying that Australian foreign policy lacked any sense of strategic purpose. Twenty-four years ago, Keating talked of the integration of China as being central to the peace and growth of Asia. Containment of China is counter-productive and will not work. The policy must be one of engagement.[iv]

Henry Kissinger has rightly said: “The United States and China are both indispensable pillars of world order” and “no single country, neither China nor the United States, is in a position to fill by itself the world leadership role of the sort that the United States occupied in the immediate post-Cold War period[v]. Any attempt to manage or contain China is doomed to fail. It will be an exercise in futility with potentially disastrous consequences, more particularly for Australia.

What about Diplomacy?

An increasingly confrontational America may provoke a conflict with China which is not in Australia’s interests. The ANZUS Treaty does not provide Australia with the assurance and confidence in dealing with China which it might once have done. This Treaty provides only for the parties to consult in the case of threats. Australia should aim to make its alliance with USA less about fighting a seemingly inevitable war, and more about preventing an entirely avoidable one. Australia needs more investment in diplomacy.[vi]

Australia’s Hugh White contends that if Australia were to adopt a neutral position, that would not make it an enemy of either China or USA - “There is nothing in China’s policies or attitudes today to suggest that it might use force against us (Australia)”. However, that could change if Australia actively supported America in a contest with China. White adds: “China is determined to establish its primacy in this region and would quite likely use force against Australia if we supported a serious rival, such as America.”[vii]

In October 2019, Australia’s Foreign Minister, Payne made the utterly inexplicable statement, against all current evidence, that “the US has a record unmatched in modern times of leading an international system aimed at benefiting all people” adding “that is still the case!”. Recent media and other commentary suggests that USA is a declining power, a rogue nation and even a failed state! On the same day as the Foreign Minister’s speech, Geoff Raby, (former Australian ambassador to China) referred to the “China Threat” having been used to justify one of Australia’s more spectacular “own goals in foreign policy” when it banned Huawei’s participation in the 5G network, with the same threat leading to Australia viewing China’s Belt and Road Initiative as an attempt to impose a Sino-Centric order on the world. Raby talked of Australia’s “megaphone diplomacy” suggesting that it was time for “diplomats to be put back in charge of our foreign policy on China.”[viii]

Although there is much to applaud in Australia’s recent Defence Update, the lack of a complementary diplomatic effort brings the risk that Australia will not just be dragged into an unnecessary conflict, but it’s unbalanced posture might even help to precipitate it. Australia needs a stronger, better resourced Department of Foreign Affairs and Trade (DFAT) to match its upgraded defence efforts.[ix] Australia should make war a last resort, not its first.

Economic Consequences for Australia

For 30 years Australia has enjoyed a stunning economic performance. Throughout that period, the Australian economy has been heavily tied to and largely dependent upon its relationship with China, its largest trading partner. This has led to an intensified debate about Australia becoming too reliant on China and the need to look to other trading partners. However, economists recognise that the Chinese markets cannot easily be replaced. Professor Jane Golley[x] contends that there are no other options that come anywhere near to making up China’s numbers. She wonders whether the man in the street thinks through what it could mean to diversify from China, and how this might lead to them or their children, not having jobs in the future. Golley is not alone. Australia-China Business Council chief executive, Helen Sawczak accused the government of going out like “a shag on a rock, little Australia, demanding an enquiry, insinuating blame, probably not a great foreign policy move.”[xi]

However rosy Australia’s economic picture has been in recent years, that has been brought to a potentially disastrous halt. In late 2019, Australia suffered the devastating consequences of bushfires on a scale never previously experienced. The country has barely recovered when the world experienced the frightening impact of the Coronavirus shutting down one economy after another, including Australia. The Australian government is spending many billions of unbudgeted dollars in an endeavour to support the economy and its struggling population. On top of that, Australia is now exposed to “economic coercion” by China as China’s reaction to Australia throwing down the gauntlet to China. Billions of dollars have been lost and will continue to be lost as a result. Ignoring diplomatic solutions, the Australian government has announced a dramatic increase in defence expenditure, widely viewed as targeting China.

In a conciliatory speech, China’s Foreign Minister, Wang Yi talked of ways for China and the US to find peaceful coexistence, saying that China stood ready to develop a China-US relationship featuring no conflict and confrontation, but rather, mutual respect and win-win cooperation based on coordination, cooperation and stability. He encouraged channels of dialogue saying that suspicion about China had reached a point of paranoia conjuring up “China Threats” which could turn into a self-fulfilling prophecy. He repeated that China’s door to dialogue remained open reminding his audience that the China-US “relationship is one of the world’s most important bilateral relations.”[xii]

Australia’s recession will be deeper and longer if Australia emerges with less trade, less foreign investment, less immigration, fewer tourists, and fewer international students. Like it or not, Australia’s economic recovery will hinge on its relationship with Asia, and China in particular.

A New Geopolitical Alignment

For the world’s global powers to address pandemics, economic and strategic issues, climate change, poverty and World Peace, a new, powerful and representative organisation which recognises the vastly changed and evolving geopolitical landscape is indispensable. The G7 made up of Canada, France, Germany, Italy, Japan, UK, and USA is no longer representative, nor does it carry the necessary clout.

To exclude China, India, Russia, and the European Union renders the G7 irrelevant and impotent. A new and powerful R5 (Representative 5) is needed, made up of today’s major global powers, USA, China, Russia, India, and the EU. Such an organisation would be representative, not only of the world’s greatest economic and military powers but, importantly, it would also provide the opportunity for the 21st Century’s differing political systems to come together and to engage in real and meaningful dialogue.

[i] Hugh White, Without America. Quarterly Essay Issue 68 2017 [ii] Asia Times, Pepe Escobar 16 January 2020 [iii] Malcolm Fraser, Dangerous Allies, published 2014 [iv] Paul Keating – After Words [v] Henry Kissinger, World Order, published 2014 [vi] Michael Wesley, Australian Foreign Affairs, February 2020 [vii] Hugh White, How to Defend Australia, published 2019 [viii] Financial Review 29 October 2019 [ix] AIIA Richard Moore 10 July 2020 [x] Director, Australian Centre on China in the World [xi] SMH 13 May 2020 [xii] Global Times 9 July 2020

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Aug 07, 2020

do you think I should close my bank account in new york ?

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