September 2020

Comment

Choppy waters

By Hugh White

Mike Pompeo and Marise Payne. © Lisa Maree Williams / Getty Images

Australia’s assumption that China will give up its Pacific rivalry with the US is dangerously misguided

No one wants to choose between America and China. Australia needs them both, and our dependency is growing. In the pandemic-ravaged world we need the opportunities that only China seems likely to offer to get our economy started and growing again. At the same time, the stronger and more strategically threatening China becomes, the more we look to America to protect us from it. 

For many years, our governments have assured us that this would all work out fine. Scott Morrison still recites the mantra intoned by every prime minister since John Howard: “Australia does not have to choose between the United States and China.” 

That was true in Howard’s day because back then America and China were not overt strategic competitors. It started becoming less true about a decade ago, when Beijing openly began to challenge US leadership in Asia, and Washington tentatively began to push back. Nonetheless, as the rivalry grew, almost everyone in Canberra was convinced that we wouldn’t have to choose sides, because they assumed that China had neither the power nor the resolve to take America on. They expected that Beijing would quickly back off once Washington flexed its muscles. Everyone in Washington expected that as well. 

They were wrong. Barack Obama’s pushback – his “Pivot to Asia” – was so feeble that it encouraged rather than deterred Beijing. By the time Donald Trump was elected, the US policy community was starting to see that they had underestimated China, and that its ambitions needed to be taken more seriously. The 2017 US “National Security Strategy” identified China for the first time as a major strategic rival and America’s most serious potential threat. Trump himself didn’t necessarily share this strategic judgement, but it has resonated with his urge to target China on trade. It also echoed growing concerns in America more broadly about China’s conduct, including intellectual property theft, cyber intrusions and political interference. All these together have seen US hostility towards China rise sharply over the past three years. Serious people started talking of a “new Cold War”. 

And then the pandemic hit. As Trump has floundered in his response, and slumped in the polls, his administration has played the China card. The secretary of state, Mike Pompeo, made a speech in California last month that marked a new apogee in Washington’s overt animosity to Beijing. He blamed China for the pandemic, repudiated the whole record of US–China relations since Nixon’s opening to China in 1972, and made it plain that good relations were impossible as long as China was ruled by the Communist Party, plainly implying that Washington sought its overthrow. He called for America’s economy to be decoupled from China’s. And he repeated and amplified calls for America’s friends, including Australia, to join a new alliance against China. It could not be clearer: our major ally is now expecting, and perhaps demanding, that we choose between them and our most important economic partner.

So, it seems, is Beijing. While Australia’s exports to China keep climbing, the political relationship with Beijing is now colder than it has ever been since the Whitlam era. This began in 2017, when Malcolm Turnbull in a major speech was the first regional leader to frankly describe China’s ambitions for regional hegemony. He then launched a crusade against China’s growing influence and alleged political interference in Australia. Then, in early 2018, Australia became the first country to ban Chinese communications giant Huawei from the national 5G rollout. Beijing has had us in the deep freeze ever since. 

But when Morrison replaced Turnbull, in August 2018, he seemed intent on soothing Beijing. He was careful to avoid suggestions that Australia was aligning itself with Washington against Beijing. He refused to follow Washington in describing China as a “strategic rival”, and instead emphasised the positives in the “comprehensive strategic partnership”. He was cautious about any deeper military cooperation with America that was overtly aimed at China, and brusquely dismissed Washington’s hints that they’d like bases here for long-range missiles aimed at China. 

Then, earlier this year, Morrison appeared to change tack and began saying things that seemed designed to provoke China. Most famously, he framed a proposal for an international inquiry into the origins of the pandemic in terms that plainly suggested Beijing was to blame. He then made things worse by conveying the impression that he had done so at Washington’s behest. In another example, Canberra’s new “Defence Strategic Update”, released in July, was unusually frank in identifying China as Australia’s primary strategic threat.

Beijing’s angry responses, including threats to trade, have driven the relationship into the deep chill we experience today. Beijing is warning that worse will follow if Canberra joins America’s Cold War. But Morrison seemed to have decided to defy the warnings and side with America, despite the economic consequences. That fits with the way he speaks of the US alliance, which he has described as “our past, our present and our future. It is the bedrock of our security.” Just last month he said that the alliance “had never been stronger or more important” in the face of China’s power and ambition. 

But it is not that simple. In late July, just a week after Pompeo’s sabre-rattling anti-China speech, Foreign Minister Marise Payne and Defence Minister Linda Reynolds took the extraordinary step of flying to Washington despite the pandemic to hold this year’s AUSMIN talks with their US counterparts. The US side had pressed for the talks to go ahead face to face, no doubt expecting that Australia would offer both a ringing endorsement of their new stance against China and a pledge of unwavering support. They didn’t get them. 

Instead, Senator Payne deliberately distanced herself from Pompeo’s call to arms. Asked about his speech as she stood beside him at the post-AUSMIN press conference, Payne quietly but firmly said that Australia would not dismantle our relationship with Beijing as he was urging. “We make our own decisions, our own judgements, in the Australian national interest, and about upholding our security, our prosperity and our values,” she said. “The relationship that we have with China is important, and we have no intention of injuring it.” 

Just a few days earlier, Morrison had indeed made a point of saying that Australia will take “our own actions and our own initiatives” in relation to China. He was supported by his great mentor John Howard, who said in the same forum that, despite the importance of the US alliance and problems with China, “I hope all Australians remember just how critical the Chinese market is to Australia’s economic future.” Clearly, China’s warnings have been heeded, and Canberra has decided not to side completely with Washington after all. 

So, what exactly are we doing? The government’s fans – and there are plenty of those in the media and the think tanks – praise its approach as a deft balancing act. Others see it as a flip-flopping muddle. But in truth Morrison is just sticking to the old policy of his predecessors back to Howard. He remains convinced that the US–China rivalry will blow over when China takes the hint and drops its challenge to the old US-led regional order. That’s the only basis upon which his present policy of ducking and weaving makes any sense. But if Morrison believes that, he does not understand just how bad things have got, and how much worse they are likely to get. In a rhetorical flourish when launching the defence update in July, Morrison compared today’s problems with the dark days of the 1930s and 1940s, but it seems he doesn’t understand just how true that is.

In Asia today, the world’s two most powerful states confront each other in a classic power contest over which of them will dominate the world’s richest and most dynamic region in the decades to come. The stakes could not be higher, and the contestants are formidable. America remains very powerful, but so too is China. For years many of us have complacently underestimated China’s economic power, military strength, diplomatic heft and deep resolve. It is therefore irresponsibly complacent to assume that China will be easily convinced to abandon its ambitions. It will only be successfully contained by a massive economic, strategic and diplomatic effort – another Cold War, indeed, against a more powerful adversary than the Soviet Union. And while the last Cold War ended peacefully, it is quite likely that China will only be contained by a successful war. 

So, Australia simply cannot assume that it will all turn out well while we duck and weave on the sidelines. Instead we have several choices to make. First, we have to choose between continuing to pretend to ourselves, as the government still does, that the problem will go away (by China abandoning the contest), and acknowledging that it won’t, and that a very real and dangerous contest is now under way. The right choice here is obvious. 

Then we have to choose between supporting America in this titanic strategic contest, or stepping back and allowing China to dominate our region. Most of us assume that this choice too is easy. China might be vital to our prosperity, but our security and our values matter more, so we will inevitably support America when the chips are down. But most of us take it for granted that America will win, and that is not an assumption we can afford to make. We have to choose between betting our future on blind faith that America will prevail, or soberly assessing the new balance of forces in our region. The fundamental new reality that we still struggle to accept is the power of the risen China. It is the most formidable adversary America has ever faced. Economically it remains on track to overtake and far outstrip America as the world’s biggest economy. In the military sphere, China has built forces that can deny America any swift easy wins in a Western Pacific war. Even if America receives the support of regional countries such as India and Japan, which is far from certain, China will be very hard indeed to deter or defeat, either diplomatically or militarily. 

That means the costs and risks of this contest will be high, and it is not at all clear that America is willing to shoulder them. Americans want to contain China and preserve their leadership in Asia, but do they want that enough to bear the burdens and accept the terrible dangers of a new Cold War – including the danger that any conflict could go nuclear? Those such as Pompeo, who talk tough, have no clear plan and say nothing of what it will cost. But those costs will become clear if Washington ever moves from tough talk to real action.

It is hard to see either Donald Trump or Joe Biden convincing Americans to bear these costs when so much needs to done at home. Instead, Americans beyond Washington’s beltway seem eager to step back and disengage from China strategically as well as economically. That means the most likely outcome is that it will be America that abandons the contest in Asia, quietly over the next decade or so. The second-most likely outcome is that by mischance or miscalculation the two sides plunge into a war over something like Taiwan, which would devastate Asia, which America would be very unlikely to win, and which would probably spell the end of its strategic presence in the region. 

So, Australia’s choice is far from a simple one between security with America or prosperity with China, because in the years ahead America will not be able to offer us the security we have taken for granted as an ally. Instead we face a much more complex set of choices about how to best protect our security, our values and our prosperity in an Asia in which, whether we like it or not, China is going to play a much bigger role and America a much smaller one. That’s going to require a fundamental rethink of our entire foreign policy, and soon. We cannot begin that task until the government comes to understand, and acknowledge, that our China problem is not going away.

Hugh White

Hugh White is an emeritus professor of strategic studies at the Strategic and Defence Studies Centre, Australian National University.

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