April 2023


Penny Wong’s next big fight

By Hugh White
Portrait of Penny Wong

Photograph by James Brickwood / AFR

Does the foreign minister believe AUKUS positions Australia for an inevitable Pacific war, or does she still think we needn’t choose between the US and China?

Penny Wong has an aura, and a responsibility. No one in national politics sounds more reasonable, more in command of her subject, or more compellingly persuasive. Her calm, disciplined manner, steely but courteous, seems perfectly fitted to her current role as foreign minister. She has emerged as by far the most capable member of the Albanese government’s foreign policy team. And that means it will largely fall to her to navigate Australia through one of the most consequential and dangerous great-power rivalries in history.

It is no exaggeration to say, as Wong and others often do, that these are the most dangerous strategic circumstances we have faced since World War Two. We are on the frontline as the world’s two most powerful states compete over which of them will dominate the world’s most important region. Nor is it an exaggeration to say that our whole future as a country in this region depends on how that contest will unfold, how it will end, and where we will stand in the new international order that will eventually emerge. Will we avoid a devastating war that might well, if it goes nuclear, become the most devastating in history? Will Asia find a new and durable basis for peace and stability? And what place will Australia find in a new Asia? If anyone is going to help find good answers to these questions, or avoid disastrous ones, it will be Penny Wong. But there are big question marks over the approach she will take.

She has two broad options, because there are basically two ways to approach the rivalry that is reshaping our region. One is to pick a side in the contest between the United States and China. The other is to decide what outcome we want from it. Picking a side is the easier option. It reduces the problem to a simple binary choice between America and China, and that – at face value – is an easy choice to make. The weight of history, habit and our proclaimed values ensure that we could never support China against America, so we must support America against China. And it feels good, too. It feels safe and right, because at some primeval level there is nothing more reassuring than being part of a team, and nothing more important than being loyal to your teammates. Those feelings are perhaps especially potent in a country obsessed by sport and in thrall to a long history of strategic dependence on great and powerful friends. Being a loyal team player comes easily to us.

But is it good policy? That depends on whether the team we pick wins, and wins easily. There is no doubt that a US victory in the contest with China, leaving America as the region’s primary power, would be a great outcome for Australia. We could go on relying on America to keep Asia stable and Australia safe, as we have done for so long. But America no longer has the overwhelming preponderance of economic and military power that once underpinned its primacy. China is now, and will remain, the most formidable rival America has ever faced, so a straightforward US victory in this contest is very unlikely. We must expect a very different kind of outcome. It will be more complex, less appealing and much messier, but that is what we will have to learn to live with and that is what we must try to shape as best we can.

In fact, any chance of success in meeting this challenge requires more than picking a side. It requires us to think more deeply about where our real interests are, to choose between numerous competing interests that will often pull us in different directions, to understand and weigh up the risks we face, and to reimagine how we might fit into a new Asian order that looks very different from anything we have known before. It requires us to recognise that old team loyalties may no longer work for us in this new and different world. None of that is going to be easy, or pleasant. It will not give us the comforting feeling of sticking by our mates. We will be much more on our own, because we simply cannot assume that America’s interests and objectives will align with ours. The simple fact that we are on opposite sides of the Pacific is enough by itself to ensure they do not.

Still, it is no surprise that since 2017, when the long-smouldering US–China rivalry burst into flame, Australia has just picked a side. By the time of last year’s election, the Coalition government was committed to following America wherever it might lead, even if it led to war. Peter Dutton was just being honest when he said last year that for the Coalition it was “inconceivable” that Australia would not go to war with China if America did. Now the big question is whether Labor will just follow in the Coalition’s footsteps.

It has been tempting to see Labor’s fresh start with Beijing as a sign that it is taking a different approach. Re-establishing workable official relations with our biggest trading partner is an important achievement, but it was not very difficult. It had been clear since late 2021 that Beijing was ready to start talking again. All it asked was that Canberra stop treating the bilateral relationship as a political football. Scott Morrison refused, because he was convinced that the rupture with China was an electoral asset. Labor accepted Beijing’s olive branch and handled the rapprochement deftly, showing that Morrison was wrong: we can talk civilly to Beijing without grovelling to it.

But nothing fundamental has changed – at least so far as the prime minster is concerned. As Anthony Albanese has moved into the unfamiliar terrain of foreign and strategic policy, he has gone out of his way – for example when he flew to Tokyo for a Quad summit with Japan, India and the US the very day he was sworn in as prime minister – to proclaim that he is as completely committed to supporting America against China as Morrison was. The announcement last month of Labor’s plans for the AUKUS submarine program shows just how deep his commitment is, because, as Albanese is fond of saying, “AUKUS is about much more than submarines”. In fact, at its heart AUKUS is not primarily about submarines at all. Its fundamental purpose is to strengthen our alignment with America against China. Australia’s acquisition of nuclear subs is just the means to do that. This is clear from the simple fact that there is no other compelling reason for us to seek this capability.

Nuclear-powered submarines do not make strategic or operational sense for Australia. That is why, right up to the moment Morrison pulled AUKUS out of a hat in September 2021, governments on both sides of politics had always flatly rejected any suggestion that Australia might opt for them. They understood that for Australia’s needs, such vessels’ advantages in speed and stealth do not justify the enormous costs, risks, delays and safety issues involved in their building and operation. The scale of these downsides has become even more glaringly obvious since the extraordinarily complex program to acquire nuclear subs under AUKUS was announced. It shows why, for us, nuclear subs are less cost-effective than conventional ones. The government only started making inflated claims to the contrary – that our strategic and operational circumstances had suddenly changed so much that only nuclear subs would do – after AUKUS was announced.

In fact, the AUKUS program, with its multiple points of failure, may well end up destroying Australia’s submarine capability, as the old Collins-class boats leave service with nothing to take their place. But in the meantime, AUKUS will have created the most profound transformation of Australia’s alliance with America since the ANZUS Treaty was signed in 1951. The key to understanding this is to recognise the big gap that has always existed, until now, between the elaborate carapace of political rhetoric that surrounds the alliance and the much softer strategic and operational reality within. Leaders on both sides have long talked as if there has never been a closer or deeper mutual commitment between any two countries than we enjoy with America. But the reality has always been very different. We have been quick to fight alongside America in small, cheap wars such as those in Iraq or Afghanistan, but under ANZUS we have never – even at the height of the Cold War – committed ourselves to support America militarily in a full-scale war against a major, nuclear-armed power.

That has made us by far the least committed of any close US ally. Throughout the Cold War and still today, America’s NATO allies have remained absolutely committed to join America and other NATO partners in a war with Russia. They have accepted US forces based on their soil, forward deployed their forces with US forces in probable conflict zones, and locked themselves into contributing forces to carefully pre-planned operations in future contingencies. Australia had done none of this until recently. We had no US combat forces based on our soil, no Australian units permanently deployed to probable conflict zones, and we accepted no pre-ordained roles in US major war plans. In all these ways, our alliance has been very different, and much looser, than any of America’s NATO allies, or than its key Asian allies in South Korea and Japan.

This first began to shift gradually in 2011, when Julia Gillard welcomed US forces to undertake rotational training deployments through Darwin, but it has accelerated very quickly over the past couple of years, with initiatives such as the provision of operational basing for US long-range nuclear bombers in northern Australia. AUKUS has taken this a huge step further, because it centres around a radically strengthened commitment by Australia to fight alongside America in a major war in Asia. Defence Minister Richard Marles has said that Australia has made no promises, but the AUKUS program itself embodies Australia’s acceptance of America’s expectations. The US decision to give us access to its most sensitive military technologies, and especially to sell us Virginia-class nuclear-powered submarines taken from the US Navy, is simply unthinkable unless it is sure that Australian forces would be fully committed to the fight if it goes to war with China. If we fail to meet those expectations, the AUKUS deal will be off, as Marles and his colleagues must understand. So, suddenly Australia has become something much more like one of America’s NATO allies, automatically committed to fight if war breaks out with America’s major regional rival. That is certainly the way Washington sees it. That’s why it has embraced AUKUS. Our siding with America against China has thus been taken to a whole new level. AUKUS guarantees that what Dutton said is right: if AUKUS stands, it is inconceivable that Australia would not fight by America’s side if America ever goes to war with China. This is an outcome that the Labor government seems to wholeheartedly embrace.

Labor, like the Coalition before it, tries to step around this reality by claiming that AUKUS will help prevent a war rather than compel us to fight one. It says that Australia’s strengthened capabilities and deeper commitment to fight will deter China from escalating its challenge to a military confrontation. That is wishful thinking. AUKUS will deliver no real increase in military capability until well into the 2040s at the very earliest. China won’t be deterred from attacking Taiwan in the next five or 10 years by the fear of a few new Australian subs that might come into service 10 years after that. The danger of a military confrontation leading to war is real and growing right now.

We can see this in the way that, just in the year since Labor was elected, the tone and intensity of US–China rivalry has escalated sharply. More trade and technology restrictions, more provocations and counter-provocations over Taiwan, more bellicose talk from both sides, and more missed opportunities for dialogue and de-escalation. In Washington, President Joe Biden’s hopes for “guardrails” to stop competition sliding into conflict have gone nowhere, partly because he has himself dumped his own administration’s policy of “strategic ambiguity” by repeatedly stating in quite unambiguous terms that he would have the US fight to defend Taiwan. Meanwhile, in Beijing last month, President Xi Jinping and his new foreign minister, Qin Gang, used the National People’s Congress to launch the most hostile diatribes against America from such senior figures in many years. It is no longer irresponsibly alarmist to say that America and China are now set firmly on a path to war. That does not mean that war is inevitable. It does mean that the probability of war has grown sharply over the past five years, and will continue to grow further unless and until the clear trend of rising bellicosity between them is decisively reversed, and there is no sign of that happening.

At the same time, the nature of a US–China war is becoming starkly clearer. The old comfortable assumptions about America’s unchallengeable military superiority over China are giving way to more realistic assessments of the balance of military advantage, and the news is not good. No one now expects America to score a swift and easy victory in a maritime war over Taiwan, and only those making heroically optimistic assumptions predict that America would win any kind of victory at all. Moreover, the risk of the war going nuclear is now better understood, as the scale and capability of China’s nuclear forces are more realistically assessed. It is now obvious that a US–China war could well be the biggest and most destructive since 1945, and is very likely to be nuclear. So, this is a war that, to quote Ronald Reagan, cannot be won and must never be fought. It is hard to imagine that Labor’s leaders do not understand this.

Why has Labor found itself following the Coalition down this disastrous path? Senior Labor figures – and many others in Canberra – say privately that they have no choice. But that’s only true if you are locked into the logic of picking a side and sticking to it, instead of focusing on the outcomes Australia wants. Labor has found itself trapped in this rut for three bad reasons. The first and most obvious is pure politics. Labor has a holy dread of allowing any daylight to appear between itself and the Coalition on anything to do with national security. It concedes the ground to its opponents because it has no faith that it can win a political debate on any security-related issue, and it fears that losing on these issues would spell electoral disaster. But the second reason is that a lot of Labor people really believe that sticking by America is Australia’s only possible choice. That’s because they cannot imagine America losing its leading role in Asia, and they cannot imagine how Australia could survive if US primacy is eclipsed. They are therefore quietly uninterested in thinking about the outcomes we should seek in an Asia no longer dominated by America. The third reason is a lack of expertise. Labor is critically short of people who really think about these questions, so it has found itself in office bearing an awesome responsibility that it is ill-equipped to discharge.

But Penny Wong is a notable exception. She was shadow foreign minister for six long years before moving into government last year, and during that time she gave a lot of speeches revealing deep reflection on the challenges we face and, very importantly, on the outcomes we should be looking for. Indeed, she appears to be one of only two senior figures on either side of politics in the past decade to have done more than simply pick a side in the US–China contest. (The other was Malcolm Turnbull – until he became prime minster.) The big question about the foreign policy of the Labor government is whether Wong still holds the views she held in Opposition, and how far she will push her colleagues to look past their loyalty to Washington and think the way she has done about the outcomes we should be working towards. If she doesn’t, nobody else will.

Wong is fond of saying that we need to deal with the world as it is, not as we’d like it to be. Over the past few years she has explored the outcomes Australia should realistically be seeking amid the turmoil that surrounds us today. She set out her ideas most clearly in a major speech in Jakarta in late 2019. She started with a clear statement on the tectonic geo-economic shifts that are driving the transformation of the Asian strategic order with the growth of Chinese wealth and power. She described in detail a “compelling chart” in the Turnbull government’s 2017 Foreign Policy White Paper that showed that, as she put it, “within a decade, the Chinese economy is set to become nearly twice as large as the econom[y] of the US”. Few if any of our political leaders have acknowledged so frankly how far the distribution of wealth and power has shifted China’s way.

She went on to describe the “profound implications for our region and for the United States”, stating: “Over the next decades, neither the United States nor China will be able to exert undisputed primacy. They must be prepared to live with each other as major powers.” This is only to be expected, she said, because “As China’s relative economic weight increased, it is unsurprising that it would seek a greater say in the region.” Nor should we be too alarmed. “We recognise that China has a right to develop, and a right to a role in the region alongside other regional powers. We do not and should not pre-emptively frame China only as a threat.” In an earlier speech in Sydney, in July 2018, she spelt out the historic implications of all this when she quoted an observation from the then dean of the College of Asia and the Pacific at the Australian National University, Michael Wesley, that “this is the first time since European settlement that Australia has had to contemplate living in a region not dominated by a culturally similar ally”.

For Wong the correct response to this fundamental power shift is clear. Australia should seek a multipolar order in Asia, she has said, “a multipolar region in which the United States remains deeply and constructively engaged; in which China is a positive contributor; and in which the perspectives and contributions of smaller powers are respected and valued.” That means finding what she called “a settling point” between what she sees as two equally unsustainable extremes: continued US primacy on the one hand, or Chinese hegemony on the other. She was quite explicit about this when she spoke in Jakarta. She rejected “the notion of a binary choice: that the only alternatives are accepting a Chinese-led regional order or unconditional support for US-defined strategic competition with Beijing”. I have italicised that last clause because it so precisely expresses Wong’s repudiation, when she was in Opposition, of the approach that the Albanese government is now taking.

She clearly understood that in calling for a new multipolar order in Asia she was advocating an outcome very different from the goal of US policy. It was not that she doubted America’s importance – “Our future resilience, prosperity and security depend on ongoing and strengthened constructive engagement from the United States”– but that America needed to rethink the kind of role it would play, accepting that in future it must share leadership in Asia with other powers. The US, she said, should “recognise and embrace the fact that multipolarity in the region is likely to get stronger”. In a remarkable passage, she called on Washington to redefine its objectives, to make it clear that its aim was not simply to contain China and perpetuate American primacy:

It’s fair to say that many countries in the region are unclear about what precisely it is that the United States is seeking to achieve. More questions … need to be asked: What, exactly, is the US competing for? And what might a plausible desired outcome of this competition look like? Absent that clarity, China will assume the worst. It will give fuel to those within the Communist Party of China who believe that the United States wants to thwart China’s rise and contain it.

America’s present policy, she said, “perpetuates the perception that, for Washington, regional engagement is secondary to the US–China relationship and that we all only matter in relation to its competition with China”. And that will not work, she said, because “a strategic competition frame that manifests as ‘you’re either with us or against us’ limits the scope of regional players to make decisions that contribute to the region we want”. And the implications of this for the countries of the region, including Australia, are clear.

So, we are in fact faced with a choice, but it is not the US–China binary. The choice is this: Are we simply to be spectators to the consequences of this strategic competition in our region, or do we work proactively and collectively to shape rules, norms and standards in line with our interests and values?

Of course, things were different back in 2019 when Wong gave this speech. Donald Trump was in the White House, Labor was in Opposition, and AUKUS was not even a gleam in Scott Morrison’s eye. How many of the policy ideas she set out then does she still believe in? We can get a sense of this from the big speech she gave as foreign minister to the Carnegie Endowment for International Peace in Washington last December. She plainly still has real reservations about some aspects of US policy. She bluntly criticised the way Washington – and, by implication, Canberra – have so far tried to build support in the region to counter China. “[F]or the alliance to respond to the challenges of a changing region, we must accept that … we have a great deal more to do to reduce the risk of conflict, and to influence the shaping of the region in our interests,” she said. “US policy needs to be based on a clear understanding of what the rest of the Indo-Pacific wants.”

She pulled no punches on Washington’s failure to counter China’s formidable economic heft in Asia by offering more economic opportunities to regional countries. She sharply criticised Trump’s decision not to join the Trans-Pacific Partnership trade deal, which, she said “is still being felt in the region”. But she also seemed deeply unimpressed by the Biden administration’s efforts to redress that problem. She reminded her DC audience that alliances could not just be about collective security. “They will increasingly require a fully developed economic dimension as well.” This was a pointed criticism of the Biden administration’s failure to offer what Asian countries most want – better access to US markets for their exports.

But perhaps more significant were Wong’s comments on Washington’s management of the rivalry with China. She stressed that both sides needed to ensure that their rivalry does not get out of hand. “We need to do more than establish military deterrents to conflict. We need to work together to create the incentive for dialogue,” she said. Wong welcomed President Biden’s calls for “guardrails” that would help avoid conflict, but she warned of the serious obstacles to that in Washington as well as Beijing. “[T]he kind of international leadership we need to prevent catastrophe must be supported and encouraged across the political systems of both China and America. Heads of government need assurance that nationalistic domestic posturing won’t sink their efforts to build safeguards.”

On other recent occasions she has reinforced the message that Washington as well as Beijing must work harder to avoid conflict. When tensions have flared, over former US speaker Nancy Pelosi’s visit to Taiwan last year and the Chinese balloon incursion into US airspace in February, Wong has pointedly called on “both sides” to show restraint. “A continuing focus on the concrete steps which can and should be taken to manage competition helps the region understand America as contributing to stability – those kinds of responsible initiatives themselves expand America’s influence.” But she surely understands that the chances of these bitter adversaries agreeing on measures to de-escalate their rivalry are very low, as long as the underlying issues between them remain unresolved, as they do. She must also understand that within two years there may well be a new administration in the White House – or a recent administration restored – which would make those chances even lower.

Most significantly, Wong’s recent speeches show that she clearly understands the risk of war and what war would mean. Both in her Carnegie speech in Washington last December and again in her speech to King’s College London in February, she described a war between America and China as “catastrophic”. That is a very significant word. It suggests she really does understand what is at stake in a way that her colleagues in the government may not. She knows that a US–China war would be disastrous for Australia whether we joined the fighting or not. She knows that if we did send forces, Australia would be plunging into the first full-scale war between major powers since 1945, and the first ever between two nuclear-armed adversaries. Wong recognises that a US–China clash would swiftly escalate into a full-scale war engulfing the whole region, and that it would quite possibly become a nuclear war. She knows that there could be no winner in a war that would leave the entire region devastated. How could she not be convinced that Australia should not fight, and that we should do what we can to discourage America from fighting too?

There is much we could debate about the ideas Wong has developed since she became shadow minister, but there is no doubt that they capture a number of central truths, and offer a great basis for very different policy focused on the key outcomes for Australia. She is absolutely right that we should work for a new multipolar order in Asia in which America plays an important role but does not dominate, in which China is accorded substantially more influence, and in which other powers, such as Australia, have a real say. She is right to emphasise the importance of working with other smaller and middle powers to help bring this about. And she is absolutely right to do much more to avoid war than simply talk about deterrence.

So here is the big question. Will Penny Wong use her prestige with her colleagues, her standing with the public, her formidable political skills and her deep policy insights to reorient Australia’s policy on the US–China contest? Will she convince her cabinet colleagues to look beyond picking America’s side in a binary “with us or against us” choice, and focus instead on how we can get the best achievable outcome for Australia from Asia’s geo-strategic crisis? Or will she allow herself to go along with the crowd? There can be no doubt that she understands the need to change course. But there is real doubt that she will do it, because she now seems reluctant to mount the kind of arguments she presented so cogently just a few years ago – arguments that are even more compelling now, and more urgent, than they were then.

These days, Wong no longer talks of a multipolar order in Asia. She talks instead of the search for “strategic equilibrium” in the region. And she won’t be drawn on the role America should play in that strategic equilibrium. She will not now say, as she did in 2019, that America cannot sustain its old unipolar leadership role, nor that it will need to acknowledge a larger leadership role for China. Indeed, she now prefers to avoid talking about the contest between America and China as much as possible, arguing that it is not the key factor in shaping the regional order. She used to understand very clearly that it is, on the contrary, the critical factor. She will not be drawn on how far her vision of regional equilibrium differs from America’s objectives, ignoring the clear evidence that America aims to maintain the position of primacy that she has in the past plainly said was unsustainable. Wong no longer seems convinced that Australia does not face and should not make a binary choice between America and China.

Nor will she now talk about Australia’s response to the possibility of war. She will not say what she believes would be at stake for Australia if we are faced with a decision about going to war with China. She will say nothing about the circumstances in which we would be justified in committing ourselves to the conflict. She criticised Dutton for saying that it was inconceivable that we would not fight, but refuses to say whether or not she believes it is conceivable that we would not. Nor will she say anything about whether the AUKUS agreement deepens our commitment to fight, or encourages Americans to assume that Australia would automatically go to war with China if they do.

Wong dismisses all of these questions, and indeed any questions about a war with China, on the grounds that they are “hypothetical”. This well-honed device for avoiding awkward subjects would be the right answer to a question about, say, whether Australia would help defend Fiji against an invasion by New Zealand. That really is a hypothetical question. But questions about a war between America and China are not hypothetical. The possibility that China will attack Taiwan is anything but remote. Biden has said that if that happens America will certainly fight in Taiwan’s defence. And if America fights, it will certainly call on Australia to fight too. This is the hard reality behind that oft-repeated claim that we face greater dangers than at any time since World War Two. Not since 1939 has Australia been anything like as close as we are right now to being engulfed by what Wong acknowledges would be a catastrophic war.

She must understand the responsibilities that these dangers impose on her and her colleagues. A decision to go to war against China over Taiwan would be one of the most serious ever taken by an Australian government. Wong must, surely, along with her colleagues, be thinking deeply now about what they would do if and when the crisis comes, because if and when the time comes they will have just hours to decide. And Wong must realise that it is not a decision that could or should be sprung on the Australian people as a fait accompli. That would be a travesty of the democratic values she so vigorously espouses. So why not discuss it?

Of course, we understand why. It is not that the issue is hypothetical. On the contrary, it is because it is all too real and immediate, and it is inextricably tied to the choice between picking a side and picking an outcome.

To even raise the question about whether we’d go to war would cast doubt on whether picking America’s side and accepting the commitments entailed by AUKUS are really the best ways to navigate Asia’s strategic crisis. That is a discussion that no one in cabinet, including Wong, seems to want to initiate. It would lead to a big fight in the cabinet and beyond. We can already see the potential for it to split the wider Labor Party, with stirrings of opposition to AUKUS among significant sections of the Labor movement. But it is a debate that the government, the Labor Party and the country needs to have if we are to find a way through the most radical shift in our international circumstances since European settlement. And it is a debate that, it seems, Penny Wong is uniquely placed to lead. It would be a fight, the biggest fight of her political career, and perhaps bigger than any on our national stage for many decades. It thus presents Wong with a test of her mettle that few of our politicians have faced for a long time. Is she up for it? As yet, that is unclear.

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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