Australia is currently courting offence rather than, as governments so often assert, defence – a transformation which might only charitably be attributed to absent mindedness if the alternative, stealth, is excluded. It is, moreover, a change wrought, in the first instance, as a consequence of the ways in which Australia thinks about its national defence, but also of both the logic and the inherent dangers arising from and within the Australia – US alliance. While an extraordinary number of avenues of inquiry are possible, there are four which are pursued, the drift to offence itself, followed by, second, the emergence of the “post-democratic” military and security complex in the US; third, the strategic dimension to the Trans-Pacific Partnership Agreement, and fourth, Australia’s developing relationship with NATO.
Part 3. US Grand Strategy and the Trans Pacific Partnership Agreement
The Trans-Pacific Partnership Agreement (TPPA), signed in Auckland on 4 February 2016 by the representatives of twelve countries which, collectively, make up 40% of the world economy, had both a checkered past and a contested future. To say the least, those opposing it could count on analyses and criticisms authored by analysts, commentators and scholars of considerable standing, including Nobel Laureates Paul Krugman and Joseph Stiglitz, and former US Secretary of Labor, Robert Reich. What received considerably less attention, however, was the camouflaging of the TPPA as a trade agreement when it was, more appropriately to be understood as one of several grand strategic instruments.
The overall context of these reprises the Cold War doctrines of Containment – preventing the expansion of an adversary – and Roll-Back – forcing changes in the strategies or policies of an adversary. Unsurprisingly, the states in question are the main US protagonists in the Cold War: resurgent Russia and ascendant China; equally unsurprising is the process of further militarizing the Pacific through what is described as the “Pacific Pivot.” The animus towards them is the result of both, through developing legal, and philosophically attractive development alternatives to the World Bank and the IMF, challenging the disparity in voting rights enjoyed by the US in revolutionary ways.
Part of the US response has been to wage a form of financial warfare against the challengers by initiating IMF rule changes which remove a critical lever on which China and Russia and other governments have long relied to enforce payment of their loans, namely protection afforded lending countries by measures ensuring collectability of government-to-government debts registered under London’s creditor-oriented rules and courts. An acute case in point is the decision, by Ukraine, encouraged by the US, that it intends to default on its debt to Russia without being penalized by not being able to obtain further loans as it would have prior to the rule changes, thus defrauding Russia’s National Wealth Fund of $US3 billion.
Taken together, actions of this nature, and US statements more generally, not only explicitly confirm the targets of the TPPA as Russia, more especially China, but also emphasise the “weaponized” character of the Agreement. The former was underwritten by President Obama’s post-signing boast that the “TPP allows America – and not countries like China – to write the rules of the road in the 21st century.” And perhaps the most striking example is the value US Secretary of Defense, Ashton B. Carter placed the pact: “as important to me as another aircraft carrier.”
In all of this war-talk at least two relevant and important considerations have been consigned not so much to the margins as to invisibility. The first is whether China is in significant way responsible for the current global economic decline, or the more specific economic decline of the United States. Suffice to say at this juncture there are well-informed suggestions that the underlying problem is more accurately identified as capitalism itself. The second is whether the TPPA will introduce divisive tensions between the members of ASEAN to the extent that neither economic nor strategic benefits are forthcoming.
Both of these, would surely point to a need for political prudence among all parties. In the context of warnings from the IMF in early 2016 that the global economy is at risk, any attempt to destabilize it by attempting moves of a clearly hostile character would, just as surely, elevate prudence from a virtue to an imperative. For Australia and New Zealand this is a stark fact. Australia is New Zealand’s major market with China a close second. It follows that, if either of their economies are negatively affected by trade wars – and the prospect is that both would be – then New Zealand’s economy would suffer a double blow. In Australia’s case, the term “fragility” is an appropriate descriptor for the economy and Tim Colebatch describes its dimensions as including: the avoidance of much-needed tax reform, sluggish, highly contingent growth, household debt at massive levels as a ratio of household income, and an economy that is China-dependent for its wellbeing at a time when China has its own vulnerabilities.
Contradictions abound but few, with the obvious exception of Hugh White’s widely published contributions, are voiced let alone debated with the sustained urgency and prominence they deserve. One that is seldom, if ever voiced concerns the Australian and New Zealand logic(s) with regard to China. Both, as noted above, have economies that would be devastated by a radical cessation of trade with China as the mere downturn in the Chinese economy has demonstrated in recent times. China’s economic wellbeing is therefore the principal economic priority for both, as is maintaining sufficient goodwill in the bilateral relationship for the trade to continue.
This is not reciprocated strategically: indeed, China appears in the various statements and strategic guidance documents as a possible adversary, and for many it is the unacknowledged threat, with recent assertive steps taken by Beijing in the South China Sea proof of a hostile disposition which will eventually have to be met with force.
No mention, of course, of embarrassing precedents – such that US control of the Panama Canal was made possible by an act of war in the first instance – US support for the seizure of territory (which became Panama) from Colombia – and the subsequent establishment of the Panama Canal Zone which effectively partitioned the new country for most of the 20th Century. [This is not an attempt to rationalize China’s actions but, rather, to bring to the fore the dangers of double standards in further destabilizing already tense adversarial international relationships].
For this reason major arms procurement projects such as the Australian decisions to purchase 72 Joint Strike Fighters (at a cost of $AUD10 billion), 12 Barracuda Class submarines from France (at a cost of $AUD50 billion) are clearly and significantly, but not exclusively, to be seen within a containment-of-China focus. In essence, China exposes the strategic schizophrenia in current Australian strategic thinking and practice: it is both the market opportunity upon which the country’s prosperity depends, and potential enemy; worse, the ability to pay for the weapons systems designed to deter, counter, or actually go to war with China depend very largely on the prosperity generated by trading with China and not being party to agreements which discriminate against it. In the short term this presumes that China will exercise exemplary and sustained forbearance in the face of considerable provocation; in the long run this presumption is absurd and dangerous.
Part 4 of this series will be posted tomorrow.
Dr. Michael McKinley formerly taught International Relations and Strategy at the Universities of Western Australia and the Australian National University; he is now a Visiting Fellow in the College of Arts and Social Sciences, ANU.