Lowy Institute

Let's put Mr Turnbull's diplomacy last week into context. While he was in China, US Defense Secretary Ashton Carter was in the Philippines talking up America's commitment to support Manila militarily against Beijing. At the same time, a senior Chinese general toured Beijing's bases in the Spraltys.

Meanwhile, the Permanent Court of Arbitration's judgement in the Philippines case against China is only a few weeks way, and credible reports say that China is preparing to build a base on the Philippine-claimed Scarborough Shoals or declare an air-defence identification zone over the Spratlys.

This all suggests that things are heading for some kind of showdown over the next couple of months. It seems the Court will find against China. If they do, China will probably react with some further provocation. And if that happens, Washington faces an ever-starker choice between responding militarily or taking a big blow to its strategic credibility in Asia. And so, in Churchill's plangent phrase, 'The terrible "ifs" accumulate'.

We cannot know whether or not these 'if's' will lead to a war, but we do know that this is just how wars often start: not when both states want to fight, but when each assumes it can get what it wants without fighting because the other will back down. Such a war, if it happened, would pose the gravest threat to Australia's security and prosperity in generations. And if war is only avoided by America backing down — which is becoming increasingly likely — then we face an almost equally grave collapse of the US role in Asia on which all our strategic expectations and policies are based. 

This should be clear to Mr Turnbull and his advisers. If it is not, what further warnings of impending conflict are they waiting for before they take the risk of US-China conflict seriously enough to try to do something to avert it?

Which brings us back to Mr Turnbull in China last week. He didn't go to China to talk about this danger. He wanted to talk trade and innovation, but a well-timed warning in the Chinese media (interesting in itself) ensured that the main focus of his visit was on the South China Sea question and what he would say about it.

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And what did he say? It seems he told the Chinese that they should stop building bases and deploying forces in the South China Sea, and instead submit their claims to adjudication in accordance with the so called 'rules-based global order'. To do otherwise, he apparently said, was contrary to China's own interests.

And what precisely was this expected to achieve? Did Mr Turnbull really expect that his remarks would apply that last bit of pressure needed to persuade China to abandon its newly-built bases, withdraw its forces, repudiate the nine-dash line and submit its claims over contested features to arbitration? That seems a long shot, to put it mildly. After all, the argument he put to them is one they have heard many times before, and it is hardly a zinger. 

In fact the claim that China's actions are counterproductive to its own aims is almost certainly false. It assumes that Beijing wants to make friends and uphold the 'rules based global order', whereas their aims are clearly to display their growing power and replace the current order with 'a new model of great power relations'. In terms of furthering these aims, their pushiness in the South China Sea is working just fine.

So turning up in Beijing simply to rehearse well-worn clichés about regional order was not serious diplomacy. The natural conclusion is that Mr Turnbull neither intended nor expected his talking points to make any actual difference to China's policy, or to the situation in the South China Sea. He was just going through the motions, while the risk of conflict grows. 

That seems close to a dereliction of duty, when the stakes for Australia are so high. But he got away with it politically because no one expected him to do anything more. Commentators assessed his diplomacy on the South China Sea solely as a test of his diplomatic mettle: would he show strength by speaking his mind, or chicken out and soften his message? No one asked what real difference it would make whether he did or not.  

This prompts a question: why do our leaders aim so low in foreign policy, and why do the rest of us not expect them to aim higher? Why do we accept that the only thing at stake in Beijing last week was Mr Turnbull's reputation as a person willing to speak his mind?  

Perhaps the answer is that we have lost the habit of serious foreign policy. For a long time we have been one of those lucky counties for whom the world works well to keep them secure and prosperous. Such countries easily take their good fortune for granted, and start to see diplomacy as a ritual in which one simply expresses one's views, and points are awarded merely for doing so. They forget that diplomacy can sometimes be an earnest and even desperate struggle to avoid disaster. What we saw in Beijing was classic lucky-country diplomacy.

It is reasonable to ask what Mr Turnbull should have done instead. That's a big subject for another time, but the first steps must be to acknowledge the nature and scale of the problem. That is not something he could start to do in Beijing. First he has to talk seriously at home about the risks and the choices that Australia faces, and talk seriously to Washington about their approach to China.

He could have done so in his Lowy Lecture last month, if he'd said something like what I've suggested here. But he ducked it. Perhaps he thinks there will be another chance later. He shouldn't bet on that because events are moving fast.

Photo by Lintao Zhang/Getty Images

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I'm usually cautious about extended metaphors, but Akira Igata's neat depiction of Japan and Australia as a young strategic couple on a first date is illuminating as well as charming. However I don't share his reassuring conclusion that there will be no harm done if the candle-lit dinner does not lead to a long-term commitment.

That is because what Australia and Japan would agree to share in Mr Igata's metaphor is not a dinner for two but a multi-decade program which is central to Australia's future military capability. If the first date doesn't go well the two people can walk away with no harm done. But if the strtageic relationship with Australia does not live up to Japan's expectations for decades to come, then the future of the submarine project is thrown into doubt.

This is the necessary corollary of Japan's reasons for wanting to be Australia's submarine partner in the first place. Japan is willing to share its submarine secrets with us because it hopes and expects Australia to be a close strategic partner — an ally — in the future. We can hardly expect them to keep sharing those secrets with us if their hopes and expectations are disappointed.

So, to push the metaphor a step further, Japan is offering us not just dinner but an engagement ring on our first date, and if we walk away from the relationship, they will want the ring back. And here the metaphor breaks down, because a successful submarine project depends not just one a one-off transfer of technology and skills, but on continual interaction and exchange – and hence on continued Japanese trust and goodwill for decades into the future. 

So if we choose the Japanese option, Australia would be betting the future of our submarine capability on our future willingness and ability to meet Japan's expectations of a long-term close strategic alignment. And in the fluid power politics of Asia today, that is a bet we would be most unwise to make.

Photo courtesy of Flickr user ARTS_fox1fire.

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...the idea of the future being different from the present is so repugnant to our conventional modes of thought and behavior that we, most of us, offer a great resistance to acting on it in practice.

— John Maynard Keynes, 1937

This line, quoted as an epigraph to the US intelligence community's Global Trends 2030 report a few years ago, has something to offer our debates today about Australian strategic policy. That is because where one stands on today's big questions mostly depends on how far one accepts the idea that Asia's future strategic order might be different from the present and recent past.

For example, those who find the new Defence White Paper credible tend to expect that Australia's strategic environment over the next few decades will not differ much in essentials from what we have known over the past few decades. Those who see bigger changes looming are more likely to find it wanting.

Likewise, those who think it is a good idea to base our future submarine capability on a closer strategic alignment with Japan expect that the roles, policies and relationships of Australia, Japan and the US will be much the same decades from now as they are today.

Michael Heazle's response to my Fairfax article and Interpreter post on the Japanese bid helpfully makes this clear. He argues that such an alignment would pose to no risk to our interests 'unless Australian security thinking dramatically changes over the next 20 years'. He says there is no reason for that to happen, because our current posture has served us so well for the past 60 years. Why would we ever want to change that, he wonders?

The answer, of course, is that circumstances change, and that policies that have worked well for so long might not work in future.

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Of course if things do not change — if America remains the preponderant power in Asia, Japan remains its close and dependent ally, and China decides it has no choice but to accept that — then it would make perfect sense for Australia's strategic posture to remain unchanged as well.

And the surer you are that this is how things will turn out, the stronger the strategic argument for reinforcing our old posture by choosing Japan as our submarine partner. But the less sure one is that nothing much will change, the more weight one should give to the possibility that both Australia's and Japan's policies might change quite radically. If that happens, our interests might not align closely, or at all, raising big risks to a submarine deal which assumes that everything will stay just as we like it.

One possibility is that America and Japan might align together against China, but with Australia deciding not to join them. Another is that the US-Japan alliance might fade, Japan might confront China and we might choose not to side with it. A third is that Japan, having lost US support, might decide not to support Australia should we confront China. If any of these seem too wildly implausible, then look again at the quote from Keynes.

The reality is we simply do not know how Asia's strategic system will evolve, what role Japan will play, what hard choices Australia will face, and how far those choices might take us from an alignment with Japan three or four decades from now. But there are clear signs that the reassuring certainties evoked by Michael Heazle are already passing. The Japan we see today is already very different from the Japan we have known for decades past, as Malcolm Cook's recent Interpreter post so neatly shows ('Mugabe in Tokyo: The Warping of Japanese Foreign Policy'). And the America we see today is not the America we used to know either.

Things are changing in Asia. It is time we recognise this, and act accordingly.

Photo by Koichi Kamoshida/Getty Images

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Sam Rogeveen's  post last week about the strategic aspects of Japan's submarine bid focused on exactly the right question: What does Japan want? This is much more important to the subs decision than the question many people seem to think matters most, which is what China wants us to do.

Some think China's presumed opposition to closer strategic relations between Japan and Australia is reason enough to kill Japan's bid. For many others, Beijing's objections are the best reason to accept it. Neither are right. While we can't and won't completely ignore what China thinks, there is no reason to allow Beijing a veto if we decide, on mature reflection, that Option J serves our best interests overall. But Beijing's objections – assuming they do seriously object, which is not beyond doubt – are no reason to do something which is against our interests just because we like the idea of defying China.

So what about Japan? There is no doubt it expects a submarine deal to lead to a much closer strategic relationship, but it is less clear what exactly the Japanese have in mind, and therefore whether it would be in our interests.

I have argued that Japan seems to expect something close to a full-blown alliance, directed against China, under which Japan would be assured of Australia's support, including military support, in a crisis. Sam quotes Brad Glosserman, who says Japan's expectations may not run this high because there seems to be no enthusiasm among Japanese to depart from its old strategic posture and build a coalition against China independent of the US.

Some thoughts on this. First, we should not presuppose that Japan would only seek an alliance with Australia if it decided to strike out independently of America. In fact, it seems quite likely that Japan would see an alliance with Australia as a real asset while Tokyo remains a US ally, in part because the Japanese hope it would bolster America's willingness to help Japan in a crisis if Australia was stepping up too.

Second, while I'm sure Brad Glosserman is right that most Japanese would prefer to keep relying on the US, they may find that is no longer possible. If America proves unwilling to bear the costs of confronting China, Japan would face an inescapable choice between building an independent role as a great power or accepting subordination to China's strategic leadership.

Perhaps, for the reasons Brad Glosserman suggests, Japan would opt for subordination. That would worry Australia if we chose a different path and our submarine capability depended on Japan's support.

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But it's at least as likely that Japan would decide to resist Chinese primacy. In that situation Japan really would want all the allies it could find, and Australia would be high on the list. My hunch is that this is at least part of the thinking behind Japan's enthusiasm for closer defence relations with Australia today. Not only would it reinforce Japan's US alliance for as long as that lasts; it would also be a building block for an alternative Japanese posture if the US alliance fails.

Whether it would serve our interests to ally with Japan in such circumstances would depend on how both China and Japan were behaving at the time. Australia would want the maximum flexibility to make a choice that suited us best in the circumstances. Tying our submarine capability to Japanese expectations of Australian support would very sharply limit that flexibility.

The bottom line here is that the less our strategic circumstances change, the more sense a strategic alliance with Japan makes. But the more they change, the more likely it is that an alliance with Tokyo would not be in our interests, and the greater the risk to a submarine capability that relied on such an alliance. And these are of course exactly the circumstances in which our submarines would be most important to us. A subs deal with Japan would work best when we needed subs least, and worst when we needed them most.

So it's clear that we really do need to know whether Japan does expect an alliance with Australia as part of a subs deal. We should not need to speculate about this. Tokyo needs to explain very clearly what kind of closer strategic relationship it expects to flow from the submarine deal, and we in Australia then need to debate what that would mean for us. If the Japanese are seeking serious strategic commitment, they need to say so as plainly as possible. If they are not, then let them come out now and say that, as plainly as possible. The ball is in Tokyo's court, and we'd be mad to make a decision before we have heard from the Japanese one way or the other.

Photo courtesy of Flickr user Atsuhiko Takagi

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10 of 14 This post is part of a debate on The 2016 Defence White Paper

Whether Prime Minister Malcolm Turnbull intended it or not, his new Defence White Paper has been widely interpreted as sending a clear message that Australia is willing to join our allies in using armed force if necessary to defend the 'rules based global order' from China's strategic ambitions in Asia. Moreover, most people apparently think that's a good message to send.

So it seems wise to ask whether this message is really true. Would we go to war with China over any of the issues which now loom as tests of the future order in Asia — in the Spratlys, or the Senkakus, or even Taiwan? 

Most people who approve of the White Paper's message probably do so with complete confidence that the issue will never arise. They assume war won't happen because they are sure the Chinese would always back down rather than risk a clash. Maybe they are right. Confronted with US and allied resolve, Beijing might decide that even Taiwan was simply not worth the immense costs of conflict.

But we shouldn't bet on that, because the Chinese probably think the same about America and its allies. They think a war would be just as costly to us as to them, and they believe the issues at stake matter more to them than to us. So they are likely to assume that, whatever we say now, on the brink we would back off rather than fight. And the more confident they are of that, the less likely they are to back down. It has happened before: in an escalating crisis, both sides assume the other will step back, and so neither does before it's too late. This is exactly what happened in July 1914.

Remember, the stakes are high for both sides. This is a contest over the future of the Asian order, and we should not for a moment assume that China is any less committed to building a new order than we are to preserving the old one. Unless one side or the other abandons its core objective, the chances of a crisis in the Western Pacific escalating to the point that we face a decision about going to war is already quite high, and is growing steadily.

So we ought to think seriously about what war with China over one of these issues would actually look like.

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It is easy to start a war expecting a quick fight and an easy win. But America and its allies do not have overwhelming military superiority, and nor does China. That means neither side would be likely to win decisively after a short, contained conflict.

Both sides would therefore soon face a new choice: to escalate and accept the much higher costs of a big and protected war, or give up. Again, it is easy to assume that China would back off first, but we can't bet on that. China has an immense capacity to both inflict and absorb damage, and we cannot expect it to be any less committed to victory than we would be.

So would we back off and accept defeat to avoid escalation, if China didn't? This choice carries grave consequences, because both sides have nuclear forces, and there is a real risk of an escalating conflict crossing the nuclear threshold. Of course no one can imagine it coming to that, but it could unless one side backed down. And how can we be sure the Chinese would back down if we wouldn't? Alternatively, if we were capable of backing down, wouldn't it be better never to have started the war in the first place?

Even without a nuclear exchange, this would soon become the biggest and most costly war since 1945, and the end of all we envisage for the Asian Century, even if we won. And what would 'winning' even mean? Neither side has any chance of a decisive victory, so it is hard to imagine how a war with China ends. That alone should give pause to those who think it might be a good idea to start one.

In fact, I think it is unlikely Australia would go to war with China in any situation short of the outright invasion of the undisputed territory of another sovereign state. I think it is quite unlikely America would either, once a president was brought face to face with the military realities. So we are just bluffing, and our bluff is being steadily and systematically called by China.

None of this is to deny that Australia, like others, has a huge stake in the way Asia's regional order evolves, and that we need to do whatever we can to prevent changes in the order that affect our truly vital interests. Moreover, it is not to deny that some principles of regional order would be worth going to war with China to defend.

But we do have to ask whether the costs and risks of such a war are justified to defend every element of the so-called 'rules based global order' in places like the South China Sea. More realistically, we will have to accept some changes in the regional order to accommodate China. We all find the idea of making such an accommodation uncomfortable, even scary. But is it scarier than war with China? It is time to think carefully about that. And it is time to stop talking tough when we don't mean it. It is undignified as well as dangerous.

Photo courtesy of Australian Defence Image Library.

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The trickiest part of Malcolm Turnbull’s speech in Washington today was always going to be the passage about China. This was the issue on which, to judge by what he said before becoming Prime Minister, Mr Turnbull’s ideas are most at odds with Washington’s and with his predecessors.

He has argued in the past that China’s rise inevitably means big changes in Asia’s strategic order, which clearly implies a bigger role for China and a lesser role for the US than we have been used to in recent decades. This is not something any Australian leader has been brave enough to say before, and it is not something anyone in Washington wants to hear. So perhaps we should not be surprised that he chose not to venture too directly into such territory on his very first visit to DC as Prime Minister.

Instead he quoted Thucydides, citing the famous line about war between Athens and Sparta being inevitable, and laying great emphasis on Xi Jinping’s statement in Seattle last year, when Xi denied there was a ‘Thucydides Trap’ and predicted a peaceful trajectory for US-China relations. 

All this attention on Thucydides owes a lot to Graham Allison, who in an influential essay in The Atlantic last September, argued that war had been avoided in four of 16 historical cases of a rising power confronting an established power. Not all of his four exceptions to Thucydides’ rule are necessarily reassuring: he counts the US-Soviet rivalry of the Cold War, for example, among them. But the basic point is fair: the Thucydides trap can be avoided.

However the really important part of Allison’s analysis comes at the end, where he explains what will be needed to avoid it. Here are his concluding paragraphs, which are worth quoting at length:

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'At this point, the established script for discussion of policy challenges calls for a pivot to a new strategy (or at least slogan), with a short to-do list that promises peaceful and prosperous relations with China. Shoehorning this challenge into that template would demonstrate only one thing: a failure to understand the central point I’m trying to make. What strategists need most at the moment is not a new strategy, but a long pause for reflection. If the tectonic shift caused by China’s rise poses a challenge of genuinely Thucydidean proportions, declarations about “rebalancing,” or revitalizing “engage and hedge,” or presidential hopefuls’ calls for more “muscular” or “robust” variants of the same, amount to little more than aspirin treating cancer. Future historians will compare such assertions to the reveries of British, German, and Russian leaders as they sleepwalked into 1914.

The rise of a 5,000-year-old civilization with 1.3 billion people is not a problem to be fixed. It is a condition—a chronic condition that will have to be managed over a generation. Success will require not just a new slogan, more frequent summits of presidents, and additional meetings of departmental working groups. Managing this relationship without war will demand sustained attention, week by week, at the highest level in both countries. It will entail a depth of mutual understanding not seen since the Henry Kissinger-Zhou Enlai conversations in the 1970s. Most significantly, it will mean more radical changes in attitudes and actions, by leaders and publics alike, than anyone has yet imagined.'

From everything Mr Turnbull wrote and said about the issue before he became Prime Minister, one would have judged that he agrees with every word that Allison writes here. But that is very far from the impression one would get from what he said in Washington today. There he only spoke of what China has to do to avoid the Thucydides Trap:

Now, if avoiding the Thucydides Trap is a core objective of China’s strategy - as President Xi insists it is - then we would hope that China’s actions would be carefully calculated to make conflict less likely, not more, and would seek to reassure neighbours of and build their confidence in China’s intentions. 

Of course this is half right: if escalating rivalry and conflict are to be avoided, then China will have to be willing to moderate its ambitions and calibrate its actions. This is a message that needs to be delivered loud and clear in Beijing. But it is only half the story, and it is not the half that needs to be heard in Washington.

Whatever we might wish, escalating rivalry in Asia will not be avoided if we wait for China to make all the concessions. America too is going to have to rethink its role in Asia and its relationship with China – these are ‘the radical changes in attitudes and actions’ that Allison is urging.

This is a message that Washington still doesn’t get and badly needs to hear, and not just from scholars like Allison. It needs to hear it from leaders like Turnbull. He missed the opportunity this time. Maybe next time.

Photo courtesy of Flickr user CSIS | Center for Strategic & International Studies.

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Lowy Institute Paper

Debating Condemned to Crisis?

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Those lucky enough to have worked with Ken Ward over his many years of government service will smile as they read his fine Lowy Paper on Australia's relations with Indonesia. It has just the same droll and occasionally mordant tone that characterised his work in DFAT and elsewhere, as well as his precise eye for detail and talent for exposition. It is no surprise, then, that Condemned to Crisis is one of the best things written for many years about the contemporary management of this relationship, and a model of plain and forthright exposition. I strongly recommend it.

Ken's central message is simple enough. He thinks that crises in the relationship are inevitable, but that governments can manage them better by understanding Indonesia's perceptions and sensitivities better and by not allowing the media or opposition to set the terms of discussion. Meanwhile, we should not be too ambitious about the relationship: it serves our interests well enough as it is, and we should not expect it to get much better or exaggerate how much it matters if it doesn't.

All of this is sound, sober and wise, based as it is on Ken's experience observing the relationship over several decades. As a guide to managing issues with Jakarta day-to-day, or even year-to year, it could hardly be bettered. Indeed if the routine management of the status quo was all that our foreign policy needed to do, there would be very little left to say. Ken has pinned it with a lepidopterist's precision.

But is that all our foreign policy needs to do?

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Running relationships day-to-day on the basis of past experience will get us a long way, but it will not help us adapt to big changes when they happen – as they sometimes do. So we also have to look to the future and ask what big changes might be looming, and what we can do to manage them.

One gets the impression that Ken is a little impatient with speculation about the future. If so, this is something he shares with many Australian foreign-policy professionals. Indeed, one might say that the professional ethos of our foreign service today emphasises a briskly practical, no-nonsense approach to the management of today's immediate problems and issues. It tends to disparage reflection about the future and how our policy might prepare for it, and shape it to our advantage.

But if we do not speculate about the future – even the relatively distant future of two or three decades ahead – then we miss opportunities to adapt to it, and risk finding ourselves stuck with old policies that do not work anymore.

This risk looms large in relation to Indonesia, because the circumstances of the relationship are changing in two important ways.

The first is the big shift in economic relativities, a shift which has already occurred and seem likely to continue over coming decades, which makes it likely that Indonesia will end up with a much bigger economy than ours. Hence, in a very important way, Indonesia will be more powerful. Ken touches on this, but does not reflect on what it might mean for the relationship.

The second is the bigger shift in the regional order that is being driven by the wider shift in the distribution of wealth and power in Asia. This is important to Ken's theme because the Australia–Indonesia relationship does not exist in a vacuum. It is profoundly influenced by the wider regional environment in which both countries live.

It has been easy to overlook this, because the regional order has been so stable for so long — until recently. But if, as seems likely, Asia works rather differently over coming decades from the way it has worked over the period covered by Ken's analysis, then it seems likely that the Australia-Indonesia relationship will work differently too.

These thoughts might nudge us towards some conclusions a little different from Ken's. In particular it might lead us to ask whether the relationship with Indonesia will become more important to us in future than it has been in the past, presenting both bigger risks and bigger opportunities.

If so, then perhaps we should not be as content as Ken appears to be with a relationship which is somewhat better managed but not essentially different from the troubled one we know today. In turn, that suggests Australian policymakers should put higher priority on changing the basics of the relationship rather than just managing it.

Of course that is a rather ambitious objective, especially compared to the modest way we have conceived foreign policy in Australian recent years. But worth a try, surely?

Photo courtesy of DFAT.

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It seems likely that President Obama's flagship Asian free-trade deal, the Trans Pacific Partnership (TPP), will sink in the US Congress. Those who worry about its implications in specific sectors like pharmaceuticals might think this is a good thing. But what would be the broader implications? That depends on what difference TPP would make if it floats. The answer comes in two parts.

On the economic side, the answer is probably 'not much' overall. The TPP would not work like a classic free trade agreement, boosting trade by lowering protection, because as Lawrence Summers pointed out the other day, protection is now so low that there is not much to be gained by lowering it further. 

Perhaps the trade-promotion effects would be bigger for some more protected economies like Vietnam, but even here some elements of the TPP might have the opposite consequences. To many Americans, the best parts of the TPP are those setting new environmental and labour standards that countries like Vietnam would find hard to meet.

The TPP is also intended to boost investment, yet here too the long-term impact on economic growth seems likely to be small. So, like other FTAs, the overall economic impact of the TPP will be modest at best.

But as everyone knows, the TPP is not really about economics, at least for the Obama Administration. Since 2011 the TPP has been seen, and sold, primarily as an element of the Administration's 'pivot' to Asia. The idea is that the TPP will help protect US political and strategic primacy in Asia by restoring the regional economic leadership which America had enjoyed for so long, and which China has been so successfully taking over in recent years.

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Washington is right to think this matters. The more important China becomes to its Asian neighbours economically, the harder it will be for America to persuade them to reject Beijing's claims for a 'new model of great power relations' in Asia, and the further US leadership will erode. Anyone listening to Tony Abbott's fulsome remarks about President Xi Jinping this week at the signing of the new China-Australia FTA will understand America's problem.

But it seems a fantasy to imagine that the TPP can solve this problem. That would require a fundamental restructuring of the Asian regional economy. The TPP would have to displace China from the central position which it has built over the last two decades, and create a new regional economic order re-centred on America.

That means counteracting the immense gravitational pull of China's economy. To see how hard that would be, just look at Australia's trade. These days we export more than six times as much to China as we do to America ($108 billion vs $17 billion). Of course, trade isn't everything – the investment numbers still go America's way – but the trends are clear and the TPP has no chance of offsetting them.

Even at relatively sluggish levels of growth, China's economy will remain a much richer source of new economic opportunities for the rest of Asia than America has any hope of being, with or without the TPP. It would make at most a marginal difference to America's relative economic weight in Asia. It would make no difference to the essential reality that China is far more important to Asia's economic future.

And that means that even if the TPP floats, the countries of Asia will remain cautious about risking their economic prospects with China in order to preserve American regional primacy. It would do very little to help America resist China's challenge to US primacy in Asia.

But that doesn't mean America's debate over the TPP makes no difference to its future standing in Asia. On the contrary, it might make quite a big difference, because the Obama Administration has itself made TPP a test of US resolve in Asia. So while a successful TPP campaign would do little if anything to solve Washington's strategic problems in Asia, a failed campaign would make those problems worse.

What we might call 'the balance of resolve' is central to the contest between America and China for leadership in Asia today, and it already leans China's way. As they become more evenly matched in other forms of power, China's most important asset in that contest is the perception — in China itself, in the region and in America — that it is more committed to overturning Asia's US-led status quo than America is to preserving it.

That perception will grow stronger if Congress wrecks the TPP, pushing the balance of resolve further in China's favour, and further weakening US leadership in Asia. If that happens Obama himself will be in large measure to blame, because he is the one who has turned the TPP into a test which will not help America if it is passed, but will hurt it badly if it is failed.

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Deterrence is a beguiling concept. It offers the hope that we can prevail over our opponents without actually fighting them because our mere possession of military power will be sufficient to compel them to our will.

This seductive idea seems to be the basis of Michael Cole's view that deterrence will allow America and its allies to defend Taiwan from China with incurring the costs and risks of conflict, and that they should therefore commit themselves to doing so. This view is set out in Michael's most recent contribution to an exchange between us about this issue, and I'd like to thank him for his thoughtful part in our exchange on this sensitive topic.

Alas, I think this view of deterrence is mistaken. Deterrence can work, of course, but only where the deterred power believes that the deterring power is willing to incur the costs and risks of conflict. So Washington can only deter Beijing from using force against Taiwan if Beijing is reasonably sure that Washington is willing to actually fight to do so.

Moreover, because the stakes are so high and the nuclear threshold is so unclear, Washington must convince Beijing that it is willing to fight a nuclear war over Taiwan if it is to deter China from starting a conventional one. Simply possessing armed forces, including nuclear forces, is not enough to do this. You also have to convince the other side that you are willing to use them, and are willing to incur the costs and risks of the resulting conflict.

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There is, as Michael acknowledges, a parallel here with the Ukraine. Many in the West believed Russia could be deterred from any military intervention in the Ukraine. But deterrence did not work because Moscow did not believe that Washington cared enough about Ukraine to accept the costs and risks of a military conflict with Russia.

Some might hope that China can be convinced that the US is willing to fight, even if it isn't. This is called bluffing, and it's a dangerous and unreliable tactic. And this is precisely why America cannot reliably deter China from attacking Taiwan. As Michael himself acknowledges, there are real doubts that America would be willing to go to war with China. It seems likely that those doubts are shared in Beijing, and they cannot be dispelled simply by rhetorical reaffirmations of the Taiwan Relations Act, because they arise from a quite reasonable assessment of the balance between costs to America of reunification on the one hand, and the costs of war with China on the other.

This assessment does not minimise the costs of unification, both to America and to the Taiwanese themselves. It simply sets them realistically against the costs and risks of war with China, which Michael seems to agree are exceptionally grave. And if Americans are not convinced of US resolve, why should we expect China's leaders to be? And if they are not reasonably sure that the US would be willing to actually commit its formidable forces to fight for Taiwan, how can they deter China from attacking it?

The conclusion seems clear: America cannot defend Taiwan unless it is really willing to fight China to do so, and unless it is plainly willing to do that, Washington should not mislead the Taiwanese into thinking that they can rely on American support if the worst happens.

Photo by Flickr user See-ming Lee.

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After a decade of relative harmony, tensions between Beijing and Taipei are rising again. As Taiwan's leaders and voters face big choices about their future relations with China, America must think carefully about its commitments to Taiwan.

Would America be willing go to war with China to prevent Taiwan being forcibly united with the mainland? J Michael Cole, responding in The National Interest to a recent op-ed of mine in Singapore's Straits Times, expresses a widely held assumption that it would, and should.

To many people it seems self-evident that America would honour the commitments enshrined in the Taiwan Relations Act. But the TRA was passed in 1979, when China's GDP was 1/20th the size of America's, its place in the global economy was miniscule, its navy and air force were negligible, and its prospects for progress depended completely on America's goodwill.

So back then a US-China conflict carried much bigger economic and military risks for China than for America. That made the TRA's commitments both highly credible and very unlikely to be tested. Washington could safely assume that Beijing would back off to avoid a conflict in which China had so much more to lose than America.

Things are different today.

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China's economy is now so big and so central to global trade and capital flows that the consequences of any disruption would be just as serious for America as for China. Militarily, America can no longer expect a swift and certain victory in a war over Taiwan. China's anti-access/area-denial capabilities would preclude direct US intervention unless those capabilities had first been degraded by a sustained and wide-ranging strike campaign against Chinese bases and forces.

China would very likely respond to such a campaign with attacks on US and allied bases throughout Asia. The US has no evident means to cap the resulting escalation spiral, and no one could be sure it would stop below the nuclear threshold. The possibility of nuclear attacks on US cities would have to be considered.

These new realities of power mean that today a US-China conflict would impose equal risks and costs on both sides. And where costs and risks are equal, the advantage lies with those who have more at stake, and hence greater resolve. China's leaders today seem to think they hold this advantage, and they are probably right. It is therefore a big mistake to keep assuming, as many people seem to do, that China would be sure to back off before a crisis over Taiwan became a conflict.

US leaders must therefore ask what happens if Beijing does not back down as a crisis escalates. At what point would they back down instead? What would be the damage to US global leadership if Washington brought on a confrontation with China and then blinked first? What could happen if Washington didn't blink first? Is Taiwan's status quo worth a global economic collapse? It is worth a real risk of nuclear war with China?

These are the questions America's leaders would have to confront in considering military action to defend Taiwan, and their answer would very likely be that the status of Taiwan is not worth risking nuclear war or economic collapse over. And that means American leaders and policy analysts must confront these questions now, as they decide whether to maintain the old commitments to defend Taiwan. The promises that America was willing and able to keep in 1979 might not be ones it is willing or able to keep now.

What about America's allies and friends in Asia? Wouldn't they help America defend Taiwan, if only because they are so worried themselves about China? Many Americans seem to assume they would. But even Australia, America's most reliable ally in Asia, is uncertain about this. And if Australia is uncertain, it is pure wishful thinking to expect the likes of India, Singapore, Vietnam or even the Philippines to offer anything more than mild diplomatic support to America over Taiwan.

The exception is Japan, which under Shinzo Abe might be expected to join the fight, especially after last week's visit to Washington. But does Mr Abe really speak for Japan? Will future Japanese leaders take the same view? And even if they did, how exactly would that help America? How would Japan's support change the answers to the hard questions posed above, and increase the chances that America would indeed come to Taiwan's aid?

So no one should lightly assert that America or its allies would help defend Taiwan from China. But should they? This is a big subject. Suffice to say here that the question is not answered simply by using the word 'appeasement' to invoke the memory of Munich.

There are hard questions to be answered about how far we should be willing to go to accommodate (or, if you prefer, to appease) China's ambitions for a bigger regional leadership role as its power grows. Any substantial accommodation would mean a shift away from the US-led order of recent decades, which would be risky and unsettling. It seems much easier to evade these questions by refusing to contemplate any accommodation at all. But that would carry high costs.

Those who assume that those costs must be worth paying might not have thought carefully enough about just how high the price could go. And those who assume that it will be impossible to accommodate China because it proved impossible to appease Hitler perhaps assume that there are no material differences between the situations in Europe in 1938 and in Asia now, or between Nazi Germany and today's China. They perhaps also assume that there are no alternatives to the old US-led order in Asia except Chinese hegemony. The magnitude of the issues at stake – including for the people of Taiwan – suggest that these assumptions need more careful scrutiny.

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For a long time American (and Australian) thinking about China has been dominated by a broad consensus that, despite many signs of growing assertiveness, Beijing does not pose a fundamental challenge to US leadership in Asia. The argument goes that, whatever they might say, China's leaders know that its economic future is too uncertain, its political system too fragile, its military too weak and its friends too few to allow it to contest American primacy. They also know that China's own stability and prosperity depend on the regional order that only America can uphold.

Therefore, the consensus has concluded, America doesn't have to do much in response except remind everyone that it intends to stick around. Hence the 'pivot', which has emphasised declaratory statements rather than substantive actions.

But that consensus may be unravelling, at least in America. Washington's AIIB debacle seems to have sounded a wake-up call and now, in just the past week, two major reports from the heart of the US foreign policy establishment have chimed in too. Both reports argue that China's challenge to US primacy in Asia is for real, and that America's policy in Asia needs to shift radically to respond.

At first glance they offer diametrically opposed views of what that response should be, in ways that might appear to frame the debate Washington is now having about how to respond to Beijing's challenge.

In fact, as we shall see, they share a reluctance to address the real issue, and to acknowledge the real risks.

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One of these reports is by our own Kevin Rudd (US-China 21: The Future of US-China Relations Under Xi Jinping). It is the product of his stint at Harvard's Belfer Centre, and is now being showcased by his new home at the Asia Society. The other, from the Council on Foreign Relations, is by two well-known policy heavyweights, Robert Blackwill and Ashley Tellis (Revising US Grand Strategy Toward China).

Both reports argue that China's economic rise marks a fundamental shift in the distribution of power in Asia, and that China's leaders, especially under Xi Jinping, are determined to use their newfound strength to transform the Asian order in their favour. Rudd's argument on this is particularly strong, in part because he draws on a deeper understanding of China. It reminds us that, at his best, Rudd can be a very good analyst indeed.

So what should America do? Rudd says America and China can resolve the tensions caused by China's ambitions through diplomacy. The two powers can and should negotiate in a spirit of 'constructive realism', deepening cooperation where their interests coincide while quarantining and managing the issues on which they disagree.

It's a nice idea, but Rudd's account of it evades the hard question: is America willing to deal with China in the way he proposes? His model implies a complete transformation in the nature of US-China relations so that they become true partners in regional leadership. But his prescription will only work if America is willing to deal with China as an equal, which is of course incompatible with the old model of US regional leadership in Asia.

Yet Rudd does not acknowledge this in his report. No doubt he understands that it is something his American audience will not want to hear, but until this issue is squarely addressed, America's debate about China will keep on missing the mark.

Blackwill and Tellis do not make this mistake. They say upfront that perpetuating US primacy is America's primary strategic objective, and they urge America to build up its economic, military and diplomatic position in Asia to preserve it from China's challenge. This is, in effect, a policy of containment.  Any accommodation of China's ambitions is ruled out.

They are rather glibly optimistic about what this policy would require. They call for the strengthening of America's economy, military power and diplomacy to counter China's rise, and a 'geo-economic' counter-offensive against China's growing economic sphere of influence, without saying how all this might be done. This suggests they do not really understand how radically China's rise has shifted the distribution of power.

But more importantly, Blackwill and Tellis are optimistic about how China would respond. They say America could continue cooperating with China where that suits US interests, while relentlessly resisting China's ambitions to build a new regional order. Their policy prescription assumes that China will be happy to continue working with the US on these terms. In other words, their prescriptions assume what their analysis disproves: that China is not really serious about challenging US primacy after all. If that was true, America could follow Blackwill and Tellis' prescription to resist China's challenge and preserve its primacy without running the risk of disrupting its relationship with China, which is what Americans want to hear.

This brings us to point where Blackwill and Tellis converge with Rudd. Both reports evade the fact that strategic rivalry between America and China is ultimately caused by their fundamentally incompatible aims in Asia. America's primary aim is to retain leadership in Asia, and China's is to displace it.

Rudd assumes America will abandon its aim, while Blackwill and Tellis assume it will be China that steps back. Rudd at least assumes that China will also be willing to compromise, whereas Blackwill and Tellis seem to think that America need make no substantial concessions to enjoy a peaceful relationship with China.

The big risk, of course, is that neither side will be willing to make concessions, because each expects the other to blink first. That leads straight to escalating rivalry and an ever-higher risk of war. Both these reports downplay that risk, because they seem to assume China does not want to change the regional order enough to risk a military confrontation with the US.

Photo courtesy of Flickr user U.S. Department of Defense.

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Jim Molan is dismayed by my suggestion that strategic-level policy is not the ADF's strong suit. The offending line — in an article by Sophie Morris in last week's Saturday Paper — accurately reflects my remarks to her. Jim's robust response peppers a rather larger target, however.

Among other things, he attributes to me the view that Defence civilians are much better at strategy than their uniformed colleagues. So to be clear, I do not believe that civilians are any better at providing strategic policy advice than military officers. On the contrary, had I been asked, I would have said that the depth and breadth of strategic policy expertise among civilians in the Defence Department is just as inadequate as it is among their military colleagues. This is a major problem for our defence policy which, to be fair, I believe the senior leadership of the organisation understands.

My primary point to Sophie was simply that serving in the ADF, perhaps at quite a junior level, does not in itself guarantee that a parliamentarian will have special expertise in the defence and strategic policy decisions discussed and made at the political level.

But the broader point remains true too: the ADF as an institution does not generally (with some notable exceptions) excel at the strategic-level tasks of advising governments about when and how they should use force to achieve policy objectives, and about what capabilities Australia needs.

I would offer as evidence the flawed advice that led to Australia's costly strategic failure in Afghanistan (and yes, I have no doubt that it was a failure), and the advice to acquire the amphibious assault ships (pictured), which I believe are now becoming widely recognised as the white elephants they are. I think the ADF's strategic-level advisers, along with their civilian counterparts, must take some share of the responsibility for these decisions, if indeed they spoke in favour of them or failed to speak to robustly against them.

Photo by Flickr user Crouchy69.

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Alan Dupont concludes his thoughtful response to my comments on his Lowy Analysis paper, Full-Spectrum Defence: Re-thinking the Fundamentals of Australian Defence Strategy, by posing some good questions.

First, he asks, should we see irregular warfare as the dominant form of future conflict, both between and within states? The answer depends on what we mean by 'dominant'. Do we mean 'most common' or 'most serious'? Irregular warfare is likely to be the most common form of conflict in future, as it always has been in the past. What I suppose we must call 'regular warfare' – large-scale conflict between the armed forces of states – has always been much rarer, and I expect this will remain true too.

But regular warfare is more serious than irregular warfare, at least for a country like Australia. If we were Yemen or the Congo or (for much of its history) Indonesia, then irregular warfare would pose a more serious threat than regular warfare, and it would make perfect sense to design our armed forces primarily for that kind of conflict.

But we face no credible or even conceivable risk of internal insurrection, and no risk of insurrections spilling onto our territory from elsewhere on anything but the smallest scale, a scale for which police are more relevant than armed forces. And the risk of state-sponsored irregular warfare against Australia by a neighbouring state was tested at length by the 'low-level contingency' concept which was so central to our defence policy in the 1980s. I think Alan would agree with me that the closer one looked at that concept, the more improbable it seemed.

Of course the risk of Australia being involved in a regular conflict is pretty low too. But I would argue that changes in the regional strategic order mean it is not as low over coming decades as it has been since the early 1970s, and that this risk is much more serious for Australia than risks of irregular warfare. And that is why I think it should predominate in our force planning.

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Second, Alan asks whether the 'force structure determinants' used in previous White Papers 'have any redeeming value'. By 'force structure determinants' Alan means the core strategic objectives which the Government decides the ADF should be built to achieve, and which therefore determine what kinds of forces we need and how much money we should spend.

I think setting these strategic objectives for the ADF does have value. Indeed I think deciding what we want our armed forces to be able to do is absolutely essential to making sensible decisions about what capabilities we need. In his paper, Alan says they are no use because governments sometimes ignore them in choosing capabilities, and often use the ADF for tasks different from the ones they identify as force structure determinants.

He is quite right about both of these, but that does not mean the idea of setting core objectives has no value. Governments do sometimes violate their own policy principles (the Howard Government did when it ordered the C-17s that Alan mentions), but the fault here might lie with government decisions rather than the principles they sometimes ignore.

More importantly, the fact that governments use the ADF for purposes other than that for which it was designed does not mean it has been designed for the wrong purposes. It often makes sense to use something for a purpose for which one would not buy it.

There is a separate question, of course, about whether the strategic objectives that have been laid down as force structure determinants in recent white papers are the right ones for Australia over coming decades. I do not think they are, because they assume that Australia's strategic risks will remain much the same in the next few decades as they have been in the last few. What objectives we should adopt instead is a question for another time.

Third, Alan asks whether I still think we should have a primarily maritime military strategy, and if so how space and cyber fit into it? The short answer to the first part is 'yes'. Most of the core strategic objectives I would set for the ADF can be achieved most cost-effectively by maritime operations, and I would focus most of our capability there.

What about cyber and space? Let's clear up a muddle here: when we talk about cyber and space as new domains of warfare, are we talking about the impact of cyber- and space-based actions on the systems that support and enable the conduct of conventional military operations in the other three domains, or are we talking about the impact of such operations on society more broadly, to achieve a direct strategic effect?

If it is the former, then clearly we need to develop our maritime forces to operate in a contested cyber and space environment, based on a sober assessment of the risks involved. This might be hard technically, but it poses no conceptual challenges to policy.

If it is the latter, the issue is much less clear. Cyber attack on national information systems is a serious potential threat, but armed force is little or no use in responding to it, so it need not shape our defence planning. Space-based attack directly on civilian populations or systems? Unless we mean such familiar problems as ballistic missiles, I'm not sure what we are talking about here. Denial of satellite services, perhaps? Whatever it is, I doubt that armed forces are going to be the answer.

Photo by Flickr user DVIDSHUB.

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The first thing to say about Alan Dupont's recent paper is that he is absolutely correct about the dire condition of Australian strategic policy.

As he suggests, we lack a coherent answer to the most basic question of all: 'What do we want our armed forces to be able to do?' Until that question is answered, there is no way we can make sensible choices about the kinds of armed forces we need, nor about how much we should spend on them.

Moreover, Alan is right about many of the reasons why our strategic policy is so bad. However, I'm not completely sold on all of his suggestions about how to do things better. Here are a few points that I think deserve fuller debate.

What is armed force good for?

Clearly we cannot decide what we want our armed forces to be able to do until we have decided what kinds of things armed forces can usefully do. Alan casts the net pretty wide. He identifies a broad range of security threats which he thinks our forces should be designed to deal with, and criticises the idea that we should focus narrowly on building them to respond to threats from other countries' armed forces.

I'm not so sure.

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For example, Alan clearly believes that stabilisation operations in the Middle East are an important role for our forces and should influence our force development decisions. This presupposes that not just our interests in the Middle East are important enough to us to warrant giving them such a central place in our national security policy, but that military operations are a cost-effective way of promoting those interests. The experience of the past decade does not support that view.

To take the most obvious case, it seems likely that a serious analysis of our experience in Afghanistan would conclude that sustained military operations there failed to achieve our strategic objectives, not because of any faults in the conduct of the operation itself, but because the aims we set ourselves could not be achieved with military means. Those are lessons we need to learn.

What kinds of threats will we face in the future?

Alan's ideas about the kind of threats that Australia's forces should be designed to address, reflect a judgement that our future threat environment will look much like the one we see have seen in recent decades. That means he emphasises lower-level contingencies and coalition operations over higher-level conventional conflicts and independent operations.

But the future does not always resemble the past, so it is important to test this judgement.

Alan rightly observes that the strategic order in Asia is changing as power shifts to China, and that America's role in Asia will change too, and he criticises our defence policymakers for not thinking carefully enough about what this will mean. But he himself, perhaps, underestimates just how big the implications of these changes might be – especially if we look out a few decades.

Alan deprecates any attempt to think this far ahead, but one wonders how decisions about capabilities that will not even enter service for 20 years can be made without doing so. This is not the place to explore what kinds of risks we might face in the very different Asia of the Asian Century: suffice to say here that it would be unwise to base our strategic policy on the assumption that they will look much like those of the past 30 years.

That is the context in which issues like the geographic focus on our defence posture and the place of maritime operations in our defence planning come into focus. The more the future resembles the recent past, the more sense there is in Alan's arguments for a wider geographic and operational focus. The more we contemplate our security needs in a very different and more contested Asia, the more questionable Alan's arguments become.

How much to spend?

Alan's paper doesn't focus much on money. That is a pity, because money is of course central to any serious discussion about strategic policy. One gets the impression that Alan thinks we should be spending a good deal more on defence than we are, but even with a much bigger budget there would be hard choices to be made between competing priorities.

Alan mentions lots of things he thinks the ADF should be able to do, but doesn't give any basis for setting priorities between them. That leaves the hard work of building a coherent strategic policy still to be done.

Photo courtesy of Australian Defence Image Library.

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In his latest contribution to our debate, Shashank Joshi raised some excellent points against my sceptical view of the emerging India-US strategic partnership. But I'm still unpersuaded.

To explain why, it helps to step back and clarify the question we are debating here. It is not whether strategic relations between Delhi and Washington have grown closer in recent years, because clearly they have. It is what these closer relations mean for the geo-political contest between America and China.

India's position is clearly important to this contest. Many Americans, and many of America's friends in Asia, have long believed that India's growing wealth and power will be vital in helping America counterbalance China's growing strategic weight, and resist China's challenge to US regional leadership.

Indeed, the belief many people have that India will play this role is central to their confidence that America can and will preserve the status quo against China's challenge. It is therefore important to decide whether the progress we have seen in US-India relations justifies that confidence.

I have argued that in a geopolitical contest of the kind we see unfolding between America and China today, India's relations with America will only make a difference to the extent that India is seen to be willing to support America in a US-China conflict.

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That is because who wins the contest between the American and Chinese visions of Asia's future order ultimately depends on which is seen to be more willing to fight for their vision. Each power wants the other to believe that it will go to war to impose its vision, and hopes that, if all else fails, this will persuade the other to back off.

This way of describing what is happening will surprise those who think that this kind of old-fashioned power politics disappeared after 1989, but it seems to me the only way to understand events in Asia today. In fact power politics never went away; people simply started to think that America was the only power that was indulging in it. It has been taken for granted that America will fight to support its vision of regional order, but that no one would be willing to oppose them. Now China is proving that false. We can no longer assume that China is any more determined to change the current order than America is to preserve it. 

That is why India's role in this contest depends on how far it appears willing and able to materially support the US in a conflict with China. In a game played for these stakes, nothing less counts for much. 

As I read him, Shashank makes two key points about this question.

One is that, while India might not be willing to send combat forces to fight alongside America's in a coalition against China, it would provide other, non-combat support such as basing and refuelling facilities. That sounds like what the diplomats call 'all support short of actual help'. It would do very little either practically or symbolically to bolster America's position against China, and certainly much less than American boosters of the relationship expect. 

His second key point is that perhaps India would be willing to provide America with more substantial support if it saw really fundamental issues of regional order at stake in a US-China conflict. He cites the example of the wide support given to America in opposing Iraq's invasion of Kuwait in 1990 by countries who saw basic questions of international order being tested there.

I agree with Shashank that very important issues for India would be at stake in a US-China clash. But deciding to support America against China would be much harder than joining the coalition against Iraq. In every way China is both a much more valuable partner and a much more dangerous adversary. The key question for India, and for America's other friends in Asia, is what would have to be at stake for them to make that decision? 

So it boils down to this: would India go to war with China to help America preserve the current order based on US primacy? If the answer is no, then I don't think the new warmth between America and India matters much to the future of Asia, and America's position in Asia is rather weaker than most people assume.

Photo courtesy of White House/Lawrence Jackson.

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