Lowy Institute

Today is a public holiday in Australia, so please check back in with us tomorrow as regular service resumes on The Interpreter.

Meantime, here's last week's best Interpreter reading in the Weekend Catch-up. Among other things, we covered Chinese President Xi Jinping's visit to the US. Here's another take on that visit:


Yesterday electric car company Tesla launched the first-ever fully electric SUV, the Model X. Despite the fact that the company is not profitable, there is tremendous buzz around Tesla and its potential to transform the auto industry with electric cars that have both the battery power to take us as far as we want and the style in which we want to travel.

Apart from being fully electric, Tesla is also something of a market leader when it comes to car electronics — in fact, its popular Model S has been described as a computer designed as a car. Which brings me to this recent NY Times story on the complexity of modern motor vehicles:

New high-end cars are among the most sophisticated machines on the planet, containing 100 million or more lines of code. Compare that with about 60 million lines of code in all of Facebook or 50 million in the Large Hadron Collider.

It also reminds me of an anecdote shared by former German Chancellor Gerhard Schroder's foreign policy adviser Michael Steiner, in a recent interview with Spiegel. This story concerns a late night conversation between Steiner's boss and then British Prime Minister Tony Blair, at a time when German car companies were buying up boutique British brands such as Rolls Royce: 

I can remember an evening in London when he was sitting together with British Prime Minister Tony Blair. It was two or three in the morning and the two were, let us say, in an advanced social state. Suddenly Blair said: "You can have them all, Gerd, all the cars that we've built here: Rolls Royce, Bentley, Rover. That is the 19th century, that is steel, that isn't the future. Schröder answered: "Tony, you have no idea about the economy. You don't get it. The cars that we build are drivers of technology. Already today, they contain the most modern electronics and that will be even more the case in the future. That is the platform for the real future." Back then, I was deeply ashamed for Schröder. I thought the future was the financial markets and virtual reality. And then comes Schröder with his old fashioned stuff. And who was right? Gerd Schröder.

I'm not sure Steiner would be sounding quite so triumphant in light of the Volkswagen scandal, but you see the point.


Over the weekend Fairfax published a short piece about a new documentary on Hong Kong's Umbrella Movement, the 79-day sit-in protesting changes to Hong Kong's electoral system which were seen to cement Communist Party control over the city.

Strangely, they didn't post a trailer along with the article, so here it is:

The film, which follows the lives of three generations of Hong Kongers at the time of last year's protests, is by accomplished Australian cinematographer Christopher Doyle, and the trailer is indeed visually sumptuous. But it's hard to get any narrative thread from it, and judging by the Guardian's review, this might be true of the film as a whole.

Hong Kong Trilogy has already had a run on the festival circuit and is released in Hong Kong today on the first anniversary of the protests.


Our most popular post this week was Shashank Joshi's piece on India's incredible shrinking air force:

The IAF presently operates around 37 combat squadrons, expected to fall to 32 to 35 (estimates vary) by the end of the year. Its 'sanctioned strength' was supposed to be 42 combat squadrons by 2022. On present trends, this looks to me to be entirely unattainable. MiG-21s are retiring quicker than other aircraft are coming in. Even if the 90-aircraft 'Rafale gap' is filled, I struggle to see how India gets above the mid-30s in squadron numbers by 2020. And after that point, India will start losing its dedicated ground attack aircraft (5 MiG-27 and 7 Jaguar squadrons). The IAF has shown little interest in procuring dedicated replacements for the strike role, suggesting that multi-role aircraft like the Su-30MKI and Rafale will have to take up the slack – underscoring the problem of numbers.

Malcolm Jorgensen had a strong piece about the differences between new Prime Minister Malcolm Turnbull and his predecessor Tony Abbott on China and the US alliance:

Turnbull's attitude toward the alliance is pragmatic: he has a strong preference for deep US commitment to the region, but is concerned about whether the US will realistically appraise its evolving position in the region and forgo temptations to contain China. The 'pivot' to Asia is welcomed as 'a vitally important, stabilising, reassuring factor in the peaceful development of our region.' Yet the preoccupation with conflicts in distant parts of the globe has compelled Turnbull to remind US leaders to remain 'engaged, aware, committed to the Asia Pacific.'

Turnbull has demonstrated a genuine and long held commitment to engaging in the debate over the shifting Sino-American power balance. He specifically accepts Hugh White's thesis that the trajectory of growing Chinese power makes a rebalance in the Asia Pacific unavoidable. In Washington, the cross-party consensus remains that US primacy must continue as the guiding principle in the region. Turnbull, however, openly contemplates whether Western nations are ready 'to adapt to a very different distribution of global power than that which they've been used to'.

Turnbull's cabinet reshuffle is great news for the Pacific, says Jonathan Pryke:

The new Turnbull cabinet is great news for the Pacific. Julie Bishop will continue to set the tone and policy priorities for the region, while Minister Ciobo can focus on day-to-day implementation in the region. The Pacific is often neglected by Australian politicians; having two ministers focused on the region is a welcome change.

Turnbull's new treasurer Scott Morrison was urged to attend upcoming multilateral talks in Peru. Tristram Sainsbury writes:

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...our economics dictate a focus on international economic issues. As a medium-sized, open economy, Australia has long been influenced by overseas economic developments. We are a capital importing country that relies on foreign savings to finance domestic investment. In the last few decades we have benefited significantly from a long and sustained push to lower tariff barriers and liberalise our financial system.

Our international inter-connectedness gives us great opportunities and exposes us to risks and vulnerabilities. The past seven years have been a tumultuous period for the global economy, and the global financial crisis demonstrated the close inter-connectedness of financial markets. Global norms affect our policy choices too, as the recent shifts in our pledges on climate change have reinforced.

Stephen Grenville came out strongly against the economic arguments for local construction of Australian submarines:

Part of this sentimental attachment to manufacturing has been a nebulous security argument: in the event of war, we need to be self-sufficient. But self-sufficiency in modern defence technology for a small country like Australia is a pipe-dream. Even if the submarines are built here, large key components are going to have to come from overseas. In the event of hostilities, we'll inevitably be dependent on overseas suppliers to keep our submarines operational (same for our military aircraft). 

Those who put forward the canard of defence self-sufficiency should recall the World War II experience of sending home-made Boomerangs up against Japanese Zeros. This did not turn out well. We need state-of-the-art subs, not compromises to boost domestic content.

Peter Layton argued the other way:

Defence can have a multiplier effect across industry, science, innovation, and the economy, if properly focused. Some will argue that defence money should mainly be spent offshore (in Dallas, not Sydney) to get the most bang for the buck. Australian money should fund American science, innovation, and new technology, not be wasted in Australia. This somewhat narrow procurement argument neglects the fact that defence capabilities are much more then just hardware. The equipment needs to be funded by all Australians, crewed and maintained by skilled people and continuously upgraded to stay at the military leading edge. And all across several decades.

Do recent joint exercises suggest an emerging anti-China security quartet in the Indo-Pacific? Abhijit Singh writes:

India's forthcoming naval interactions with Pacific powers, therefore, are likely to focus on contingencies arising from greater Chinese naval presence in Asia's littorals. According to media reports, the India-US Malabar naval exercises later this month will go beyond the traditional ambit of humanitarian assistance and disaster relief to also include anti-air and anti-submarine warfare operations. The fact that New Delhi has extended an invitation to the Japanese navy to participate in these exercises reveals a willingness to expand the framework of maritime engagements.

Did you know New Zealand is debating a change of flag? Robert Ayson surveys the debate:

As this process has meandered towards a stunning anti-climax, some commentary has suggested that it has come to look like a branding exercise and not a thriving discussion about New Zealand's national identity. But it isn't clear that New Zealanders were itching for the latter. One hundred years after the Gallipoli landings, New Zealand is in the middle of a four-year stretch during which much is being made of the First World War centenary (including in its more significant strategic moments). It's an odd time to highlight New Zealand's distinctness from Australia and its independence from the old empire.

But there may actually not be a right time for this debate. New Zealanders seem willing to put up with an unexciting national anthem (even if it has been improved with the practice of singing it in both Maori and English) and an unremarkable national flag. This is probably a healthy sign at a time when the uglier side of nationalism is becoming obvious in other parts of the world.

US congressional negotiations over the Iran deal bode ill for US China policy, writes Jacob Berah:

The controversy over the Iran deal raises the spectre that as key points of contention with China become the subject of politicised debate in Congress and on the campaign trail, the ability of the executive to conduct deft diplomacy in response to tensions with China will be curtailed. In particular, an environment where acts of significant diplomatic compromise, concession or accommodation are portrayed as capitulation will make it increasingly difficult for US leaders to find creative ways to solve disputes and avoid escalation with China. Already the stagnant opposition to US ratification of the UN Convention on the Law of the Sea (UNCLOS) arguably weakens US credibility and limits policy options on territorial disputes and island-building in the South China Sea.

Why is Europe's approach to the refugee crisis incoherent? Former Danish senior civil servant Martin Bresson answers:

The root of the conundrum lies in the constitutional and institutional set-up of the EU and in the cultural and historical heritage of its members.

The EU is constitutionally and hence institutionally a patchwork of what was politically possible at the time of various founding treaties. It is a case of forever balancing the desire (and sometimes the need) for more unified decision-making with the desire (and sometimes the need) for national sovereignty over specific issues. So, although the EU has a common set of rules for persons traveling inside the EU (the Schengen Agreement, of which only the UK, Ireland and Denmark opted out), the EU has no rules on how, at a community level, to handle refugees or immigrants to the Union. It does have FRONTEX, which helps member-state secure their exterior borders and coordinates border guard agencies, though it leaves member states 'of arrival' such as Italy, Greece and Hungary with the financial burden of border management, as well as the burden of handling incoming refugees or immigrants.  

The EU has no rules of common treasury, let alone rules of common economic burden-sharing, except for a scarcely respected set of 'rules' about budget-balancing and the procedural rule that almost any agreement that relies on national treasuries has to be unanimous.

Does China's non-interference policy still work in the age of ISIS? Marie-Alice McLean-Dreyfus answers:

With a Chinese citizen now being held hostage, it seems the Chinese Government does not know how to react. There have only been two statements from the Foreign Ministry, neither of which gave any indication of how China will respond. The spokesman has only said that 'the Chinese side reiterated its firm opposition to any violence against innocent civilians' and that it has launched an 'emergency response mechanism.' There has been next to no coverage of this event in the Chinese media. 

While China prefers to remain on the sidelines when it comes to the fight against ISIS, the kidnapping of one of its citizens may prompt Beijing to seek a more proactive role in the Middle East. The incident could act as the impetus to change its longstanding policy of non-intervention.

Tristram Sainsbury from the G20 Studies Centre writes: 'The question I have been asked most frequently in overseas discussions about the G20 this year is: whatever happened to Australia's Global Infrastructure Hub?' The answer?

At this stage, the Hub remains an experiment.  The only likely deliverable in 2015 is the business plan. However, we should not scoff at what has been achieved so far. As those developing the other new kids on the infrastructure financing block (the AIIB and BRICS New Development Bank) have quickly learned, multilateral institutions take time to set up. It is important to get the right people in key positions.

Ultimately, the Hub will be judged on what it delivers over the next three years. But at a time when the G20 needs to demonstrate that it is delivering outcomes, the Hub still carries the potential to contribute to real improvements in the coming years to global investment financing, and give a compelling reason for an extended mandate. Momentum is beginning to build.

Photo by Flickr user Dongyl Llu.


Chinese President Xi Jinping began his US visit with a policy speech in Seattle, Washington today. There's a poor quality video above (the speech starts 20:28 minutes in) and a transcript here. A few highlights from me, which are weighted towards the first half of the speech, in which Xi addresses major areas of international concern about China one by one:

On economic growth:

China's economy will stay on a steady course with fairly fast growth. The Chinese economy is still operating within a proper range. It grew by 7 percent in the first half of the year, and this growth rate remains one of the highest in the world.

On economic reform:

The key to China's development lies in reform. Our reform is aimed at modernizing the country's governance system and governance capabilities, so that the market can play a decisive role in the allocation of resources, the government can play a better role and there is faster progress in building the socialist market economy, democracy, advanced culture, harmonious society and sound environment.

So, the market's role should be 'decisive' but the government's role should be 'better'? Is that liberalisation as the West knows it, or something else? I'll be looking for China economy experts to parse this language…

Moving on, this claim on foreign investment seems dubious:

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We will address legitimate concerns of foreign investors in a timely fashion, protect their lawful rights and interests and work hard to provide an open and transparent legal and policy environment…

Moving to cybersecurity, as others have pointed out, it is notable that Xi framed his pledge in the future tense...:

China is a staunch defender of cybersecurity. It is also a victim of hacking. The Chinese government will not, in whatever form, engage in commercial theft or encourage or support such attempts by anyone.

On corruption, here's another claim that strains credulity, though points for the pop-culture reference:

In our vigorous campaign against corruption, we have punished both "tigers" and "flies", corrupt officials irrespective of ranking, in response to our people's demand. This has nothing to do with power struggle. It's nothing like what you see in House of Cards.

On China's foreign policy aims:

Let me reiterate here that no matter how developed it could become, China will never seek hegemony or engage in expansion. To demonstrate our commitment to peaceful development, I announced not long ago that the size of China's military will be cut by 300,000.

But of course, reducing the manpower of the military will actually facilitate the very modernisation that China's neighbours fear.

Finally, on great-power competition, Xi addresses head-on the Western debate about China's rise using its own historical refences:

There is no such thing as the so-called Thucydides trap in the world. But should major countries time and again make the mistakes of strategic miscalculation, they might create such traps for themselves.


Here's Prime Minister Malcolm Turnbull on the Sunrise program on Monday:

PRIME MINISTER: Well this is the most exciting time to be an Australian and there is no more exciting place in the world than Australia.


PRIME MINISTER: Because we are sitting here in Asia. We are a multicultural society; we are a highly educated society; we have the capacity to be more innovative, more productive. We've got extraordinary lifestyles, we've got great cities, we're a great place to live and we've got to make sure our cities continue to be liveable and sustainable. All of those are great priorities.

This is the Asian century or the Pacific century and we are perfectly positioned in it but we have to be - Kochie, we have to be optimists. We have to be committed and confident in ourselves. We have to not fear the future but embrace it and that's the critical thing. We need - optimism is absolutely critical. It can't just be based on rhetoric; we have to make sure that we make the changes to promote innovation, promote science, promote technology to ensure that we deliver the jobs of the future.

The tone of optimism about Australia's place in the world is certainly a relief after the Abbott years. It has been said that Tony Abbott's mindset on foreign relations was too negative — that his worldview was dominated by threats rather than opportunities. But that's not entirely true. Most of his pessimism was directed at the ISIS threat and 'the boats'. On Asia, his tone was not that different to that of Turnbull above and the Gillard Government, in which Asia's rise is treated primarily as an opportunity for Australia to trade and invest.

In this narrative, the risks of Asia's rise are mentioned far more rarely,  but as Linda Jakobson argued after the 2012 launch of the decidedly sunny Asian Century White Paper, this focus on the positive risks leaving the public unprepared for the major strategic shock Australia would suffer in the not unforseeable event that China and the US clash.

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I suspect the Abbott Government focused on the ISIS threat rather than the strategic challenges closer to home in part because the former is an easier problem. ISIS is far away and can't really do much damage to Australia or its interests (if the Abbott Government really believed its own Henny Penny rhetoric about ISIS, it would have sent far more combat hardware to the region than half a squadron of Hornets), whereas China represents a more fundamental challenge to the regional order and to Australia; we're witnessing a once-in-a-century shift of economic power that will inevitably stress the existing US-led strategic order Australia relies on. Turnbull himself is aware of this historic shift and has written about it extensively.

That same evening on the ABC's 7:30 program, Turnbull tempered his optimism:

...in terms of our region, what we need to ensure is that the rise of China, which is happening, it's - nothing's gonna stop that any time soon - is, if you like, conducted in a manner that does not disturb the security and the relative harmony of the region upon which China's prosperity depends. Now - now that requires careful diplomacy, it requires balancing and it's an issue, as you know, I've taken a very keen interest in.

So, it's wrong to think that the change from Abbott to Turnbull amounts to a shift from a bunker mentality about the outside world to one of openness, optimism and opportunity. Turnbull's worldview also has its dark corners, and in fact Turnbull's pessimistic streak is more accurately aligned than that of Abbott. That should at least ensure a more honest public conversation about the risks and opportunities of the Asian century.


A stellar cast behind this drama about US subprime mortgages and the roots of the 2008 financial crisis. The film is based on a non-fiction book by Michael Lewis (Vanity Fair has an extract):

The trailer is intriguing because it's unclear which direction the film will go in with regard to the causes of the crisis. Will it look for a villain (greedy bankers), which is easy and emotionally satisfying for a movie audience, or will it demand more of the viewer by looking at the systemic and human weaknesses that bring about such disasters? 


Late yesterday I talked with Daniel Flitton, a senior correspondent with The Age, and Anthony Bubalo, Research Director at the Lowy Institute, about what lies ahead in foreign and national security policy under Prime Minister Turnbull. What started as a ten-minute chat lasted twenty minutes as we surveyed Turnbull's own views, the credentials and capabilities of his new defence minister, Marise Payne, and the possible appointment of Joe Hockey to the ambassadorship in Washington.


Yesterday the Secretary of the Department of Foreign Affairs and Trade, Peter Varghese, gave a true big-picture address to the Lowy Institute on Australia's place in a changing global and regional order. To get a sense of Peter's themes, check out his op-ed in yesterday's Australian. The full recording and transcript of the address are available here, and I notice John Garnaut covered the speech for Fairfax.

Below is a short interview I conducted with Peter just before his speech. One of the most interesting parts of the speech is Peter's claim that two factors will determine whether China's rise can be managed peacefully: the first is China's own behaviour, and the second is 'the extent to which the existing international and regional order intelligently finds more space for China.' In the middle of the interview, I ask Peter what that means, in practical terms:  


A strangely beautiful piece of data visualisation from a Canadian 'electronic music and visual trio' called Orbital Mechanics. The red dots denote atmospheric detonations, yellow is for underground and blue is for underwater:

I note in the comments for this video that readers are pointing to a very similar data visualisation which appeared in 2003. Orbital Mechanics replies that they came up with this independently.

(H/t Kottke.)


Herewith a few more data points on the global energy picture.

I post about this topic semi-regularly, and loyal readers might have noted that I swerve wildly from pessimism (we're going to need huge amounts of fossil fuels for a long time) to optimism (the green energy revolution is just around the corner!). I would just caution that none of these missives represent my finished views; in the best traditions of blogging, you are watching me make up my mind as I write.

My latest pessimistic note was on India's energy needs; I said India would be heavily coal-dependent for some time. On Twitter someone kindly pointed me to this Guardian piece putting the contrary view. Interesting piece, particularly the argument that the coal which might be dug up from Queensland will not in fact raise living standards for the poorest Indians, as Prime Minister Abbott argued, but will go to the already energy-rich. I note, though, that the piece ends with the plea that 'What Indians need is affordable, locally-generated renewable energy, not coal.' True, and in fact affordable renewable energy is what the entire world needs. But if wishes were horses....

Anyway, to a couple of other pieces I have stumbled on in recent days. First, Bill Gates on energy innovation:

If we create the right environment for innovation, we can accelerate the pace of progress, develop and deploy new solutions, and eventually provide everyone with reliable, affordable energy that is carbon free. We can avoid the worst climate-change scenarios while also lifting people out of poverty, growing food more efficiently, and saving lives by reducing pollution.  

To create this future we need to take several steps...One step is to lay the foundation for innovation by drastically increasing government funding for research on clean energy solutions. Right now, the world spends only a few billion dollars a year on researching early-stage ideas for zero-carbon energy. It should be investing two or three times that much. Why should governments fund basic research? For the same reason that companies tend not to: because it is a public good.

And here's Amory Lovins, head of the Rocky Mountains Institute, a research institution focused on the efficient use of resources, on the troubled future of the oil industry

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Having advised oil companies for 42 years, I’m worried that many don’t yet grasp how their competitive landscape is being transformed far faster than their cultures can comprehend or cope with.

Most importantly, their demand is going away — not incrementally but fundamentally. Like whale oil in the 1850s, oil is becoming uncompetitive even at low prices before it becomes unavailable even at high prices. U.S. gasoline (and electricity) demand has been falling since 2007 as more people drive thriftier vehicles fewer miles; the same is true in rich countries as a whole. Now major developing countries like China are shifting their energy strategy so quickly toward efficiency and renewables that global “peak oil” — in demand, not supply — could occur in this decade, not many decades in the future as the industry assumes.

Over decades, oil reserves unburnable for climate reasons could well be smaller than reserves unsellable for competitive reasons...

There's a tension in these two articles: if market forces are working so dramatically against fossil fuels, as Lovins argues, is the kind of government investment in renewables that Gates advocates really necessary? We'll have a piece for you next week from one of Bloomberg's top energy analysts which explores that tension.

Photo by Flickr user nate2b.


It's hard to find a dominant topic on The Interpreter this week, although energy — clean and otherwise — was a recurring theme. Let's start with Hannah Wurf on speculation that China will join the International Energy Agency:

...it is not clear if China and other emerging economies are ready to join the IEA. The Chinese Government has not made IEA membership a top priority, although it has strong ties with the organisation. There are some who believe the future of energy governance is in Asian-focused organisations rather than the IEA, with its fixed principles and institutional history. The IEA risks going through a series of complicated reforms only for disgruntled members to be told that big players like China and India are not yet interested in membership.

 Shashank Joshi looks at India's counter-terrorist capability in light of the recent Gurdaspur attack:

KPS Gill, a former director of police in the Punjab, renowned for his central role in curbing the insurgency, wrote a scathing column for the Indian Express pointing to a woeful lack of equipment and training for local police. The same newspaper noted that Punjab police had been trained by Israeli specialists four years ago but that funding dried up, leaving police firing 'a handful of rounds for practice' every year, SWAT teams walking around a live siege without bulletproof vests or helmets, turf wars between local and federal forces, and no back-up for two hours. Seven years after the Mumbai attacks, India's ability to respond quickly and effectively to major attacks remains under serious question.

Stephen Grenville on the 50th anniversary of the ANU Indonesia Project:

There has been plenty of Indonesian recognition of the Project's value as a source of research. One top Indonesian economist said 'It is ironic that the best institution...on the Indonesian economy is not in Indonesia but is to be found in Australia.' 

But evaluating its worth as 'ballast' in the relationship has proven harder and its value has often gone unrecognised. One of the regular reviewers noted that the Project's budget (less than A$1 million a year) 'represents significantly less than 1/10th of one percent of AusAID's country program in Indonesia. Effectively, the Project operates on a slender shoestring, while providing plenty of leverage for AusAID's money'.

It now seems clear that Taliban leader Mullah Omar died in 2013. Will that undermine the early stages of peace talks between the Taliban and the Afghan government? No, says Lowy Institute Thawley scholar Jacob Berah

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If we assume the announcement was correct and that Mullah Omar in fact died years ago, as the Kabul rumour mill has long conjectured, then it was a matter of 'when' rather than 'if' his death was revealed. Although the announcement will probably stall talks for now, it was better to have gotten this out of the way early, before talks progressed and the foundation of a negotiated agreement was hammered out. Announcing his death later in the piece would have likely been far more disruptive, potentially calling into question what had already been negotiated and sending the peace process back to square one.

Is Southeast Asia really a piracy hotspot? Statistics can be misleading, says Sam Bateman:

A recent piece by Elliot Brennan (Southeast Asia: Here be Pirates) misrepresents the piracy situation in Southeast Asia. It follows media reports claiming Southeast Asia is now the main global 'hot spot' for global piracy and sea robbery. That may be true in absolute numbers of reported attacks, but before making broad statements about piracy in the region and the counter-measures required, it's necessary to look more closely at the figures.

Turkey and Malaysia are on parallel political-religious trajectories, wrote Daniel Woker:

At opposite ends of the Islamic world, two traditional examples of moderate Islam in a modern state are slipping fast. In their desperate quest for personal power, President Erdogan of Turkey and Prime Minister Najib Razak of Malaysia appear to be not only destroying their personal reputations but also dragging their countries towards religious extremism and confrontation between national minorities.

Prime Minister Abbott announced a new naval shipbuilding plan this week, which was expertly picked apart by Derek Woolner:

Whatever happens, it seems likely that the Navy's force structure will become more expensive as either the surface fleet is expanded or its vessels' operational lives are reduced in line with a continuous replacement program. Whatever the Government's preferences, it also seems that a considerable part of the future submarine program will need to be undertaken in Australia if a continuous build policy is to be sustained.

More clearly, Australian naval shipbuilding is now centred on Adelaide. Some of the smaller regional yards may be able to survive on fleet maintenance, which will also support the continued viability of the industry in Fremantle. However, should BAe wish to remain in Australian naval shipbuilding, it might be best advised to realise the latent real estate value of its Williamstown facility and purchase ASC. Whether that would ultimately contribute to the Commonwealth Government losing more seats in Victoria than it might hope to save in South Australia remains to be seen.

The Interpreter took a close look at President Obama's big clean-energy announcement, via climate experts Frank Jotzo and Howard Bamsey:

The Clean Power Plan will contribute perhaps a quarter of the reductions needed to reach the US national target, so clearly much more needs to be done. But the Plan is an expression of earnest political will, the fuel of the negotiating process. Sustained US leadership throughout Obama's second term has helped move that process from feeble sputtering to a steady tick.

Obama claims US action is the reason China is moving on climate change. This is a massive overstatement. China acts for its own domestic reasons and objectives. But it is true that without commitments and action in the US, it would be harder for China to take a leadership role on climate change. The converse holds true too: if there was less action in China, it would be more difficult for Obama to run hard on the issue of climate change.

ASEAN is once again being outmanoeuvred by China, says Elliot Brennan:

In recent years, Cambodia has been a thorn in the side of ASEAN unity on this issue. In 2012 it blocked any ASEAN unity, and since then Chinese investment into Cambodia (and Laos) has increased. The relationship remains strong; a day before ASEAN foreign ministers began thrashing out a position on the South China Sea, Hun Sen was (with impeccable timing) opening a new Cambodia-China Friendship Bridge...

...If ASEAN can find unity at this meeting on the South China Sea, it will have a far stronger hand at the East Asia Summit in November. But China has already completed a large amount of construction across the South China Sea, and to much surprise on Wednesday, Chinese foreign minister Wang Yi said construction in the area has now stopped. That will throw a big spanner in the works of any final ASEAN statement. From a position of greater strength, it could also see China become more receptive to discussions on a Code of Conduct with ASEAN members.

Once again, it appears Beijing has outmanoeuvred a laggardly and divided ASEAN.

'How should Australia treat ISIS returnees?', asks intelligence expert David Wells:

Will the possibility of jail time deter potential travelers from leaving for the Middle East? Given that some are actively seeking martyrdom, and given the current rate of attrition for foreign fighters, I'd suggest not.

But importantly, it will and already is deterring or delaying the return of individuals who claim to be disenchanted with life in the Caliphate but who hope to avoid a lengthy jail sentence back in Australia. A successful prosecution in this case would undoubtedly help drum home the Australian Government's message. Conversely, an unsuccessful prosecution could send a message that new counter-terrorism legislation does not stand up to the challenges of prosecuting foreign fighters returning from Syria and Iraq. It's a high-risk, high-reward approach, with significant implications for the Government's counter-terrorism policy as a whole.

Is Australia's embrace of MIKTA risky? Christian Downie thinks so:

...any intrusion of a power-based grouping limited Australia's capacity to establish issue-based coalitions, one of our principal strategies to influence G20 outcomes. This is the risk with MIKTA. Australia's participation has the potential not only to further legitimate power-based and regional groupings, which are not in Australia's interest, but also to undermine the credibility of Australian calls for other countries to coalesce around issues instead of blocs.

Every time Australian officials at the G20, or some other international forum, chastise the G7 or the BRICS for blocking progress or developing positions across a range of issues rather than addressing each issue on its merits, these countries can point to MIKTA.

Catriona Croft-Cusworth took her weekly look back at events in Jakarta:

In other news, an Indonesian non-government organisation made world headlines this week for honouring North Korea's autocratic leader Kim Jong-un with an award for statesmanship. The award came from the Sukarno Education Foundation, headed by former president Sukarno's daughter, Rachmawati Sukarnoputri. Under the media spotlight, Rachmawati defended the award,  saying that human rights abuse allegations against Kim were only 'Western propaganda', and that there were parallels between him and her father for their 'fight against neo-colonialist imperialism'. She did not reveal how the foundation would deliver the award to the reclusive dictator.

Climate economist Fergus Green began a three-part series on Australia's renewable energy wars:

In terms of absolute renewable energy capacity additions, China reigns supreme, and its additions dwarf what Australia is considering. Whereas Australia would need to build only about 1.4 gigawatts (GW) of large scale renewable capacity per year between 2020 and 2030 to get to 50% renewable electricity (ie. 14GW in ten years), China built more than 20GW of wind capacity last year alone. China is planning to add another 100-200GW of wind power and another 75GW of solar in the next five years, targets that are likely to be increased and exceeded if recent experience is any guide (see p. 38 of our recent Policy Brief). A recent report by Chinese government energy planning agencies contained a 'high-penetration renewable energy scenario' whereby China would build 2400GW of wind and 2700GW of solar by 2050.

Of course, China's electricity sector is vastly bigger than Australia's, but the point is that we needn't think that 14GW of large scale renewables in Australia over ten years is anything radical. It's the very least we should be doing.

Photo by Flickr user t.bone1987.


Prime Minister Abbott can expect to be pilloried by the usual suspects for his comments that the recent court ruling against the  massive Adani coal mine in central Queensland is 'tragic for the wider world'. But take a look at the video accompanying the SMH story on this issue, and you will see that this quote comes right after Abbott's claim that the coal to be dug out at Carmichael will 'power up the lives of 100 million people in India', which is where the coal will be exported.

In that context, Abbott's 'tragedy' statement looks a lot more defensible.

This is not to say Abbott's claim about 100 million Indians should be taken at face value, given that he is evidently playing somewhat loose with the truth when he claims the Adani mine will create 10,000 jobs. But the broader point stands: the electricity generated from cheap coal has been enormously beneficial to the developing world, and has helped lift hundreds of millions of people out of poverty and misery. Given India's massive energy demand, coal will continue to play that role in the future.

Inevitably, the SMH story also recycles Abbott's October 2014 statement that coal is 'good for humanity'. That statement can also be defended on the grounds that electricity generated from coal has alleviated a lot of poverty. Nevertheless, given the damage coal does to the atmosphere, it's necessary to modify Abbott's claim. It's not coal that is good for humanity, it is cheap energy that is good for humanity. The trick is to generate energy in such a way as to not warm the earth through carbon emissions, and on that front, the Abbott Government can certainly be criticised, as Fergus Green argues in his latest Interpreter piece.

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Abbott's critics also need to grapple with the fact that coal is not on its way out. Despite the impressive growth of renewables, these technologies can't quite compete yet, which is why developing countries such as India are still investing in coal. As the FT's energy correspondent Nick Butler writes:

The coal industry is growing. Demand was up last year despite the slowdown in China, and globally almost 30 per cent higher than a decade ago. Coal will soon (perhaps as soon as next year) overtake oil as the world’s most substantial single source of energy, regaining some of the market share it has lost to oil and gas over the last half century.

The first era of coal began with the industrial revolution and extended through the 19th century, thanks to the development of railways and shipping across the world. The second era has its origins in the economic transformation of China which began in the last two decades of the last century, followed now by that of India. The next 50 years are likely to see more coal burnt than in the whole of the 20th century.

These are not random predictions or assertions put out by the coal industry lobby. They reflect the considered conclusions of all the serious long-term forecasts of the global energy market, including those published by the most reputable and neutral public agencies such as the International Energy Agency.

Photo by Flickr user Jeremy Buckingham.


Andrew Revkin, who writes the New York Times' Dot Earth blog:

This is an important step on two fronts — sustaining domestic momentum away from coal in electricity generation and providing a fresh signal to other countries that the United States is committed to cutting its carbon footprint.

Brad Plumer, Vox:

A bunch of media outlets are referring to this as "Obama's climate plan." But that's not quite right. More precisely, this rule is just one piece of a much broader Obama agenda to reduce US greenhouse-gas emissions over the next decade. The Clean Power Plan is certainly a significant component, but it isn't even expected to account for a majority of the cuts Obama's envisioning. So keep an eye on all those other rules and policies, as well.

Michael Levi, Senior Fellow for Energy and the Environment at the Council on foreign Relations:

Politics has greatly constrained the realm of the possible for emissions cutting policy. A fundamental shift in U.S. politics could in principle yield something substantially better – but that isn’t the universe we’re living in. For the time being, the principal alternatives to the Clean Power Plan as it stands are inaction; a different set of EPA regulations that’s far less flexible (and hence less economically sound) or far weaker; or, potentially, large subsidies to a range of zero-carbon energy generators. The Clean Power Plan is a vastly superior way forward.

Michael Grunwald, Politico:

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by the end of this year, according to Bloomberg New Energy Finance, the power sector’s emissions will already be down 15.4 percent from 2005 levels — about half the anticipated reductions in just a decade, and before the plan goes into effect. In other words, even under the strengthened plan, the rate of decarbonization is expected to slow over the next 15 years. What, did you think the strongest action ever taken to combat climate change would actually accelerate the nation’s efforts to combat climate change?

The final rule will also delay the first deadline for states to meet interim targets from 2020 to 2022, a significant walkback in a plan that Obama, cueing the Times, called “the biggest, most important step we’ve taken to combat climate change.”

If you’re really ranking them, the Clean Power Plan is at best the fourth-strongest action that Obama has taken to combat climate change, behind his much-maligned 2009 stimulus package, which poured $90 billion into clean energy and jump-started a green revolution; his dramatic increases in fuel-efficiency standards for cars and trucks, which should reduce our oil consumption by 2 million barrels per day; and his crackdown on mercury and other air pollutants, which has helped inspire utilities to retire 200 coal-fired power plants in just five years. The new carbon regulations should help prevent backsliding, and they should provide a talking point for U.S. negotiators at the global climate talks in Paris, but the 2030 goals would not seem overly ambitious even without new limits on carbon.

Kevin Drum of Mother Jones responds:

This is a little unfair in two ways. First, the 15 percent reduction of the past decade was the low-hanging fruit. The initial cuts are always the easiest. The next 15 percent will be harder, and mandating that it happen at about the same rate is more stringent than it sounds.

Second, the decrease over the last decade happened mostly because gas-fired plants became cheaper than coal thanks to the boom in natural gas fracking. That's a one-time deal, and there's no guarantee that something similar will drive further decreases. Having a mandate in place forces it to happen regardless of future events in the energy market.

David Graham, The Atlantic:

In brief, the Clean Power Plan puts limits on carbon pollution from power plants, mandating a 32-percent reduction by 2030, though based on 2005 levels, setting state-by-state standards for reduction. The rule is expected to lead to the closure of many coal-fired plants and prevent new ones from opening. The regulation was first proposed last year, and, after the EPA considered public comments, the final rule was released Monday. Experts described the rule as historic.

“They’re the most important regulations on climate change ever issued by the U.S.,” said Michael Gerrard, director of the Sabin Center for Climate Change Law at Columbia Law School.

Gerrard said while the rule’s impact would be important stateside, it was at least as important because of the role it will play in the global negotiations in Paris. Although China is now the world’s largest emitter of greenhouse gases, the U.S. has historically been larger, and American action is seen as essential to urging other countries to move on reductions. Following Obama’s proposal in 2014, China announced new emissions targets. But international progress is fragile, and attempts at marshaling a global response to climate change have repeatedly foundered.

“If these rules were to crash and burn before the Paris conference, that would likely have disastrous effects there,” Gerrard said.

 The Economist's Democracy in America blog:

Even if domestic leadership on the EPA’s proposals remains uncertain, the plan suggests America wishes to occupy a bigger role at the climate negotiations in Paris this December. Ethan Zindler, from Bloomberg New Energy Finance, says the measures finally “sync up international promises with domestic policies.” America’s emissions-reduction deal with China late last year now has more bite, for example. And any indication that America is more open to multilateral negotiations is welcome news elsewhere in the world, even if many allies had hoped for a more ambitious environmental agenda.


This trailer for a new documentary about Steve Jobs  (there's also a biopic in the works starring Michael Fassbender) reminds me that I have been meaning for some time to tell you about a thoughtful essay I read recently called Web Design: The First 100 Years.

Over the last few years a backlash has begun against the technological utopianism of the tech industry, and Apple and Google in particular. I suspect the tech sceptic Yevgeny Morozov has had a lot to do with this shift (see particularly To Save Everything, Click Here), and more recently it has become popularised in the TV comedy series Silicon Valley, in which tech industry CEOs with more than a passing resemblance to the Jobs persona are depicted as ruthless capitalists who have the public image of spiritual leaders. The industry's altruistic pretensions are also regularly mocked by way of a running joke on the mantra to 'make the world a better place': 

Maciej Ceglowski, an American programmer who shares this scepticism about Silicon Valley's utopian mission, writes in Web Design: The First 100 Years:


This is the prevailing vision in Silicon Valley. The world is just one big hot mess, an accident of history. Nothing is done as efficiently or cleverly as it could be if it were designed from scratch by California programmers. The world is a crufty legacy system crying out to be optimized...This vision holds that the Web is only a necessary first step to a brighter future. In order to fix the world with software, we have to put software hooks into people's lives. Everything must be instrumented, quantified, and networked. All devices, buildings, objects, and even our bodies must become "smart" and net-accessible. Then we can get working on optimizing the hell out of life...

....But what if after software eats the world, it turns the world to shit?  Consider how fundamentally undemocratic this vision of the Web is. Because the Web started as a technical achievement, technical people are the ones who get to call the shots. We decide how to change the world, and the rest of you have to adapt. There is something quite colonial, too, about collecting data from users and repackaging it to sell back to them. I think of it as the White Nerd's Burden.

Technological Utopianism has been tried before and led to some pretty bad results. There's no excuse for not studying the history of positivism, scientific Marxism and other attempts to rationalize the world, before making similar promises about what you will do with software.

Ceglowski endorses a more modest vision for the web, one that has largely been achieved: to erase the barriers of distance between people, and put all of human knowledge at our fingertips.

Do read the whole thing