US Defense Secretary Robert Gates is proving himself quite the provocateur. He has given speeches advocating increased funding for US soft power, he has criticised the US Air Force for being old fashioned, and now he says elements of the US military are prone to what he calls 'Next-War-itis', which he defines as:

...the propensity of much of the defense establishment to be in favor of what might be needed in a future conflict. This inclination is understandable, given the dominant role the Cold War had in shaping America’s peacetime military, where the United States constantly strove to either keep up with or get ahead of another superpower adversary. 

And, certainly, one cannot predict the future with any certainty. Soon after 1900, Winston Churchill said that he could not foresee any “collision of interests” with Germany. In the 1920s, as the Chancellor of the Exchequer, he said that there wasn’t the “slightest chance” of war with Japan in his lifetime. Today, rising and resurgent powers with new wealth and ambition are pursuing military modernization programs. They must be watched closely and hedged against. 

But in a world of finite knowledge and limited resources, where we have to make choices and set priorities, it makes sense to lean toward the most likely and lethal scenarios for our military. More...

In the pages of coverage of the first Australian Labor Government budget in 12 years, one small tax increase has largely been overlooked, and yet it seems to contradict the rhetoric of the new government more than most and exacerbate Australian insularity by adding to our 'tyranny of distance.'

The new government is proud to call Australia the most Asia-literate Western country, has pushed for more recognition of the Australian diaspora, wants a more internationally engaged and open Australia, wants to fight inflation, and is all for 'working families'. Yet, the budget mandates an increase in the airport departure tax of $9 per international flight, lifting it from $38 to $47. And this when the budget surplus is estimated to be over $20 billion.

It is not as if Australian flyers (flying is the only real way for Australians to see any of the rest of the world) are not already socked with a variety of travel taxes, fees, surcharges etc that quickly mount up and already make international travel particularly tough on the vaunted 'working family'. By increasing this tax, the government is dissuading a more open, engaged and Asia-literate Australia, making it more costly to develop links to our diaspora. It is also acting against the 'war on inflation' by making it harder for Australians to spend overseas.

Photo by flickr user Soapstar D'lux, used under a Creative Commons licence.

The new federal budget tells two international stories. One story is of the US economy falling over. The Treasury Budget Outlook at first uses the phrase 'a sharp slowdown in the US economy.' But Treasury then twice states its expectation of 'a mild recession' in the US. The word 'mild' is the Treasury hope, while the word 'recession' is the looming fact. The headline views of the US, then, brings those phrases together: 'sharp slowdown' and 'recession'.

Japan is dismissed in a terse paragraph. Japanese growth is 'expected to slow over the next few years', with Japanese consumer spending only partially offsetting the problems confronting Japanese business investment and exports.

When Treasury turns to the rest of Asia — especially China and India — it tells the second story: the Asian boom that is carrying Australia. More...

It is impossible to look at this morning’s media coverage of Burma — even the few skerricks of news to have made it through the wall of secrecy erected by one of the world’s most appalling regimes — and not feel profound anger. Just look at the photograph in this morning’s Sydney Morning Herald to see what I mean. And disease and malnutrition in the wake of the cyclone could make for an even greater humanitarian disaster.

Despite the entreaties of most of the international community to let the aid flow, the generals’ predictable response has been to clamp down on media coverage, circle the wagons and content themselves with relabelling the trickle of aid packages that are getting through in a further, pathetic effort to mislead the Burmese people.

The Australian government has, rightly, been calling on China and other regional governments to pressure the regime to give the aid agencies free access. Under pressure, it has increased our own contribution to a (still pretty dismal) $25m. What more can we do?

Surely this is a situation tailor-made for the sort of creative, activist ‘middle power’ diplomacy that the Rudd government espouses? More...

Yesterday, The Economist's blog, Free Exchange, led me to this Financial Times article on India's camel boom:

As the cost of running gas-guzzling tractors soars, even-toed ungulates are making a comeback, raising hopes that a fall in the population of the desert state’s signature animal can be reversed. “It’s excellent for the camel population if the price of oil continues to go up because demand for camels will also go up,” says Ilse Köhler-Rollefson of the League for Pastoral Peoples and Endogenous Livestock Development. “Two years ago, a camel cost little more than a goat, which is nothing. The price has since trebled.”

The shift comes not a moment too soon for a national camel population that has fallen more than 50 per cent over the past decade, to about 450,000, according to government figures.

Rising prices. High demand. Falling supply. Sounds like a good scenario if you can exploit it. So I called Peter Seidel of Camels Australia Export to ask if he was detecting an export upswing. But according to Peter, Australian camels are sold to the Middle East and Southeast Asia mainly for meat and dairy production, and some as breeding stock. India couldn't afford Australian camels anyway, he reckons, though that might change if oil prices continue to head north.

Yesterday the Australian Strategic Policy Institute released a new paper advocating a more resilient Australia. Societal and economic resilience is a topic we've tackled before here at The Interpreter, and it is very encouraging to see it get such systematic treatment from ASPI. Let's hope it kicks along a national debate, and that Ric Smith's homeland security review makes resilience a real priority.

The ASPI paper focuses deliberately on the broad topic of Australia's ability to cope with and recover from all kinds of disasters, not just man-made ones like a major terrorist attack. More...

Chris responds to my post of yesterday:

I have lived in the USA in three separate periods totalling some five years and spent most of my working life in some form of business relationship with US companies and people. I love them dearly but I also view them as the most devious bastards (term of endearment from an Aussie) on this earth. As a German friend of mine said when also working in Washington DC, ‘remember that Americans invented the game of poker’.

I would say that, yes, Americans are self-critical but in the context of an unwavering belief in their pre-eminence in most things. The display of humility you mentioned is more an indirect attempt to elicit your response, for at least two reasons: More...

Rowan Callick, China Correspondent for The Australian, has unearthed an unedifying interview given by Human Rights and Equal Opportunity Commission President John von Doussa to Chinese state television. Judging by the quotes, von Doussa is too accommodating to China on human rights and Tibet, though as Andrew Bolt notes, the interview may have been edited that way on purpose. Still, even based just on those quotes, von Doussa deserves some defending. More...

In the Weekend Australian, Greg Sheridan wrote:

The China obsession of the Rudd Government, and especially of the PM himself, has alarmed leaders in India, Japan and Southeast Asia, who fear Australia is reorienting its foreign policy to an unbalanced stress on China.

There has been a lot of this sort of talk since the Western world’s first Mandarin-speaking PM was elected. While Rudd may be well placed to build Australia’s relationship with China, before getting too carried away, consider three recent Chinese actions which must have driven the PM mad. More...

Regular readers will know I'm something of an enthusiast for what might be called the 'new security agenda'. I'm sympathetic to the idea that we face a number of serious non-military security threats in our future, and that the era of state-on-state conflict may be passing. I also believe that terrorism, in its present form, has been over-rated as a security threat, but that it could metastatize into a far more serious problem.

And yet, columns like this effort from Paul Dibb yesterday, about the need to maintain conventional military capabilities against state-based threats, give me pause*. In part, that's because 'new security' advocates tend to sound a little too sure of themselves when they put their arguments for the decline in 'conventional' war between developed states. More...

Foreign investment has become a touchy issue for many countries, with rich countries increasingly keen to throw up barriers to foreign capital. And apparently Australia is not immune to the trend. According to this story by The Australian’s Jennifer Hewett, at least ten Chinese companies withdrew foreign investment applications to buy Australian resource companies following pressure from Canberra. John Garnaut noted in the SMH that this is having consequences for Australia’s reputation in Beijing as a destination for foreign investment.

Last year, I wrote a paper called Second thoughts on globalisation, which argued that, due in large part to the globalisation-powered rise of China and India, many in the developed world were experiencing growing doubts about the benefits of continued international economic integration. Some were scared by the success of globalisation in creating powerful new competitors in global markets, or spooked by the security implications of the resultant shifts in economic power. Others were ill at ease with increases in inequality and troubled by the implications of rapidly expanding trade ties with low income economies. Still others were concerned about the consequences for the environment and resource security of the industrialisation and urbanisation of the world’s most populous economies.  More...

Paul Dibb sets out in today’s Sydney Morning Herald to depict a clash of views on Australia’s strategic outlook, pitting Foreign Minister Stephen Smith against the Director-General of the Office of National Assessments, Peter Varghese. The Minister is portrayed as elevating the importance of non-traditional security challenges like climate change; the head of Australia’s peak strategic analysis agency as focusing on the risks from competition among powerful states. Professor Dibb concludes that the latter view is right, the former is wrong, and Australia must not 'allow our advanced conventional warfighting capabilities to be sacrificed on the altar of the trendy, so-called new security agenda'.

There is both less and more to this than meets the eye. Professor Dibb’s article quotes from a public speech on Australia’s future strategic environment, given by Mr Varghese last December. I encourage readers to make up their own minds by reading the speech in full (pdf). But first, run through this alternative set of equally selective quotes, which could provide the basis for a rather different (though similarly one-sided) interpretation of a very comprehensive presentation: More...

Via the Observing Japan blog, I see that the Japanese Government is set to end its gasoline tax holiday. This comes soon after Republican presidential nominee John McCain proposed a similar measure for the US, which Hillary Clinton has backed and Barack Obama won't. The McCain proposal does look like a stunt and it is probably bad policy. 

It is somewhat mysterious how politically sensitive fuel pricing can be in first-world countries like Japan and the US (and Australia). As recently as 2004-05 (the most recent figures I can find), Australian fuel bills accounted for less than 3% of total household spending. This IHT story says it's 6.1% in the US (I can't find figures for Japan). Yet politicians and the media spend inordinate time on the issue, and I can only think it is because fuel pricing is so obvious to consumers — we don't even have to get out of our cars to note increases and compare prices.

One further point: as American blogger Virginia Postrel points out, the public discussion of petrol pricing is conducted overwhelmingly in terms of its social impact, and is largely divorced from the environmental debate.

Graeme Dobell draws attention to one of the problems associated with negotiating (high profile) preferential trade agreements, or PTAs: once significant political capital has been invested in the negotiations, it may become extremely difficult politically to walk away from even a lousy deal. This was one of the difficulties with FTA negotiations I highlighted in my 2005 Lowy Institute Paper on the evolving international trading system, The New Terms of Trade. Is there anything that can be done to overcome this ‘political’ problem? More...

Mike Steketee might be a bit annoyed at his sub-editor today. Steketee has written a perfectly reasonable column about why the last government's anti-terror laws went too far, but the piece is headlined 'Real terror is found in legislation', which suggests a rather more radical perspective (about how our government is the real terrorist) than the piece offers. Steketee doesn't argue that there is no terrorist threat. He simply makes the  point that governments cannot protect us from terrorism at all times in all places, and when they try, they just end up eroding our liberties.

Guest blogger: Raoul Heinrichs, the 2007 Lowy Institute Thawley Scholar, is on a research placement at the Centre for Strategic and International Studies in Washington D.C.

The New America Foundation recently hosted an event here in Washington, moderated by the Arms Control Wonk himself, Jeffrey Lewis, on the nuclear dimension of Sino-US relations. The presenters, Darryl Press and Keir Lieber, have published a number of provocative articles on the topic (see here, here and here). Boiled down, their observations are predicated on the idea that the US has either achieved or is fast approaching nuclear primacy, a condition in which Washington could be very confident in its ability to destroy China’s intercontinental range strategic nuclear forces in a pre-emptive first strike. According to Press and Lieber, the strategic implications of American nuclear supremacy are a double-edged sword. More...

I hope that The Australian's Cameron Stewart is right, and that Joel Fitzgibbon won't use the air power review report, due to land on his desk today, to make a definitive announcement about the Joint Strike Fighter. Stewart reports that Fitzgibbon will keep his options open until next year. As I wrote yesterday for Crikey (you need a subscription to read the whole thing):

...any decision on future air combat capability should be delayed until after the White Paper is published.

Defence is continuously developing its capabilities, and it is unrealistic to expect that it would all be put on hold until the new White Paper is published. But JSF is not just any defence contract: the fleet is expected to cost $16 billion. And unlike the Super Hornet, we haven’t yet signed contracts for the JSF that it would be financially ruinous to back out of. So what’s the harm in waiting until we make a conscious decision about whether we even need this type or size of fleet? More...

Alison Broinowski writes in response to Graeme Dobell's post:

Of course Japan refuses to negotiate with Australia on beef, dairy, wheat, barley, and sugar! So did the United States. The Howard Government, by accepting a preferential trade agreement that conceded no access for years for those exports, guaranteed that we would also fail with Japan and China. Why this government has decided to press on with both has not been satisfactorily explained.

On the spur of the moment yesterday I decided that Graeme Dobell's excellent post on the Australia-Japan trade negotiations needed some jazzing up to get the punters in. So I added a headline and a photo that played on how boring the whole subject is. If that managed to get a few people to click the 'more' button, great. But I now regret being so flippant. As economist Tyler Cowen argues in a NY Times op-ed on the rise of food prices around the world, the issue of agricultural protectionism has a direct bearing on whether a lot of very poor people starve or not.

So although it's tempting dismiss these free trade negotiations as wonkish esoterica, there is a lot at stake in the broader trade debate. Exactly how much became a point of difference between Cowen and another economist, Dani Rodrik, on their respective blogs. Rodrik's free trade scepticism is here, and Cowen's reply here.