My thanks to John Quiggin for plugging my new book on his blog, and apologies for taking so long to reply. John admits he hasn't read the book, and then takes issue with a claim on the jacket that 'the benign and comfortable world that has allowed Australia to be safe and prosperous is vanishing quickly'. He goes on to argue that over the past few years, the threats to Australia have lessened.

This is precisely the point I make in 'There Goes the Neighbourhood'. I argue in Chapter 5 that 'practically every international issue that really worried Australians at some stage over the past 60 years has seemed to simply fade away without even a whimper' – resurgent Japanese militarism, communism, American isolationism, the Yellow Peril, terrorism, the Soviet navy. But the point of my argument is that the world that has given Australia such a benign neighbourhood is coming to an end.

Quiggin issues a challenge that unless someone 'can point to something I've missed, I'm going back to sleep'. Well, here goes. In a nutshell, five big changes should give us serious pause for thought:

1. The unprecedented rise of the world's only two continent-sized economies, at approximately the same time. We can already feel their gravitational effect, and the future will see us ever more tightly bound into their economic dynamics. Their increasing influence and centrality will mean that our world and our choices are more and more shaped by the preferences of countries that see the world differently to how we see it, and less and less shaped by the preferences of countries that think like we think.

2. In a political sense, these will be very different great powers. All other great powers have been rich; India and China, even when they are the largest and third largest economies in the world, will still be poor in per capita terms. The combination of power and poverty will ensure they have very different priorities from other leading countries, and this will affect the prospects for meaningful collective action on everything from climate change to global financial instability to nuclear proliferation, to energy, food and water security.

3. The continent of Asia, from the Gulf in the west to Japan in the east, is integrating further and faster than ever before. East Asia's trade with the rest of Asia grew by six and a quarter times between 1990 and 2007, compared with just a three and a quarter-fold increase in cross-Pacific trade over the same period. The Asia Pacific era has ended and been replaced by the century of the Indo-Pacific, where the coastlines and waterways to our immediate north and west are going to be the primary arena for the patterns of competition and collusion among the great powers.

The real estate we occupy will be a valuable prize for any great power than can draw Australia into its orbit and away from the others'.

4. We're witnessing an increasing blurring of security and prosperity interests. The world we've become used to was one in which countries traded and invested primarily with their allies or friendly countries, and not their rivals. Now Australia joins Japan, South Korea, Taiwan and a range of other countries that have the US as their major security partner and its great rival China as their major economic partner. Even the two great competitors, China and America, are deeply economically dependent on each other.

This is a world of agonising choices – a world of rivalrous interdependence in which our choices as a society will be closely watched by much more powerful countries.

5. A world of rivalrous interdependence is not one in which matters can be decided by momentous confrontations. It will be a world in which each country has to balance a range of different interests and offsetting partnerships. The incentive for powerful countries will be to attract the support of as many smaller countries as possible, and to prevent their rivals from gaining too many supporters. Smaller countries will probably gain more from playing the field than from signing up with one or other of the great powers.

This will be a world of endless maneuver – a world of competitive cooperation where the battle lines and pitfalls are not always obvious.

In short, we're entering a world not of threats but of agonising choices that will come at us constantly. My bet is that we'll look back on the vanished threats that Quiggin talks about with nostalgia for a world that all seemed so simple.

Photo by Flickr user alancleaver_2000.