The 26-page (!!) transcript of Defence Minister Stephen Smith's speech to the Lowy Institute today is available for you to read, so I won't summarise it. As the Minister joked, if he had read the whole thing, we would have needed dinner served. I haven't read the full transcript yet, so I'll confine my thoughts to what I heard in the speech and Q&A, in particular on the topic of China and the US.

The Minister's office released snatches of the speech last night, and in media previews published this morning it was billed as a rejoinder to Paul Keating's remarks at the Lowy Institute on Monday. Smith did indeed rebuff suggestions that US power in the Asia Pacific would be 'rapidly eclipsed overnight', but I don't think Keating would disagree with that assessment (although he would probably wince at Smith's tautology).

Smith in fact sounded quite Keating-esque in his repeated assertion that the US and China must 'avoid strategic competition'. The rub, of course, is how they do that. Smith's answer, also repeated for emphasis, was for a deeper level of political and defence engagement to match the depth of the economic relationship. In the Q&A, Smith compared the anaemic China-US military relationship with that between the US and Soviet Union during the Cold War (he didn't specify, but presumably this was a reference to various confidence-building and crisis management mechanisms the US and Soviets had in place).

Here we arrive at the real point of contention between Smith and Keating.

Smith argues that more talks and closer military cooperation will keep the US-China relationship on an even keel. Keating would reply, I think, that it all depends on what they talk about. Focusing on confidence-building and crisis management simply won't be enough because it leaves the basic security structure in the Asia Pacific, with the US at the helm, untouched. China, according to this view, no longer sees the US-led system as being in its interests. It wants a new deal, and talking with the US about confidence-building measures, rather than changing the status quo may, in Chinese minds, just reinforce it.

A couple of other random observations. First, Smith's comments about the Indian Ocean. I know the emphasis on the Indian Ocean is not new, but this seemed particularly stark:

Crucial trading routes, the presence of large and growing naval capabilities, as well as transnational security issues such as piracy, will drive Australia to ultimately put the Indian Ocean alongside the Pacific Ocean at the heart of our maritime strategic and defence planning.

Second, as Foreign Minister, Smith routinely talked up our country as a world player ('...we're in the top 15 economies. We're in the top dozen military and peacekeeping spenders. We are a significant country'). So this aside in today's speech was a little jarring:

Occasionally I have seen the suggestion that somehow a country like Australia could be a bridge between the US and China. Two great powers do not need a country with a population of less than 25 million people to be a bridge between them.

I'm not saying Smith is wrong on the substance, but there was surely a less self-deprecating way to make the point.