Ric Smith, Andrew Carr and Peter Dean all present a compelling case as to why a 2% of GDP target for defence spending does not constitute a strategy. But this completely overlooks the target's purpose. The bipartisan 2% target is not for defence planning, it is for alliance management.

As Ric Smith points out, the 2% target is shared by NATO countries. This alone tells you that the figure is not 'arbitrary'; rather, it serves an important political purpose by demonstrating Australia's fidelity to, and independence within, the ANZUS alliance framework.

Even strong critics of ANZUS such as Malcolm Fraser acknowledge that Australia would need to spend significantly more on defence if we were to let the alliance go. It is universally recognised that our alliance with the US subsidises our own defence spending. The 2% target is aimed at reassuring Washington. It would be incredibly naïve if one were to suggest that the US is going to accept the continued atrophying of Australia's defence budget at no cost to ourselves. Certainly it would not be accepted over some notion that Australia's defence circumstances do not require it, because without the alliance, we would require it.

If Australia does not contribute financially to the alliance we will end up paying in other ways — through the increasing erosion of Australia's sovereignty. This includes expanding the American military presence on Australian soil, deepening our bilateral co-operation on ballistic missile defence, and an open financial commitment to failing American fighter projects.

Without adopting the minimum buy-in as a US ally (which is the NATO figure of 2% of GDP), either the alliance will erode (forcing a dramatic boost to Australia's defence spend anyway), or Australia will face reduced decision-making independence in the Asia Pacific and declining influence in Washington.

I whole-heartedly agree that Australia's defence planning must be based on sound methodology that seeks to maximise the strategic return on every dollar spent, but to suggest that the 2% of GDP defence target should be abandoned on that basis is to make a complete non sequitur.

Photo courtesy of the Defence Department.