Are we really going to sell out the US alliance for property prices?

Finally the nation has been shunted into a decent debate about China and its role in Australia’s future. We know it’s a debate of substance because the Chinese Communist mouthpiece, The Global Times, was sufficiently exercised to mock it:

A Briefing Book, given to all senators and members by Australia’s Parliamentary Library recently, warned them of China’s “Belt and Road” initiative and expressed concerns toward it. The book called on senators to adopt a prudent mind toward China affairs and to keep alert toward China’s motives behind its investments.

The book is an epitome of some Australians’ attitude toward China. The news that Labor Senator Sam Dastyari from New South Wales accepted political donations from a Chinese man has caused quite a stir. The Chinese donor was found to have paid his legal bills, and Dastyari reportedly supported China’s stance in the South China Sea issue. Conservative forces within Australia launched an assault on Dastyari and urged him to resign.

“I think the Australians need to make a choice,” said Colonel Tom Hanson, assistant chief of staff, US Army Pacific. “It’s very difficult to walk this fine line between balancing the alliance with the United States and the economic engagement with China.”

Some Australians seem to be deliberately hyping up the alarm toward China, which baffles Chinese society. China and Australia are geographically detached. Like Canada, Australia is an English-speaking country and apt for doing business, study, travel and migration. Canada used to have disputes with China over human rights. It is not difficult to understand as Canada belongs to the Western camp. But what bewilders us is why Australia keeps confronting China over security issues.

Southeast Asia is situated between China and Australia. But Australia seems to have more security concerns toward China than Southeast Asian countries like Indonesia and Malaysia. It is even difficult to maintain a normal relationship with Australia now.

Geographic advantages grant Australia the most security among world countries. Its sense of insecurity comes partly from its own paranoia and partly it is created by itself. As an external nation, it is keen to get involved in Asia’s political disputes like the US. But its strength is relatively weak. The US wants to be a guard in Asia. Does Australia want to behave like an auxiliary policeman affiliated to the US?

Australia does not have to feel unsettled. It can rest easy due to being an ally of the US and stressing its identity as a Western country. At the same time, it needs China as its largest trading partner who is also willing to do business with it. Beijing will not force Canberra to pick a side. As long as Canberra knows what it is doing, Washington can do nothing about it.

China does not have to care about Canberra’s provocative words. But if it resorts to real actions to hurt China’s security such as sending warships to the South China Sea, it is bound to pay a heavy price. So far, China and Australia have only been engaged in a war of words, and their ties are not really affected. China’s relations with Canada have been warming up recently. The momentum of China-Europe ties keeps steady. The maritime disputes between China and the Philippines and Vietnam have been put under control. Australia should make reflections on whether it has gone too far in standing up to China.

That’s pretty clear. Beijing is happy to be friends so long as we stay out of any strategic tensions. If not look out, so says US strategic analyst Richard Fontaine, from the AFR:

“I did not sense there was a great appreciation for the specific vulnerabilities in the Australian economy,” said Mr Fontaine, who is currently the president of the Centre for a New American Security and has just spent two months as the inaugural Alliance 21 fellow at the University of Sydney’s US Studies Centre. His writings on “salvaging the global order” have been widely circulated within Australia’s Department of Foreign Affairs and Trade.

“If Australia were to do something that China considered provocative and it was going to retaliate what might that actually look like? What areas is it likely to impact and therefore how much risk Australia is willing to assume in order to push back.”

Mr Fontaine said retaliation was unlikely to be related to the iron ore trade but could take the form of a travel advisory warning or a directive to state-owned enterprises.

Precisely. What is most likely at stake here is the ‘citizenship export’ sector: education, immigration, property prices and capital imports (sold assets). Pretty much Australia’s current great hope for future economic development, known around here as the ‘McKibbin Doctrine’.

On the other hand, if Australia was to stand aside from any actual China/US tensions what would be the strategic cost? Again Richard Fontaine:

Fontaine argues the global order, an open and rules-based system, is under threat on a number of fronts including “China’s challenge to maritime rules across the South China Sea”.

“Countries like Russia and China were not among the architects 70 years ago, and they have been brought into the house only haphazardly,” writes Fontaine, who is now president of the Center for a New American Security in Washington.

“It remains unclear whether they wish to make major renovations to that house, or to tear it down entirely.”

As a middle power the cost to Australia from a collapse of the “rules based” multilateral system would be extreme. We would need to divert enormous new resources to defense spending, the Great Power tensions we are currently witnessing would morph into a permanent ‘Cold War’ and the US is quite likely to shift to a policy of China containment, forcing Australia into the very choice it is aiming to avoid.

It is here that we find an old school of Australian strategic thinkers, also at the AFR:

In foreign policy circles this is known as “independence within the alliance”, a posture favoured by former Labor prime ministers Gough Whitlam and Paul Keating.

…”Australia needs a foreign policy, and it needs it urgently,” said Keating, who was prime minister from 1991-96 and now sits on the advisory board of the China Development Bank, at a forum this week.

“China will once again be a great state in the world. Through its population and GDP, China [economy] will end up being one and a half or twice as big as the US.”

Keating believes Australia should respond by joining the Association of South East Asian Nations and avoiding any involvement in a potential US-China conflict in the South China Sea.

[Hugh] White, for his part, still thinks Turnbull is inclined towards a more independent foreign policy.

“I just think he is reluctant to open a debate on China, which is a big and scary subject,” White says via phone.

“That’s equally true of the [current Labor opposition]. There is a kind of cartel where both sides agree this issue will stay off the agenda.”

Which seems to be the default position for pretty much everything of importance on the Aussie agenda. Anyway, ‘independence within the alliance’ is what we’ve been doing for the past decade whether it was spelled out or not. You may be able to palm off the Chinese for a while longer by stating it openly but the Great Power tensions will simply keep rising. Australia may be ready to sell the US out but Japan and Korea sure aren’t. The three-way enmity there with China is never far below the surface. And if it comes to conflict in the South China Sea (or elsewhere) then the rules based system will be trashed whether we go or not.

The strategic fallout for ANZUS may also be severe. ‘Independence within the alliance’ that persists with Australia’s current economic transformation is turning us into a Chinese espionage hot spot, also from the AFR:

The government’s top intelligence experts are concerned Prime Minster Malcolm Turnbull isn’t taking their warnings about the security threat posed by China seriously enough and the former banker is relying on advice from outside experts.

Despite vetoing a Chinese bid for Sydney’s electricity network this month, Mr Turnbull and some other cabinet ministers are reluctant to act on or receive warnings that China is engaging in spying on an “industrial scale” and that business secrets are among its top targets, three sources with senior contacts in the security services said.

“It is far more ambitious and better resourced than ever before,” said Paul Monk, an intelligence and foreign affairs expert who headed China analysis for the Defence Intelligence Agency.

“It’s notorious with politicians that they find intelligence to be a new thing when they go into politics. It’s things they would prefer not to know or suggest actions that can be embarrassing.”

“There is an unspoken rule that we spy on each other,” said Alan Dupont, a former military officer and defence analyst. “But to target in a massive way the business community of your trading partners and friends, in a way China has done, is unprecedented.”

In case you don’t know, these are the top minds in Australian strategic thought and what they are saying is more than a little scary.  I mean, check out this bombshell from Peter Hartcher:

It is a polite fiction that donors will give money to politicians without expectation of a return on investment.

One of the biggest paymasters of Australian politics, the chairman of the property developer Yuhu Group, laid this out explosively for all to see this week.

…Huang has paid more than $1 million to both sides of Australian politics since 2012.

He is also the financier for Bob Carr’s pro-China outfit, giving $1.8 million to set up the Australia China Relations Institute.

Carr’s outfit is so relentlessly pro-China that Professor John Fitzgerald, of Swinburne University, has written of “the monotony of Carr’s China-Whatever comments”.

…None of this is happening in a vacuum. The president of China, Xi Jinping, has publicly called on the patriotism of overseas Chinese to advance Beijing’s interests in foreign countries:

“As long as the overseas Chinese are united,” declared Xi, “they can play an irreplaceable role in realising the Chinese Dream of National Rejuvenation as they are patriotic and rich in capital, talent, resources and business connections.”

The Chinese Communist Party even has a department responsible for the co-ordination of Chinese diaspora and international communities – as sinologist Gerry Groot, of Adelaide University, has written:

“The United Front Work Department (UFWD) is the organisation through which the Party reaches out to many key non-party groups within and outside China in order to achieve important political goals.

“It also monitors sensitive constituencies and selects representatives from them who they can then incorporate into the political system.”

There is a group of Chinese Communist Party party-connected influencers in Australia acting not merely for personal or commercial advantage but for China’s national interest.

The ABC’s Chris Uhlmann reported that “the security warning to party chiefs is another indicator of the growing concern in intelligence agencies about the use of ‘soft power’ in Australia.

“That includes donations to politicians and universities, urging community groups to press Beijing’s cause, increasing control over Chinese language media and buying space in mainstream media.

“The immediate goal is to push China’s case for control of the South China Sea and, long-term, to urge a rethink of Australia’s alliance with the US.”

Inside the parties, the connection between Chinese money and Australian foreign policy is being made starkly plain.

Senior Labor figures have told MPs that Senator Stephen Conroy’s tough position on China’s disputed claims in the South China Sea have cost Labor a lot of money, well informed sources tell me.

Specifically, they’ve said that big Chinese donors withheld $450,000 in payments that otherwise would have been given to Labor, the sources said.

…By offering, or withholding, money, this is an attempt at deep, strategic corruption, an effort to pay politicians to change Australian foreign policy.

Total disclosed payments to the major parties by Chinese corporate and business interests in the two years to June 30 last year was $5.89 million.

An informed official tells me: “There is very high level concern inside ASIO about the use of donations to purchase access and influence.

“It’s concern about systematic behaviour by people connected to the Chinese state apparatus. It’s centrally directed by Chinese intelligence.”

The obvious conclusion to draw for the Americans is that under such an espionage assault, little Straya is no longer a trustworthy “five eyes” intelligence partner. Moreover, if we were to abandon the US in a North Asian skirmish with China, or indicate that we would do so in advance, then why share intelligence with us now? Or, for that matter, spend trillions on policing the Pacific hegemony that enforces the rules-based system? In the simple calculus of real politik what’s in it for them?

None of this is really as hard as it appears. It’s only hard if we allow the fundamental tension between the economy and our strategic outlook to develop further. That tension is not between Australia as a Chinese trading partner of goods like raw materials on one hand, and the US as the regional hegemon on the other. The supply of raw materials to developing countries and emerging powers supports the international rules-based system because without free access to commodities nobody can grow and invasions for access become a rational choice for governments. The rules-based system polices the sea lanes that keep that trade flowing.

No, the fundamental tension is between where Australia’s economy is going and the US alliance. The strain is between the McKibbin Doctrine – selling to the Chinese everything that is not bolted down and the ‘citizenship export’ sector of high immigration, education exports, property prices – and the US alliance. There is no getting around this. If we allow that part of the economy to continue to develop and dominate then we are ipso facto entering an altogether deeper engagement with China that will render us strategically dependent upon the rising Great Power of North Asia and whatever it decides to do with the “rules based” system of Pacific strategic relations. There is no “independence within the alliance” that supports the current rules-based system policed by a US hegemon, there is only risking it by backing an unproven new one.

We might choose to back the new kid on the block but if so we should do it with our eyes open. Given it is totalitarian, we do not know to what extent it will at some point rely upon external aggression to support internal power.

On the other hand, the US is still the great Liberal Empire of our time, the greatest democracy on earth by some distance. It has no interest in leading wars of aggression in the Pacific. This is not some glib “end of history” drivel about democracies never invading one another. The US has been a troubled alliance partner in a decade of global misadventure that was shockingly destructive to itself and others. It might next elect a weirdo to the Oval Office and turn inwards for a while. It is very far from perfect. But its track record of support for an Asian rules-based system of international relations is very good (with some prominent Cold War exceptions) and that benefits Australia in ways so large that it is difficult to measure.

The answer to this strategic dilemma is actually pretty easy. When I was publishing The Diplomat, the then Chinese Ambassador to Australia, the elegant Fu Ying, recounted a story about travelling to far northern Australia where she imagined diggers and US marines fighting side by side on the beaches against Japanese invasion. It was at the moment, she said, that she understood that the strategic links between Australia and the US go deep into history, and exist beyond simple alliance paraphernalia (it may be that knowledge that has the Chinese state working so intensively to disrupt it). So, to manage our strategic tension we simply do what Fu Ying might have expected us to do, we take away Chinese leverage by:

  • properly policing Australia’s foreign property buyer rules;
  • banning Chinese investment in strategic assets while freeing it up in raw materials (including agriculture);
  • ratcheting down immigration levels;
  • focusing hard on improving general economic competitiveness so that we rebuild tradable sectors instead of relying on selling everything off to prosper, and
  • ban political donations.

We do this within a clear foreign policy, strategic, investment and trade framework, communicated through white papers and consistent decision-making so that it is clear to Beijing that we are their loyal partner in their developmental economic journey within the existing rules-base system of regional governance. And we tell the US that we back them all the way as the regional hegemon.

Comments

  1. Did India have to choose between USSR and USA?

    For sure it was close to the Soviets and I think the Soviets let it annex Goa.

    But Canada built nuclear reactors in India and USA let it win the Bangladesh war.

    So maybe there are lessons for AUS in that?

      • India got the bomb in the 1970s. But probably had no launch capability then.

        But neither the Americans, nor the Soviets attacked it.

      • @Jacob. China almost did. They took out the buffer that was Tibet and who knows where they would have stopped if India hadn’t detonated their first underground atomic bomb in the nick of time. China still organises and funds a communist insurgency destabilizing parts of Northern India.

    • India started the non aligned movement, but it was more socialist than capitalist until the 1990s. And we got a free ride in the Soyuz once.

  2. It’s too late.
    With nearly 3 million Chinese born or origin of some form plus over 1 million PRC alone on some form of temporary fake or alibi visa of some form..

    We are well and truely infiltrated.
    We are already Chinese colonised.

    Our politicians dance to Chinese instruction, and our key institutions, border control, housing and financial services are all totally corrupted by the Chinese.

    • Just the facts Mike:
      “As a whole, Australian residents identified themselves as having Chinese ancestry make up around four percent of Australia’s population or approximately 865,000 people as of 2011. …. According to the 2011 Australian Census, 318,969 Australians declared they were born in China (excludes SARs and Republic of China (Taiwan)).[19] A further 74,995 declared they were born in the Hong Kong SAR, 2,013 in the Macau SAR and 24,368 in Taiwan:[18] a total of 304,775 or 1.5% of those counted by the Census.[20] Chinese ancestry was claimed by 866,205, either alone or with another ancestry, and Taiwanese ancestry was claimed by 5,837 persons.[1] The 2011 Australian Census reported that Chinese was the seventh most common self-reported ancestry.[1] In the 2001 Census, just under 40% of those claiming Chinese ancestry were born in mainland China, Hong Kong or Taiwan; 26% were born in Australia with other notable birth places being Malaysia (10%) and Vietnam (8%).”
      https://en.wikipedia.org/wiki/Chinese_Australians

      • ResearchtimeMEMBER

        That seems a bit on the low side? Its a bit like the British Elite saying there are only million immigrants (from 2010-2015), then it turns out there were over 2.4 million national insurance numbers handed out just to EU citizens alone, not including other nationalities, also not including the several million estimated long-term illegals….

        Anyone in Sydney will tell you that those numbers you have quoted are total bollocks. Just saying. Not saying that its not good having Chinese immigrants, but at least we should have the truth!

        PS – do not rely on Wikipedia, its is to easy to manipulate the numbers – to get a certain outcome.

      • RT, I have no problem with counterfacts. If Mike had said 1 million I would have let it slide. But if in 2011 you had 865000 with “Chinese ancestry”, of which 320000 where born in PRC (http://www.abs.gov.au/ausstats/abs@.nsf/Lookup/2071.0main+features902012-2013) then I have to call it as a made up number. Notice also that my numbers are now from the abs (which I botheredto check for your peace of mind). So unless there is a more reliable source other than going for a walk to check a property auction in Box Hill, I´d say the numbers are on my side. Even if we want to account for the possible changes from 2011 to 2016, the population change has been 1 million approx, it is highly unlikely that the PRC born will have increased by 650,000, let alone to 3 million. In the end all this matters not. As a final comment, not all the PRC born are a “Fifth Column” as Mike fears. Very likely they are a minority, particularly when you consider the reasons why they left. This is not the Invasion of the Body Snatchers, just crappy politics by third rate lawyers.

      • ResearchtimeMEMBER

        Just saying – your numbers appear utterly wrong… the number of Chinese students alone is sizeable – many don’t leave… then there are 457’s!

        I don’t know how those statistics were collated, but blind Eddie can see the numbers you are quoting are more wrong than Mikes. Truth probably is somewhere in-between. But to hazard a guess, there are easily several million Chinese in Oz. And that would be conservative! I think 6-8% of the population Chinese is not unreasonable?

        Have you been to a house auction lately, anywhere in Sydney???

      • RT…

        The godless commies hand wringing is tiresome no matter how you dress it up…..

        Disheveled Marsupial…. the plural of anecdotal is not facts…. its observer bias…

      • ResearchtimeMEMBER

        Actually Skip, a lot of Chinese of my acquaintance are Christian, bias you may say… or maybe not?

      • RT….

        I agree that contingent is an export to anglophone countries and one that CPC is glad to facilitate, yet that does nothing to reconcile the anecdotal bias of your statements.

      • ResearchtimeMEMBER

        And none of us have bias Skip? Really??? Who is naive…

        I never shy away from view – but here’s one you will appreciate, are my bias are – because I am better informed than you?

        OR alternatively – you are the sole individual on this planet not to have a bias, an opinion, or a view. The truth is my friend, views without fact are just opinion! Needless, I try to try and get as many facts as I can. Again, not to say they too are not biased. At least I understand where I am coming from.

        You however, try to make yourself out to be superior… you can continue to think that if it helps. You comment has nothing to do what I wrote above – you follow me incessantly, thinking lets get one over RT. But in reality, it doesn’t move the game along – does it? If it makes you feel good, I am not offended… but don’t make the assumption I am not self aware.

        Truth by definition – is exclusive…

      • 2011 was a loooong time ago now.
        Things have changed dramatically and those numbers are MUCH bigger.

      • Merely going by impressions of Sydney city centre is really a distorted view. I’m up here in Central Coast, NSW and its full on white Australia around here… Point is, outside downtowns of a the major capital cities there are not that many Chinese – so chances are 4 to 5% are possible.

      • If the population of Chinese went from under 1 million to 2 million from 2011 to 2016, that means all our population growth is from Chinese!! That simply isn’t plausible especially since the number of Indian arrivals outnumbers the Chinese.

      • “You however, try to make yourself out to be superior”

        Projection RT. All I did was point out the anecdotal nature of your rhetoric and if you think responding to your public statements is some from of personal anything you should get that pathology checked. I only respond to your statements, which I might offer goes the same for everyone else. Unless people are obviously gaming the conversation or rhetorical devises and not dealing with the information.

      • 3 million Chinese born or ORIGIN is fairly correct.
        The Chinese come in from many sources and transit stops or other enclaves be it Malaysia Singapore Indonesia Vietnam pacific islands U.K. NZ back door as well as China HK Taiwan etc. so Wikipedia et al don’t actually count these ethnic Chinese even if they have non Chinese entry path.
        1 million Chinese on fake or pretext visa alibis eg tourist, working holiday, student, NZ back door, bridging & other visas is probably an underestimate.

      • The anecdotes are relentless by some people here (not to mention made up statistics). Listen to Skipp.

      • 3 million Chinese born or ORIGIN is fairly correct.
        The Chinese come in from many sources and transit stops or other enclaves be it Malaysia Singapore Indonesia Vietnam pacific islands U.K. NZ back door as well as China HK Taiwan etc. so Wikipedia et al don’t actually count these ethnic Chinese even if they have non Chinese entry path.

        The 865,000 is from the 2011 Census, for those claiming Chinese _ancestry_.

        Only about 300,000 claim to have been born in China (/Hong Kong/Taiwan/etc).

        865,000 to 4,000,000 in five years ? You’re gonna have to show your working for that one.

    • Not all Chinese Australians born in China have fond memories of the Chinese government. Assuming all Chinese support the CCP is like assuming all Australians support the LNP. Or assuming all Australians support democracy.

      In fact the Chinese who migrated earlier are now having integration issues with the Chinese who migrated more recently. There is a difference between mainlanders and people from Hong Kong, a difference between those who sought freedom & democracy and those who only came here for business.

      • Spot on Fek’
        I know plenty of “old” Chinese who want the number of new Chinese reduced as it seems to be increasing resentment not to mention putting the cost of housing out of the reach of their kids since their kids haven’t had the benefit of the house price boom Beijingers etc have enjoyed in the last couple of decades.

  3. Of course the USA is not a squeaky clean democracy.

    Watch “Chasing Edward Snowden” to see how the USA protects its own high level officials who break the USA laws while it cruelly attacks and punishes whistle blowers with the same contempt for freedom as does the Chinese political system. Nonetheless, the USA is definitely the safer bet for protection of human rights that are in line with Australian values.

    http://topdocumentaryfilms.com/terminal-f-chasing-edward-snowden/

    The following points you suggest as being in Australia’s strategic interests are spot on H&H:

    properly policing Australia’s foreign property buyer rules;

    banning Chinese investment in strategic assets while freeing it up in raw materials (including agriculture);

    ratcheting down immigration levels;

    focusing hard on improving general economic competitiveness so that we rebuild tradable sectors instead of relying on selling everything off to prosper, and

    ban political donations.

    • Grand Moff Tarkin

      The United States is the most corrupt militant state on earth and has been for decades. It absolutely beggars belief just how much SPIN (total bullshit) this blog can actually generate.

      No one doubts that the United States is run entirely for corporate interests with democracy playing almost no role at all – that makes it a fascist state.

      It foreign policy is almost entirely run via and for the military (ALPHABET agencies) pushing its corporate interests – again, the bench mark definition of fascism.

      Its elections are by far the most corrupt of any western nation – rejecting all International scrutiny – despite the ubiquitous irregularities and tsunami of evidence.

      Anyone pandering to the United States as some sort of desirable bastion of freedom, liberty, democracy or more laughably openness and transparency in a modern world ruled by laws is either ignorant in the absolute EXTREME or bought and paid for spreading propaganda.

      There is no wriggle room on that one.

      • Grand Moff Tarkin

        Then I chose the one that respects international rule of law and has not invaded well over 100 countries and killed millions.

        How people can point to China looking after its interests directly off its coastline as a global act of aggression while ignoring the United States enforced global web of 200 military bases in almost every country on earth – including the eviction of an entire nation of people from their Island Home in order to build a military base which was used to bomb millions into the stone age killing hundreds of thousands of citizens is a truly SICK JOKE.

        China has 1.5 Billion people – every single member of their political party is voted into office by the communist party – yes they vote – the US has 300 million people and they get the opportunity to nominate one of two people – which is then rigged.

        Its a sick joke what is being said in this blog.

      • Most corrupt? Not even close. Certainly the flaws of the USA are written large due to its power, but the USA is still a beacon of light despite those flaws. If you think otherwise you have not travelled widely enough.

      • The American people are great, the american power brokers make the Spanish inquisition look like a bit of fun.

      • AK
        Good to see France right there below Chile & Uruguay! (as an ex-Pom, couldn’t help myself..sorry.)

      • @ GMT, the USA is in imperial overreach mode. They see full spectrum dominance within their reach, but they won’t get it. All other countries / civilisations to try have also failed. Most recently the Nazi’s tried and the Russians slapped them down. Then the Communists tried, at least in their sphere of the world and they collapsed on themselves. The same will eventually happen to the US, and then China if it rises to a period of dominance.

        The world is sick and tired of their meddling, hypocrisy and self declaration of exeptionalism. They would nuke and wipe Russia off the map in an instant if they could without military repercussions to their mainland. Their morality only extends to their own consumption and “exceptionalism.” They are fast turning into the new fascists. Corporations control all and they believe they are the master race / country . All civilisations before them who also got to that point eventually fell to the “barbarians.” It will happen again.

      • Since we’re playing Fantasy Super Powers, which Super Power do you imagine is going to be advance its interests and enforce its hegemony in a more acceptable fashion ? China ? Russia ? Give me a break.

      • None Green, that’s the point. None have and none will. It’s just whether the US has a hissy fit on the way down and we have to fight a war to see a changing of the guard or a keeping of the status quo.

      • ErmingtonPlumbingMEMBER

        “Corporations control all and they believe they are the master race / country”

        Bullshit JC, Corporate plutocrats don’t give a F#ck about Race or Country,… its all about the money,…Real money,… If you’ve got it,..you’re one of them,… if not,… you are the enemy.
        Same applies in pretend Communist China.

      • @Grand Moff Tarkin — Spot on & comprehensive summing up ! Fully agree that USA is the biggest problem on the Planet.

    • Nice starting list, NT.
      Add “apply the principle of Reciprocity” (i.e. you can’t do in my country what I can’t do in yours) and we’re getting there

  4. ResearchtimeMEMBER

    Brilliant post H&H – probably your best I have read yet… what you say is largely free, fair and frank – but we live in a dynamic system. There are pressures and events that will push us more in one direction than the other, increasingly under Chinese influence; namely (a) we will have a major economic correction, as China has one; (b) the temptation will be to turn on the immigration taps even larger; (c) The “weirdo” you refer is to Trump winning, which I almost see as inevitable. And you are dead right, not only does he see a great imbalance of American interests on senselessly demonising Putin (http://www.zerohedge.com/news/2016-08-15/ivanka-trump-vacationing-croatia-putins-girlfriend), but he sees isolationism, which has a long tradition in US politics, getting their own house in order as being more important that taking on Chinese power.

    The net sum is that Australian is going to feel vulnerable geopolitically for a while. Many do not realise how much we owe to Pax Americana umbrella until it slips a bit. Some will take it as a sign that the US is old history, that acquensence under a undemocratic monolith is the answer.

    A third force is also shaping up. One of the most amazing things a friend has told me, that despite the UK being the fifth largest economy in the world, they are borrowing new Zealand and Australian negotiators for the Brexit talks, because they don’t have any experienced ones of their own (http://www.telegraph.co.uk/news/2016/09/03/g20-theresa-may-in-talks-over-a-free-trade-deal-with-australia-a/).

    The world is changing quickly. I think we have too long seem ourselves as privileged, have protection and values in common with our Anglo Saxon partner, the US – but thinking that China would never have any real power over us. In my experience, this is the best quote regarding politics of all time, Kissinger could have written it himself:

    We have no eternal allies, and we have no perpetual enemies. Our interests are eternal and perpetual, and those interests it is our duty to follow.
    – Henry “The Mongoose” Temple, Viscount Palmerston (1784 – 1865)

    • Brilliant post H&H – probably your best I have read yet !” What a load of Bollocks.
      For my money it was one of his worst – a complete mess of contradictions blessing the biggest World Bully. Bahhh

  5. I think the talk of wholesale spying and political donations is overblown. These measures are merely interim until the CCP has a legitimate voting block in this country, then those things will return to normal levels. Nothing to worry about ! sarc

  6. Living in the past, We are much more vulnerable than we used to be. Think of our position in production of transport fuels, food and basic technology. No strategic oil supply and rrelying on Coles and Woolies warehouses sourced from overseas for much of our food supply. Not to mention medical supplies ( think diabeties for a start. )

    The only independence we have is the Hornets but we are kept purposely low on missiles to give the US control over us. We got by in the past with the F111’s, but we have no replacement and can no longer threaten anyone with consequences. To regain any semblance of control of our own affairs we would have to change over to Russian armaments with adequate local ammunition production. The US will never let us off the leash and we are no longer capable of running our own affairs anyway. I actually expect us to become a US Dollar nation one day under the Federal Reserve umbrella. Only the largest central banks will survive.

    • Jumping jack flash

      “…change over to Russian armaments with adequate local ammunition production.”
      I agree, especially about the local ammunition production. I assume the US don’t allow to make their stuff locally?

      It is also a fantastic way to create jobs, and creating military equipment has been used successfully to pull countries out of great depressions in the past. It is important that you don’t go to far with it though…

      • Original JohnMEMBER

        “It is also a fantastic way to create jobs, and creating military equipment has been used successfully to pull countries out of great depressions in the past.”

        This only works if you create a supply side demand for new equipment. This can be achieved either through planned obsolescence or using said equipment for the purposes it was designed. What is the point of all these shiny toys if you can’t take them out and play with them…..

  7. SkoptimistMEMBER

    Great post. Personally I would like to ban all foreign donations and make continuous disclosure with full details mandatory.
    I would also advocate restricting all Chinese investments from state owned enterprises to no more than 25% ownership and that this be further restricted to areas in which there is already significant competition and no potential conflict of interest. The electricity grid purchases were/are designed to ensure that even robotized manufacturing is difficult to make competitive here.

  8. A national anti corruption body that focuses on political donations is needed. The finance and property lobbies influences would also be bought to light. One in beach state and one in Canberra. It can’t undo the damage that has been done but it would hopefully force changes to the donations system and access to politicians.

  9. Great post. Why don’t we do both and shut the gates! Stop selling off our country, enforce the rule of law on our political parties and not get involved in any overseas wars. Australia could be a self sufficient paradise.

  10. Grand Moff Tarkin

    Fontaine argues the global order, an open and rules-based system, is under threat on a number of fronts

    The United States has, without any doubt what so ever, been the greatest threat, and flagrant transgressor of an open and rules based system. Of that there can be no doubt.

    There is literally no country on this planet that the United States has not covertly manipulated, threatened, invaded either covertly or overtly – none.

    The United States has used military powers to invade in some manner over 100 nations in the past century – killing millions upon million.

    Their roles in everything from the Ukraine ($13 Billion in “democracy initiatives” which empowered the far right wing ultra-nationalists and openly fascist groups to overthrow a democratically elected government and then engage in a progrom of ethnic cleansing – all of which was blamed on the Russians) right through to the CIA covert operations in Indonesia which we now know led to the execution of 500,000 Indonesians – the deliberate infection of hundreds of thousands of Guatemalans with Syphilis as an “experiment”, to the School of the Americas – an open training ground for despots and dictators which churned out such luminaries as Pinochet, Norriega, Hussein, Tsakasvilli, and many many more – CIA trained dictators.

    This is before we even mention the illegal wars of Afghanistan, Iraq, Iraq again, Libya, etc, etc –

    There is no OPEN RULE OF LAW with the United States- its simply unchallenged militant hegemony and it makes me absolutely SICK to think that anyone could propose anything else – not because it is such an obvious and stupid lie which detracts from their brutality – but because of how insidiously STUPID you must think people are.

    • How to Hack an Election

      Andrés Sepúlveda rigged elections throughout Latin America for almost a decade. He tells his story for the first time.

      For eight years, Sepúlveda, now 31, says he traveled the continent rigging major political campaigns. Sepúlveda’s career began in 2005, and his first jobs were small—mostly defacing campaign websites and breaking into opponents’ donor databases. Within a few years he was assembling teams that spied, stole, and smeared on behalf of presidential campaigns across Latin America. He wasn’t cheap, but his services were extensive. For $12,000 a month, a customer hired a crew that could hack smartphones, spoof and clone Web pages, and send mass e-mails and texts. The premium package, at $20,000 a month, also included a full range of digital interception, attack, decryption, and defense. The jobs were carefully laundered through layers of middlemen and consultants. Sepúlveda says many of the candidates he helped might not even have known about his role; he says he met only a few.His teams worked on presidential elections in Nicaragua, Panama, Honduras, El Salvador, Colombia, Mexico, Costa Rica, Guatemala, and Venezuela. Campaigns

      Usually, he says, he was on the payroll of Juan José Rendón, a Miami-based political consultant who’s been called the Karl Rove of Latin America.

      http://www.bloomberg.com/features/2016-how-to-hack-an-election/

    • ErmingtonPlumbingMEMBER

      So Mr Moff, If someone had the power (let’s say Aliens or some shit like that) to entirely eliminate the US from the face of the earth, leaving no trace and did so and then leave, leaving the rest of the countries of world to their own devices.

      What would unchallenged Chinese hegemony look like for the nonChinese peoples of Southeast asia and Australia/NZ?

      Better, worse or the same?

      I agree that the American Military industrial complex, in alliance with global Plutocracy, is responsible for waging multiple Grubby and Atrociously unnecessary conflicts around the world for generations now.
      But I think the enormous power of the US, esp after WW2 has been somewhat tempered by Democracy and connected public opinion. That’s why US propaganda, spin doctoring PR etc etc, command such huge sums of money.

      https://www.youtube.com/watch?v=YHa6NflkW3Y

      But a Global Hegemon, that doesn’t even play lip service to Democracy, one soon to have a Nuclear arsenal capable of exterminating all human life on the planet,… or at the very least erase all civilisation as we know it.
      That in my mind is another upping of the level of magnitude of concern again.

      • Why do you think you can weigh the suffering of others and decide which suffering is greater?

        e.g. why would be the suffering of nonChinese peoples of Southeast asia (in case of unchallenged China) be any greater then the current suffering of Libyans, Iraqis, Avghans, Palestinians etc (in actual case of unchallenged conglomerate trading as “The Gov’t of USA)?

    • All great power behaves without regard to law, that’s why they have armies. The argument against the USA is not that they’re evil : it’s that they don’t seem to know what they’re doing.

  11. I clicked through the link provided above by H&H to the Global Times propaganda piece.
    Have a look at the racy comments section. Makes the debate here look veritably intelligent and polite. Remarkable.

    • AlbyManglesMEMBER

      ahh yeah I just clicked through and read the comments after reading yours, if that’s the global times audience I don’t think we need to worry about the what global times publishes ever again

  12. In order to play a strong diplomatic game between superpowers, you need to have diplomats who 1. can play such a game 2. are not influenced easily by a greenback 3. know that the possibility of such a game exists.

    But the internal game is slightly different – the game between hawks, doves and pigeons is surely easily visible. The hawks are in on the racket of war, and alliance with the hegemonic status quo; the doves have turned into bloated pigeons who believe in an eat whatever you can get your hands on regime.

    What needs to be said are the following:
    Australian policymakers have been wrong on China. They need to be fired. For 20 years Australian policy towards China was founded under the premise that China was a nation transitioning to a liberal democracy. For all intents and purposes, this assumption, was blatantly wrong. Australia needs to adjust its worldview now to take upon this changed narrative. Whereas the dialogue of democracy was a powerful hook for justice, freedom and the value of Australians – now Australia’s policy has lost its purpose. Australia is simply a messenger for stagnation, neoliberal policies and for the ruling classes to keep everyone else down the rat race. Australian identity has been sold the American lie – that high and largely unaccountable debt creation is the road to prosperity; and that if you can work hard and buy a house; you can reach nirvana. In that house should be a truckload of Chinese produced appliances that sap energy all day and night.

    Where to from here?

    The hawks will flex their muscles.
    The pigeons will eat whatever comes their way.

    We need to decide on an issue by issue basis where we stand.
    We need to have a watertight environment for global and local security issues.
    We will need monetary innovation at some point; otherwise the security agenda will percolate.
    We need to deal at the local and global level with marine decay of the oceans and acidification.

    We need to build diplomacy on common values of respect, prosperity and human rights.

    Until we prioritise these cornerstones in our own lexicon and policy debates at home; we will continue to be at the bottom of the pecking order with a handful of elite families keeping everyone down whilst the superpowers trample all over our values, aspirations, security buffer and economic independence.

  13. Grand Moff Tarkin

    >. It has no interest in leading wars of aggression in the Pacific.

    God – this is just absolute BULLSHIT.

    The United States has sent a relentless armada of warships half way around the world into the coastline of China. It is sending war ships and soldiers to countries entirely circling China. It has built a a wall of missiles and troups surrounding Russia and China.

    What the actual F*CK are you talking about ?

    you could not get any more aggressive and militant ?!

    20 years ago Dick Cheney announced that China posed the greatest threat to US hegemony and that the US would do everything in its power to ensure the US was not just unrivalled that no country would even countenance the thought of challenging the United States.

    Since that time the United States has not only sent an unending stream of war ships, Carrier Fleets, but also built bases, surrounding China along with engaging in wars and troops built ups entirely surrounding China whilest also sending an unending stream of aggressive threatening Challenges to China.

    The US are involved in almost every single neighbouring country to China pushing for bases, threatening, military and economic actions for non-compliance as they seek to isolate and contain China in order to maintain their global hegemony.

    The author of this blog has a very archaic 1970’s world view based around fantasies of white western supremeacy and the “shining beacon on the hill” of United States as a benign for of good.

    It is just SHOCKING the level of ignorance being displayed. Truly shocking.

    And yes – your previous forays into “The End of History” are just as misplaced, poorly understood references to what Francis Fukuyama was talking about – just a total, complete and utter lack of the most basic grasp of International Relations and Political Theory and contemporary Political Philosophy/

    Yes I have several masters in all of those areas – and what I am reading on this blog is just self accredited hubris with what can only be described as a fantastical fantasy land understanding of what is ACTUALLY going on in the world, what AMERICA ACTUALLY IS, what it represents and how it goes about its business.

    Ludicrous and incredibly ignorant fiction at best.

      • Grand Moff Tarkin

        We should become part of a strategic alliance which controls Asia from North to South ensuring we are a political powerhouse for the next century aligning ourselves with China, India and Asia.

        All of Asia is sitting there appeasing the United States biding their time – ALMOST EVERY SINGLE COUNTRY in Asia has been bombed into oblivion by the United State, or at least invaded by the US and her allies. They HATE the invading whites – hate them – despite what some here would have you believe as they do the propaganda work of their paymasters.

        The US is despised (outside of Vassal US nation States in Asia like Singapore) and puppet dictators.

        Of course we should align with China and in so doing demand our independence in return becoming the bookends of Asia – it would make us incredibly powerful – and at the same time FORCE the United States to treat us with respect while also empowering us as the middle men between Asia and the west.

        Just being the “lap dog” of the United States is by far the DUMBEST thing that could happen.

        If it turns to a hot war – we will be taken out in a heart beat and the United States will be as about as reliable as the UK was in the previous global encounter. Tumbleweeds.

        If not – we will be in a fantastic strategic position economically and militarily – while the US will be the one left out in the cold isolated between South America and – well – Canada. While Asia rises with the ME, India, Central Europe and Western Europe.

        Its just moronic to look to the future and think the United States is the way to go – DUMB DUMB
        DUMB DUMB.

        It is fundamentally either racist or an inability to accept change and a desire to maintain nostalgic world views. Any comparison on humanitarian, legitimate rule of law sees the United States as the worst player possibly in all of human history.

        .

      • GMT,
        Is it really possible to align with China and demand indepence? The pound of flesh they’d seek would surely be greater than what America takes.

      • GMT, thanks for those thoughts and reply to GG. A bit of a muddle though: “We should become part of a strategic alliance which controls Asia from North to South . . aligning ourselves with China, India and Asia.”
        Then you write that those same Asian nations “HATE the invading whites – hate them”.
        Aust cannot be separated out from US war involvement as we fought alongside that nation in every war I can think of.
        Aust must therefore be hated also.

        You go on to say:
        “Of course we should align with China and in so doing demand our independence in return becoming the bookends of Asia”.
        Independence from China?
        Tell me, how is it working out for Taiwan and Tibet?

        How independent are the African nations that trade their resources for soft loans created by a few keystrokes in the Accounts Department of the PBOC? The image that comes to mind is that of taking candy from babies.

        After China collectively shows signs of respect for its own people in particular dissidents, stops organ harvesting from prisoners as well as treating them like slaves, ceases its financial skullduggery and gives some respect to the environment, I will consider.

      • +1 Bob. We would have to import some execution vans, but think what it would do for the price of body parts though…. have to be some upside. Think of the money you could save on due process….

    • The Project for the New American Century (PNAC) was a neo-conservative think tank (1997 to 2006) that had strong ties to the American Enterprise Institute. PNAC’s web site said it was “established in the spring of 1997” as “a non-profit, educational organization whose goal is to promote American global leadership.”

      PNAC’s policy document, “Rebuilding America’s Defences,” openly advocated for total global military domination. Many PNAC members held highest-level positions in the George W. Bush administration. The Project was an initiative of the New Citizenship Project (501c3). [1]

      In 2009 two of PNAC’s founders, William Kristol and Robert Kagan, began what some termed “PNAC 2.0,” The Foreign Policy Initiative.

      The PNAC was co-founded by William Kristol and Robert Kagan in 1997[2], with roots in the 1992 Pentagon. PNAC’s original 25 signatories were an eclectic mix of academics and neo-conservative politicians, several of whom have subsequently found positions in the presidential administration of George Walker Bush. PNAC is noteworthy for its focus on Iraq, a preoccupation that began before Bush became president and predates the terrorist attacks of September 11, 2001. In 1998, the group wrote a letter to President Bill Clinton, Mississippi Senator Trent Lott (then Senate Majority Leader) and Newt Gingrich (then Speaker of the House of Representatives), demanding a harder line against Iraq. By then, the group had grown in numbers, adding individuals such as former Reagan-era U.N. Ambassador Jeane J. Kirkpatrick, and long-time Washington cold warrior/pro-LikudRichard N. Perle.

      According to William Rivers Pitt, “Two events brought PNAC into the mainstream of American government: the disputed election of George W. Bush and the attacks of September 11th. When Bush assumed the Presidency, the men who created and nurtured the imperial dreams of PNAC became the men who run the Pentagon, the Defense Department and the White House. When the Towers came down, these men saw, at long last, their chance to turn their White Papers into substantive policy.”[3]

      Several original PNAC members, including Cheney, Khalilzad and the Bush family, have ties to the oil industry. Many other members have been long-time fixtures in the U.S. military establishment or Cold War “strategic studies,” including Elliott Abrams, Dick Cheney, Paula Dobriansky, Aaron Friedberg, Frank Gaffney, Fred C. Ikle, Peter W. Rodman, Stephen P. Rosen, Henry S. Rowen, Donald H. Rumsfeld, John R. Bolton, Vin Weber, and Paul Dundes Wolfowitz. It should not be surprising, therefore, that while the group devotes inordinate attention to Iraq, its most general focus has been on a need to “re-arm America.” The prospect of mining oil riches may explain part of the group’s focus on Iraq, but this motivation has been buried under the rhetoric of national security and the need for strong national defense.

      To justify a need to “rearm” the country, however, reasons must be found. In the more peaceable world of the late 1990s, with no rival super-power in sight, Iraq and “ballistic missile defense” against “rogue states” were the main games in town. The group’s links to advocacy for ballistic missile defense came through Donald Rumsfeld, who in 1998 chaired a bi-partisan commission on the “US Ballistic Missile Threat” and Vin Weber, a registered lobbyist for Lockheed Martin and other Fortune 500 companies.

      http://www.sourcewatch.org/index.php/Project_for_the_New_American_Century

      This documentary film goes in detail through the untold history of The Project for the New American Century with tons of archival footage and connects it right into the present.

      It exposes how every major war in US history was based on a complete fraud with video of insiders themselves admitting it. This film shows how the first film theaters in the US were used over a hundred years ago to broadcast propaganda to rile the American people into the Spanish-American War.

      It film shows the white papers of the oil company Unocal which called for the creation of a pipeline through Afghanistan and how their exact needs were fulfilled through the US invasion of Afghanistan.

      This documentary shows how Halliburton under their “cost plus” exclusive contract with the US Government went on a mad dash spending spree akin to something out of the movie Brewster’s Millions, yet instead of blowing $30 million they blew through BILLIONS by literally burning millions of dollars worth of hundred thousand dollar cars and trucks if they had so much as a flat tire.

      http://topdocumentaryfilms.com/new-american-century/

      Disheveled Marsupial…. then you have the whole NASB thingy….

      • Grand Moff Tarkin

        I don’t subscribe to the whole neo-cons apparition at a particular juncture in space time – they are continuation of the US foreign policy enacted under McNamara, Kissinger right through to Rumsfeld and his cohorts. They have all been there for decades preceding Bush the second, and remain there to this day (those that are alive).

        Its not some abrupt paradigm shift in foreign policy it is merely a continuum under new nomenclature.

      • GMT….

        I understand your grist, but as the New American Century doco shows this world view dates back to the Spanish-American War, if not the ideological underpinnings in the expansion of Colonialism itself.

        Just highlighting the PNAC currant agenda and how it shapes – today’s – events.

    • Why would the US invade any country in the Pacific? It makes no sense strategically. Far better for them to egg the Japanese to fight with China over a few pieces of rock.

      • They tried invading. Did not always work out that well. The US used WW2 to displace the Euro colonists but never went home much to the chagrin of many Japanese, South Koreans, etc.

  14. Excellent though most of the actions required to maintain an adult, cordial and productive relationship with China are of broader application.

    Adopting those actions more generally will be beneficial and help avoid unnecessarily annoying the Chinese with ‘selective’ policy

    Taking a stand against mercantilist economic strategies is central not only to our policy towards China but our other trading partners as well.

    Large trade deficits imply large capital flows to ‘finance’ them.

    That has worked fine while the English speaking countries (aka the USA and its same language buddies) have been happy to hollow out and unbalance their own economies to trade claims on future income and title to assets, for manufactured goods.

    But how long can that continue now that people in those countries are starting to understand that they and their jobs were thrown under the bus as part of the geopolitical “manage the world” program of the US.

    What if politically, accepting massive unproductive capital flows from mercantilists becomes more and more challenging?

    Especially when they come from a geopolitical competitor (China) rather than defeated former enemies and now effectively client states (Japan and Germany)?

    Mercantilists might find their exchange rates rising higher and higher as barriers to unproductive capital inflows (just like the ones they use) start to rise.

    Especially a mercantilist who the US believes is now too big for its boots and is holding the line and is refusing to submit to Hollywood plot lines.

    Blocking unproductive capitals inflows is how we stop mercantalism in its tracks.

    To function Mercantilists must continue to suppress their exchange rates and that means they must restrict:
    1. Foreign acquisition of title to their real assets like land, key industries and infrastructure.

    2. The sale of their government securities off shore ( how many foreigners own Chinese govt bonds)

    3. Their banks from selling vast numbers of claims on private future income offshore.

    and encourage

    4. THE EXPORT OF CAPITAL TO ACQUIRE ASSETS AND THE IOUS OF THEIR TRADE COMPETITORS

    All we need to do is to return fire with the same strategies- except No 4.

    The difference being that the objective of our trade policy will balanced trade rather than a massive surplus or deficit. Limiting unproductive capital inflows and outflows will ensure that, as trade imbalances follow from exchange rates mispriced due to unproductive capital flows.

    The deal offered by English speaking governments to their citizens over the 50 years, give up your jobs for cheap gadgets and cheap debt is as unsustainable as the model offered by the mercantalists to their poor citizens – keep their export orientated lowly paid jobs by handing over part of their income/savings to your customers in exchange for a claim on their customers future income or title to their assets.

    If China does not move to end this unsustainable model it may find the rest of the world will do it for them.

    Though don’t expect our treacherous cadres – current and former LNP and ALP politicians and assorted ticket clippers and carpet baggers – to support it.

    • Great post, getting right at the meat of the issue at hand.

      Gotta get up early to beat the chicom astroturfers.

    • The rest of the world should have dealt with this in the early 2000’s when China deliberately started to counteract Fed rate hikes setting in motion the sub-prime crisis. A country of 1.3b people should never have been allowed to pursue a Singapore growth strategy. Trumps 45% tariff isn’t as stupid as it sounds.

    • WOW 007…..

      How can anyone call China or any other country a manipulator… after decades of the Fed’s neoliberal antics since the 70s.

      • Skippy,

        “..How can anyone call China or any other country a manipulator… after decades of the Fed’s neoliberal antics since the 70s…”

        Easy – no one is forced to run an unbalanced trade account over an extended period. Plus you can always choose who you run an unbalanced trade account with.

        China had a lot to gain from the US/China ‘trade imbalance’ and it clearly gained a lot. It got to run a mercantilist strategy to drive economic growth and industrialization with one of the most advanced economies in the world. Where would China be now without being allowed ‘access’ to US markets and ‘joint-venture knowledge transfers’? Probably 10-15 years behind where it is now.

        Certainly, the US hoped to be able to use ‘trade relationship’ to build a bridge (a bridge can be used for many purposes) to China and no doubt make sure that it was always compliant – like Japan, Germany and Saudis – as a consequence of the ‘trade-finance’ relationship.

        You don’t need to infantilise China to paint a unsavory picture of the US record and ambitions.

        If anything China has played their cards very well and patiently extracted most if not all of what they need to become an independent great power.

        Japan got too big for its boots back in the early 1980s and the US was forced to take it down a notch.

        They would like to do the same with China but whether they can now (peacefully) is another question.

        My concern is what happens when the US finds it imperial ambitions thwarted with real determination by China.

        China just defending the middle kingdom and securing its supply lines will be provocation enough for the Beltway.

      • 007….

        You seem completely blind to the Chicago schools machinations over 60 years mate, what do you think monetarism was all about, they weaponized finance and currency to pursue an ideological imperative and – force – it down everyone’s gob. Eisenhower was the last American president with a shred of liberal democracy left, after that is been with ratchet like effect increasing neoliberalism e.g. America started the whole monetary dramas with bastardizing Bretton Woods and going Imperial with it. FFS did you miss the Chicago boys in Russia, pre and post GFC USA, etc, etc….

        As far as Plaza goes it was all good in the fight against Commies and making the club rich until politically it became an issue with the servants back at home. Then Clinton served the coup de grâce with NAFTA and Rubinomics, Bush I and II started the executive take over and Obama forwarded it. Then GFC followed by LIBOR and other plain as day fruads….

        Disheveled Marsupial…. to top it off a couple of decades of non stop wars…. shezzzzzz… bad China…

        PS. this is not some Sunday afternoon black and white hat cowboy flick 007….

      • Skippy,

        How has that response got anything to do with hat I have said about China??

        One of the strange things about home grown critics of the US like yourself is that even when they are critical of the US they still insist that it be “exceptional”.

        Except they make it the “exceptional” bad guy.

        Not everything on the planet is about the US – even though far too much is.

        You don’t seem to understand that the rising frictions with China ARE the result of China having managed to resist the US embrace much more than the US would like.

        Building rock aircraft carriers in the South China Sea is simply China sending a message that it is not to be trifled with or pushed around.

        China is not run by a bunch of Chicago boys and their banking and monetary system is still firmly in control of their government. It has not yet been privatized or placed under foreign management.

        Need I point out that you are a supporter of privatised or franchised private money creation. The Chinese, to their credit, have not (yet) fallen for the trap of allowing public money creation to become a profit centre for private and usually foreign bankers.

        They still might and when that happens I will be inclined to agree that the US Chicago brand of neo-liberalism has taken deep root in China.

      • Skippy,

        Just re-read your responses and realised that you are completely misreading my comments.

        My point is NOT that the US is not trying to use its trusty “manage the world” tool kit on China – it clearly has been trying to do that for the last 30 years with its approach to trade and finance. The US strategy was clearly to entwine China in a US/China trade finance relationship (stronger than the EU/China trade relationship) that would force China to comply with US ambitions to remain world manager.

        My point is China has been smart enough to use both the US and EU trade-finance relationships as a massive springboard to industrialisation and technical advancement WITHOUT falling into line as the US intended.

        A bit like how the French hoped that the Euro would allow a unified Germany to be controlled but instead Germany now controls the Euro.

        China is showing clear signs that it is no longer prepared to bite its tongue as it did while it industrialised and modernised.

        You may find that your home grown Chicago Boys and their US military finance sector pals may not find controlling China as easy as they thought it would be.

        That might be a good thing but I would not start romanticizing the current government of China either.

      • ErmingtonPlumbingMEMBER

        I would like to hear your retort to 007, Skip.

        You seem overly obsessed and blinded with the economic philosophy infecting the Apparatchiks of the American Plutocracy,… as though all other “evils” in the world, sprout from Neo-liberalism alone.

        Whats Neo-liberalism got to do with the threat of Chinese Expansionism?
        Is Xi reading from the Chicago hymn sheet below,

        The president of China, Xi Jinping, has publicly called on the patriotism of overseas Chinese to advance Beijing’s interests in foreign countries:

        “As long as the overseas Chinese are united,” declared Xi, “they can play an irreplaceable role in realising the Chinese Dream of National Rejuvenation as they are patriotic and rich in capital, talent, resources and business connections.”

        The Chinese Communist Party even has a department responsible for the co-ordination of Chinese diaspora and international communities”

      • Ermo,

        They way that neo-liberals keep rabbiting on about the importance of free trade – even with authoritarian China – has a whiff of Pig Iron Bob’s boat loads of raw materials to Japan pre WW2.

        When it comes to conservatives or neolibs choosing between making a quick buck or the national interest, my money is on the quick buck.

        Which is another way of saying don’t assume that conservatives or neo-liberals are even thinking about the consequences of the deals they have been cutting or assets they have been flogging.

        Though the ones who make their cash from the tools of war are probably having a bet each way.

        Chances it will not be the US but instead one of its indebted allies (Phillipines, Indo, Japan) who get selected to poke the Chinese Dragon to test its reflexes.

        Korea seems like a real possibility. Getting them into a scrap with North Korea would be proxy v proxy. Everyone can watch, observe and try out weapons without too much at stake!

        Unless of course you are Korean.

      • 007….

        Simply put China is not by any means engaged in the kind of “expansionism” that anglophone nations have been since colonialism. It detests foreign intervention in its own internal politics, with passion, and really does not engage in the same level of intervention the anglophone nations have – historically. The rest just devolves into kettle and pot paint slinging, pick your poison.

        China playing the game to reach economic par, sure, as did the USSR, sociopolitical nomenclature aside, tho the Chicago boys did not have the same success wrt China as they did with the USSR [not that it was long lived imo].

        Skippy….. as Toynbee said…. society is not a harbor…

      • ErmingtonPlumbingMEMBER

        Well the Koreans have been there before.

        Bradley had proposed to the Joint Chiefs that nuclear weapons be placed at MacArthur’s disposal in July 1950, but after consideration of the matter, the Joint Chiefs did not adopt the proposal.[85] However, ten B-29 bombers were deployed to Guam. While Truman publicly denied that he was considering the use of nuclear weapons, he authorised the transfer to Guam of all their components except for the fissile cores.[86]

        At a press conference on 30 November 1950, Truman was asked about the use of nuclear weapons:
        Q. Mr. President, I wonder if we could retrace that reference to the atom bomb? Did we understand you clearly that the use of the atomic bomb is under active consideration?
        Truman: Always has been. It is one of our weapons.
        Q. Does that mean, Mr. President, use against military objectives, or civilian—
        Truman: It’s a matter that the military people will have to decide. I’m not a military authority that passes on those things.
        Q. Mr. President, perhaps it would be better if we are allowed to quote your remarks on that directly?
        Truman: I don’t think—I don’t think that is necessary.
        Q. Mr. President, you said this depends on United Nations action. Does that mean that we wouldn’t use the atomic bomb except on a United Nations authorization?
        Truman: No, it doesn’t mean that at all. The action against Communist China depends on the action of the United Nations. The military commander in the field will have charge of the use of the weapons, as he always has.[87]
        The implication was that the authority to use nuclear weapons had been handed over to MacArthur.[88] Truman was forced to issue a clarification that “only the President can authorize the use of the atom bomb, and no such authorization has been given.”[87] Truman had touched upon one of the most sensitive issues in civil-military relations in the post-World War II period: civilian control of nuclear weapons, which was enshrined in the Atomic Energy Act of 1946.[89]
        On 5 April 1951, the Joint Chiefs of Staff drafted orders for MacArthur authorizing attacks on Manchuria and the Shantung Peninsula if the Chinese launched airstrikes against his forces originating from there.[90] The next day Truman met with the chairman of the United States Atomic Energy Commission, Gordon Dean,[89] and arranged for the transfer of nine Mark 4 nuclear bombs to military control.[91] Dean was apprehensive about delegating the decision on how they should be used to MacArthur, who lacked expert technical knowledge of the weapons and their effects.[92] The Joint Chiefs were not entirely comfortable about giving them to MacArthur either, for fear that he might prematurely carry out his orders.[90] Instead, they decided that the nuclear strike force would report to the Strategic Air Command.[93]

        Foreign pressure
        The British Prime Minister, Clement Attlee, was particularly disturbed by Truman’s gaffe about nuclear weapons, and sought to revive the wartime Quebec Agreement, under which the United States would not use nuclear weapons without Britain’s consent.[94] The British were concerned that the United States was drifting into a war with China.[95] In a visit to the United States in December 1950, Attlee raised the fears of the British and other European governments that “General MacArthur was running the show.” As MacArthur’s views about the importance of Asia in world affairs were well known, it was feared that United States would shift its focus away from Europe.”

        Without Going Nuclear, No way could South Korea, even with US support, repel a Chinese invasion Now.
        So they’d have to go Nuclear then? and who makes the call? could get messy.

        https://en.wikipedia.org/wiki/President_Truman%27s_relief_of_General_Douglas_MacArthur

      • Skippy,

        “..Simply put China is not by any means engaged in the kind of “expansionism” that anglophone nations have been since colonialism….”

        As I had not suggested anything to the contrary, I generally agree with that though Tibetans and a few other neighbours will probably argue that the more modest Chinese expansionism still has a sharp edge

      • 007….

        China is acting in reference to “historical norms” and not the ones arbitrarily imposed on it by others…

        Disheveled Marsupial…. I’m not pro or con China, just looking at it for what it is… and not what I want it to be…

      • ErmingtonPlumbingMEMBER

        It seems not all historical norms are the same. Isn’t Colonialism a ” historical norm”?
        I mean the Romans were doing it 2000 years ago, the Greeks and Phoenicians long before that!

        The Historical norms rethoric is certainly no pathway to peace or justice,…War and conquest has been the default state of the human animal since the very beginnings of proto civilizations

      • In some ways it’s not so much China’s fault for being a manipulator, but more the debtor countries fault for believing the neoliberal myths. ie. That floating currencies will correct trade deficits / surpluses over time, it’s impossible to fix a real exchange rate over more than the short term, it’s impossible to fix long term rates (Greenspans cunundrum) etc. all these myths have allowed China to take advantage. Also, that tariffs are always bad – not always true either.

      • EP…

        China’s historical norms wrt geography predate the anglophone mapping of nations, America was not even a nation at that point, furthermore they did not have to subjugate the indigenous population to form a nation. China has only one period of external navigation and exploration, not soon afterwards the fleet was dismantled and en fin. The one military adventure got repelled on the beach, even tho they vastly outnumber their opponents, and then whilst they pondered the next move a typhoon wiped out most of the fleet. What was left went home and en fin.

        Whilst were on body parts from prisoners I remember that little drama in Europe sourcing organs from both eastern Europe and the Asian poor about 10+ years ago, big industry names involved imo. All for wealthy clients.

      • Sweeper….

        It was supposed to use Bancor….. that was the bastardization that the Americans affixed to it, hence China’s moves to seek a place at the SDR table and now the opinions at the G20.

        “The rules of Bretton Woods, set forth in the articles of agreement of the International Monetary Fund (IMF) and the International Bank for Reconstruction and Development (IBRD), provided for a system of fixed exchange rates. The rules further sought to encourage an open system by committing members to the convertibility of their respective currencies into other currencies and to free trade.

        What emerged was the “pegged rate” currency regime. Members were required to establish a parity of their national currencies in terms of the reserve currency (a “peg”) and to maintain exchange rates within plus or minus 1% of parity (a “band”) by intervening in their foreign exchange markets (that is, buying or selling foreign money).

        In theory, the reserve currency would be the bancor (a World Currency Unit that was never implemented), suggested by John Maynard Keynes; however, the United States objected and their request was granted, making the “reserve currency” the U.S. dollar. This meant that other countries would peg their currencies to the U.S. dollar, and—once convertibility was restored—would buy and sell U.S. dollars to keep market exchange rates within plus or minus 1% of parity. Thus, the U.S. dollar took over the role that gold had played under the gold standard in the international financial system.[21]

        Meanwhile, to bolster confidence in the dollar, the U.S. agreed separately to link the dollar to gold at the rate of $35 per ounce of gold. At this rate, foreign governments and central banks were able to exchange dollars for gold. Bretton Woods established a system of payments based on the dollar, in which all currencies were defined in relation to the dollar, itself convertible into gold, and above all, “as good as gold”. The U.S. currency was now effectively the world currency, the standard to which every other currency was pegged. As the world’s key currency, most international transactions were denominated in US dollars.[citation needed]

        The U.S. dollar was the currency with the most purchasing power and it was the only currency that was backed by gold. Additionally, all European nations that had been involved in World War II were highly in debt and transferred large amounts of gold into the United States, a fact that contributed to the supremacy of the United States[citation needed]. Thus, the U.S. dollar was strongly appreciated in the rest of the world and therefore became the key currency of the Bretton Woods system.

        Member countries could only change their par value by more than 10% with IMF approval, which was contingent on IMF determination that its balance of payments was in a “fundamental disequilibrium”. The formal definition of fundamental disequilibrium was never determined, leading to uncertainty of approvals and attempts to repeatedly devalue by less than 10% instead.[22] Any country that changed without approval or after being denied was then denied access to the IMF.”

    • Good comments. As you outlined the globalist neoliberal economic model is collapsing. Current economic and conventional business models have no answer. We need to create a future based on an approach that enables Australia to become ‘competitive’, balance trade with China and Asia and generate ‘economic well-being’ that is based on the acquisition and manipulation of technology – not debt. The current dumb innovation approach will more than likely contribute to a decline in Australia’s competitiveness.

    • Excellent post +10000

      We need to achieve our economic independence FIRST.. before we can entertain some idea of playing the US / China off each other for our benefit.

      To be geopolitically independent, we first need to be economically independent.

  15. proofreadersMEMBER

    ” … we take away Chinese leverage by:
    •properly policing Australia’s foreign property buyer rules;
    •banning Chinese investment in strategic assets while freeing it up in raw materials (including agriculture);
    •ratcheting down immigration levels;
    •focusing hard on improving general economic competitiveness so that we rebuild tradable sectors instead of relying on selling everything off to prosper, and
    •ban political donations.”
    HnH – your proposals are all eminently sensible, but the other horse has just about finished and won the race, before we have even gotten out of the gates. But what can you expect when the pollies have their money on the other horse?

  16. Hmmm it must be Monday morning…nothing like leading with Yellow Peril story to get the click count up.

    Fontaine argues the global order, an open and rules-based system, is under threat on a number of fronts including

    An open rules based system is under threat…..I can only guess that’s an oblique reference to TPP….TPP is many things but open ain’t one…TPP rules based?? sure there are rules, its just unclear who gets to decide what the TPP rules are…the TPP rules process sure as heck ain’t democratic…. there’s this other niggling thing about knowing what the rules are before you get to vote…yea but they’re good rules trust us!

    An Independent Australia don’t make me laugh (Independent countries run Current Account Surpluses)….
    Australia simple needs to choose who’s biatch they wanta be.

    • “Hmmm it must be Monday morning…nothing like leading with Yellow Peril story to get the click count up.”

      Sigh. All media is the same…

    • Grand Moff Tarkin

      Agreed. Its just so shameful to see people blogging like this thinking we are all so dumb as to just swallow the drivel hook line and sinker, or worse, that they actually believe this shit and we have been listening to such mental light weights.

      Rule of law – get back to me on the actual UN resolution which covered the no fly zone in Libya, or the laws which governed the bombing of LAOS, or the CIA involvement in 500,000 Indonesians executed under Suharto for being communists at the direction of the United States, or the US false flag in Vietnam, assassination of their President, invasion of China, invasion of Philipinnes, invasion of – INSERT ANY OF OVER 100 COUNTRIES FROM PAST CENTURY.

      Ridiculous shit really.

      • Whilst this is true, powerful countries always ignore international law in matters they perceive as too important. The Russians and Chinese also do this, as does Israel (de-facto USA) and any powerful country who deems that followign the actual law is against ist vital interests.

    • The transition from British to American colonialism was relatively smooth given the same language, similar cultures, and similarities in race.

      The transition to Chinese colonialism won’t be as smooth given you’re dealing with a different language, different culture, and (in the main) different race (though with migration levels this is becoming less so). The way corruption is manifest in Chinese society is also different to American-colonial Oz.

      Most people hate change and the coming change in colonial masters may be similar (over time) in the way that tribal people have been dispossessed of their land (asset sales), laws (pollies owned by Chinese sponsors), language, and way of life.

      The fact that this is a click-bait topic is an indication that it is an emotive issue to many. It’s not surprising that colonialism is an emotive topic. Sadly Australians have no desire to be genuinely independent.

      • Yep that’s about how I see it too.
        The King is Dead…long live the King!
        Trouble is the new King looks a bit “different” and thinks a bit different to the last two kings.
        Can he really be a King if he looks …ahm Chinese??
        Can he really be Our king if he only speaks Chinese? …Surely he needs to at least learn our language….
        Can he honestly be our king if he writes in some form of 200 year old childish pictographs.
        Can he really become our king if his laws ain’t our laws?…his customs ain’t our customs…his morals ain’t our morals…
        In the end analysis it’s all about Change …about the rewards for Change…and suitable punishments for recidivists.

    • You know it’s touching a nerve when China Bob bobs up to play the “racist” card

      Yep, the TPP is bad policy. The FTA with China even worse. A deliberate shift to increase the level of Chinese investment in strategic and housing assets, and the level of Chinese immigration into this country, all in order to prevent our banks from being written down, to allow us to cut another few billion from funding our public institutions, is absolutely treacherous.

      In the end, it is always just a matter of enough business interests prepared to write down the national agenda to advance their personal commercial interests, one China Bob at a time. Whose side will you be on, China Bob ?

      • Whose side will you be on, China Bob ?
        Interesting question….to be honest, I’ll usually try to be on the winning side.
        Yep, the TPP is bad policy. The FTA with China even worse…
        No disagreement from me…Seems to me that Slaves always sign whatever contracts that their Masters waive in front of them almost regardless of how onerous and lop sided the terms and conditions are. Hint : it one of the best ways to recognize a good wage slave…or maybe it’s fundamentally what makes a slave a slave and a master a master.

        As for me playing the “racist” card, hey it wasn’t my lead story, I’m just observing an undeniable trend.

      • ErmingtonPlumbingMEMBER

        “I’m just observing an undeniable trend.”

        Sure but how is observing and commenting on the increasing expansion of Chinese Soft and Hard Power, Racist?

        Are you on the payroll CHINA Bob?
        :-p

  17. Jumping jack flash

    I don’t think Australia would be the only country on earth that relies on Chinese money to keep their debt machines going. If we all need to answer to the US, then it isn’t us with the problem, its the US.
    Australia is probably that skinny kid in the playground that gets picked on for doing something when everyone else is doing the same things!

    Besides, take a look at Chinese investment in the US. If the US start sabre-rattling and getting all “holier-than-thou” about the Chinese buying up entire countries, they have as much to lose as anyone.

    Part of the problem is the US’ refusal to let go of their dream: that they are the best country on earth and none can overtake them. Ironically, they started the global trend to sell out manufacturing to China.

    • The US uses its deficit as a management tool. Whilst the $US reigns supreme it works. Countries get access to the US market but the quid pro quo is that they finance the transaction at least in part by buying US real or financial assets.

      Only the US has the muscle to default on its debts and it can do so without default by devaluing the $US with volume.

      Allowing China access to US markets was intended to create a bond. The natural assumption being that the USA would ultimately control the relationship via control of the $US.

      China is not showing signs that they are prepared to accept this state of affairs long term (short term they had no choice) but doing something about it is a major undertaking.

      If they try it is unlikely the US will just sit back and let it happen.

      The US generally do not hesitate to deploy any manner of tool to acheive their strategic objectives.

      Australia is best served from unplugging itself from the mercantalist trade surplus/deficit model by weaning itself off unproductive capital inflows.

      Being a debtor to great powers is a quick way of getting dragged into their quarrels.

      “How would you like to lose your line of credit chum”

      • Original JohnMEMBER

        “Being a debtor to great powers is a quick way of getting dragged into their quarrels.

        “How would you like to lose your line of credit chum”

        Exactly – if the LoC was shut down, would the Chinese continue buying Australian property? Our problem is we are beholden to both sides of this struggle through our own history of unproductive investment. And rather than acknowledge the dilemma we are in, we are debating which side to support. Piss off America and our Line of Credit is at risk. Piss off China and our external trade is at risk.

      • Jumping jack flash

        “Australia is best served from unplugging itself from the mercantalist trade surplus/deficit model by weaning itself off unproductive capital inflows.”

        yes, but good luck with that. Our manufacturing is all but dead and our economic growth is powered by the debt machine creating new debt against inflated property prices, inflated by debt.

        Our debt machine is pretty much 100% reliant on Chinese money now.

        And, yes, the US petrodollar and their reserve currency advantage. The best decision ever in all history. Without that they would have been screwed 1000 times over.
        If China can get OPEC to agree to price their oil in Yuan then the US may actually have some problems, but for now all is fine.

        I think it is just Australia being pushed around because the US want to say something about it. Why aren’t the US talking to Canada about Chinese buying all their houses? Maybe they have and that’s why they suddenly have that new tax?

    • Original JohnMEMBER

      “Our debt machine is pretty much 100% reliant on Chinese money now.”

      Not quite accurate. As noted here on this site, the banks have continued to source offshore funds, the biggest buyers coming from Japan, US and UK. China is our largest trading partner buy a country mile. So our debt machine is dependent on our banker to keep the funds coming and our customer to keep buying our goods (even though our goods are neither rare or solely supplied by us).

  18. Original JohnMEMBER

    Just as a note on investment in Australia:

    http://dfat.gov.au/trade/topics/investment/Pages/which-countries-invest-in-australia.aspx

    “The United States and the United Kingdom are the top two sources of investment in Australia, ahead of Belgium, Japan and Singapore.”

    In this list, China, while growing in scale, is still well down the list. Different story on trade though. So it seems that Australia is caught – do we we offend our largest investor or our largest trade partner? Do we offend the group propping up our housing bubble through direct purchases or do we offend the group financing our ability to have said housing bubble? I would guess that unless China starts buying our wholesale debt (gov bonds and bank bonds), this debate is not going to end quickly as we really need both countries to keep the ship afloat.

  19. “We might choose to back the new kid on the block but if so we should do it with our eyes open. ”

    “Given it is totalitarian, we do not know to what extent it will at some point rely upon external aggression to support internal power.”

    “On the other hand, the US is still the great Liberal Empire of our time, the greatest democracy on earth by some distance. It has no interest in leading wars of aggression”

    I’m sorry, but can anyone read that with a straight face?!

    Bwahahahahahaha!

    Very droll. Very droll indeed!

      • ErmingtonPlumbingMEMBER

        Best posted link of the day, Skip.
        That sounds like a good book (the one mentioned) to hand around.

        “What precipitated this was that the mortgage industry thought they could ignore a 300-year old system of property law. They considered it too costly and time-consuming to generate and store (and pay to publicly record) paper assignments for every single transfer. Never mind that it was the law. Never mind that having a well-established property records system, so you can buy and sell property with the confidence that nobody else has a claim on it, is what separates developed and under-developed nations. The industry didn’t want to pay for it, so they didn’t.”

        “And to be clear, ignoring property records law facilitated the securitization frenzy, led to the housing bubble, and drove the collapse. There wouldn’t have been a recession, at least not one that looked like this, if the banks had to follow the property laws.
        I think what struck me most about this story was the fact that the foreclosure fraud these ordinary citizens uncovered was so crude and so sloppy. I could only conclude that the people involved knew there was nobody minding the store. That says a lot about Americans’ sense of ethics. How many people working in that industry do you think knew they were committing fraud and just didn’t care? ”

        I thought the Chinese property purchasing frenzy was based on the perceived, superior “legal protection of private property” enjoyer in the anglo-sphere.

        Its still gotta be better than china though,…right?

      • EP…

        I think Vidal Gore covered this terrain quite well, from both an intellectual stand point and as a direct observer….

      • Sorry… Dyslexia and haste strikes again… Gore Vidal – to wit

        As Gore Vidal said years ago, “libertarian” is the wrong word — they should be called “propertarians,” and I will use that term. And it is possible to be rigorously logical and dead wrong at the same time. In fact it is pretty common. Nevertheless —

        The propertarian logic can be expressed (I think) in three premises:

        1) People who own economic resources (especially property) should be allowed to dispose of it as they please, so long as they do so individually.

        2) Subject to 1, people should be able to make “lifestyle” decisions as they choose [ID politics], as long as others are not materially harmed.

        3) The military and police powers of government should be limited to protecting those freedoms.

        In this context money – wealth is a personal rights multiplier, much to the confusion of those down the ladder devotes i.e. rules and laws applied equally e.g. a corporation is an uber human with rights benefiting such status.

        Disheveled Marsupial…. what cracks me up is AET and neo-Classical economists from the West have been advising China for yonks, albeit the Chinese invariably apply it vis their own ethnic / cultural and political system infrastructure, all that’s lagging is the previous periods ideological propaganda branding [environmental conditioning]. But my…. oh my…. the pearl clutching and fainting couch exercises… the barbarians are at the gates…

      • Great link skippy.

        I’ve posted this link a few times but I do think it is worth everyone’s time.
        Matt Taibbi talking about his investigations into the Great Fraud of 2008 and the cognitive dissonance that the Justice System has with sending business people to jail.
        https://youtu.be/2kd4jpPZrRs

      • ErmingtonPlumbingMEMBER

        Yes, i’ve been meaning to get my hands on Vidal’s Narratives of empire series for years now, ever since seeing a very good Doco on his life.
        Love well researched historical reads,…Read all of James Clavell’s stuff by 18yrs old and couldn’t put down McCullough’s First man in Rome series when I started them.

        Gores series looks like the kind you get in paperback (instead of Kindle) so you can hand it around.

        http://whyyoushouldread.blogspot.com.au/2009/08/gore-vidals-narratives-of-empire.html

        Gotta love a contrarian

        http://www.telegraph.co.uk/books/authors/gore-vidal-and-his-bitter-feuds/

      • Skippy,

        “..what cracks me up is AET and neo-Classical economists from the West have been advising China for yonks, albeit the Chinese invariably apply it vis their own ethnic / cultural and political system infrastructure,..”

        That sounds like you are saying that the AET and Neo-classical crowd are teaching the Chinese a ‘system’ and the Chinese are applying a neo-liberal model with some local differences?

        What exactly are the AET and neo-classical economists advising communist China to do?

        If they are advising them to try smaller government and the privatization of publicly owned infrastructure and assets – it appears the Chinese government is not listening. And if they are not advising them to do that what are they advising them to do?

        If anything the Chinese model would appear to have more in common with 1930s Germany or Japan – but with even closer ties between the state and large corporations.

        Whilst neo-liberals might be keen to make a buck selling their own countries down the river to authoritarian states it is hard to see how they would see an authoritarian state as anything other than the polar opposite of a fully privatized corporatist model with a puny state sector.

      • 007….

        What are you not aware of western economists making the rounds in China, really, just search it and behold. Yeah from a monetary perspective their all ears conta the stuff the Chicago boys told Gorbie….your broke…

        Disheveled Marsupial…. even linked to it back in the day to 8~

      • 007….

        What are you not aware of western economists making the rounds in China, really, just search it and behold. Yeah from a monetary perspective their all ears conta the stuff the Chicago boys told Gorbie….your broke…

        Disheveled Marsupial… even linked to it back in the day to 8~ … discussed over at NC…

      • EP…

        Totalitarian eh…. try what happened to the Occupy mob, Prison industrial complex, largest transfer of wealth in modernity post GFC, the bed rock of capitalism i.e. property title spit on due to RE fraud, and no butts in jail as Holder said – NO – to systematically important national security entity’s…. et al…

        Disheveled Marsupial…. the coup went down in 2000… then the Patriot act… moving forward….

      • Skippy,

        Yes I am sure they are all ‘trying’ to bring the glories of neo-liberalism to China. Just not sure whether they are getting very far until the CCP starts getting on board with the program of seriously privatising key state owned assets – especially banking. At time it seems as though CCP economists are reading the WSJ – at other times it is almost as though they have zero intention of sticking close to the neo-liberal belief system. It is not even clear whether all the crooked CCP cadres can be said to ‘own’ the assets they are busily milking.

        Perhaps it doesn’t really matter how the system is being milked by insiders but it is very different to what the IPA would endorse.

      • ErmingtonPlumbingMEMBER

        Still didn’t answer the question Skip,…who is China’s equivalent of a Vidal or Chomsky?, do they exist? Could they survive the scruitny of a million man Stasi?

        I share 100% Skip, your desire to inform and call out the discracefull abuse of power and Coruption of Democracy that the United States of America is and to a lesser degree has always been.

        But cut the enemy of my enemy is my friend crap Skip.
        China has got plenty to be ashamed of and called out for, herself and many people here push a dangerous mentality, that all “evil” in the world is a product of the US, and as such need not be critical of courupt and agressive behaviour elsewhere in the world.

        It ALL deserves to be called out.

      • China’s equivalent of a Vidal or Chomsky… Confucius – “Do not do to others what you do not want done to yourself”, the Golden Rule. circa 551 BC

        China has 5000ish years of history –

        Written records of the history of China can be found from as early as 1500 BC[1][2] under the Shang dynasty (c. 1600–1046 BC).[3] Ancient historical texts such as the Records of the Grand Historian (ca. 100 BC) and the Bamboo Annals describe a Xia dynasty (c. 2070–1600 BC), which had no system of writing on a durable medium, before the Shang.[3][4] The Yellow River is said to be the cradle of Chinese civilization, although cultures originated at various regional centers along both the Yellow River and the Yangtze River valleys millennia ago in the Neolithic era. With thousands of years of continuous history, China is one of the world’s oldest civilizations,[5] and is regarded as one of the cradles of civilization.[6]

        Compared to 250ish for America or a couple of thousand for Western Judaic – Christian and I don’t remember the last time America was invaded or economically made subservient, as such I’ll resist in the reductive over simplifications apples and oranges comparisons.

        Disheveled Marsupial…. yet at the end of the day DNA makes a mockery of most of this, if not Jared Diamond’s observations on resources and enviroment being more important in uplift than ideology alone.

      • Skippy

        “…If you think the IPA is the sole repository of neoliberalism your sorely mistaken….”

        Okay which repositories of neolberalism you reckon endorse the Chinese state authoritarian model?

        The MPS toboggan team?

        The Chicago Boys?

        The CIS?

        The hard baked former trot neo-cons who still swear blood vengeance on the stalinist tankies?

        Trying to fit China into your model whereby the USA via its neoliberals think tanks control the world is too hard.

        Let it go and just accept we are about to watch the Chicago boys privatised system of control duke it out with a system of authoritarian state control that is their mortal enemy.

        None of us know how it will turn out.

        And knowing who to cheer for is even harder as both sides are unpleasant in their own special way.

      • 007….

        Not saying China is going neoliberal, but are cherry picking bits of economics from neoliberal economic schools, especially monetary theory i.e. sorta MMT AMST but instead of a corporatist [neoliberal] bent, its more state based from the CPC perspective.

        I can only provide you with a suggestion to read – Machine Dreams: Economics Becomes a Cyborg Science.

        “This is the first cross-over book in the history of science written by an historian of economics, combining a number of disciplinary and stylistic orientations. In it Philip Mirowshki shows how what is conventionally thought to be “history of technology” can be integrated with the history of economic ideas. His analysis combines Cold War history with the history of the postwar economics profession in America and later elsewhere, revealing that the Pax Americana had much to do with the content of such abstruse and formal doctrines such as linear programming and game theory. He links the literature on “cyborg science” found in science studies to economics, an element missing in the literature to date. Mirowski further calls into question the idea that economics has been immune to postmodern currents found in the larger culture, arguing that neoclassical economics has surreptitiously participated in the desconstruction of the integral “Self.” Finally, he argues for a different style of economics, an alliance of computational and institutional themes, and challenges the widespread impression that there is nothing else besides American neoclassical economic theory left standing after the demise of Marxism.”

        In my own words neoliberalism is the linear progression of concocted axioms used to prescribe what it is to be human, for the benefit of those that funded its ascent – in the social imperative e.g. we serve the market and not that the market should serve humanity or that the market is the sole determinate in our species choices, especially when fear and insecurity is the major driver.

        PS. If you think after the patriot act that DC has a huge distinction from the CPC I disagree…. both party’s are fundamentally the same on economic matters with only ID political separation. Both want to end SS and Medicare et al.

    • I actually half expected based on the headline, that the entire piece was going to consist of the words ‘Of course we f king are!!’ repeated about 150 times down the page.

  20. Do we have a choice?,Wwe need the high migration to maintain growth via the property boom. We don’t have any savings and most of what we export can be supplied by other countries. Most of us are too lazy to really look into issues and most of us are too divided or too stupid to agree on short term pain for long term salvation. We’re stuffed.

  21. Hmmmmm .,…. a persuasive argument with which many MB readers concur. A few in disagreement, but the debate has been quite interesting and informative. I have zero understanding of national strategic issues except to say that historically the US was the key to Australia surviving intact in the Pacific War. I understand much has changed in the intervening period, but I can only comment that the major democratic presence in our region is the US, so we need to think very clearly about how we align our economic and national security ducks with non democratic powers in the region. For me it’s unequivocal, but I know nothing.
    I hark back to the Asian miracle of the seventies and eighties when the Japanese seemed to be buying up north and eastern Australia to the detriment of citizens and will never forget being locked out of my hotel lobby breakfast bar so that a gaggle of near sighted Asians could slurp their tea free of the stench of local whites – I never paid my bill in protest and it’s still unpaid to this day. I liken this to the young citizens who are locked out of the market by rampant Chinese capital, but I’m of the older class so my roots are fertilised with a dose of racism fed by the White Australia Policy, which I would be foolish to deny.

    In my mind the comparison is somewhat valid even though the scale is disproportionate. The Japanese miracle rapidly unwound when the source of their capital was found to be funded on loose capital when the Asian recession forced the financial casinos to cash in their plastic. It was further exacerbated by the realisation that the Japanese were not only borrowing thin air from corporate shells but they were lying about it in their corporate and national accounts. That realisation came too late as they had already offshored their manufacturing capacity and skills base to the extent that the sharp contraction in labour demand pushed them into a recession from which they have never recovered despite the Government trashing the superannuation savings of millions of the older Japanese to stave off what they saw as sovereign default. The unthinkable for Japan became the reality. Had they not held their massive technological brand power within Japan their economy would have disappeared faster than a bowl of Pyongyang kimchee.

    And so it will be with China as they manipulate their currency to maintain a domestic demand which is already showing cracks. Remember that unlike Japan, we know little about the reality in the Chinese economy who are renowned for manipulating statistics and having little harmonisation with international accounting standards. The single factor holding up the Sino miracle is the volume of their domestic population driven demand and it seems the financial mandarins are betting this will replace the export demand of their imitations as the globe formulates the plethora of “free” trade agreements, many of which lock out those states troublesome to the EU and the USA. BRICS has yet to achieve lift off and will stutter as long as Sino-Soviet tension remain despite the beaming leaders practicing their shit eating grins at official functions…….India will not put much on the BRICS trade table until they develop the macroeconomic fundamentals to their economy, so really what we have is a bunch of countries with massive populations all locked into their own crises of economic development. Compare that with the USA, although smaller in population but with a sophisticated global economic and strategic influence and power and you would have to put the odds on the US and not China of emerging from the China Sea tussle in a position of strength.

    As I admit I have nothing to contribute to the national strategic argument, save barring outright war which neither side would win. It just seems to me that Australia would be stoopid to shy away from the USA in favour of pleasing the profits of those corporates trading with China. We tend to forget that Australia still has the sovereign capacity to talk tough with China because the fallout from dirt exports would fall on relatively few corporates and if that factor were removed from the China trade, the reality is that the rest is small change by comparison. In that context it behoves Australia to exercise controls in the national interest over Chinese “investment” and immigration to maintain a degree of independence from the dubious practices of their central powers whilst reinforcing a willingness to share trade opportunities. I doubt Hawke ever thought we would sell the farm when we led the way in opening up China to the West, so maybe we need to remind ourselves why we tugged the tail of the dragon in the first place.

    • Malcolm…

      To a fault most wars over the last few hundred years has more to do with bond holders than anything else. In Japans case the McCollum memo is informative, as well, as the latent effects from as old, as the whole east indies corp experience. People should be reminded that ethnic memory does not just disappear or that self awarded superiority is easily forgotten outsides ones own ethnic mob.

      Disheveled Marsupial…. History makes a laughing stock out of most of the economic rationalizations about humans or what has occurred in our species travels…. might have something to do with the disdain all the other academic disciplines have for it… that’s until some threw money at it and institutionalized it for narrow ideological reasons…

    • Thanks Malcolm….well written and well thought out.
      I’d be on the same page, were it not for the monetary paradox that occurs when a country transitions into a Reserve Currency.
      Make no mistake on this point, the Triffin Paradox out lived Bretton Woods and the implications of this paradox are very well understood by all PBOC insiders.

      • Don’t forget Bretton Woods was bastardized… Bob… by you know who and why….

        This is the rub, architecture is perverted to benefit the most powerful player in order to rig the outcomes. Of course, in the name of some self awarded rational argument.

  22. Saint MatthewMEMBER

    Why wouldn’t Australia sell out the US alliance? Australians didn’t care about selling out their own kid’s futures.

  23. US is an ally while China is not.

    But then again, the Moron side of the Force is a pathway to many abilities some consider to be unnatural.

  24. History is repeat itself, “pig iron Bob” Menzies sold scrap iron to imperial Japan in 1938 as Japanese imperial forces invade China and carried out nanjing massacre. Roll forward to 2016, appears China has ‘imperial’, strange for blue suited communists, for South China Sea, call it gun boat diplomacy. Too similar scenario in history and present day for comfort.

    • China isn’t going to have a go at anyone militarily. It is all bluster. They know they will get pummeled in under 4 weeks by the US military. It is bluster to get concessions and allow room to grow. Also to assert themselves on the world stage and say, we are a big power, you can’t ignore what we want.

      • Sorry but all the scenarios run by mobs like Rand et al show just the opposite wrt Russia and China, although MIC loves to gin up a story for profit. Remind me how long it took for the coalition of the willing to militarily defeat Iraq again, even after its air force was grounded and destroyed, how long the conflict has been going on in Afghanistan.

        Both China and Russian military doctrine is purely defensive capacity.

  25. Are we really going to sell out the US alliance for property prices?
    Short answer, Yes, and much more..
    If past behavior is any indicator of future behavior, then the answer is obvious..
    This place is becoming a joke.. Iceberg lettuce costs $4 in Sydney.. in Spain it’s 1 Euro..
    The only constant in a changing world is the ability of companies big and small to screw the Australian consumer.. I can see Sydney and Melbourne heading into some type of Monaco in this part of the world..

      • Well is it the size of the market allowing volume transactions, Ag subsidies, or is it imported from Romania et al using slave labour…. eh…

      • Nothing to do with market size. It’s supermarkets marking up prices for one reason: Because they can and the little guy has no choice but pay.. That same lettuce costs less than $1 in the US..
        It’s the same reason our houses cost more, our banking cost more, our labor cost more, electricity, gas, schools, etc.. etc..

      • 2b2f….

        Mate its not that simple… or are you arguing Walmart was the best thing ev’a because low prices or did they destroy thousands of local jobs and taxes whilst getting huge subsidies [food stamps et al], massive environmental polluter, and tax offsets from the Government due to lobbying power.

        Not to mention they then sent all the jobs to China, hell right now their getting ready to slash a thousand or so administrative jobs, those are the only ones that pay a living wage and have any sort of longevity. Not to worry tho the stock price will remain strong and enrich the executives, boardroom, and majority share holders, none imo that pay much tax. Everyone else can eat crumbling infrastructure and enjoy increasing social instability.

        Disheveled Marsupial…. have a nice day and a coke too – !!!!!!!!!

      • +1 2b2f, Resort pricing for everything. I don’t think Skip has left the country in the last 20 years.

      • Logandy….

        Tortured logic is not a substitute for what actually goes on in reality…. sorta like the hyper inflationists still Pavlovian conditioned contrary to reality…

        Skippy…. how about we pay you less for what ever it is you do… so everyone else can get it cheaper… your stealing my purchasing power and rights to my own labour…. because Markets go die whilst your at it…. eh…