Australia rallies to fight Angry China

After Andrew Hastie called out the weak-kneed yesterday for failing to resist the rise of Chinese tyranny, a furious debate has erupted. The AFR leads us off with the good news:

…public utterances such as Hastie’s are unhelpful. They aggravate an already volatile situation.

China has Australia over a barrel economically. “They could put us in recession tomorrow,” said one senior Coalition source.

…As much as Morrison and his ministers insist Australia is not taking sides in the tensions between the US and China, its actions suggest that at a minimum, it is certainly hedging its bets.

At a micro level, Morrison is surrounding himself with China hawks, as evidenced by the appointments of Mike Burgess as the next ASIO director-general and Andrew Shearer as the next Cabinet secretary.

Hastie was thoroughly helpful and bravo ScoMo on the appointments. Kow towing to China by pretending it isn’t there is the response of a three year old child with his hands over his eyes. If conducting such discussions costs you a recession then you might as well find out as soon as possible because there is absolutely no stopping it in the future.

Ironically for the AFR, the key takeaway from Hastie’s Nazi analogy is not that Communist Party China is evil, it is that we are weak. He is highlighting how the co-opting of greedy elites aided and abetted Nazi power via such kow towing notions as the Maginot Line.

Thankfully, the wider MSM is more circumspect. The Australian:

New ASIO director-general Mike Burgess will transform the domestic spy agency, increasing its use of sophisticated technology and cyber spycraft to counter growing foreign interference by state ­actors, including China and ­Russia.

…Mr Burgess takes on the role amid growing concerns over foreign interference in Australian politics and universities, a surge in hacking and intellectual property theft, and the identification of China by Western nations as a clear strategic threat.

…At ASD, he advised Malcolm Turnbull not to allow Chinese companies Huawei and ZTE to be involved in Australia’s 5G rollout.

That’s a terrific choice. It will not only make things tougher for CPC spooks, it will draw us closer to the US. Shearer is an equally good choice: a former national ­security adviser to John Howard and Tony Abbott and head of ONA.

Equally good is the dumping of Martin Parkinson as PM&C head, who had populated the department with DFAT drones and dislocated economic from strategic policy. Phil Gaetjens has a much better understanding of the issues.

Speaking of DFAT, recent appointments will also help contain its China apologists.  Marise Payne was a good choice for the ministry and her new chief of staff, Justin Bassi, is Malcolm Turnbull’s former national security advisor who shepherded through both the foreign interference laws and the Huwaei decision.

Defense is also in good hands with Linda Reynolds with former head of geospacial intelligence Scott Dewar her chief of staff.

Steven Kennedy as the new Treasury Secretary is also open minded.

This is about as close to a dream team of China hawks and realists as Australia could muster. I doubt we would have seen the same from a very confused Labor Government so, if on nothing else, the Australian people have been rewarded for their choice of government in a bolstered team to redress the burgeoning CPC tyranny.

And they are already hard at it already, via Domain:

An intense diplomatic effort is under way to overturn “seriously disturbing” plans for a new Chinese military base after repeated public denials of the deal by Beijing and Cambodia failed to convince the Australian government.

…The reports, which Cambodian Prime Minister Hun Sen dubbed “the worst distorted news”, prompted Australia to urgently seek more information, but officials are deeply unsatisfied with the response and believe the base could go ahead.

…Senator Payne discussed the Cambodian base with US Secretary of State Mike Pompeo in Sydney on the weekend and agreed to stay in close contact on developments.

…One senior national security official said the base plan was “seriously disturbing” and had triggered alarm. The Indonesian government was so concerned by last month’s reports that it dispatched an official from Phnom Penh to seek first-hand information.

A number of countries in the region are quietly working behind the scenes to prevent any Chinese military installation on Cambodian territory.

Domain also printed an op-ed from Professor Anne-Marie Brady, China specialist at the University of Canterbury, New Zealand, and author of Small States and the Changing Global Order: New Zealand Faces the Future:

Australia has led the world in facing up to the China component of the new security environment, passing legislation against foreign interference, addressing the risk of Huawei and the 5G network, and working to undo the damage of former Australian government policy that allowed three BeiDou global navigation ground stations to be set up on Australian territory and permitted foreign control of critical infrastructure such as the Port of Darwin.

The Australian government has also launched a new Pacific policy, stepping up its level of engagement with its neighbours. As was the case in WWII, the small island states of the South Pacific are shields for Australia. If a hostile nation controlled one of the island states on Australia’s maritime periphery, they could cut off shipping and communications.

Australia has made adjustments in its China policy and developed a well-thought-out resilience strategy, because a realistic assessment of Xi Jinping’s foreign policy has given it no other choice. Since coming to power in 2012, Xi Jinping has returned the Chinese Communist Party’s foreign policy to a level of antagonism not seen since the Cultural Revolution, while China’s domestic foreign policy has also returned to extremes of oppression familiar from the Mao years.

Professor Brady is well acquainted with CPC bullying. Her’s is high praise. If we are the tip of the spear in Cold War 2.0 then it was just sharpened.

David Llewellyn-Smith

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.

He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.

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  1. TailorTrashMEMBER

    “An intense diplomatic effort is under way to overturn “seriously disturbing” plans for a new Chinese military base after repeated public denials of the deal by Beijing and Cambodia failed to convince the Australian government.”

    Chinese also said those islands that are now fortresses and airbases were for maritime rescue …..surely they weren’t lying ? …….Good to see straya awakening… they just got to clean up the fifth column that is here ….fire the universities VC s would be a nice start

  2. david collyerMEMBER

    Yes. This matters. Keep discerning between our warmth toward the Chinese people and our revulsion at its totalitarian government at every opportunity.

    • John Howards Bowling Coach

      I am torn on this issue. While in theory I agree the government are the problem, every single time I am over there in China I come back feeling that they are the most dishonest and morally depraved society on the planet. Then I get back home and the majority of my interactions with Mainland Chinese migrants and visitors show the same thing. Manipulation of/gaming the migration system, lying to the government, lying to everyone they talk to. Complete greed and obsession with money in everything they do in life. Environmental destruction and the urgency with which they chase down rare species to eat or use in mindless and unscientific medicines. Perhaps the government there is just representative of these people? This is from a someone who’s better half is Mainland Chinese, so I am even approaching from a positive point of view…

  3. Plenty of tough talk but are we just going to keep:

    1. Selling pig iron to build the next 10 Chinese aircraft carriers

    2. Buying the cheap products of a workforce controlled by an authoritarian collosus?

    3. Providing technical and other skills to the privileged children of CCP party members?

    We are?

    Oh good, I would hate a rising 1930s world threat to get between us and a buck.

    Did I miss the bit where we kicked China out of North Korea and Tibet?

    So Hong Kong is now Poland?

    Or is Czechoslovakia?

    Or the Ruhr?

    Or Austria?

    What about Cambodia? Are they allowed to agree to a Chinese Base?

    What about Cuba? Do they get to ask the USA to vacate Guantanamo Bay?

    Does China get to sail its fleet around the Gulf of Mexico to ensure freedom of navigation?

    Who are the baby eaters in this scenario.

    Someone murdered a bunch of pinko nuns in South America in the 1980s, who was that?

    • NoodlesRomanovMEMBER

      Pig iron? That’s value adding my friend. We don’t do that here – red dirt is easier to export.

      • Tassie TomMEMBER

        LOL. BHP’s briquette foundry around the turn of the century tried this sort of value adding. What a failure that was! Writing that off led to pretty much BHP’s only full-year loss in history.

      • You mean you can’t make pig iron using solar and wind energy? Wow. What a shame we don’t have a limitless supply of coal for cheap and reliable energy.

    • bolstroodMEMBER

      Our(Australia’s ) major shareholder has spoken ,Captain Hastie is doing as he is told.

  4. At this point it seems like a matter of time before trade stops.

    Question is, will it be the CCP snubbing us, standing up, USA blackmailing us, some sort of Pig Iron Bob, or something else entirely?

  5. SnappedUpSavvyMEMBER

    yes if Labor had of got in with their off the charts estrogen levels….. so that’s one positive

  6. “He is highlighting how the co-opting of greedy elites aided and abetted Nazi power via such kow towing notions as the Maginot Line.”

    I think that is an unfair characterisation of that period. By and large, the ‘elites’ as represented by those with power in the Liberal democracies wanted to avoid another horrific war at any cost. WWI was truly nightmarish, and you can trace the death of every single European empire to that war, some just took more time to realise it. The appeasement period was only 20 years after WWI. There were still limbless, blind and horrifically deformed former servicemen in the streets. The monetary costs of that war had completely reshaped the world financial system in favour of the US and New York, and the Depression had further eroded London’s ability to act unilaterally. The US had turned inward again, and serious people within the UK were not supportive of the UK becoming embroiled in a war over something, as they saw it, as unimportant as Poland.

    We are not in the interwar period. Hastie is right, China needs to be confronted. Our elites are weak not because they have the memory of a horrific catastrophe in their thoughts. No, our elites are weak because they are weak. That is worse and far more dangerous in my opinion.

    • I don’t think they’re weak so much as they’ve already done the political / military calculations and know which side they need to on.
      Sometimes that’s all that really matters, because history is always written by the victor. Morality is normally just a sort of post-facto adjustment to the Position statement that aligns actions with intent, and outcome with righteousness…after all god is on our side!

      • Hastie and this article posit that our elites are compromised/weak, likening them to the elites that ‘failed’ to confront Hitler. I don’t think that is a correct reading of the situation. The Interwar liberal democracy elites had very good reasons for not wanting to enter into another war, as the memory and effects of that catastrophic war were very fresh. They were very aware of what war would cost.

        Unfortunately, we are in a worse position, because our elites have absolutely no good reasons NOT to confront and contain China. There is no recent cataclysm for them to try and avoid.

        In fact the better period to liken this to is the build up to WWI. WWI happened after a long period of peace and prosperity that began to be undone by changes to the makeup of the great powers and their relative power/weight. That is what we are seeing with China and the USA.

        For the record I believe China needs to be confronted and even contained, but we had better come up with a watertight story as to why it should be confronted and contained, and why WE (the West, the Liberal Democracies) are better. China’s system is clearly a dead end for humanity, but we have to make the argument as to why that is. It doesn’t help our cause that we are consigning the environment to a heat death, allowing continued destructive inequality to build, and eroding the freedoms we like to trumpet about.

        We are meant to be better, it is what we tell ourselves. Time to start acting like it.

      • And fisho, the Keynesians, are doing their “dig the hole, and fill it back in again”, but with a war and all that rebuilding thing. Maybe that’s Chairperson Dan’s plan for VIC. It would be nice to know what’s really going on, but China probably won’t back down on any plan they have.

      • I’m kinda of the opinion that countries earn the right to hold their opinions and demand that others respect the opinions that they hold. The most dangerous world is one where the ascendant power is denied the position they’ve rightfully earned.
        WW1 was very much about containing Germany, containing it economically, containing it politically and containing it Militarily. Pre WW1 France and England engaged in a sort of division of worlds spoils that tried to deny Germany the place they had Economically/ Scientifically/ Politically earned at the table. The rise of Germany’s (and Holland’s) industrial sectors posed a clear threat to Great Britain’s global dominance as a manufacturer and created conflict wrt rights to raw materials (vis-à-vis Boer war).

    • C.M.BurnsMEMBER

      Well said. Having just finished listening to Dan Carlin’s 20+ hour opus on the Great War, he speaks regularly about the deep and permanent effect that all aspects of the war had on those who survivied. The politicians, artists, the generals, the civilian populations and of course every individual that served on any side (but especially those on the western front).

  7. Government is a multi-dimensional thing. In many dimensions the LNP gummint under ScoMo and his predecessors is one of the worst we’re ever had and deserves harsh criticism. Josh Frydenberg, if you know what I mean. In this particular dimension though, they far outweigh the Chinese controlled soy boys in the ALP who were willing to flood us with more Chinese immigrants in the hope of winning a few seats in Sydney so that they could gain “power”. Can anyone imagine Wong or any other ALP drone saying the things that Hastie said? I don’t think so.

    Credit where credit is due.

    My view is that the ALP are now irrelevant in Australian politics. They are just a fake left foreign controlled obstruction that is preventing the formation of an actual leftist party that would truly represent the people of the country. The sooner they fold up and disappear like the Democrats did, the better off we’ll all be.

    • bolstroodMEMBER

      although I doubt we do leftish politics any more.
      I would settle for a new party that put the Common Good front and center.

    • spot on about alp droogs saying nowt and kudos to hastie. but my list includes every other member of the coalition..they’re proven corrupt self aggrandisers…a pox on all of ’em

      more hasties lambies wilkies required…hell.. ricky bobby even

    • SupernovaMEMBER

      Once the ALP threw labor and unions under the bus (Public Sector an exemption) and pursued the capitalist path, they needed to desperately reinvent themselves and they did this using far extreme left ideologies such as neoliberalism, accomplished at a time when western universities still retained respect. The extreme left social policies of the ALP complemented globalisation and unregulated corporatisation. Perhaps China may have democratized if the West did not pursue policies that weakened nation states.

      • “they did this using far extreme left ideologies such as neoliberalism”

        What the! They are polar opposites.

      • John Howards Bowling Coach

        Supernova, the reason China has not and will not democratise is not anything external, it is entirely the result of China being the same battle for power and internal fight that it has always been. Throughout history they have set about destroying themselves through over reach and insistence on totalitarianism. How did the culture that invent gunpowder, and had one of the earliest navies never conquer the globe? They were too busy fighting each other in the dream of absolute domination. Each dynasty ends in bloodshed and that will be the same for their current iteration. Where the Europeans set borders and agreed to disagree, then got on with creating new methods, the Chinese kept on killing and destroying each other, and never managed to get beyond their own patch. The nature of the people is the same as it was then, and likely always will be, like much of the world they have always needed a strongman leader because left to their own devices, it’s nothing but greed driven chaos. It’s ironic that largest communist nation really works on the everyone for themselves principle. No wonder none of them pay tax when they get to Australia.

    • +99

      I agree,

      25,000t of steelwork about to be imported from xhina for BHP’s Southflank project, what does the Scottnoplan Govt say about that?

      To start to get out of this mess we need 100% local steel, local design, local not 457 workers.

  8. St JacquesMEMBER

    Sure, they have us over a barrel.and could have us in a recession tomorrow, and very easily at that. That’s news? hey could have us in a DEPRESSION tomorrow! SO WHO ARE THE KNUCKLEHEADS THAT LED US INTO THIS SITUATION OVER THE LAST TWENTY OR THIRTY FRICKING YEARS??????

  9. Be careful with this statement “Professor Brady is well acquainted with CPC bullying. Her’s is high praise”. As professor Brady is also a global fellow at the Wilson Centre, which gets a third of its of its funding from the USA government and is housed in a US government building. Hence, probably should not be considered impartial.

    That being said Australia needs to do something to reduce China’s influence over the country. However, there seems to be a misunderstanding of the causes of the problem. In my opinion there are two main problems one with the democratic system and the other with the economic system.
    The problem with the democratic system is that it is not even vaguely democratic in Aus. The politicians take donations from industry and others and carry out their bidding. This means that the politicians are ready and willing to take money from China as well as they are already corrupt. This corruption has lead to a neoliberal economic system where everything is globalised. Subsequently manufacturing and other labour intensive activity has moved to where wages are cheapest and Australia is no longer self sufficient. Aus gets by with selling raw materials and importing manufactured goods, which is a strategy employed by third world countries around the world that have been shafted by the IMF. This makes Aus extremely susceptible to China’s bullying policies. The way to stop it it to block free movement of goods, services, capital and labour without strict regulation. However, the neoliberal freetrade meme has taken over the minds of > 99.9% of economists so I can’t see Aus developing the structural economy that will allow it to stand up to China anytime soon.

    • bolstroodMEMBER

      The Chinaman may do us a favour if they do throw us into depression.
      It may be the only way we find our way back to being a self sufficient , manufacturing nation.

  10. David

    Good point about the DFAT bias towards China.

    I think the DFAT bias is due to their long term view that Australia has to become Asianised, and is something that was popularised in the various Uni Arts faculties (from where the Department of Foreign Affairs has traditionally drawn its graduates and staff) over the last 40 years and is now mainstream thinking. Note that DFAT is a 1987 ALP amalgam of the Department of Foreign Affairs and the Department of Trade (trade previously residing as either an independent department or as part of one of the industry departments (I worked in the Department of Trade and Resources the in early 1980s). In effect DFA took over the trade function (The DFA Secretary remained post merger) and used it as a mechanism to help change the economic underpinning of Australia away from manufacturing and to increased foreign ownership and the promotion of Australia’s asianisation.

    Since that merger there has been very little if any policy power in the public service in support of local industry and ownership.

    I think the Trade policy function should be removed from the DFAT portfolio and either merged with one of the industry departments (as happens in many overseas countries) or re-established as a stand alone Department in order for Australia to get much more sensible trade treaty outcomes and to remove the inherent bias of DFA towards Australia’s asianisation..

    • John Howards Bowling Coach

      Worse than that, Austrade is now tasked with bringing in foreign investment not just with assisting industry with developing export markets. So the government(s) (state and federal) are actively selling off our nation, funded by the taxpayer! What an absolute crime!