Two articles in The Saturday Paper over the weekend are disturbing for the future of Australia under the Albanese Government.
The first was Kevin Rudd who correctly diagnosed the problem:
To understand the People’s Liberation Army’s fortnight of political and military pyrotechnics over Taiwan, you have to start with the domestic political conditions in Beijing.
…China’s economic reform program stalled from 2015 and, since 2017, the general trend has been to reassert party control over many of the businesses that powered previous rapid growth. We now see party representation in the management of private firms and their co-option by the state for political ends. State industrial policy has been revitalised on a grand scale, crowding out private innovation, while state-owned and private businesses meld through mixed-equity arrangements. There have been crackdowns on technology firms under the rubric of competition policy and against what Xi calls the “fictitious” economy (for example, property) as opposed to the “real” economy (that is, manufacturing). An ongoing party rectification campaign reminds the Chinese that the courts exist to serve the party, including in commercial disputes. Most of these fall under the umbrella of what Xi calls the “new development concept”.
Added to these issues are the deeper structural problems of demography (low fertility, a peaking population, negative immigration, rising dependency on fewer workers) and productivity growth (crawling along at barely 1 per cent for the past decade). This is a worrying trifecta for any economy, let alone China’s, where unfailing economic growth has been crucial to the party’s political legitimacy.
It is now an open question as to whether China will escape the “middle-income trap” often faced by developing economies whose ambitions to join the high-income club are outpaced by rising costs and declining competitiveness. If that happens, China might never surpass the United States in economic power – which was once considered inevitable – or do so only narrowly. It is no surprise then that Xi is reportedly pushing officials to ensure China’s official growth rate stays ahead of America’s.
This brings us back to the 20th Party Congress. Under normal conditions, this economic outlook would place a leader under extreme pressure. But Xi’s consolidation of his personal power during the past decade is nearly complete. He will almost certainly be reappointed as general secretary this October-November. The real questions hang over key positions such as premier and the inner circle of economic advisers, and whether the successful candidates can persuade Xi to release the political, ideological and regulatory controls he has imposed over the past five years to restore business confidence and growth. Xi’s Achilles heel remains the economy.
…Xi Jinping, for the first time, has set an effective deadline for Taiwan’s return no later than the centenary of the People’s Republic of China in 2049. The analysis of the Asia Society Policy Institute, of which I am president, is that the real risk of war will escalate markedly in the late 2020s and early 2030s. Our objective should be to do whatever is possible to preserve the status quo over Taiwan, which has become a vibrant democracy, a dynamic economy, an open society – as well as the innovation capital of Asia, as the premier source of advanced semi-conductors. That is why all sides should take action now to restore the political insulation in the US–China relationship that has been stripped away over recent years, so that the two sides can strategically compete without accidentally spiralling into crisis, conflict and war. The years ahead should be used by Washington, American allies and, most importantly, Taiwan itself, to enhance its own deterrence. I have outlined my proposal for how this might be done in my book The Avoidable War, through a framework I have called managed strategic competition.
Rudd’s reasoning is:
- The CCP cannot do the reforms it needs to boost living standards.
- Ipso facto, its social contract to rule is tearing.
- Ipso facto, it is turning to nationalism to legitimise itself and that means absorbing Taiwan.
Readers will recognise that this is precisely my own argument. I agree with his conclusions too except on one account.
If the drivers of Chinese expansionism are domestic politics, as Rudd says they are, then the CCP has to invade Taiwan no matter what we do to stop it or what the cost.
If so, criticising politicians for visiting Taiwan is just noise.
In the hard calculus of realpolitik, any potential civil war over Taiwan is a great opportunity to stop Chinese expansionism in its tracks. To make sure it understands that such a conflict will result in immediate and massive trade, commodity, monetary and financial sanctions that shove it directly out of the global economy.
Then it will either return to reform or collapse upon itself. Either is an outstanding result for global liberalism.
The second story, by John Hewson, might have been written by a kindergarten kid:
We must work on collaborative research, academic and cultural exchanges. We have trained so many Chinese students in Australia but very few have remained for us to gain any benefit from their education. As a nation we have to rise above this latent racism; some people in responsible positions are fostering fear, which is then fuelled by an irresponsible media hungry for salacious headlines. Surely a mature engagement with China would provide the scope to register our concerns about issues such as human rights abuses, detention of our journalists and others.
The basis for any effective relationship is surely mutual respect. We should recognise and respect China’s many economic achievements, most notably moving millions of their people out of poverty. Misinformation and a longstanding culture in Australia of suspicion towards China is stopping us from moving forward.
Many seem stuck on the idea that it is a choice between the United States and China, and we should let the US dictate what we do, how we respond to the rise of China. The Americanisation of Australia has gone too far – we are in danger of losing our national identity. We don’t need to choose. We need to be the best we can be, and extract all that is good in our national interest from both of those relationships.
For starters, in what universe are we under-engaged with China? We’ve massively overdone it. That’s our problem.
Has JH been living under a rock for the past five years? Parliamentary bribes, espionage, cyberwar, plague, trade war, wolf warriors, Solomons coup, university corruption, Ukraine war. You name the statecraft dirty trick, China is doing it to Australia.
Has JH even read the 14 conditions to end democracy?
These must be met if we are to deliver JH’s little dystopia.
As for losing our identity, this is waffle of the worst kind. Australians know exactly where they stand on the US alliance network versus the Chinese alternative:
Playing the race card over these issues is profoundly irresponsible. This is about our liberal system versus a rising and diametric opposite.
We have chosen America, Japan and Europe because liberalism is the foundation of our identity and America is its protector.
On that note, let’s close with Professor James Curran, the persistent AFR China groveller at the AFR:
Since 2017 the Australian public has been subjected to a concerted attempt by political leaders and a compliant media to prepare for possible war with China.
It has worked.
Some folks never learn.
