cover story Punching Above Our Weight If Australia wants to maintain its influence in the world, it needs to keep reforming its economy and increase its population, says Paul Kelly ustralia’s opinion makers love to old fashioned debates we once had about power discuss our identity. Paul Keating were infected with racism, imperialism and a left the Lodge eight years ago but the cultural cringe that could only dismay today’s identity debate, while devoid of its sophisticated and cosmopolitan Australians. Past A previous passion, still exerts its hold leaders such as Billy Hughes, Arthur Calwell over the quality media. This is no bad thing. Yet and ‘Black’ Jack McEwen were obsessed with its endurance highlights by omission the debate Australia’s power, or rather its lack of power, Australia refuses to have—over the nature and and the ideas they championed of nationalistic extent of its power in the world. imperialism, racial-based mass immigration and This is a subject not to be raised in polite an unforgiving protectionism are now out of sight company and rarely to be confronted in the and out of mind, interned as the aberrations of straightjacket of Canberra officialdom. There are political primitives. other debates that command attention—our ties with America, our engagement with Asia, our counter-terrorism strategies and our defence force Paul Kelly is Editor-at-Large at The Australian. structure. But as a nation we prefer to discuss He is the author of numerous books including the various parts of our existence rather than the The End of Certainty: The Story of the 1980s totality of our existence. (1992) and Paradise Divided: The Changes, the This is because we have belatedly learnt how Challenges, the Choices for Australia (2000). to behave in civilised company. We know that the 28 Vol. 20 No. 2 • Winter 2004 • Policy Policy • Vol. 20 No. 2 • Winter 2004 29 Punching Above Our Weight There is one discussion that we do have about important in Asia, nearly half, 46% disagreed. power. It is about the morality of its use. As Only 30% felt that Australia ‘is able to influence academics and journalists are less subject to moral major issues in ways important to Australia’. and religious codes in their personal lives so their And 52% said it was now harder for Australia to claims to be moral guardians of Australian policy influence trends in world politics. These are the have become more presumptuous and pompous. people, of course, charged with this precise task. Their broad conclusion is easy to summarise—the It is fashionable to debunk the Government’s Keating Government was immoral and the 1997 Foreign Affairs and Trade White Paper Howard Government is more immoral. Keating’s that missed the Asian financial crisis but its offence was to seek a personal relationship with arguments have a long-run validity. The White President Suharto to leverage a series of foreign Paper warned that the disparity in growth rates policy objectives. Howard’s offence is deeper: it is between Australia and industrialising East Asia the absence of any moral conscience in his pursuit meant that the gap in economic size, technological of objectives from East Timor’s independence to and industrial sophistication will narrow, and, as border protection to his alliance with President a result ‘Australia will be able to rely less on its Bush in the so-called war against terror. When strategic and economic weight in the region to survival is not an issue then morals command a achieve its policy objectives’. In short, its relative premium. power is in decline. This idea is no longer popular. Since the Asian crisis the Howard Government has been an Since the Asian crisis the Howard exponent of the opposite view. It argues that our Government has argued that our influence in the world is increasing (when has any influence in the world is increasing government said otherwise?) with Foreign Minister (when has any government said Alexander Downer insisting that Australia is otherwise?) with Foreign Minister a very significant nation and the world’s 13th largest economy. However, notwithstanding such Alexander Downer insisting that cyclical trends, the challenges that face Australia Australia is a very significant nation and are immense. the world’s 13th largest economy. They begin with the 1997 White Paper’s projection of a relative decline in Australia’s ‘hard’ power in its own region. The best two measures Our focus on morality helps to substitute that define our ‘hard’ power are population and for any sustained debate about national strategy. GDP. At Federation some of the Founding Fathers This is because in the two generations since the dreamt that in 100 years time Australia would have Vietnam War Australia’s strategic circumstances a population of 50 million or aspire to become a have been relatively benign. (It also reflects our second United States. But its arid centre and ‘she’ll be right’ fatalism). Australia is a more distance from European cities defied such dreams. confident nation today and is conscious of its Australia is dwarfed by its neighbours—Indonesia transition to national maturity. Sooner or later, (215 million), China (1.3 billion), India (1.1 however, it must confront the strategic debate billion), Thailand (64 million) and Malaysia (25 inherent in its national situation. million). Current trends suggest that over the next half century this gap between Australia and The coming decline of Australian relative its region will increase and that it will increase in power proportional terms. A premonition of the problem is identified in Australia’s economic growth over the past Making Australian Foreign Policy by Allan Gyngell decade tops the rankings among the industrialised and Michael Wesley when they report a survey OECD nations. It has been a stellar performance. they conducted of DFAT’s policy officers (242 But many East Asian nations at an earlier stage responded). While 51% agreed that Australia was of economic development than Australia can be 30 Vol. 20 No. 2 • Winter 2004 • Policy Policy • Vol. 20 No. 2 • Winter 2004 31 Punching Above Our Weight expected to record higher growth rates in coming security terms virtually co-terminus with the US, decades. When the ANU’s Professor Glenn is fully integrated into the US economy (which Withers superimposes current economic trends takes more than 85% of its exports). Finally, the and population projections he finds that Australia’s United Kingdom is a member of the EU outside GDP ranking slips by mid-century from sixth to the Euro zone, enjoys its trans-Atlantic links 11th in the Asia-Pacific. Indonesia, Thailand and is a member of NATO. These constitute and Hong Kong—all smaller economies than for our former Empire partners an intensity of Australia’s today—would be larger. China would regional bonds and networks that transcend any be more than 30 times as large; Thailand now a comparable ties Australia is likely to create with its third the size of Australia’s economy would be own geographic, political and economic partners. larger. It is true that Australia benefits from being Second, Australia is in a region where in a dynamic region. However, as the 1997 White dislocation and conflict are on the rise. Australia Paper says (or sometimes leaves unsaid) these is the metropolitan power in the South Pacific economic trends mean the advantages Australia and a key player in a trouble-afflicted South enjoys in technology and economic weight will be East Asia. The South Pacific is increasingly beset eroded or reversed over time. by state failure and self-determination disputes; It is easy to say that such long-run trends defy witness the recent crises in Fiji and Solomon precise prediction. It is however difficult to argue Islands and the alarm in Canberra about Papua that this trend is improbable. And if it is probable, New Guinea’s stability. The future of East Timor then this decline in Australia’s ‘hard’ power must remains problematic. South East Asia represents have serious consequences for its future influence. an intersection of rising Muslim extremism, growing secessionist disputes and weak central Strategic realities governments, notably in Manila and Jakarta. The The situation is compounded by a series of Howard Government’s 2000 Defence White Paper strategic realities. First, unlike the situation facing said that Australia ‘cannot be secure in an insecure many other middle powers there is no political region’ yet our own region is becoming more or regional economic union for Australia to join. insecure and the forces driving such insecurity will Australia will not join the European Union. It will not be expended soon. not become a state of the United States. It will As a consequence Australia will have to assume not be accepted as a fully fledged member into a greater role within its own neighbourhood not any subsequently created East Asian economic just as a security partner but to uphold civil society union. In short, it will not find safety in numbers and check the drift towards failed states. This by trading away sovereignty to enter a regional awareness is seen in the Howard Government’s federation. Its location and the absence (apart from more interventionist approach to Papua New New Zealand) of neighbours at a comparable stage Guinea and Solomon Islands. The threat of of economic development means that Australia’s Islamic terrorism will drive Australia into deeper destiny will be determined as a free standing collaboration with Indonesia, the Philippines and nation state and not as a component in a larger other regional partners—a direction set after the political, economic or regional bloc.