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Gillard and China

China and the USA, two big and powerful friends, with some potentially divisive

differences. Australia has never faced a foreign policy dilemma like it.

Paradoxically, picking up the cudgels, is a Prime Minister in Julia Gillard with nobackground, and little prior interest, in international relations.

As a small nation, Australia has always pursued the obvious strategy of seeking

the protection of a world superpower. For our entire history that strategy has

focused on an English-speaking nation with which we shared cultural values, as

well as economic and national security interests. When the UK could no longer

deliver the required protection, we looked to the USA.

Australia drove the ANZUS treaty negotiations after the Second World War to

lock in this protection and ensure that America did not forget about our region as

it dealt with post-war reconstruction in Europe and the threat from the Soviet

Union.

We wanted something like the NATO alliance, we got something less, more

ambiguous. But it has been enough. Gillards gushing enthusiasm for the US and

our alliance on her recent trip to Washington is a continuation of our efforts to

secure US protection and its continued involvement in our region. Those efforts

included our participation in the Korean and Vietnamese Wars, and Howards

invocation of the ANZUS treaty in the wake of September 11.

Since federation, Australia had worried, with much justification, about the rise of

Japan. But since the second World War, Japan has been just as closely aligned

with the US as Australia. Japans industrialization provided an economic boom

for us, especially through iron ore and coal, without disturbing our national

security arrangements with America. Ditto South Korea.

China is different. We see Chinas rise as an economic opportunity and an

exemplar of a third world country achieving prosperity by adopting our own

beloved market principles.

Chinas rise changed Australias economic destiny. Chinas need for raw

materials and her cheap manufactured goods have dramatically changed our

terms of trade in our favour in recent decades. It gave us the longest economic

boom in our history, and it softened our path through the recent global financial

crisis. Without the greed is good policies of the Chinese communist party, we

would be stuffed.

China sees its rise as a return to its rightful position in the world, after several

centuries of humiliation by Europeans. It is never going to be happy with the sort

of US domination that Japan and South Korea have learned to live with, in

exchange for their security and prosperity.

The 2009 Defence White Paper, endorsed by the Rudd Government, is premised

on the notion that Chinas rise will ultimately destabilize the US dependent

security arrangements that have been a feature of our region since World War

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Two. If that happened, Australia would be vulnerable. Its unpleasant, and it may

never come to that, but history supports the White Paper analysis.

Chinas military expenditure has increased rapidly in recent years. Given that it is

in the middle of a dangerous part of the world, with borders with several

nuclear-armed states, this is perhaps hardly surprising. But historically, rapid

build-ups tend to be followed by conflict.

There is plenty of opportunity for conflict. China has millennia long, often

unfriendly, relations with most of our region from the Korean peninsula, to

Japan, to Indo-China and beyond. China also has ambitions about Taiwan, which

it sees as an alienated province, and it has been extending its influence close to

us in the South Pacific through much needed financial support.

Australia needs Chinas economic growth, but the national security issues that go

with it are increasingly of concern. Partly the problem is that we just dont know

China in the way we know Britain and the US, those countries are an open book

to us. China remains opaque, her intentions and inclinations are difficult for us to

read.

China does not believe its journey of national recovery is anywhere near

complete. The communist party survives through staggering rates of economic

growth, and the jobs it creates, gradual improvements in freedoms and

opportunities to participate, and, of course, fierce political repression when the

regime perceives a serious threat to its stability.

Most Westerners find this repression disturbing. But China argues that is unfair

to compare modern day China with the contemporary West. A better

comparison, they argue, is with the UK and the USA during their

industrialization. It took well over a century of industrialization in those

countries before there were universal suffrage and trade union rights. InAustralia in the 1890s, and later, state violence was used against peaceful

strikers and demonstrators.

Under the recent spectre of terrorism, Western countries have shown a

considerable willingness to withdraw or modify our cherished human rights.

Think Haneef. Think asylum seekers. And anyone familiar with the treatment of

indigenous peoples in this country is unlikely to get too dewy eyed about the

Wests commitment to human rights. Still, Chinas record on human rights is

terrible and the West is right to seek improvements.

Ultimately, the human rights agenda is a sideshow. Gillard is no more likely than

Howard to risk economic growth for a softer Chinese approach to its dissidents.

Its not about principle, its about Australian domestic politics. Australians want

our longest boom to keep on going. Sure, we worry about abuses, but not that

much. Well pursue the human rights agenda right up to the point where it

seriously antagonizes the Chinese, and not an inch further.

Meanwhile, we will try to create a strategic architecture in our region that

continues to be US-centred, while slowly giving the Chinese a greater role in

maintaining stability. Whether two super powers can co-exist in Asia is a

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question for the future. One day we may have to choose sides in a dispute,

perhaps over Taiwan. But not yet. Gillards challenge is to make sure we dont get

crushed by the dancing elephants. If she proves to be a safe pair of hands she will

have done her job. She conveyed our continuing enthusiasm for the US in

Washington, in Beijing shell do the obligatory human rights thing, but the

overall message will once again be about letting the good times rol l for China and

Australia.