Finance Michael Pascoe: Wombat warriors leave Australia isolated, our ‘allies’ eating our lunch
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Michael Pascoe: Wombat warriors leave Australia isolated, our ‘allies’ eating our lunch

Pascoe
The government is selling fear on China, with little thought about Australia’s best interests, Michael Pascoe writes.
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Last week Scott Morrison and Peter Dutton competed to confirm the conclusion previously reached by Paul Keating, Max Suich et al: Domestic political purposes are running our China policy.

It is not a hard conclusion to reach.

The only alternative is a cascading series of boof-headed bumbles that have left Australia isolated without a functioning diplomatic relationship with the world’s great rising power.

OK, there is Option C – both of the above. It is possible the Morrison government is attempting to make a political virtue of the disaster it stumbled into creating.

Whichever way the carton of eggs was dropped, the result is that Australia has been left alone with the mess and neither the desire or ability to unscramble it.

Both the trade flow between China and our supposed “allies” and the diplomatic manoeuvring of the United States point to Australia’s folly in leading the attack on China.

Peter Dutton
Defence Minister Peter Dutton has led the way in provoking China.

While the Prime Minister and Defence Minister are bristling with wombat warrior talk, the US appears to be fulfilling Geoff Raby’s prediction of resetting its relationship with China.

Dr Raby, Australia’s ambassador to China from 2007 to 2011 and a consultant and company director there since, published a book before  last year’s presidential election with the catchy title China’s Grand Strategy and Australia’s Future in the New Global Order.

Whether Trump or Biden, he argued that the US would find a new accommodation as it accepts the inevitability of containment not working. It seems to be happening quicker than he expected.

Former ambassador to China Dr Geoff Raby with his book in November 2020. Photo: AAP

Earlier this month Dr Raby counted off the signs that Australia was going to be left alone with its boasts of shirt-fronting – a mega 20-year LNG deal at Australia’s expense, the revelation that the US and China had been secretly working together for months on an initiative to cut methane emissions and the Biden-Xi virtual summit only part of it.

“The signs that the US and China are finding a new accommodation have been apparent for months,” Dr Raby wrote in the AFR.

“Senior officials on both sides have increased the frequency of their meetings. The two most senior foreign policy officials from the US and China met last month in Zurich. The US’s chief climate change negotiator was in China recently. You can be sure his brief went well beyond climate change.

“These days the administration talks more about co-operation with China than competition. Containment has disappeared from its vocabulary. Talk of a “new” Cold War is archly dismissed by the US National Security Adviser.”

Now a new study from the UTS Australia-China Relations Institute shows we have already been left on a trade rock. The US and other “allies” have happily grabbed the economic opportunities our wombat warriors created for them.

ACRI’s James Laurenceson and Thomas Pantle have dug through the  statistics to confirm what was widely expected.

Professor James Laurenceson.

Rather than “standing with us” and “having our back”, they’ve been eating our lunch.

“Australia’s strategic friends have offered useful rhetorical support for Australia’s predicament,” Professor Laurenceson and Mr Pantle write.

“But outcomes demonstrate a parallel commitment to advancing their own commercial interests, including by snapping up lost Australian sales and trading more with the PRC.

“In January-September 2021, the PRC’s imports from Australia of 12 disrupted goods fell by $US12.6 billion ($17.3 billion), compared with 2019. The biggest beneficiary was Australia’s security ally, the US, which increased sales of the same goods to the PRC by $US4.6 billion ($6.3 billion). Canada and New Zealand increased their sales by $US1.1 billion and $US786 million, respectively.”

And the figures find our strategic friends haven’t significantly stepped up their purchases of the Australian goods disrupted by the PRC freeze. We’ve done better redirecting trade to the likes of Turkey, Saudi Arabia and Vietnam.

The study shows the PRC and our strategic friends, let alone the rest of the world, are not “decoupling”. It’s just us.

Meanwhile, the wombat hole was echoing on Friday with Defence Minister Dutton raising the spectre of 1930s Europe and Chinese missiles reaching every Australian capital. It was an extraordinary performance.

There is a theory that everything Mr Dutton says is at least partially framed with Mr Morrison in mind. Most people forget it was Mr Dutton who started the Wuhan inquiry demand rolling.

As it happened, Mr Morrison was getting his wombat warrior diplomacy in first during Thursday’s question time.

Twice in answers to Labor questions about other matters – government members crossing the floor, Mr Morrison telling lies, that sort of thing – the Prime Minister launched into well-rehearsed lines, giving clear notice of an election campaign theme.

“Then there are the security issues we face in this region, which are going on even as we speak right now in our own region, where Australia has to provide the strength to stand up to those who would seek to coerce us; to stand with our allies and our partners; and to gain access to the defence technology which means we can have nuclear-powered submarines, which those opposite would never dare to even ask for, let alone understand why it was necessary, and have been quibbling over ever since, even backing overseas countries as they’ve attacked Australia’s capability to perform on that front,” was one sentence.

It was followed a few questions later by: “The other reason why I believe and know that Australians are listening is that this government knows how to stand up for their interests and stand up to those who would seek to compromise their interests.

“I know, and our government knows, how to stand up to those countries not too far from here that would seek to coerce us and interfere in our country, in our universities, in our laws, and seek to affect us with trade and other forums. We know how to do that. We know how to call out action when it comes to human rights abuses overseas. We’re not afraid to do that.”

No, he never said “China” – he didn’t have to. Having burnt his China bridges, he’s now competing with Mr Dutton to landmine the approaches.

Never mind that it further isolates Australia, that it’s at odds with what the rest of the world is doing, that having needlessly gone earlier, we keep going further than any of our “allies” in provoking China.

It’s domestic politics, trying both to excuse the mess they’ve created and resurrect some Red Menace now we’re in election mode. Fear sells.

Too bad about Australia’s best interests.