Cold-blooded Realpolitik cannot determine Australia's China Policy
  • Wed, 11/14/2012 - 00:00

Michael Danby
Federal Member for Melbourne Ports

Speech to the Henry Jackson Society, 8 November 2012, London UK

It’s an honour to be asked to address this distinguished gathering today, under the auspices of the Henry Jackson Society.

I was a great admirer of Senator Henry “Scoop” Jackson. He was a Cold War Democrat in the best sense of that term. He favoured a combination of liberal domestic policies, a strong military and a robust foreign policy in defence of freedom around the world.

We can only speculate on how different the course of both US politics and world events would have been had he won the Democratic nomination in 1976, instead of Jimmy Carter. I suspect it would have been not just different, but much better.

My own political position is similar to his in many respects. My political philosophy is based in the tradition of Central European anti-communist social democracy. I imbibed this tradition from my and one of Australia’s most influential post WWII university teachers,  Dr Frank Knopfelmacher, a Czechoslovak exile from both the Nazis and the Communists.

In an Australian context, I uphold the tradition of “patriotic labourism,” represented by great Labor Prime Ministers such as John Curtin, who forged the US-Australian alliance with General MacArthur in the bleakest days of 1942, and Bob Hawke, who upheld that alliance in the 1980s in the face of strong domestic opposition.

Today Julia Gillard’s Labor government is maintaining that tradition, by keeping our forces in Afghanistan, despite the high cost we are paying in lives and treasure, and significant domestic hostility to our continued involvement there.

At the same time, our government is pressing ahead with an ambitious domestic reform agenda, including action against climate change, building a national high-speed internet network and bringing in a national disability insurance scheme.

And just recently, this October, the Prime Minister released the government’s ‘Australia in the Asian Century’ White Paper setting out Australia’s objectives to increase and improve its relationships with Asia surfing the Asian boom.   Whilst the focus in the White Paper is on Asia’s undoubted rise in economic terms, it acknowledges that with a changing economic order comes a change in power relationships.  And among these, is “China’s rise and the resulting impact on its regional and global interests and those of its neighbours” (follow the link to read the White Paper, click here).

Fundamental to the Scoop Jackson world view which I embrace was his principled criticism of Dr Henry Kissinger’s approach to foreign policy, which was marked by a high degree of what Kissinger called realpolitik, and what Jackson called cynicism.

L-R- Dr Henry Kissinger, Kissinger's Aussie acolytes: Owen Harries,
Prof. Hugh White and Tom Switzer

Now, given our similar backgrounds, I cannot help admiring Kissinger’s great achievements. But he followed consciously in the footsteps of Metternich, in seeing international politics through the prism of power, and in terms of the balance of military and economic strength among contending great powers. Dr Kissinger’s weltanschauung and that of his acolytes discounts the importance of ideas in international affairs, and also the notion that a great power’s foreign policy ought to be founded on ideals and not just self-interest.

Jackson rejected that view, and so do I. Military and economic strength are prerequisites for a great power, but they are not enough. For a great power to command respect instead of fear, it must stand for something in the world.

As Bill Clinton rightly said, in America’s case “the world has always been more impressed by the strength of America’s example than by the example of its strength.”

The United States has always stood for something, and that something is the idea of liberty – economic, political, social and religious liberty. Whether it was Woodrow Wilson’s 14 points, or Franklin Roosevelt’s Four Freedoms, or Ronald Reagan’s great speech in front of the Berlin Wall, the US in its best moments has been the world’s great champion of the cause of liberty for the past century.

Sometimes, of course, the US has fallen short of its own ideals, but it has always found its way back to the path that leads to Churchill’s broad sunlit uplands.

Henry M. Jackson (1912-1983), read more

In Jackson’s day, the great challenge facing the US and its allies was confronting the power and ambition of the Soviet Union and the world communist movement it led. For forty years the US and the system of alliances built around US strength contained Soviet expansionism, and eventually the Soviet Union collapsed under the weight of its own contradictions.

The Soviet Union proved, as Nazi Germany did before it, that in the modern world genuine and lasting great power status cannot be built on force and oppression.

Today the US and its allies and friends, including very prominently the United Kingdom and Australia, face new challenges in the world. One is the challenge of militant political Islam. I could say a great deal about that, but it would be a diversion from what I really want to talk about – the rise of China from an Australian perspective

In Australia, we have as a neighbour the largest Muslim country in the world, Indonesia. For many years, so-called “realist” commentators said that although the Suharto dictatorship was bad, it was better than the alternative, which would be chaos and the rise of Islamic extremism.

Well, Suharto fell, and what we got was not chaos, but a stable and increasingly prosperous democracy, which under President Yudhoyono has broken the back of the Jihadist threat in that country. That’s a lesson we should not forget.

We live with China as a neighbour and as our largest trading partner. The rise of China has, together with our trade with South Korea, Japan and the US have contributed to Australia’s remarkable economic success over the past 20 years. Finding a consistent, principled and sustainable way of dealing with China is not a luxury for us – it is a necessity

The main thrust of my argument today is that notwithstanding China’s existing and growing economic power, Australia does not need to, nor should it, shift away from its support for, and strategic alliance with, America.

On this I agree with former Prime Minister John Howard.  He recently said that "China is our biggest customer, the United States is our biggest ally". (Follow the link to read more of Howard's comments, click here).

China’s peaceful rise is a welcome and necessary development. It would be a strange state of affairs if the world’s largest country did not aspire to great power status, and even stranger if, with 1.3 billion hard-working, productive, entrepreneurial and patriotic people, China did not achieve great power status. The world needs a prosperous, stable, satisfied China, not a poor, unstable and angry China.

The second thing to say is that China is not the Soviet Union, and that the policy responses of Scoop Jackson’s day are not the exact policies the West needs to adopt today in dealing with China’s rise. The Soviet Union was an artificial state, cobbled together from disparate nations, with an inefficient and unproductive command economy and a parasitic state and party bureaucracy, the whole thing held together by police terror. That is not what we see today in China.

Since Deng Xiaoping’s reforms began in 1979, China has developed elements of a free-market economy. Hundreds of millions of people have been lifted out of poverty, creating an enormous urban working class and a growing and powerful middle class. China has also, for the first time in its long history, become a great trading nation, not only with Australia but also with the US, Europe and the Middle East.

These radical changes have made China today not only a very different country from the China of Chairman Mao’s day, but also a very different country from the Soviet Union of Scoop Jackson’s day.

Westminster from the Speakers office

China differs from the Soviet Union in several important respects

Most importantly, China is for the most part an ethnically and culturally united country, with a very long tradition of centralised government. The presence of restive minorities like the Tibetans and the Uyghurs do not alter this fact: the Han Chinese are 91% of the population. China is not going to collapse in the way the Soviet Union collapsed. Nor should we want it to – a return to the division and chaos of the past would be in no-one’s interest.

Secondly, China is a dynamic, growing economy, whereas the Soviet Union after about 1960 was a stagnant, declining economy. By Gorbachev’s time the Soviet Union could no longer pay the bills for its massive military and security establishment, and effectively went into voluntary liquidation. That is not going to happen in China, where the economy is producing healthy surpluses part of which are being invested in the military; although for the first time and disconcertingly, Beijing’s expenditure on internal security outweighs even the burgeoning military budget.

But this very success creates problems for the Chinese leadership which the Soviet leaders never had to face. China must sustain economic growth in order to provide employment to its workers and a rising standard of living to its middle class. There can be no going back to autarky or the command economy, no matter what nostalgic neo-Maoists may think. The Chinese regime may be able to repress political dissent “stability preservation” as the Chinese term it, but it cannot ignore the economic demands of its population in the way the Soviet regime could.

China needs trade with the world for its growth

Furthermore, in order to sustain that growth, China must keep trading. China needs markets for its manufactured goods, and it needs supplies of raw materials and energy to fuel its industries. Although China is working hard at developing its domestic energy sources, that fundamental fact is not going to change.

The Chinese leaders are not stupid. They understand these facts. They know that China’s economy is hostage to its trading partners. Beijing cannot embark on the kind of adventurist foreign policy that the Soviet Union used to embark on, because China is vulnerable to trade sanctions in a way that the Soviet Union never was. Cutting off China’s energy imports, or its access to Western markets, even for a short time, would create such economic chaos in China that the regime’s grip on power would be threatened.

Conflict with the US is not inevitable

This is why I reject the view put forward by some of our more apocalyptic commentators, who see political and even military conflict between China and the US as inevitable. China is not North Korea or Iran. It is not run by psychotics or fanatics. As we speak, at the 18th congress of the CCP, Xi Xinping from the “Princeling faction” will be assuming leadership of a smaller 7 man standing committee of the Chinese Politburo. An insight into his loyalty to party orthodoxy saw him criticize foreigners “who have eaten their fill and have nothing better to do than point their fingers at our affairs.” But as if wanting to reassure the international community he added: “China does not first spread revolution, export poverty and hunger or 3rd cause trouble for you.”

What complicates that is the fact that one of the ideological weapons the Chinese regime uses to cement its grip on power is Han Chinese nationalism. The Chinese are a proud and patriotic people. After a century of humiliation at the hands of Western and Japanese imperialists, they are also a people sensitive to real or imagined attacks on China. Perhaps this explains the aggressive comments of Chinese Lieutenant General Ren Haiquan, who told a meeting of senior military officials in Melbourne that the US pivot towards Asia was an “interference” which complicated ‘progress’ towards a new security order. (Follow the link to read more of Haiquan's comments, click here)

Chinese Lieutenant General Ren Haiquan

Han Chinese nationalism can conveniently be directed against internal enemies, such as the Tibetans or the Uyghurs, or at external ones such as the Japanese or the Western powers. But once ignited, nationalism is hard to control, particularly in this age of instant communication. The Chinese regime is now riding the tiger of Han Chinese nationalism, and it must keep the tiger fed, or there is a danger that it will be eaten, just as the Manchu regime was in 1911, when Chinese nationalists found the regime’s subservience to foreign powers no longer tolerable.

This dilemma goes a good way to explaining the current Chinese attempts to bully its neighbours over the territorial disputes in the South China Sea. Asserting Chinese territorial claims in an area that used to pay tribute to the Chinese Emperors plays well to nationalist sentiment at home, and bolsters the regime’s standing. But it also damages China’s relations with its neighbours, and risks consolidating an alliance between these countries and the West.

We in Australia perhaps have a closer perspective on this than do observers in the US or Europe. We can see clearly that China is not the only rising power in East Asia. We can see the enormous strides that our near neighbours and close trading partners, Indonesia, Malaysia, Thailand and Vietnam, have made over the past 20 years.

None of these countries has any desire to be a Chinese satellite. East Asian countries have privately welcomed the recent US “pivot towards Asia.” This is somewhat ironic in Vietnam’s case, but we should remember that Vietnam’s most recent war was with China, not with the US. Even Burma is now trying to break free from China’s orbit.

China’s rise doesn’t mean US withdrawal in the Asia-Pacific nor Australia reorienting its strategic alliance

Some commentators in Australia have suggested that China’s rise inevitably means that the US will withdraw from, or even be driven out of, the Asia-Pacific region, and that Australia should accommodate itself to that fact by agreeing to become a junior partner in the new Chinese hegemony over our region. Perhaps some in Beijing mistake views of Australian commentariat for indecision. This may explain why shortly after Australia’s victory in election to a temporary seat on the UN Security Council, Chinese officials warned Australia not to always vote with the US. Wang Zhenyu a scholar working for a Foreign Ministry Institute said: “Australia shouldn’t always have the same views as the US otherwise its contradictory to its role on the Security Council.” (To read more please see, 'China warns over UN seat sycophancy', AFR, 20th October)

First, China has grown mightily over the past 30 years, but it is nowhere near being a fully-developed free market economy, let alone a rival to the US or even Japan. Its semi-private, semi-state economic system, riddled as it is with inefficiencies and corruption, is a severe constraint on ongoing substantial economic growth. China is also going to pay a heavy price over coming decades for its misguided one-child policy, which will severely distort the demographics of its workforce.

Corruption is endemic in China.  Associate Professor Feng Chongyi has commented that “the couple Bo Xilai and Gu Kailai had transferred as much as $US6 billion of corruptly acquired funds out of the country” and that “it is widely believed that families of all top leaders have done the same, sending huge amounts of money abroad.” Even professed liberals like Wen Jia Bo have been accused of using their position to enrich themselves and their families (To read more about Wen Jia Bo please see 'Billions in Hidden Riches for Family of Chinese Leader', published in The New York Times).Also please see “Auspicious time for change in China”, by Professor Feng Chongyi. Published in the Australian Financial review on the 12th October

A second reason why America’s strategic influence in the region will not give way in favour of China, is that, despite expansion and modernisation drives, China is still not a serious military rival to the US, let alone the US and all its regional allies. China has spent a lot of its military budget on second-rate ex-Soviet technology which is no match for what the West can deploy. A few days ago the Times pictured outgoing General Secretary Hu Jintau parading before China’s reconstituted Ukrainian carrier, the Veryag. With the news that a nearby shipyard had constructed Beijing’s locally built Aircraft carrier.

Chinese President Hu Jintao on the aircraft carrier “Liaoning” at a naval base in Dalian.  Please see China charts a course towards choppy waters

Thirdly, as I noted before, China literally cannot afford to provoke a serious political or military crisis with the US, because China is heavily dependent on trade and cannot risk seeing its trade disrupted. The prophets of US decline like to point out that the US owes China $1.2 trillion. What they don’t say is that that may be a bigger problem for China than it is for the US. When a debtor defaults, it’s the creditor who loses their money. Of course the US is not going to default, but it might use its position as leverage if China foolishly provoked a confrontation. And as I said before, the Chinese leaders may be many things, but they are not fools.

The eminence grise of Australian strategists, Paul Dibb has pointed to China’s aggressive posture pushing nearly all Asian states towards the United States. When China’s Foreign Minister says “China is a big country and other countries are small countries” there is blow back. Professor Dibb also commented that given “the correlation of forces” in the region, China has essentially “no real friends other than Pakistan and North Korea.” (To read Paul Dibb's article, click here)

Far from reducing its role in Asia, the United States has refocused on the region.  Last year President Obama pointedly chose the Australian Parliament to express a reemphasis of its role in the Asia Pacific, the so-called pivot to Asia.  One manifestation of this was the commitment of 2,500 US marines to be based in Darwin in the North of Australia. The US State Department called it a natural “rebalancing” in America’s strategic redeployment back to the Asia-Pacific following its decade of preoccupation in the Middle East. Whatever the nuance, it is clear that Australia’s dominant economic trade partner – China, and its dominant strategic ally – America, are joined in a period of reorientation.

As I mentioned earlier, some prominent commentators have intuited into this scenario the need for Australia to make a strategic choice between the two countries.  But I disagree.  And the former Secretary of the Department of Foreign Affairs and Trade, Dennis Richardson, also disagrees.

Richardson Argued:

“Being a friend doesn’t mean you can’t have differences of perspective. We have had, and continue to have, differences of perspective with China on human rights, some consular matters and some broader regional and global issues such as the South China Sea and Syria.

We have robust exchanges with the Chinese on these and other matters, but the discussions are always mature and sensible. There is no requirement for us to change our perspectives, which are underpinned by a mix of values and interests, because of the depth of our economic relationship. I am not aware of other serious countries doing so. Why should we be any different?”  (Please see Dennis Richardson's article, 'Save face over China relationship')

Indeed.  And Australia’s continuing support for its alliance with the US and a strong US presence in the region is restated in the ‘Australia in the Asian Century’ White Paper that I referred to earlier.  (Follow the link to read the White Paper)

Non-appeasement of China

Not only do I reject the apostles of strategic declinism, but I also reject the advocates of appeasement. As a capital dependant country Australia must seek to maintain mutually beneficial economic relations with China whilst at the same time supporting those Chinese who suffer for their advocacy of freedom of speech, for freedom of religion, for free trade unions, for accountable environmental policies, for autonomy for Tibet and Xinjiang, and against corruption and abuse of power. How many Tibetans have to burn themselves to death before the conscience of the world is stirred. Perhaps the kindness His Holyness Dalai Lama showed the late father of Xi Xinping will allow some softening of the harsh cruelty with which China treats the peaceful Tibetans.

The Chinese regime should know that it will pay a price when it violates basic international norms and indeed its own constitution by denying these freedoms and rights to its citizens. It is quite false to suppose that if the US, the UK or Australia speaks up for the artist and activist Ai Weiwei or the blind ‘bare foot lawyer’ Chen Guangcheng or Chinese Catholics or Tibetan activists, then China will retaliate by not buying Australian iron ore or not exporting goods to the US. China cannot afford to do those things. In fact, as the Chen Guangcheng case showed, China will respond to international pressure on human rights issues. And if the pressure were applied more consistently, the results would be even greater.

Avert your eyes the China Lobby insists. L-R: Uyghur leader Rebiya Kadeer, Chinese artist Ai Weiwei and blind Chinese activist, Chen Guangcheng

Finally let me return to my original observations. Scoop Jackson was a hard-nosed Cold War Warrior, but he was also an idealist who believed in democracy and freedom, both in the US and for all the world. So do I.  I want to see a free and democratic China as part of a peaceful and prosperous Asia-Pacific region. I am of course a realist. The Chinese system is not going to collapse, nor do I expect the Chinese Communist Party to give up its monopoly on power any time soon.

But I remain optimistic that sooner or later, this Chinese leadership, or its successor, will realise that the best way to secure a strong, respected and prosperous China, a China which is truly a great power in every sense of that expression, is to dismantle the apparatus of totalitarian control and allow the Chinese people to choose their own government. If the benighted Burmese generals can finally come to accept that peace and freedom are better than conflict and oppression, so can the Chinese Politburo. I don’t expect it to happen soon, but it will happen eventually.

Danby at St Stephens entrance after BBC interview and before his address to the Henry Jackson Society