What will Albanese give Trump on defence? Not much
US Defence Secretary Pete Hegseth's demand for Australia to nearly double defence spending to 3.5 per cent of GDP has gone down like a bucket of cold sick in Canberra.
Anthony Albanese, who chose to ignore the Coalition's calls earlier this year for him to travel post-haste to Washington and prostrate himself before President Donald Trump to secure Australia a tariff exemption, feels his judgment has been vindicated.
Fresh from being re-elected with a historic majority, Albanese is in no mood to bow down to the Americans, especially when dislike (or at least distrust) of the current US administration aided Labor's victory.
At present, Australia spends about 2 per cent of GDP on defence, or about $59 billion a year, and that figure will rise to 2.3 per cent by 2030. Going to 3.5 per cent would mean spending an extra $40 billion each year, approximately the annual cost of the entire NDIS.
Delivering this would require significant tax rises or a big increase in federal borrowing – maybe both – and potentially swingeing cuts to the expanded social programs that Australians just voted for.
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The prime minister's response on Monday was cautious, measured and a polite rejection of our closest ally's request.
'What you should do in defence is decide what you need, your capability, and then provide for it. That's what my government's doing ... we've provided an additional $10 billion of investment into defence over the forward estimates [four years],' he said.
'What we don't do is do what the opposition did during the election campaign, where they announced an amount of money, they couldn't say where the money was coming from and they couldn't say what it was for. That makes no sense.'
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