Trump's negotiation position diminishes as Albo sits him out

The Advertiser

3 days ago

Anthony Albanese's visit to China has exceeded everyone's expectations, including mine, and arms him with extra weapons and arguments for when he meets President Donald Trump and United States officials, whenever that is to be.
One can expect that Americans, and the advocates on The Australian, will accuse him of weakening perceptions that Australia is firmly in the Western camp. But he studiously said and did nothing that he has not said and done before, and one would have to parse each statement carefully to see evidence of any shift away from America, let alone movement towards the Chinese camp.
Yet the visit has reminded Australians and the Chinese, and perhaps the region, that Australia is a very strong trading partner of China and that we are not proposing to weaken the partnership, or our economy, simply so as to oblige the US, whose interests and conflicts with China mostly involve their own economic national interests when they are in conflict with ours. Australia may be unequivocally in favour of America remaining engaged in Asia and sees itself as a close military ally. But at least as far as Albanese is concerned, Australia will no more automatically turn to help protect America's interests when they are threatened than America will automatically stand beside us when our economic interests are threatened.
As it happens, the US could hardly have done more during the past five years in playing the fair-weather friend. The Morrison government foolishly but deliberately picked a fight with China over the origin of the COVID-19 bug. I imagine we did not do it at America's urging, because our foreign policy at the time consisted of anticipating what the US might want, and doing it of our own accord, even when no advantage accrued to Australia. (The origins of the bug are and were political currency in the US, particularly in the Trump camp, not least as they were trying to ratchet up claims that Chinese expansionism over trade disagreements would most likely lead to war).
China did not show its annoyance by getting angry with both Australia and the US about the accusations. Instead, it picked Australia away from the US and began a hostile and expensive round of economic sanctions against us. Market access to select Australian exports was denied. American statesmen grumbled, as we might expect, that China was exercising just the sort of economic coercion it had warned the world about. Its tame propagandists in Australia repeated their cry. But any support for Australia from the US was purely rhetorical. American traders attempted to steal our markets and profit from China's anger at us, when all that we had done was to echo some American claims.
The resolution of our trade disputes with China has been very hard work, and much more as a feature of quiet diplomacy under the Albanese government. It has had no clear support or assistance from our ally across the Pacific. No doubt the Chinese are taking advantage of a certain chaos in America's relationships with its allies.
The chaos and uncertainty of Trump is a fit topic for discussions with China, as are tips undercutting his erratic style.
So far as all the trade tension is concerned, China sees it as in its interests to draw neighbours and trading partners towards its side. If so, one might imagine that Australia would be low down on the list of any potential converts willing or likely to change sides.
But China's pull for many of its neighbours has been made stronger by the erratic policies of the Trump Administration, real uncertainties about where the US is going, and the ever-changing demands on tariff levels, with seemingly arbitrary rate-fixing, sometimes determined by spite or a misunderstanding of the effect and impact of trade imbalances. Australia has had much the same experience, even as we seem to have fared much better than most. Trump is continuing to muse about punitive rates on pharmaceuticals, on steel production and on meat imports. Trump has now been in power for six months. It has not been Australia's fault, nor Albanese's, that there has been no meeting with Trump. Nor has it been clear that there has been anything to gain from a face-to-face meeting at which points of trade or military alliance differences will be "sorted out". Has Canada, or Mexico, or Japan, or for that matter nations in the European Economic Community or India, comfortably settled their differences with Trump?
Some of the few nations that have done a "deal" with Trump are rationalising and attempting to justify their surrender, but very few are happy about it. At some time one can be sure that the agreements will ultimately be repudiated with the same lack of regard for a "rules-based order", a "gentleman's handshake" or international law as Trump has demonstrated throughout the process. No doubt it will occur at a time when it is the US, not the coerced nation, which has the disadvantage.
Many of those subject either to "deals" or to arbitrary settings are not planning to respond by simply buckling down to the bully. This includes Australia, with or without passive support from China. And the European Community, and Japan, Korea and India. They will try to find substitute markets, deciding doing business with the US is simply too risky, too subject to arbitrary whim, dodgy science and bigotry, and too unreliable. Perhaps also too authoritarian, too little subject to a recognisable rule of law or principles of fair dealing.
RELATED: PM confident of Australian jobs boost after China visit
China is not the only big trading nation considering alternatives to being dependent on the US for too much of its trade and economic growth. It may not want to refuse to supply the US, but it may operate a two-tier trade scheme in which it maintains its ordinary prices while passively allowing American consumers to pay a lot more (after tariffs) for its products. Trump is reckoning that his tariff walls will inevitably bring manufacturing centres back to the US. It may well be, instead, that the US cannot reverse the process by which rich industrialists, such as Trump, exported American jobs and American factories. Over the past six months, China has approached several neighbouring economies, including Japan and Australia, with talk of a multilateral free-trade pact, one that strikes a deal with the European Community. The EC has likewise discussed a free-trade pact with Australia.
One can be sure that Albanese, and Australian trade officials swapped economic intelligence with China, including views about the best way of negotiating with Trump, and their fresh experiences of his negotiating style (including what's been coined his famous "TACO" - Trump Always Chickens Out) in terms of discussions between China and the US. In one sense, it might seem a bit disloyal for Australia to be swapping experiences and insights about its closest ally with its bitterest enemy. On the other hand, if there is anything that six months of Trump has demonstrated, American military interests differ from its economic ones, and it does not hesitate to treat anyone as its economic enemy. Australia is quite capable of looking after its economic interests with China without divulging national security secrets. Indeed, if Australia did blab, there would be any number of Australian officials, regarding themselves as having a loyalty to the alliance over and above their loyalty to Australia, who would leak about it.
Australia is by no means the only nation that faces further difficult negotiations about the terms under which it buys and sells pharmaceuticals. China and India are in the same position. Their dominance of international manufacturing markets is not a result of failure to adhere to international intellectual property laws or to play by the established rules. Australia and many other nations have special interests in preserving the shape of the trade as it is because it forms the basis of public health schemes providing life-saving drugs to their populations at much cheaper prices than in the US public health system, such as it is. Trump may proclaim that schemes outside the US are socialist, or sometimes communist, but the argument is hardly persuasive to most of the rest of the world. Winding the schemes back would lead to major civil unrest, whether here or in Britain, Europe or even China.
Perhaps Trump has a big sense of grievance about how some nations, including China (and in narrow respects, Australia), have come to dominate metals markets, including steel. Americans may fondly remember when American steelworks and foundries dominated world production. But its loss of that field, and the export of the jobs, skills and capital that this involved, is not primarily a consequence of the conscious exporting of American jobs and the stealing of American secrets. It is a consequence of economic growth by which developing countries, including China, consciously moved into steel production to feed new appetites for housing, manufacturing plant and cars. Nor can the story of steel be reduced to a two-dimensional story about some sort of economic raid upon the US. The mere fact that Trump, or American steelworkers, resents the loss of a once-critical industry may make Trump's efforts a heroic feat from an American's point of view. Outsiders, even neighbours or allies, hardly see it the same way.
What this suggests is that Trump's program is receiving more and more pushback as it continues. Trump's rich backers are used both to making direct demands for tariff protection and to being mulcted by the Trump organisation if he succeeds on their behalf. The personal negotiating style of Trump may have its attractions, but to many it appears corrupt. It also appears to lack an organising principle, by which outsiders can see that like is treated as like, or the services of disinterested parties, such as adjudicators or judges, able to consider and determine claims made upon the system. Indeed, the intimate style, which includes public bullying and bluster, the appearance of demanding quids pro quo, and individualised determinations changing by the day smack of arbitrary government running to personal advantage, not a system of government under law. Increasingly, however, the US Supreme Court is stripping lower courts of the capacity to scrutinise such schemes.
At this point, one of the worst possible ways in which Albanese could tackle negotiations would involve going to Washington with a determination to dicker and negotiate each Trump agenda item, based on giving up something here in the hope of keeping the status quo elsewhere. In any such negotiation, Trump, as the standover man in chief, has completely the open hand, able to walk out threatening retaliations or interim fees, able to introduce new considerations and denying Australia any real capacity to have its arguments determined by any independent or fair system. The Canadian negotiations provide a good example of what should be best avoided, the more so when one considers that Albanese is not a particularly good negotiator.
But it may well suit Albanese's interests to keep various disputes, such as the future of AUKUS, what is promised under it, how much Australia ought to be paying for its defence, and the trade negotiations running simultaneously. Australia is not quite in the position of NATO countries, which Trump has bullied into promising a virtual doubling of defence expenditure. Albanese's argument, that he will spend whatever seems necessary, but not an arbitrary sum, nor enter contracts to buy American equipment Australia does not want or need, is popular politically. The opposition - and even more the Murdoch advocates - are flailing in arguing that either a formula is needed, or that Australian defence can use or manage a much bigger armoury.
MORE JACK WATERFORD:
But even more, arguments about AUKUS, and what it can or should deliver, are developing in a way that suggests a wind-back will be necessary. Even if the US could ramp up its production of submarines - doubtful in the short term - there will be powerful American interests reluctant to see them leave American control. Even more doubtful, whether from the US or the UK, are supposed deadlines about delivery of useful working ships within 15 years of the timetable promised. In a three-horse race for which nation has the least efficient, competent and viable defence acquisition system, it would be impossible to scratch any contender, even with the lamentable Australian procurement record in mind.
A month or so ago, I wrote here about American pressure descending on Australia to pre-commit itself to using its nuclear submarines (if handed over) in a war with China over Taiwan. It was no mistake that it surfaced publicly in the past week, in a manner designed to embarrass and compromise Albanese during his visit to China. If it was designed to bamboozle, I expect it backfired. First, the US itself has never made an explicit commitment to what it would do if, say, the Chinese crossed the Taiwan Strait. Nor has it ever made any sort of explicit pre-commitment about how it sees its ANZUS obligations. (On the one occasion, in conflict with Indonesia over Malaysia in 1963, US president John Kennedy told Robert Menzies that far from flying to Australia's aid, it would support Indonesia if it came to war).
The American military would be foolish to get involved in a war over Taiwan. Even their own research and war-gaming tells it that its intervention would involve comprehensive defeat. Admittedly, that is something the Yanks do nearly as well as we do, but we ought to have enough experience by now in opting out of something we have never indicated we would do. It's primarily a matter of logistics, not manpower (though we don't have enough) and weapons systems (ditto). These are deficits unlikely to be addressed before the year 2300.
It might be US policy (though I do not think it is) to expend money and treasure on noble but futile quests, but it should not be Australia's. And that's assuming that China has any immediate plan to launch an invasion. It may be only a splendid tease to keep everyone on their toes, too distracted to do anything much about more fundamental issues involving China's development as a world power.
Anthony Albanese's visit to China has exceeded everyone's expectations, including mine, and arms him with extra weapons and arguments for when he meets President Donald Trump and United States officials, whenever that is to be.
One can expect that Americans, and the advocates on The Australian, will accuse him of weakening perceptions that Australia is firmly in the Western camp. But he studiously said and did nothing that he has not said and done before, and one would have to parse each statement carefully to see evidence of any shift away from America, let alone movement towards the Chinese camp.
Yet the visit has reminded Australians and the Chinese, and perhaps the region, that Australia is a very strong trading partner of China and that we are not proposing to weaken the partnership, or our economy, simply so as to oblige the US, whose interests and conflicts with China mostly involve their own economic national interests when they are in conflict with ours. Australia may be unequivocally in favour of America remaining engaged in Asia and sees itself as a close military ally. But at least as far as Albanese is concerned, Australia will no more automatically turn to help protect America's interests when they are threatened than America will automatically stand beside us when our economic interests are threatened.
As it happens, the US could hardly have done more during the past five years in playing the fair-weather friend. The Morrison government foolishly but deliberately picked a fight with China over the origin of the COVID-19 bug. I imagine we did not do it at America's urging, because our foreign policy at the time consisted of anticipating what the US might want, and doing it of our own accord, even when no advantage accrued to Australia. (The origins of the bug are and were political currency in the US, particularly in the Trump camp, not least as they were trying to ratchet up claims that Chinese expansionism over trade disagreements would most likely lead to war).
China did not show its annoyance by getting angry with both Australia and the US about the accusations. Instead, it picked Australia away from the US and began a hostile and expensive round of economic sanctions against us. Market access to select Australian exports was denied. American statesmen grumbled, as we might expect, that China was exercising just the sort of economic coercion it had warned the world about. Its tame propagandists in Australia repeated their cry. But any support for Australia from the US was purely rhetorical. American traders attempted to steal our markets and profit from China's anger at us, when all that we had done was to echo some American claims.
The resolution of our trade disputes with China has been very hard work, and much more as a feature of quiet diplomacy under the Albanese government. It has had no clear support or assistance from our ally across the Pacific. No doubt the Chinese are taking advantage of a certain chaos in America's relationships with its allies.
The chaos and uncertainty of Trump is a fit topic for discussions with China, as are tips undercutting his erratic style.
So far as all the trade tension is concerned, China sees it as in its interests to draw neighbours and trading partners towards its side. If so, one might imagine that Australia would be low down on the list of any potential converts willing or likely to change sides.
But China's pull for many of its neighbours has been made stronger by the erratic policies of the Trump Administration, real uncertainties about where the US is going, and the ever-changing demands on tariff levels, with seemingly arbitrary rate-fixing, sometimes determined by spite or a misunderstanding of the effect and impact of trade imbalances. Australia has had much the same experience, even as we seem to have fared much better than most. Trump is continuing to muse about punitive rates on pharmaceuticals, on steel production and on meat imports. Trump has now been in power for six months. It has not been Australia's fault, nor Albanese's, that there has been no meeting with Trump. Nor has it been clear that there has been anything to gain from a face-to-face meeting at which points of trade or military alliance differences will be "sorted out". Has Canada, or Mexico, or Japan, or for that matter nations in the European Economic Community or India, comfortably settled their differences with Trump?
Some of the few nations that have done a "deal" with Trump are rationalising and attempting to justify their surrender, but very few are happy about it. At some time one can be sure that the agreements will ultimately be repudiated with the same lack of regard for a "rules-based order", a "gentleman's handshake" or international law as Trump has demonstrated throughout the process. No doubt it will occur at a time when it is the US, not the coerced nation, which has the disadvantage.
Many of those subject either to "deals" or to arbitrary settings are not planning to respond by simply buckling down to the bully. This includes Australia, with or without passive support from China. And the European Community, and Japan, Korea and India. They will try to find substitute markets, deciding doing business with the US is simply too risky, too subject to arbitrary whim, dodgy science and bigotry, and too unreliable. Perhaps also too authoritarian, too little subject to a recognisable rule of law or principles of fair dealing.
RELATED: PM confident of Australian jobs boost after China visit
China is not the only big trading nation considering alternatives to being dependent on the US for too much of its trade and economic growth. It may not want to refuse to supply the US, but it may operate a two-tier trade scheme in which it maintains its ordinary prices while passively allowing American consumers to pay a lot more (after tariffs) for its products. Trump is reckoning that his tariff walls will inevitably bring manufacturing centres back to the US. It may well be, instead, that the US cannot reverse the process by which rich industrialists, such as Trump, exported American jobs and American factories. Over the past six months, China has approached several neighbouring economies, including Japan and Australia, with talk of a multilateral free-trade pact, one that strikes a deal with the European Community. The EC has likewise discussed a free-trade pact with Australia.
One can be sure that Albanese, and Australian trade officials swapped economic intelligence with China, including views about the best way of negotiating with Trump, and their fresh experiences of his negotiating style (including what's been coined his famous "TACO" - Trump Always Chickens Out) in terms of discussions between China and the US. In one sense, it might seem a bit disloyal for Australia to be swapping experiences and insights about its closest ally with its bitterest enemy. On the other hand, if there is anything that six months of Trump has demonstrated, American military interests differ from its economic ones, and it does not hesitate to treat anyone as its economic enemy. Australia is quite capable of looking after its economic interests with China without divulging national security secrets. Indeed, if Australia did blab, there would be any number of Australian officials, regarding themselves as having a loyalty to the alliance over and above their loyalty to Australia, who would leak about it.
Australia is by no means the only nation that faces further difficult negotiations about the terms under which it buys and sells pharmaceuticals. China and India are in the same position. Their dominance of international manufacturing markets is not a result of failure to adhere to international intellectual property laws or to play by the established rules. Australia and many other nations have special interests in preserving the shape of the trade as it is because it forms the basis of public health schemes providing life-saving drugs to their populations at much cheaper prices than in the US public health system, such as it is. Trump may proclaim that schemes outside the US are socialist, or sometimes communist, but the argument is hardly persuasive to most of the rest of the world. Winding the schemes back would lead to major civil unrest, whether here or in Britain, Europe or even China.
Perhaps Trump has a big sense of grievance about how some nations, including China (and in narrow respects, Australia), have come to dominate metals markets, including steel. Americans may fondly remember when American steelworks and foundries dominated world production. But its loss of that field, and the export of the jobs, skills and capital that this involved, is not primarily a consequence of the conscious exporting of American jobs and the stealing of American secrets. It is a consequence of economic growth by which developing countries, including China, consciously moved into steel production to feed new appetites for housing, manufacturing plant and cars. Nor can the story of steel be reduced to a two-dimensional story about some sort of economic raid upon the US. The mere fact that Trump, or American steelworkers, resents the loss of a once-critical industry may make Trump's efforts a heroic feat from an American's point of view. Outsiders, even neighbours or allies, hardly see it the same way.
What this suggests is that Trump's program is receiving more and more pushback as it continues. Trump's rich backers are used both to making direct demands for tariff protection and to being mulcted by the Trump organisation if he succeeds on their behalf. The personal negotiating style of Trump may have its attractions, but to many it appears corrupt. It also appears to lack an organising principle, by which outsiders can see that like is treated as like, or the services of disinterested parties, such as adjudicators or judges, able to consider and determine claims made upon the system. Indeed, the intimate style, which includes public bullying and bluster, the appearance of demanding quids pro quo, and individualised determinations changing by the day smack of arbitrary government running to personal advantage, not a system of government under law. Increasingly, however, the US Supreme Court is stripping lower courts of the capacity to scrutinise such schemes.
At this point, one of the worst possible ways in which Albanese could tackle negotiations would involve going to Washington with a determination to dicker and negotiate each Trump agenda item, based on giving up something here in the hope of keeping the status quo elsewhere. In any such negotiation, Trump, as the standover man in chief, has completely the open hand, able to walk out threatening retaliations or interim fees, able to introduce new considerations and denying Australia any real capacity to have its arguments determined by any independent or fair system. The Canadian negotiations provide a good example of what should be best avoided, the more so when one considers that Albanese is not a particularly good negotiator.
But it may well suit Albanese's interests to keep various disputes, such as the future of AUKUS, what is promised under it, how much Australia ought to be paying for its defence, and the trade negotiations running simultaneously. Australia is not quite in the position of NATO countries, which Trump has bullied into promising a virtual doubling of defence expenditure. Albanese's argument, that he will spend whatever seems necessary, but not an arbitrary sum, nor enter contracts to buy American equipment Australia does not want or need, is popular politically. The opposition - and even more the Murdoch advocates - are flailing in arguing that either a formula is needed, or that Australian defence can use or manage a much bigger armoury.
MORE JACK WATERFORD:
But even more, arguments about AUKUS, and what it can or should deliver, are developing in a way that suggests a wind-back will be necessary. Even if the US could ramp up its production of submarines - doubtful in the short term - there will be powerful American interests reluctant to see them leave American control. Even more doubtful, whether from the US or the UK, are supposed deadlines about delivery of useful working ships within 15 years of the timetable promised. In a three-horse race for which nation has the least efficient, competent and viable defence acquisition system, it would be impossible to scratch any contender, even with the lamentable Australian procurement record in mind.
A month or so ago, I wrote here about American pressure descending on Australia to pre-commit itself to using its nuclear submarines (if handed over) in a war with China over Taiwan. It was no mistake that it surfaced publicly in the past week, in a manner designed to embarrass and compromise Albanese during his visit to China. If it was designed to bamboozle, I expect it backfired. First, the US itself has never made an explicit commitment to what it would do if, say, the Chinese crossed the Taiwan Strait. Nor has it ever made any sort of explicit pre-commitment about how it sees its ANZUS obligations. (On the one occasion, in conflict with Indonesia over Malaysia in 1963, US president John Kennedy told Robert Menzies that far from flying to Australia's aid, it would support Indonesia if it came to war).
The American military would be foolish to get involved in a war over Taiwan. Even their own research and war-gaming tells it that its intervention would involve comprehensive defeat. Admittedly, that is something the Yanks do nearly as well as we do, but we ought to have enough experience by now in opting out of something we have never indicated we would do. It's primarily a matter of logistics, not manpower (though we don't have enough) and weapons systems (ditto). These are deficits unlikely to be addressed before the year 2300.
It might be US policy (though I do not think it is) to expend money and treasure on noble but futile quests, but it should not be Australia's. And that's assuming that China has any immediate plan to launch an invasion. It may be only a splendid tease to keep everyone on their toes, too distracted to do anything much about more fundamental issues involving China's development as a world power.
Anthony Albanese's visit to China has exceeded everyone's expectations, including mine, and arms him with extra weapons and arguments for when he meets President Donald Trump and United States officials, whenever that is to be.
One can expect that Americans, and the advocates on The Australian, will accuse him of weakening perceptions that Australia is firmly in the Western camp. But he studiously said and did nothing that he has not said and done before, and one would have to parse each statement carefully to see evidence of any shift away from America, let alone movement towards the Chinese camp.
Yet the visit has reminded Australians and the Chinese, and perhaps the region, that Australia is a very strong trading partner of China and that we are not proposing to weaken the partnership, or our economy, simply so as to oblige the US, whose interests and conflicts with China mostly involve their own economic national interests when they are in conflict with ours. Australia may be unequivocally in favour of America remaining engaged in Asia and sees itself as a close military ally. But at least as far as Albanese is concerned, Australia will no more automatically turn to help protect America's interests when they are threatened than America will automatically stand beside us when our economic interests are threatened.
As it happens, the US could hardly have done more during the past five years in playing the fair-weather friend. The Morrison government foolishly but deliberately picked a fight with China over the origin of the COVID-19 bug. I imagine we did not do it at America's urging, because our foreign policy at the time consisted of anticipating what the US might want, and doing it of our own accord, even when no advantage accrued to Australia. (The origins of the bug are and were political currency in the US, particularly in the Trump camp, not least as they were trying to ratchet up claims that Chinese expansionism over trade disagreements would most likely lead to war).
China did not show its annoyance by getting angry with both Australia and the US about the accusations. Instead, it picked Australia away from the US and began a hostile and expensive round of economic sanctions against us. Market access to select Australian exports was denied. American statesmen grumbled, as we might expect, that China was exercising just the sort of economic coercion it had warned the world about. Its tame propagandists in Australia repeated their cry. But any support for Australia from the US was purely rhetorical. American traders attempted to steal our markets and profit from China's anger at us, when all that we had done was to echo some American claims.
The resolution of our trade disputes with China has been very hard work, and much more as a feature of quiet diplomacy under the Albanese government. It has had no clear support or assistance from our ally across the Pacific. No doubt the Chinese are taking advantage of a certain chaos in America's relationships with its allies.
The chaos and uncertainty of Trump is a fit topic for discussions with China, as are tips undercutting his erratic style.
So far as all the trade tension is concerned, China sees it as in its interests to draw neighbours and trading partners towards its side. If so, one might imagine that Australia would be low down on the list of any potential converts willing or likely to change sides.
But China's pull for many of its neighbours has been made stronger by the erratic policies of the Trump Administration, real uncertainties about where the US is going, and the ever-changing demands on tariff levels, with seemingly arbitrary rate-fixing, sometimes determined by spite or a misunderstanding of the effect and impact of trade imbalances. Australia has had much the same experience, even as we seem to have fared much better than most. Trump is continuing to muse about punitive rates on pharmaceuticals, on steel production and on meat imports. Trump has now been in power for six months. It has not been Australia's fault, nor Albanese's, that there has been no meeting with Trump. Nor has it been clear that there has been anything to gain from a face-to-face meeting at which points of trade or military alliance differences will be "sorted out". Has Canada, or Mexico, or Japan, or for that matter nations in the European Economic Community or India, comfortably settled their differences with Trump?
Some of the few nations that have done a "deal" with Trump are rationalising and attempting to justify their surrender, but very few are happy about it. At some time one can be sure that the agreements will ultimately be repudiated with the same lack of regard for a "rules-based order", a "gentleman's handshake" or international law as Trump has demonstrated throughout the process. No doubt it will occur at a time when it is the US, not the coerced nation, which has the disadvantage.
Many of those subject either to "deals" or to arbitrary settings are not planning to respond by simply buckling down to the bully. This includes Australia, with or without passive support from China. And the European Community, and Japan, Korea and India. They will try to find substitute markets, deciding doing business with the US is simply too risky, too subject to arbitrary whim, dodgy science and bigotry, and too unreliable. Perhaps also too authoritarian, too little subject to a recognisable rule of law or principles of fair dealing.
RELATED: PM confident of Australian jobs boost after China visit
China is not the only big trading nation considering alternatives to being dependent on the US for too much of its trade and economic growth. It may not want to refuse to supply the US, but it may operate a two-tier trade scheme in which it maintains its ordinary prices while passively allowing American consumers to pay a lot more (after tariffs) for its products. Trump is reckoning that his tariff walls will inevitably bring manufacturing centres back to the US. It may well be, instead, that the US cannot reverse the process by which rich industrialists, such as Trump, exported American jobs and American factories. Over the past six months, China has approached several neighbouring economies, including Japan and Australia, with talk of a multilateral free-trade pact, one that strikes a deal with the European Community. The EC has likewise discussed a free-trade pact with Australia.
One can be sure that Albanese, and Australian trade officials swapped economic intelligence with China, including views about the best way of negotiating with Trump, and their fresh experiences of his negotiating style (including what's been coined his famous "TACO" - Trump Always Chickens Out) in terms of discussions between China and the US. In one sense, it might seem a bit disloyal for Australia to be swapping experiences and insights about its closest ally with its bitterest enemy. On the other hand, if there is anything that six months of Trump has demonstrated, American military interests differ from its economic ones, and it does not hesitate to treat anyone as its economic enemy. Australia is quite capable of looking after its economic interests with China without divulging national security secrets. Indeed, if Australia did blab, there would be any number of Australian officials, regarding themselves as having a loyalty to the alliance over and above their loyalty to Australia, who would leak about it.
Australia is by no means the only nation that faces further difficult negotiations about the terms under which it buys and sells pharmaceuticals. China and India are in the same position. Their dominance of international manufacturing markets is not a result of failure to adhere to international intellectual property laws or to play by the established rules. Australia and many other nations have special interests in preserving the shape of the trade as it is because it forms the basis of public health schemes providing life-saving drugs to their populations at much cheaper prices than in the US public health system, such as it is. Trump may proclaim that schemes outside the US are socialist, or sometimes communist, but the argument is hardly persuasive to most of the rest of the world. Winding the schemes back would lead to major civil unrest, whether here or in Britain, Europe or even China.
Perhaps Trump has a big sense of grievance about how some nations, including China (and in narrow respects, Australia), have come to dominate metals markets, including steel. Americans may fondly remember when American steelworks and foundries dominated world production. But its loss of that field, and the export of the jobs, skills and capital that this involved, is not primarily a consequence of the conscious exporting of American jobs and the stealing of American secrets. It is a consequence of economic growth by which developing countries, including China, consciously moved into steel production to feed new appetites for housing, manufacturing plant and cars. Nor can the story of steel be reduced to a two-dimensional story about some sort of economic raid upon the US. The mere fact that Trump, or American steelworkers, resents the loss of a once-critical industry may make Trump's efforts a heroic feat from an American's point of view. Outsiders, even neighbours or allies, hardly see it the same way.
What this suggests is that Trump's program is receiving more and more pushback as it continues. Trump's rich backers are used both to making direct demands for tariff protection and to being mulcted by the Trump organisation if he succeeds on their behalf. The personal negotiating style of Trump may have its attractions, but to many it appears corrupt. It also appears to lack an organising principle, by which outsiders can see that like is treated as like, or the services of disinterested parties, such as adjudicators or judges, able to consider and determine claims made upon the system. Indeed, the intimate style, which includes public bullying and bluster, the appearance of demanding quids pro quo, and individualised determinations changing by the day smack of arbitrary government running to personal advantage, not a system of government under law. Increasingly, however, the US Supreme Court is stripping lower courts of the capacity to scrutinise such schemes.
At this point, one of the worst possible ways in which Albanese could tackle negotiations would involve going to Washington with a determination to dicker and negotiate each Trump agenda item, based on giving up something here in the hope of keeping the status quo elsewhere. In any such negotiation, Trump, as the standover man in chief, has completely the open hand, able to walk out threatening retaliations or interim fees, able to introduce new considerations and denying Australia any real capacity to have its arguments determined by any independent or fair system. The Canadian negotiations provide a good example of what should be best avoided, the more so when one considers that Albanese is not a particularly good negotiator.
But it may well suit Albanese's interests to keep various disputes, such as the future of AUKUS, what is promised under it, how much Australia ought to be paying for its defence, and the trade negotiations running simultaneously. Australia is not quite in the position of NATO countries, which Trump has bullied into promising a virtual doubling of defence expenditure. Albanese's argument, that he will spend whatever seems necessary, but not an arbitrary sum, nor enter contracts to buy American equipment Australia does not want or need, is popular politically. The opposition - and even more the Murdoch advocates - are flailing in arguing that either a formula is needed, or that Australian defence can use or manage a much bigger armoury.
MORE JACK WATERFORD:
But even more, arguments about AUKUS, and what it can or should deliver, are developing in a way that suggests a wind-back will be necessary. Even if the US could ramp up its production of submarines - doubtful in the short term - there will be powerful American interests reluctant to see them leave American control. Even more doubtful, whether from the US or the UK, are supposed deadlines about delivery of useful working ships within 15 years of the timetable promised. In a three-horse race for which nation has the least efficient, competent and viable defence acquisition system, it would be impossible to scratch any contender, even with the lamentable Australian procurement record in mind.
A month or so ago, I wrote here about American pressure descending on Australia to pre-commit itself to using its nuclear submarines (if handed over) in a war with China over Taiwan. It was no mistake that it surfaced publicly in the past week, in a manner designed to embarrass and compromise Albanese during his visit to China. If it was designed to bamboozle, I expect it backfired. First, the US itself has never made an explicit commitment to what it would do if, say, the Chinese crossed the Taiwan Strait. Nor has it ever made any sort of explicit pre-commitment about how it sees its ANZUS obligations. (On the one occasion, in conflict with Indonesia over Malaysia in 1963, US president John Kennedy told Robert Menzies that far from flying to Australia's aid, it would support Indonesia if it came to war).
The American military would be foolish to get involved in a war over Taiwan. Even their own research and war-gaming tells it that its intervention would involve comprehensive defeat. Admittedly, that is something the Yanks do nearly as well as we do, but we ought to have enough experience by now in opting out of something we have never indicated we would do. It's primarily a matter of logistics, not manpower (though we don't have enough) and weapons systems (ditto). These are deficits unlikely to be addressed before the year 2300.
It might be US policy (though I do not think it is) to expend money and treasure on noble but futile quests, but it should not be Australia's. And that's assuming that China has any immediate plan to launch an invasion. It may be only a splendid tease to keep everyone on their toes, too distracted to do anything much about more fundamental issues involving China's development as a world power.
Anthony Albanese's visit to China has exceeded everyone's expectations, including mine, and arms him with extra weapons and arguments for when he meets President Donald Trump and United States officials, whenever that is to be.
One can expect that Americans, and the advocates on The Australian, will accuse him of weakening perceptions that Australia is firmly in the Western camp. But he studiously said and did nothing that he has not said and done before, and one would have to parse each statement carefully to see evidence of any shift away from America, let alone movement towards the Chinese camp.
Yet the visit has reminded Australians and the Chinese, and perhaps the region, that Australia is a very strong trading partner of China and that we are not proposing to weaken the partnership, or our economy, simply so as to oblige the US, whose interests and conflicts with China mostly involve their own economic national interests when they are in conflict with ours. Australia may be unequivocally in favour of America remaining engaged in Asia and sees itself as a close military ally. But at least as far as Albanese is concerned, Australia will no more automatically turn to help protect America's interests when they are threatened than America will automatically stand beside us when our economic interests are threatened.
As it happens, the US could hardly have done more during the past five years in playing the fair-weather friend. The Morrison government foolishly but deliberately picked a fight with China over the origin of the COVID-19 bug. I imagine we did not do it at America's urging, because our foreign policy at the time consisted of anticipating what the US might want, and doing it of our own accord, even when no advantage accrued to Australia. (The origins of the bug are and were political currency in the US, particularly in the Trump camp, not least as they were trying to ratchet up claims that Chinese expansionism over trade disagreements would most likely lead to war).
China did not show its annoyance by getting angry with both Australia and the US about the accusations. Instead, it picked Australia away from the US and began a hostile and expensive round of economic sanctions against us. Market access to select Australian exports was denied. American statesmen grumbled, as we might expect, that China was exercising just the sort of economic coercion it had warned the world about. Its tame propagandists in Australia repeated their cry. But any support for Australia from the US was purely rhetorical. American traders attempted to steal our markets and profit from China's anger at us, when all that we had done was to echo some American claims.
The resolution of our trade disputes with China has been very hard work, and much more as a feature of quiet diplomacy under the Albanese government. It has had no clear support or assistance from our ally across the Pacific. No doubt the Chinese are taking advantage of a certain chaos in America's relationships with its allies.
The chaos and uncertainty of Trump is a fit topic for discussions with China, as are tips undercutting his erratic style.
So far as all the trade tension is concerned, China sees it as in its interests to draw neighbours and trading partners towards its side. If so, one might imagine that Australia would be low down on the list of any potential converts willing or likely to change sides.
But China's pull for many of its neighbours has been made stronger by the erratic policies of the Trump Administration, real uncertainties about where the US is going, and the ever-changing demands on tariff levels, with seemingly arbitrary rate-fixing, sometimes determined by spite or a misunderstanding of the effect and impact of trade imbalances. Australia has had much the same experience, even as we seem to have fared much better than most. Trump is continuing to muse about punitive rates on pharmaceuticals, on steel production and on meat imports. Trump has now been in power for six months. It has not been Australia's fault, nor Albanese's, that there has been no meeting with Trump. Nor has it been clear that there has been anything to gain from a face-to-face meeting at which points of trade or military alliance differences will be "sorted out". Has Canada, or Mexico, or Japan, or for that matter nations in the European Economic Community or India, comfortably settled their differences with Trump?
Some of the few nations that have done a "deal" with Trump are rationalising and attempting to justify their surrender, but very few are happy about it. At some time one can be sure that the agreements will ultimately be repudiated with the same lack of regard for a "rules-based order", a "gentleman's handshake" or international law as Trump has demonstrated throughout the process. No doubt it will occur at a time when it is the US, not the coerced nation, which has the disadvantage.
Many of those subject either to "deals" or to arbitrary settings are not planning to respond by simply buckling down to the bully. This includes Australia, with or without passive support from China. And the European Community, and Japan, Korea and India. They will try to find substitute markets, deciding doing business with the US is simply too risky, too subject to arbitrary whim, dodgy science and bigotry, and too unreliable. Perhaps also too authoritarian, too little subject to a recognisable rule of law or principles of fair dealing.
RELATED: PM confident of Australian jobs boost after China visit
China is not the only big trading nation considering alternatives to being dependent on the US for too much of its trade and economic growth. It may not want to refuse to supply the US, but it may operate a two-tier trade scheme in which it maintains its ordinary prices while passively allowing American consumers to pay a lot more (after tariffs) for its products. Trump is reckoning that his tariff walls will inevitably bring manufacturing centres back to the US. It may well be, instead, that the US cannot reverse the process by which rich industrialists, such as Trump, exported American jobs and American factories. Over the past six months, China has approached several neighbouring economies, including Japan and Australia, with talk of a multilateral free-trade pact, one that strikes a deal with the European Community. The EC has likewise discussed a free-trade pact with Australia.
One can be sure that Albanese, and Australian trade officials swapped economic intelligence with China, including views about the best way of negotiating with Trump, and their fresh experiences of his negotiating style (including what's been coined his famous "TACO" - Trump Always Chickens Out) in terms of discussions between China and the US. In one sense, it might seem a bit disloyal for Australia to be swapping experiences and insights about its closest ally with its bitterest enemy. On the other hand, if there is anything that six months of Trump has demonstrated, American military interests differ from its economic ones, and it does not hesitate to treat anyone as its economic enemy. Australia is quite capable of looking after its economic interests with China without divulging national security secrets. Indeed, if Australia did blab, there would be any number of Australian officials, regarding themselves as having a loyalty to the alliance over and above their loyalty to Australia, who would leak about it.
Australia is by no means the only nation that faces further difficult negotiations about the terms under which it buys and sells pharmaceuticals. China and India are in the same position. Their dominance of international manufacturing markets is not a result of failure to adhere to international intellectual property laws or to play by the established rules. Australia and many other nations have special interests in preserving the shape of the trade as it is because it forms the basis of public health schemes providing life-saving drugs to their populations at much cheaper prices than in the US public health system, such as it is. Trump may proclaim that schemes outside the US are socialist, or sometimes communist, but the argument is hardly persuasive to most of the rest of the world. Winding the schemes back would lead to major civil unrest, whether here or in Britain, Europe or even China.
Perhaps Trump has a big sense of grievance about how some nations, including China (and in narrow respects, Australia), have come to dominate metals markets, including steel. Americans may fondly remember when American steelworks and foundries dominated world production. But its loss of that field, and the export of the jobs, skills and capital that this involved, is not primarily a consequence of the conscious exporting of American jobs and the stealing of American secrets. It is a consequence of economic growth by which developing countries, including China, consciously moved into steel production to feed new appetites for housing, manufacturing plant and cars. Nor can the story of steel be reduced to a two-dimensional story about some sort of economic raid upon the US. The mere fact that Trump, or American steelworkers, resents the loss of a once-critical industry may make Trump's efforts a heroic feat from an American's point of view. Outsiders, even neighbours or allies, hardly see it the same way.
What this suggests is that Trump's program is receiving more and more pushback as it continues. Trump's rich backers are used both to making direct demands for tariff protection and to being mulcted by the Trump organisation if he succeeds on their behalf. The personal negotiating style of Trump may have its attractions, but to many it appears corrupt. It also appears to lack an organising principle, by which outsiders can see that like is treated as like, or the services of disinterested parties, such as adjudicators or judges, able to consider and determine claims made upon the system. Indeed, the intimate style, which includes public bullying and bluster, the appearance of demanding quids pro quo, and individualised determinations changing by the day smack of arbitrary government running to personal advantage, not a system of government under law. Increasingly, however, the US Supreme Court is stripping lower courts of the capacity to scrutinise such schemes.
At this point, one of the worst possible ways in which Albanese could tackle negotiations would involve going to Washington with a determination to dicker and negotiate each Trump agenda item, based on giving up something here in the hope of keeping the status quo elsewhere. In any such negotiation, Trump, as the standover man in chief, has completely the open hand, able to walk out threatening retaliations or interim fees, able to introduce new considerations and denying Australia any real capacity to have its arguments determined by any independent or fair system. The Canadian negotiations provide a good example of what should be best avoided, the more so when one considers that Albanese is not a particularly good negotiator.
But it may well suit Albanese's interests to keep various disputes, such as the future of AUKUS, what is promised under it, how much Australia ought to be paying for its defence, and the trade negotiations running simultaneously. Australia is not quite in the position of NATO countries, which Trump has bullied into promising a virtual doubling of defence expenditure. Albanese's argument, that he will spend whatever seems necessary, but not an arbitrary sum, nor enter contracts to buy American equipment Australia does not want or need, is popular politically. The opposition - and even more the Murdoch advocates - are flailing in arguing that either a formula is needed, or that Australian defence can use or manage a much bigger armoury.
MORE JACK WATERFORD:
But even more, arguments about AUKUS, and what it can or should deliver, are developing in a way that suggests a wind-back will be necessary. Even if the US could ramp up its production of submarines - doubtful in the short term - there will be powerful American interests reluctant to see them leave American control. Even more doubtful, whether from the US or the UK, are supposed deadlines about delivery of useful working ships within 15 years of the timetable promised. In a three-horse race for which nation has the least efficient, competent and viable defence acquisition system, it would be impossible to scratch any contender, even with the lamentable Australian procurement record in mind.
A month or so ago, I wrote here about American pressure descending on Australia to pre-commit itself to using its nuclear submarines (if handed over) in a war with China over Taiwan. It was no mistake that it surfaced publicly in the past week, in a manner designed to embarrass and compromise Albanese during his visit to China. If it was designed to bamboozle, I expect it backfired. First, the US itself has never made an explicit commitment to what it would do if, say, the Chinese crossed the Taiwan Strait. Nor has it ever made any sort of explicit pre-commitment about how it sees its ANZUS obligations. (On the one occasion, in conflict with Indonesia over Malaysia in 1963, US president John Kennedy told Robert Menzies that far from flying to Australia's aid, it would support Indonesia if it came to war).
The American military would be foolish to get involved in a war over Taiwan. Even their own research and war-gaming tells it that its intervention would involve comprehensive defeat. Admittedly, that is something the Yanks do nearly as well as we do, but we ought to have enough experience by now in opting out of something we have never indicated we would do. It's primarily a matter of logistics, not manpower (though we don't have enough) and weapons systems (ditto). These are deficits unlikely to be addressed before the year 2300.
It might be US policy (though I do not think it is) to expend money and treasure on noble but futile quests, but it should not be Australia's. And that's assuming that China has any immediate plan to launch an invasion. It may be only a splendid tease to keep everyone on their toes, too distracted to do anything much about more fundamental issues involving China's development as a world power.