Secret

by Brian Toohey

  Coalition prime minister John Gorton in the late 1960s was the most senior politician to want Australia to get nuclear weapons. Journalist Tom Hyland reported that declassified documents obtained by the National Security Archive in Washington show that Gorton bluntly told US Secretary of State Dean Rusk in a Canberra meeting on 6 April 1968 that he did not trust the US to defend Australia and that he wanted the option to develop nuclear weapons because Australia ‘could not rely upon the US for nuclear weapons [protection] in the event of nuclear blackmail or an attack on Australia’.6 After Rusk said the US wanted Australia to commit to the Nuclear Non-Proliferation Treaty, Gorton explained that he was concerned that Japan and India would go nuclear and that signing the NPT would prevent Australia doing likewise for the next twenty-five years. Gorton eventually signed the NPT in February 1970, and the newly elected Whitlam Government promptly ratified it in January 1973.

  Preliminary work on an Australian bomb was already underway in Sydney in 1968 at the Lucas Heights headquarters of the Australian Atomic Energy Commission. Its chair, Sir Philip Baxter, passionately backed Gordon’s ambitions. The US was sufficiently concerned to place air-sampling sensors on the ground, and on planes that overflew Lucas Heights, to detect isotopes associated with the weapons program.7

  Gorton was right to doubt that the US would always come to Australia’s aid with nuclear weapons. It’s hard to believe the US would risk the obliteration of one or more of its major cities if it agreed to use nuclear weapons to help Australia. Take the case of a nuclear-armed state that was attacking Australia, but only with conventional weapons. In one scenario, the US could use a low-yield nuclear weapon in what it described as a one-off action to destroy a target in the attacking country. The adversary might then retaliate with a nuclear attack on a small Australian target, such as Launceston, and insist this was also a one-off action. In another scenario, instead of being the first to use nuclear weapons since 1945, a rational US president would reasonably refuse to use them because the conflict could escalate into a full-scale nuclear war that killed millions of Americans.

  Nothing has changed about the advantages of non-proliferation. If more countries acquire nuclear weapons, the risk increases that they will be used (accidentally or otherwise) to kill millions of harmless people. But Australia’s ingrained fear of a threat from Asia has resurfaced as China’s growing power attracts more attention. Calls for Australia to consider developing nuclear weapons have re-emerged, this time among think tanks and academics, although not yet senior politicians. ANU scholar Stephan Frühling sees several advantages of going nuclear, but not yet.8 Doing so could easily encourage others, such as Indonesia, to follow. The possession of nuclear arms would not prevent Australia and Indonesia from becoming involved in conventional war, as happened between India and Pakistan in 1999.

  Coalition governments since 2007 have bluntly refused to push for nuclear disarmament, preferring to rely on the dubious protection of a US ‘nuclear umbrella’. They should revisit the explanation US officials gave to their Australian counterparts during negotiations in 1974: ‘The threat of massive retaliation, with all its catastrophic risks, was essentially a bluff.’9 The Coalition prime minister Malcolm Turnbull didn’t support a UN conference resolution on 7 July 2017 to establish a legally binding treaty prohibiting the development or possession of nuclear weapons. There were 122 votes in favour and one opposed. Australia was one of thirty-five to abstain, claiming the treaty had imperfections.

  Supporters of the UN resolution aren’t pretending more work isn’t needed to address the difficulties. One acknowledged problem is how to get the existing nuclear-weapons states to agree. No country has followed President F.W. de Klerk’s moral lead when his South African apartheid government voluntarily dismantled its nuclear weapons in the early 1990s. Part of the solution is to develop an international verification authority that can provide the strong level of trust needed for the nuclear-armed powers to agree to relinquish their weapons.

  The International Campaign to Abolish Nuclear Weapons (ICAN) has gathered support since Australian activists established it in 2007. After it was awarded the Nobel Peace Prize in December 2017 in Oslo, its leader, Beatrice Fihn, said, ‘The only rational course of action is to cease living under conditions where our mutual destruction is only one impulsive tantrum away.’10 The Turnbull Government refused to congratulate the Australian-led organisation on its award.

  Nothing will be achieved until international leaders start talking calmly to each other in an effort to make progress. Nixon and Brezhnev did so, as did Reagan and Gorbachev. William Perry, a former US secretary of defence, gives another compelling example of the value of talking rather than trying to prove who’s toughest. After observing the 1962 Cuban missile crisis from inside the White House early in his career, Perry was dismayed by the American media’s triumphal ‘crowing that Khrushchev had “blinked”’.11 He said this was specious: ‘Not only because Khrushchev’s decision to back down spared the world from an unprecedented catastrophe, but because the [crisis] … accelerated the nuclear arms race already underway’.12

  Before Australian policy-makers again extol the value of sheltering under the US nuclear umbrella, they should heed Perry’s advice: ‘A lifetime in which I had first-hand experience and special access to top-secret knowledge of strategic nuclear options has given me what may be a unique, and chilling, vantage point from which to conclude that nuclear weapons no longer provide for our security—they now endanger it.’13

  PART 10

  THE CHANGING OF THE GUARD

  59

  THE RISE OF CHINA, INDIA AND INDONESIA

  ‘A country where the strong prey on the weak, where a burgeoning middle class opposed to free multi-party elections is willing to stand up … for more accountable government, a place where money-making is called socialism.’

  John Keane1

  Great powers rise and fall, regardless of Australia’s wishes. There is no inherent reason why we must be worse off if the relative economic and strategic power of China, India and Indonesia keeps rising while that of the US declines. Ever since World War II, Australian business has coped with political upheavals, decolonisation, wars, economic crises, disruptive technologies and policy changes while welcoming the opportunities created by China over the past forty years.

  Australia’s national security establishment, however, refuses to welcome China’s rise. It wants to damage China’s economy, although this would make Australia worse off economically but no safer.2 Australia’s two-way trade with China was worth over $183 billion in 2017—more than the total with Japan, the US and India.3 Faced with change, many in the media and the wider population have also reverted to a reflex fear of China. Australians’ earlier fear was that China’s hungry hordes would pour down and eat their lunch. The new fear is that China can buy enough weapons and political influence to reduce Australia to a puppet state. Terrible images may even arise of the prominent politician Peter Dutton pulling a fat Chinese general in a rickshaw across the Sydney Harbour Bridge.

  Precise predictions can be wrong, but the overall message is that the economic power of China, India and Indonesia will dwarf Australia’s in future decades, notwithstanding periods of slower growth.4 The world already depends on China for much of its prosperity: it contributed 32.5 per cent to world GDP growth in 2017 compared to 9.6 per cent contributed by the US.5 Forecasts in the Australian government’s 2017 Foreign Policy White Paper show the Chinese economy well ahead of the US’s by 2030.6 The big accounting firm PwC’s projections to 2050 are even more sobering. They show the size of Australia’s economy dropping from nineteenth in the world to twenty-eighth while many Asian countries forge ahead. According to PwC, China’s economy will be largest by 2050, followed by India, the US and Indonesia.7 China’s middle class is forecast to expand to 850 million people by 2030.8 If this happens, it will create tremendous opportunities for a wide range of Australian industries, as will the growth of the middle class i
n India and Indonesia.

  Although Australia’s relative economic and strategic clout is projected to shrink sharply, the 2017 White Paper seems incapable of recognising that Australia is in no position to keep insisting that everyone must obey the US-led rules-based international order that has supposedly kept the peace and delivered prosperity since 1945.9 Never mind that the US repeatedly engages in illegal wars of aggression, breaks trade rules and abandons nuclear arms control treaties. The most likely outcome is that China will be the dominant power in its immediate region, and India and Indonesia will be increasingly powerful in their neighbourhoods. China will have no motive to invade Australia and probably not the military capability for decades. It won’t be able to dominate Europe or North America.

  A leading Asia scholar, Kishore Mahbubani, says that Chinese president Xi Jinping’s accumulation of enormous political power has been taken in the West as a harbinger of armed conflict. But he says it has ‘not fundamentally changed China’s long-term geopolitical strategy … [of] avoiding unnecessary wars … Quite remarkably, of the five permanent members of the UN Security Council, China is the only one that has not fired a single shot across its border in thirty years since a brief naval battle in 1988. By contrast, even during the relatively peaceful Obama Administration, the American military dropped 26,000 bombs on seven countries in a single year.’10

  Nothing is certain. China could collapse economically and politically or continue to thrive and revert to its earlier commitment to live in Confucian harmony with its neighbours. It is unlikely to become a democracy while its population fears this form of government would be as divisive as it is in the US. Even less likely, it might become a democracy and seek global dominance, as the US has done. Many outsiders, including myself, prefer to change governments in free and fair elections, but support for liberal democracy is waning in the West.11

  Only the most curmudgeonly Sinophobe could dismiss former World Bank president Jim Yong Kim’s statement that China has lifted over 800 million people out of poverty. As Kim said, ‘This is one of the great stories in human history.’12 It reflects favourable policy settings and the hard work and enterprise of the Chinese people. However, income distribution remains badly skewed.

  When I covered Foreign Minister Don Willesee’s visit to China in 1975, people dressed in drab Mao suits had no choice about where they lived or worked, and still suffered from the madness of Mao Zedong’s Cultural Revolution. Severe poverty was entrenched. Today, people are much freer to dress fashionably and buy or rent their own homes, although many struggle to afford to do so close to their jobs in city centres. In 2018, 134 million Chinese holidayed overseas and millions more studied abroad.13

  Under Mao, there was no private sector. Today, it comprises about 70 per cent of the Chinese economy. Further expansion is expected to slow under President Xi, but it’s likely that many high-tech companies could still thrive and start-ups will abound, unless US policies block their export markets. China’s Communist Party rejects the Marxist goal of imposing complete public ownership of the means of production, distribution and exchange, and punishes Marxist labour activists who try to improve wages by forming militant unions.14 It could easily, and just as inaccurately, be called the Capitalist Party or even the Confucian Party.

  The political scientist John Keane says of modern China, ‘Contradictions are found in all the leading institutions, at every street corner, in every nook and cranny of its vibrant multimedia scene … a country where the strong prey on the weak, where a burgeoning middle class opposed to free multi-party elections is willing to stand up … for more accountable government, a place … where there are more billionaires, skyscrapers and card-carrying communists than in the rest of the world.’15

  The 2018 announcement that President Xi would hold his post for life is troubling. Philippa Jones, a former Australian diplomat turned Beijing publisher, told me in 2016 that policy formation in the one-party state had been far less monolithic than often portrayed. She said sanctioned contention about broad economic and social policy was often a check on the government, and that she feared that although the party used extensive polling to keep in tune with public sentiment, party panels set up by Xi would ‘overtake the role of the technocratic agencies in decision-making’.16 Xi has cracked down particularly hard on Communist Party corruption in a popular campaign that has punished over 1.5 million party members, including some of his main party rivals, but not his family or factional allies. There is no guarantee he will survive—widespread public anger could erupt if his provocative boasts about China’s growing power rebound or anger grows at his attempts to control the personal behaviour of the Chinese people.

  Human rights abuses are the biggest blot on modern China. Although 50,000 protests are held each year, they can be controlled or banned and political dissidents can be jailed.17 Tibetans and the Islamic Uighur minority in Xinjiang Province receive the harshest treatment. There are credible reports that the Chinese government has interned one million Uighurs in ‘re-education’ camps out of a population of 10 million.18 This is a hugely disproportionate reaction to the Uighur terrorist attacks in Tiananmen Square in 2013 and at Kunming railway station in 2014.

  The government plans to roll out a ‘social credit’ system covering the entire population by 2020. It will use massive databases from private and public sector sources to grade citizens on their social behaviour, rewarding those who do well.19 Punishments for those who rate badly will range from minor to much more onerous. Australia has cashless debit cards that control what items some welfare beneficiaries, mainly Indigenous people, can buy. Single parents must follow a prescribed plan of behaviour called ParentsNext or lose their welfare payments. A system like China’s may never be accepted in Australia, but many traditional civil liberties have been scrapped here with little fuss.

  In 2018, the US imposed high tariffs on Chinese imports and pressured its own firms to stop producing goods more cheaply in China. It also complains that China has stolen patents to help it grow, as Japan and South Korea did—but earlier, the US allegedly stole British technology.20 Mainstream economics regards patents and copyright as initially needed to entice industrial inventors or artistic creators to produce. Beyond that level, protection increases consumer prices unduly and prevents firms using the lowest-cost inputs. In its (misnamed) free trade agreement with the US, Australia foolishly agreed to extend the copyright on products of the entertainment, software and similar industries to seventy years after the death of the creator—far longer than Lennon and McCartney needed to write songs for the Beatles. Damaging trade flows will erode an important source of ballast in the US–China relationship. Unlike China’s inefficient, but heavily subsidised, state sector, its private sector accounts for about 85 per cent of total industrial production, yet receives significantly less budget assistance than its much smaller Australian counterpart.21

  The US National Research Council says the federal government has played an integral role in the early development of numerous strategic industries—‘Telecommunications, aerospace, semiconductors, computers, pharmaceuticals and nuclear power are among the many industries that were launched and nurtured with federal support.’22 But in June 2018 the United States stated that it considered China’s high-tech goals to pose an unprecedented national security threat.23 This is implausible. The US will long remain the most militarily secure nation on earth. Its commercial concern is that some Chinese companies are gaining an edge over their US rivals by spending huge sums on original research. Staff-owned high-tech firm Huawei is a particular target because it creates cutting-edge communications and information technology at attractive prices. Huawei allocates at least 10 per cent of its revenue to research and development in thirty-seven joint centres around the globe. In late 2018, it sold more smart phones than Apple (whose phones are assembled in China).24

  Australia stopped Huawei supplying routers to the NBN in 2012, supposedly to protect its top-secret national security communica
tion system. But that system can’t be accessed from the NBN, especially from the sections Huawei would supply. In 2018, Australia banned Huawei’s advanced and competitively priced new 5G equipment that has a wide range of benefits in areas such as business, medicine, education and the remote operation of infrastructure, as well as for personal usage, but high-grade encryption can ensure important information remains secret. The Australian Signals Directorate expects ‘these new technologies will provide new ways [for the ASD] to detect and track threats’.25 China could do the same, regardless of whether Huawei supplied Australia’s network. The Chinese government can order companies to hand over domestic data, just as the Australian government can and does. It would make no sense for a Chinese government to order Huawei to misuse its technology overseas, as the international reaction could destroy the financial viability of one of its leading high-tech companies. It has other ways to conduct electronic espionage. Without a convincing public explanation, it is hard to see the justification for completely banning Huawei’s 5G equipment, which Optus and TPG intended using, while Telstra preferred Ericsson’s 5G system. The government could have mandated the use of Telstra’s system for the remote operation of critical infrastructure, in conjunction with additional protection against cyber attack. Optus and TPG could have still used Huawei’s 5G equipment to provide serious competition in the rest of the market. The different systems would sometimes need to interact, but critical infrastructure could still be protected. Highly classified information would still use the government’s secure network, which is inaccessible by 5G.