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Australia faces mounting pressure to lift defence spending, with a growing chorus of US lawmakers joining what is fast becoming an inevitable regional and global push for Canberra to meet NATO’s new 5 per cent spending “floor”.
Washington’s mounting demands for higher Australian defence spending have triggered resistance in Canberra, reflecting both unease with President Donald Trump’s hard-edged diplomacy and a deeper reluctance to accept that America can no longer carry the global burden alone.
This has brought Australia into a low level of dispute with our principle geopolitical security partner, as the Australian government sends two distinctly contradictory messages: the first being we remain committed to the post-Second World War order and the second being we will decide just how much we will spend to defend it.
After 1945, the United States established Pax Americana, anchoring global order through unmatched military might, economic innovation and institutions such as the International Monetary Fund, World Bank and NATO.
This framework underwrote decades of stability, reconstruction and prosperity. America became the global policeman, containing communism, curbing imperial conflicts and creating an international system that delivered unprecedented growth.
By the late 20th century, however, this dominance was under strain. Rising multipolarity, the resurgence of rival great powers, economic uncertainty and deep domestic divisions steadily eroded the inevitability of US primacy.
Today’s global environment is more contested, with Washington stretched thin and increasingly impatient with allies who, in its view, are not pulling their weight. Australia has long relied on the US alliance for security and prosperity.
Yet as the Indo-Pacific becomes the centre of strategic competition, Canberra, like a number of allies across the region, faces pressure to shoulder greater responsibility. Trump’s return to the White House has only sharpened this reality. His administration is blunt: America wants allies to pay more for their own defence.
Prime Minister Anthony Albanese has so far resisted, often with a degree of overt hostility towards the US request, further raising concerns about the future of the relationship under his government.
Despite US Defence Secretary Pete Hegseth urging a lift in spending at the Shangri-La Dialogue in Singapore, Prime Minister Albanese defended Australia’s settings: “What we’ll do is we’ll determine our defence policy, and we’ve invested just across the forwards, an additional $10 billion in defence. What we’ll do is continue to provide for investing in our capability but also investing in our relationships in the region.”
Canberra’s current trajectory, 2.33 per cent of gross domestic product (GDP) by 2033–34 under the 2023 Defence Strategic Review and 2024 Integrated Investment Program, falls short of Washington’s expectations. Yet Prime Minister Albanese argues that regional partnerships and targeted investments are as critical as raw spending increases.
This figure falls well short of what is being described as the new “floor” for NATO-member defence spending of 5 per cent in total, with 3.5 per cent to spent on “hard” or traditional military capabilities, and the remaining 1.5 per cent to be spent on “enabling” capabilities, ranging from infrastructure through to industrial capacity, cyber resilience and space enablers.
The debate is not confined to the US, with the recently visiting Dutch Chief of Defence, General Onno Eichelsheim, warning Australia to step up its spending quickly, citing Beijing’s growing ambitions in the Indo-Pacific.
As allies and partners revisit their own commitments, Canberra is being pushed to decide how much it is prepared to invest in security amid an increasingly dangerous world. Highlighting this is two pieces by The Australian’s Joe Kelly, the first titled No free ride in defence of free world, Pentagon tells Indo-Pacific and the second, titled US politicians back AUKUS and bigger defence spend, in which he articulated the growing pressure Canberra faces.
Enhance efforts for ‘collective defence’
At the core of Kelly’s analysis in No free ride in defence of free world, Pentagon tells Indo-Pacific is the period of reflection some find in both America and Australia as both nations prepare to commemorate the 80th anniversary of the end of the Second World War. Washington has made it clear that shoring up collective defence in the Indo-Pacific is now an urgent priority.
Kelly highlighted that with 2027 looming as the year China may be capable of seizing Taiwan, the Pentagon is pressing allies, including Australia, to do more.
“We’re coming up to the 80th anniversary of the end of World War II,” a US Defense official told The Australian. “The lesson to take in commemorating the end of the war in the Pacific is the need for real efforts and readiness for collective defence.”
The US Department of Defense has firmly set its priorities as defending the homeland, deterring Beijing, revitalising its defence industrial base, and “getting the allies to do more in order to pick up slack”, key points firmly in line with President Trump’s “America First” agenda.
However, officials warned that Australia is not pulling its weight, particularly when it comes to AUKUS. “On defence spending – the objective analysis is that the Australian government is not spending enough on defence, even for Pillar One,” one senior figure said, referring to the deal under which Australia will acquire at least three Virginia Class nuclear-powered submarines from the early 2030s.
Canberra’s defence spending is coming under greater scrutiny as NATO allies commit to lift their budgets to 5 per cent of GDP to counter Russia. US officials are asking why Asian allies, facing a much larger threat in China, should “sit back while the Europeans are stepping up”. South Korea, with its heavier investment and larger standing force, is being held up as the model ally in the region.
Prime Minister Albanese’s recent Curtin Oration also struck a nerve in Washington. In it, he praised John Curtin’s wartime defiance of both Winston Churchill and Franklin Roosevelt.
Kelly articulated that for some in the Trump administration, the message was jarring at a time when Australia is being pressed to lift its contribution.
Still, the Albanese government maintains AUKUS is firmly in both nations’ interests. So far, $1.6 billion has been funnelled into the US shipbuilding industry as part of the deal.
Defence Minister Richard Marles sought to play down doubts, insisting that Secretary Hegseth remains a strong backer on the partnership and it’s central priorities, saying, “I speak to my counterpart and we have an ongoing dialogue, and there is support in the United States for AUKUS,” he told the ABC. “It’s fundamentally in the strategic interests of the United States.”
But behind the reassurances, US officials are blunt: time is short and the gap between Australia’s commitments and its current defence posture is becoming untenable. “Those are facts that we must address, given the gravity of the strategic situation,” one said. “This is a very real near-term problem. We have essentially no time in defence terms before 2027.”
Growing US bipartisan expectations
If the Albanese government believes it could look to congressional Democrats for support in weathering the storm of US requests, it appears as though they were sorely mistaken.
This comes following the Australian American Leadership Dialogue recently held in Adelaide. Senior US lawmakers from both sides of the aisle have urged Canberra to lift its defence spending, backed the AUKUS security pact, and pressed for President Trump to make a presidential visit to Australia.
Leading the congressional delegation, Democrat senator Chris Coons described the alliance as “close and long standing” and stressed there was “strong bipartisan support in Congress for the landmark AUKUS agreement”.
But he also cautioned that America’s own shipbuilding struggles posed a challenge to delivering on commitments. “We are severely constrained in our shipyard capacity and our workforce,” he said. “We are not hitting our targets in terms of naval construction.”
Senator Coons, a member of both the Senate foreign relations and appropriations committees, said it would be “valuable for President Trump to come and visit Australia”, arguing that sitting leaders down together in person could strengthen ties.
“When you are sitting in the same room, watching and talking with someone, you have a better conversation,” he said. “So, yes, of course I would see a real value in President Trump making a priority of sitting down with Prime Minister Albanese.”
The delegation also included Republican congressman Michael Turner, who gave credit to Canberra for its existing defence commitments but insisted more was needed.
Congressman Turner added, “We have to take this in (the) context of what our adversaries are doing,” he said. He pointed to the recent NATO summit in The Hague, which saw members agree to lift defence spending to 5 per cent of GDP, describing it as “wildly successful” and crediting President Trump’s pressure for the result.
Both Senator Coons and Congressman Turner acknowledged Canberra’s investment beyond defence hardware. “Frankly, Australia is making the investment in other critical capabilities – development and diplomacy – in areas where the United States just cut back sharply,” Senator Coons said. “But, of course, I would encourage increased investment in defence.”
Despite bipartisan assurances, uncertainty lingers over the Pentagon’s ongoing review of AUKUS led by Elbridge Colby. Democratic congressman Joe Courtney, a strong supporter of the agreement, admitted some of Colby’s past remarks had “definitely raised some warning flags”.
Back home, Opposition Deputy Leader Sussan Ley argued that the alliance was in a state of “drift” and urged Prime Minister Albanese to extend an invitation to President Trump. “We all know a strong Australia–United States relationship is critical for our national security and the prosperity of both our nations,” she told The Australian.
“The last presidential visit was in 2014. Since that time, the world has changed significantly … To deepen shared understanding … A presidential visit to Australia would be an important opportunity to ensure Australia and America continue to stand shoulder to shoulder in a volatile world.”
The US delegation of two senators and five members of the House of Representatives will meet Prime Minister Albanese in Sydney this week, following visits to the Osborne shipyard in Adelaide and stops in the Marshall Islands and Papua New Guinea.
Ultimately though, the question now becomes a matter for Australia’s returned and emboldened Albanese government and whether they can find it within themselves to meet the spending obligations they now face before disaster strikes, or will we be left woefully underfunded and unprepared for conflicts which may emerge in our region.
And if the government was smart, they’d be leveraging spending through the multibillion-dollar National Reconstruction Fund and it’s central priorities to make up some of the difference in spending, because it would certainly move the dial and appeal to America’s own concerns about the degradation of the allied industrial base.
Final thoughts
If Australia is to not just survive but genuinely prosper in this era of shifting great power competition, policymakers and the broader community must acknowledge that the world is growing ever more multipolar, and that the Indo-Pacific is quickly becoming the most fiercely contested region on the planet.
This transformation is driven by the rising economic, political and strategic influence of nations like China, India, Pakistan, Thailand and Vietnam, alongside the established and resurging capabilities of South Korea and Japan. Together, they’re forging a highly competitive arena right on Australia’s doorstep.
At the same time, Australia is having to grapple with the relative decline of its primary security benefactor’s own relative power declining as the aggregated and individual concentration of power is placing real limitations on the United States.
Confronting these challenges and opportunities means moving beyond the narrow outlooks that have long underpinned our diplomatic, strategic and economic policies since Federation.
To truly harness the profound shifts taking place in the Indo-Pacific, Australia needs to adopt a long-term perspective. The urgent question now is: when will we see a comprehensive analysis and response to these developments?
When will a clear narrative and strategy emerge that enables both industry and the community to understand not only the risks but the thrilling, untapped opportunities ahead?
As regional dynamics evolve and China continues to extend its sway, Australia must decide whether it can afford to remain a secondary power or whether it needs to embrace a more independent and influential role amid intensifying great-power competition.
Most importantly, our leaders and citizens must avoid short-term distractions and stay true to Australia’s core values and principles.
Get involved with the discussion and let us know your thoughts on Australia’s future role and position in the Indo-Pacific region and what you would like to see from Australia’s political leaders in terms of partisan and bipartisan agenda setting in the comments section below, or get in touch at
Stephen Kuper
Steve has an extensive career across government, defence industry and advocacy, having previously worked for cabinet ministers at both Federal and State levels.
