With COVID showing no signs of going away, combined with rising tensions and coercion at the hands of our major trading partner, is it time to ask “what price is too high to pay for our sovereignty?” For Sam Roggeveen from the Lowy Institute, the public needs to identify the price we put on our sovereignty to plan accordingly.
Across the globe the post-Second World War economic, political and strategic order appears to be in tatters; the impact of COVID-19 has exposed a startling over-dependence on global supply chains.
Meanwhile, the continued threat of asymmetric competitors, unrestricted, political warfare and broader global trends of great power competition are serving to impact the security and critically sovereignty of many nations, including Australia.
Adding further fuel to the fire are the global and more localised impacts of COVID-19, which range from recognising the impact of vulnerable, global supply chains upon national security as many leading nations, long advocates of "closer collaboration and economic integration", grasp at the lifeboats of the nation-state to secure their national interests and sovereignty.
Despite its relative isolation, Australia's position as a global trading nation, entrenched in the maintenance and expansion of the post-Second World War order has left the nation at a unique and troubling cross roads, particularly as its two largest and most influential “great and powerful” friends: the US and the UK appear to be floundering against the tide of history.
With the spectre of COVID-19 far from diminished across the globe and waves of civil unrest and violence tearing their way across the US, and the UK still under strict lock downs, these two great powers are limited in their capacity to actively and assertively intervene on behalf of their allies around the world, despite intent.
The fragility of these two nations has prompted many global dictators to take advantage of the absence, as the old saying states: "When the cat is away, the mice will play", leaving Australia and many other allies, including Taiwan, Japan and South Korea, exposed to the whims of nations dedicated to the end of post-war order.
Nowhere is this more evident than across the Indo-Pacific as an emboldened Beijing continues to punish Australia for pursuing a global inquiry into the origins and China's handling of COVID-19, while also leveraging the diminished presence of the US military in the region to project power and intimidate both Japan and, critically, Taiwan.
While the Australian government and the Prime Minister, in particular, have taken the proverbial bull by the horns in standing up to China's blatant antagonism and hostility to the post-World War Two economic, political and strategic balance of power, ironically the same one China owes its economic transformation to, the need for a truly co-ordinated response has fallen by the wayside, at least until now.
As the public continues to grapple with the new reality and the period of nation-state based competition and coercion, particularly from Australia's major trading partner, many have raised the question: what price is our sovereignty worth?
For Sam Roggeveen, director of the Lowy Institute’s International Security Program, and a visiting fellow at the Strategic and Defence Studies Centre, Australian National University: "It is impossible to have a useful public debate about the value of sovereignty if we refuse to put a price on it."
Sovereignty, but at what price?
Many Australian's would argue that the blood and treasure shed throughout the nation's formative years of the 20th century was spilled in the preservation and protection of the national independence and sovereignty and the individual rights, freedoms, and standards of living we now enjoy - in particular they would highlight the Pacific campaign where Australia itself came under direct threat as a pivotal example of the nation defending its sovereignty.
For Roggeveen, it would seem that for many Australians, these intangible, yet intrinsic parts of the national identity are important, yet not "non-negotiable". He expands on this, stating: "I agree that independence and sovereignty are important (though not 'non-negotiable' – more on that later), but that only makes it more urgent to calculate the costs of protecting it.
"That’s a difficult task and the results will be imperfect, but it is not beyond us to come up with estimates that provide a meaningful guide to policy. In fact, it will be impossible to have a really useful public debate about the value of sovereignty if we refuse to put a price on it."
Utilising a specific public policy area, in this instance, public health, Roggeveen argues that the cost-benefit analysis for Australia's sovereignty and independence is a metric we can accurately measure: "We can draw an analogy with health policy. Most of us have asserted, at one time or another, that 'you cannot put a price on human life', and in moral and legal terms, that’s true. But without measuring the cost of keeping human beings alive, it is impossible to fairly distribute finite resources across the health budget. In fact, although the Australian government doesn’t advertise it much, it actually does put a price on human life – it’s about $4.9 million at the moment."
Shifting to two critical focal points of the national sovereignty debate, defence and economic diversity, Roggeveen makes an interesting point: "Governments make similar calculations with the defence budget. Every year, they judge what it will cost to defend Australia – too much and we waste resources, too little and we weaken our deterrent power and leave ourselves open to intimidation by adversaries.
"It’s hard to ever know if the government is getting this judgment right, but we do know that it is impossible to build a defence force without making them.
"So it is not at all unrealistic to ask those who want to diversify Australia’s economy away from China to estimate what it will cost, and whether we should be prepared to pay that price. Or, to offer some specific examples: how big a subsidy are we willing to pay companies like BHP Billiton to stop selling iron ore to China?
"How much extra are we willing to pay for a 5G service if we exclude the cheapest vendor? Recently, regular Interpreter contributor Greg Earl highlighted some new studies which estimate the costs of diversification. Not surprisingly, it depends on what we are buying or selling. In some cases, the costs of diversifying away from China would be minimal, but not in others," in doing so Roggeveen makes the classic neo-liberal, globalist argument that money and cheaply accessed goods, services and technology should come before our principles and values.
Economic diversity is not always the answer
Beijing's blatant attempts at economic coercion and threats following Prime Minister Morrison's push for a thorough and international investigation into the origins of COVID-19 has revealed what many have suspected since China actively began expanding its territorial and strategic interests throughout the Indo-Pacific and increasingly around the world: economic dominance is an instrument of statecraft.
Many have advocated that putting all of our economic eggs in one basket, in this case Beijing's basket, leaves us dangerously exposed to not only the fluctuations of the Chinese market, but also the now blatantly obvious bullyboy tactics of a totalitarian regime that is dedicated to the destruction of the post-Second World War order it has used to build its own wealth and power.
However, for Roggeveen, economic diversification away from China doesn't mean better opportunities, stating: "Moreover, dependence a single market is not always risky. Dupont thinks universities now regret their 'China-centric, bottom-line driven business models', but as Richard McGregor has argued, China’s education and tourism markets have been liberalised, making it difficult for the central government to suddenly turn off the tap in order to coerce the universities or our government.
"Moreover, the market is the best judge of whether reliance on Chinese students or tourists is too commercially risky – if universities, hotels, airlines or tour operators want to spread that risk, they can do so. No government intervention is required."
Again, this argument is based upon the false belief that these actors will prioritise the national interest and sovereignty over the alluring power of the almighty dollar.
It is also clear that Roggeveen refuses to accept that the economic 'relationship' between Australia and China has turned to a toxic one, one where we will sell out because we're afraid to do the hard leg work to not only broaden our access to other potential markets, but also broaden our economic diversity at a time when it is critical to ensuring the long-term sustainability and prosperity of the nation.
This is based on the flawed, Cold War-era belief that economic development and rising prosperity in China would promote a shift away from totalitarian Maoism, towards a liberal, democratic model – something we now know to be blatantly untrue as Beijing's totalitarian agenda continues to cast its shadow over the Indo-Pacific.
The nation is defined by its relationship with the region, with access to the growing economies and to strategic sea lines of communication supporting over 90 per cent of global trade, a result of the cost-effective and reliable nature of sea transport.
Indo-Pacific Asia is at the epicentre of the global maritime trade, with about US$5 trillion worth of trade flowing through the South China Sea and the strategic waterways and chokepoints of south-east Asia annually.
For Australia, a nation defined by this relationship with traditionally larger, yet economically weaker regional neighbours, the growing economic prosperity of the region and corresponding arms build-up, combined with ancient and more recent enmities, competing geopolitical, economic and strategic interests, places the nation at the centre of the 21st century's 'great game'.
Enhancing Australia’s capacity to act as an independent power, incorporating great power-style strategic economic, diplomatic and military capability, serves as a powerful symbol of Australia’s sovereignty and evolving responsibilities in supporting and enhancing the security and prosperity of Indo-Pacific Asia.
Australia is consistently told that as a nation we are torn between our economic relationship with China and the long-standing strategic partnership with the US, placing the country at the epicentre of a great power rivalry – but what if it didn’t have to be that way?
Get involved with the discussion and let us know your thoughts on Australia's future role and position in the Indo-Pacific and what you would like to see from Australia's political leaders in terms of shaking up the nation's strategic approach to our regional partners.