The author has been described by News Ltd as an "iconoclast", "Svengali", a pollie's "economist muse", and "pungently accurate". Fairfax says he is a "Renaissance man" and "one of Australia’s most respected analysts." Stephen Koukoulas concludes that he is "85% right", and "would make a great Opposition leader." Terry McCrann claims the author thinks "‘nuance’ is a trendy village in the south of France", but can be "scintillating" when he thinks "clearly". The ACTU reckons he’s "an enigma wrapped in a Bloomberg terminal, wrapped in some apparently well-honed abs."

Tuesday, August 21, 2012

AFR column: Australia's defence dilemma and China/US relations (outside utility-wall)

Enclosed is a link to my first foray into the complex debate on Australian defence strategy, spending, and our relations with China and the US. I have tried to bring some fresh angles to these issues. I doubt whether my views will be embraced by most. You can read the column outside the Financial Review's utility-wall here. The following is a summary only:

Confronting a more capricious Asian century, Australia’s defence strategy suffers from three shortcomings.

First, we are systematically underestimating the lower-probability, but nevertheless existential, security risks that taxpayers could be exposed to during their lifetimes. This results in us materially underinvesting in the military capabilities that would best mitigate future hazards.

Second, our present government is unwilling to countenance the clearest, and most cost-effective, “minimum deterrence” solutions that could both improve the durability of the US alliance and our capacity to realistically dissuade external threats...

A third problem is the prioritisation of Australia’s interests. Analysts confuse our economic and security objectives, which do not always coincide.

Two of the most economically integrated nations in history were the United Kingdom and Germany before 1914. In elevating our relations with China, commentators put far too much weight on its accomplishment in lifting hundreds of millions out of financial, if not political, poverty.

At the same time, they fail to acknowledge the fact that this one-party dictatorship has advanced on the back of the global economic architecture that the US established and protected over the last half-century and, more specifically, via artificially subsidised exports to Western markets.