The Age newspaper, 22 May 2015.  A bet each way: our China policy is rational, by John Garnaut.

An edited extract of the original article is reproduced below.

For nearly forty years the Chinese Communist Party has worked to combine the dynamism of the market with its Leninist commitment to absolute political control…

The resulting dilemma is particularly acute for Australia because of its outsized dependence on the Chinese market and its alliance reliance on China’s great strategic rival, the United States.

Australian leaders publicly claim there is no problem. They act as if Australia can keep supplying China’s steel mills, and welcoming Chinese students, immigrants and “red capitalist” investors, while pretending not to notice the friction and ever-growing demands. Behind closed doors, of course, it’s a different story.

Prime Minister Tony Abbott earned himself an honesty prize after the G20 summit in November, when Germany’s Angela Merkel asked what drove his China policies. “Fear and greed,” Abbott said.

Since then Australia’s bipolar China syndrome has grown more acute.

The “fear” side of the national psyche was on show last week when a Pentagon official said he would be “placing” long-range B-1 bombers and surveillance aircraft in Australia as part of a regional response to China’s aggressive territorial claims…

I asked Peter Jennings, who chairs the Abbott government’s experts panel advising on the upcoming defence white paper, to explain what the US would do to restrain China from asserting audacious claims of maritime sovereignty around the artificial islands it is frenetically building across the South China Sea. “The next step after asserting our position is the simple physical demonstration of it by actually sailing through the sea and airspace,” Jennings said…

Abbott would be prepared to call the bluff of China’s sabre-rattling generals in the South China Sea but he baulks at the tycoons, middlemen, vice-chancellors, entrepreneurs, scholars and treasurers who are loudly offended whenever their assumptions of boundless opportunity are disturbed. The twin imperatives of economic engagement and security hedging coexist, in their parallel bureaucratic and emotional universes, and now they have to be reconciled…

OTHER NEWS ON THE AUSCHAM WEBSITE

In the toolbar of this website, click on “NEWS” for the drop down menu which includes: