People’s world recently reported on the nuclear submarine deal concluded between Australia, the United States and Great Britain and the danger it poses to peace in the Asia-Pacific region. Below, we feature a guest editorial by analyst Anna Pha, who writes regularly for The Guardian, a weekly socialist newspaper in Australia.
US President Joe Biden, British Prime Minister Boris Johnson and Australian Prime Minister Scott Morrison lined up as three cronies in a staged virtual presentation to announce the formation of a new military alliance, AUKUS. Morrison sold the deal as a victory for Australia. He had a big smile on his face, but Biden’s smile was bigger, knowing he had secured such a lucrative deal for the US military-industrial complex.
Morrison unceremoniously abandoned the more than $ 90 billion contract for twelve conventional Attack-class submarines from French military contractor Naval Group. In its place, Australia will buy eight nuclear-powered submarines from the UK or the US. All things considered, it will be the United States.
The damage to Australia is far more serious than the reputation. In addition to turning Australia into a military target, the economic benefits will be enormous for the Australian people.
Morrison signed a blank check for the submarines. The cost, the details of the submarines, the builder and the delivery time are not specified. All we have been told is that it will cost the Australians more than the French. The original contract for them was $ 40 billion, which over time exploded to $ 90 billion. The French were to be delivered by 2030. Nuclear-powered submarines will cost billions of dollars (over $ 100 billion) and will be ready around 2040 at the earliest.
“The government’s intention is to build the nuclear powered submarines in South Australia, maximizing the use of Australian workers,” Morrison said.
Works? Built in Australia? Already, these promises are evaporating.
It only took a few days after the announcement for the proportion of Australian-built components to shrink to a minority. In terms of jobs, the sector is capital intensive. The same amount spent on nurses, teachers, construction workers and community services would create hundreds of thousands more jobs.
The bill will continue to rise with billions more in cost overruns.
The Morrison government has agreed to the United States having a base in Darwin, which will be paid for by Australian taxpayers. Who knows how much will be spent to modernize the Collins-class submarines that were to be decommissioned by 2030? There are suggestions that Australia should lease nuclear-powered submarines in the meantime – another cost.
Defense Minister Peter Dutton refuses to give any figures on the additional costs of his latest shopping list. “It won’t be a cheap project, but peacekeeping is not something that comes for free,” he said. An understatement if there is one! It will be a “huge cost” according to Dutton.
“If we have to pay an economic price for it, that’s something we’re prepared to pay,” Trade Minister Dan Tehan said. “At the end of the day, our values are so important to us, and we believe they are something we need to protect above all else.”
Australia will purchase eight nuclear-powered submarines, extend the life of its existing Collins-class submarines, fund an American base on Australian soil, eventually lease nuclear-powered submarines, and acquire nuclear-powered submarines. Additional long range strikes for the Australian Defense Force. This additional long-range strike capability is intended to “enhance the ADF’s ability to deliver strike effects in our air, land and sea domains,” Morrison said.
It includes Tomahawk cruise missiles, joint air-to-surface missiles (extended range), long-range anti-ship missiles (extended range), precision-strike guided missiles, and hypersonic missile development in collaboration with the United States. .
The military budget will drop from around 2% of gross domestic product to between 3 and 4%.
When other economies entered recession following the global financial crisis, Australia avoided recession thanks to China’s economic growth and its purchases of Australian raw materials and investments.
The Australian economy owes its first trade surplus in nearly fifty years to China. China absorbs about 80% of our iron ore exports, with iron ore being our most important. The price of iron ore recently skyrocketed to over $ 200 a tonne, although it has since fallen.
The Australian government has restricted Chinese investment in Australia, demonized the Chinese Communist Party and the Chinese government, attempted to interfere in China’s internal affairs, and challenged Chinese exports to the World Trade Organization.
Tourism and education were two of Australia’s top exports until COVID hit. China was one of the biggest markets. Tehan was at the forefront of removing Chinese “influence” from universities.
The government shouldn’t be surprised if the Chinese look elsewhere. Other Australian exporters are already feeling the effects of Chinese quotas and increased tariffs on exports of coal, barley, timber, lobster and wine.
China is already reducing its iron ore imports as it tackles climate change and tries to reduce market heat. If China imposes restrictions on imports from Australia or reduces imports of iron ore, the Australian government has only asked for such a response.
The Morrison government appears determined to push China to the point of no return with its approach to the brink. In doing so, it plays with the lives and well-being of not only Australians, but people across the region.
The height of arrogance
One of China’s strategic and economic successes is its diplomacy, conducting economic relations on an equal and mutually beneficial basis, and integrating with other economies, large and small, around the world. China has asked to join the Comprehensive and Progressive Trans-Pacific Partnership Agreement (CPTPP), which has eleven members all riparian or located in the Pacific, including Australia. To be accepted, the unanimous agreement of the CPTPP members is required. The United States withdrew under former President Donald Trump.
The Morrison government has arrogantly said it would not agree unless the Chinese government resumes ministerial talks between the two countries and removes “sanctions” it had imposed on Australian exports. In addition to holding China hostage to his demands, Morrison at the same time urged Biden to break an election promise and return to the CPTPP.
Chinese newspaper World time issued a blunt warning to Australia: “There is no path to future prosperity for an Australia that chooses to isolate itself from the region’s largest economy. “
There could be other economic repercussions. France’s anger is palpable and the European Union is stunned by the behavior of the United States and Australia. It is not yet clear whether Australia’s negotiations with the EU for a free trade agreement are in jeopardy.
The economic crisis is looming
Australia was already sliding into recession when the COVID pandemic hit. The $ 90 billion spent on JobKeeper (unemployment benefits), the billions on the JobSeeker supplement and corporate donations provided the stimulus needed to avert a severe recession.
The federal government’s gross debt is over $ 800 billion and is expected to peak at $ 1,000 billion. The debt itself is not bad; it depends on the use he makes of it and the ability to repay it. Not so long ago, young people were worried about having to pay off a huge debt. If the government had spent on job creation and had not cut corporate taxes and income taxes for the rich, the debt would not be a problem. Full employment would generate additional income through personal income tax and, over time, pay down debt.
The Parliamentary Budget Officer, in his latest medium-term outlook ahead of the latest big spending announcement, estimated defense spending will grow by nearly 70% over the next ten years to over $ 75 billion annually . Right now it’s $ 44 billion. This additional debt will be piled up on killing machines and will create little or no jobs. This estimate is expected to rise to billions with the next escalation in military purchases.
The neoliberal coalition government led by Morrison will be determined to start reducing this debt and budget deficits as quickly as possible. It will cut spending for social security beneficiaries, retirees and the most vulnerable. Services will be cut. Redundant officials. Health and education will take a hit. The likelihood of war will become greater, resulting in death and destruction.
For the war preparations of US imperialism. This madness must stop.