Australia Is at War With Itself Over China

Yves here. The Australian security state has declared war on the Government over China. The last time something similar took place was under Prime Minister Gough Whitlam. As John Pilger wrote in the Guardian:

Whitlam knew the risk he was taking. The day after his election, he ordered that his staff should not be “vetted or harassed” by the Australian security organisation, Asio – then, as now, tied to Anglo-American intelligence. When his ministers publicly condemned the US bombing of Vietnam as “corrupt and barbaric”, a CIA station officer in Saigon said: “We were told the Australians might as well be regarded as North Vietnamese collaborators.”

Whitlam demanded to know if and why the CIA was running a spy base at Pine Gap near Alice Springs, a giant vacuum cleaner which, as Edward Snowden revealed recently, allows the US to spy on everyone. “Try to screw us or bounce us,” the prime minister warned the US ambassador, “[and Pine Gap] will become a matter of contention”.

Victor Marchetti, the CIA officer who had helped set up Pine Gap, later told me, “This threat to close Pine Gap caused apoplexy in the White House … a kind of Chile [coup] was set in motion.”

Other commentators vigorously contest Pilger’s claim, that Pine Gap was the incident that sealed Whitlam’s fate, leading to what is antiseptically referred to as the dismissal by the Queen’s man on the ground in Oz, the Governor General. But it is a plausible thesis.

By David Llewellyn-Smith, founding publisher and former editor-in-chief of The Diplomat magazine, now the Asia Pacific’s leading geo-politics website. Originally published at MacroBusiness

On one side is the security agencies and Australian Defence Force on the other is other departments and the Parliament and they are in a fight to do the death.

Last week we saw an unprecedented raid on Newscorp after it released secret papers relating to a push by the Australian Signals Directorate (the ADF intelligence arm) to spy locally, previously via Herald Sun:

Under the plan, emails, bank records and text messages of Australians could be secretly accessed by digital spies without a trace, provided the Defence and Home Affairs ministers approved.

…The Sunday Telegraph can reveal the Secretary of the Department of Home Affairs Mike Pezzullo first wrote to the Defence Secretary Greg Moriarty in February outlining a plan to potentially allow government hackers to “proactively disrupt and covertly remove” onshore cyber threats by “hacking into critical infrastructure”.

…Under the proposal, seen by The Sunday Telegraph, Home Affairs Minister Peter Dutton and Defence Minister Marise Payne would tick off on orders allowing cyber spooks to target onshore threats without the country’s top law officer knowing.

In short, this is about tracking Chinese agents of influence, which is why the ASD is involved (though these days it has evolved beyond just Defense).

The media is in uproar and for good reason. The raids were heavy handed and stupid. The proposal itself is potentially overreach. Some are describing it as part of an evolution towards a surveillance state in an era of unconventional threats and terrorism. That is partly true. But there is a larger frame of reference that is all the more threatening. It is the swift deterioration of US/China relations and how our ill-prepared institutions are coping with it.

Consider just the last few days  of news flow. Over the weekend, Peter Jennings of the Australian Strategic Policy Institute (ASPI), which is Australia’s pre-eminent ADF-funded think tank, wrote the following:

When the Chinese navy flotilla berthed in Sydney in front of an adoring crowd of Chinese Australians this week, you can be sure the timing and look of the event had been planned in every detail, right down to the professionally painted welcome signs.

…Our reflex instinct to tolerate Beijing’s bad behaviour will damage us. If China’s leaders conclude that Australia will tolerate any slight, no one should be surprised if their ill-disguised disregard of us continues.

…In cyber security, China is a sophisticated and persistent aggressor, seeking to steal intellectual property from Australia’s universities and businesses while gathering intelligence on government and political secrets.

…A second example has been China’s annexation of the South China Sea and building of three large air bases on reclaimed land.

…only a few days ago an Australian helicopter operating in the South China Sea was “lased” from a so-called Chinese fishing vessel. Lasing is a hostile act designed to damage flyers’ optic nerves. Defence chose not to reveal the incident publicly, saying instead that its Chinese counterparts “were friendly, they were professional and said g’day”.

…In January, an Australian-Chinese national, Yang Hengjun, was detained without charge by Chinese state security police. Days later a five-line DFAT statement said officials were “seeking to clarify the nature of this detention”, and that’s all that was said publicly.

…Only a few days after the Prime Minister revealed Australia’s political parties had been hacked by a sophisticated state actor, our Department of Foreign Affairs and Trade announced substantially increased funding would be provided for “a new and innovative National Foundation for Australia-China Relations”. A media release claimed: “This new initiative reflects the Australian government’s commitment to a constructive relationship with China, founded on shared interests, mutual benefit and mutual respect.”

“Mutual respect”: is DFAT serious? But the list of slights and Australian non-responses goes on.

Extraordinary stuff. The ADF and security agencies brains trust are directly attacking the Government about expanding Communist Party of Chinese (CPC) influence internally and externally. I can’t think of a single time in my adult life when this kind of open criticism by the ADF and the security agencies of the Government was underway. Not even during the War on Terror.

Let’s not forget, either, that it was the same group of spooks that triggered the entire Huawei global push, previously via Reuters:

In early 2018, in a complex of low-rise buildings in the Australian capital, a team of government hackers was engaging in a destructive digital war game.

The operatives – agents of the Australian Signals Directorate, the nation’s top-secret eavesdropping agency – had been given a challenge. With all the offensive cyber tools at their disposal, what harm could they inflict if they had access to equipment installed in the 5G network, the next-generation mobile communications technology, of a target nation?

What the team found, say current and former government officials, was sobering for Australian security and political leaders: The offensive potential of 5G was so great that if Australia were on the receiving end of such attacks, the country could be seriously exposed. The understanding of how 5G could be exploited for spying and to sabotage critical infrastructure changed everything for the Australians, according to people familiar with the deliberations.

Mike Burgess, the head of the signals directorate, recently explained why the security of fifth generation, or 5G, technology was so important: It will be integral to the communications at the heart of a country’s critical infrastructure – everything from electric power to water supplies to sewage, he said in a March speech at a Sydney research institute.

Washington is widely seen as having taken the initiative in the global campaign against Huawei Technologies Co Ltd, a tech juggernaut that in the three decades since its founding has become a pillar of Beijing’s bid to expand its global influence. Yet Reuters interviews with more than two dozen current and former Western officials show it was the Australians who led the way in pressing for action on 5G; that the United States was initially slow to act; and that Britain and other European countries are caught between security concerns and the competitive prices offered by Huawei.

The Australians had long harbored misgivings about Huawei in existing networks, but the 5G war game was a turning point. About six months after the simulation began, the Australian government effectively banned Huawei, the world’s largest maker of telecom networking gear, from any involvement in its 5G plans. An Australian government spokeswoman declined to comment on the war game.

After the Australians shared their findings with U.S. leaders, other countries, including the United States, moved to restrict Huawei.

But there are still security and ADF dissenters. Alan Dupont is one:

Excluding Huawei from 5G networks is at best a crude, stopgap measure that will not prevent China from controlling the information highway. It would be much better to develop commercially attractive alternatives in response to the legitimate complaints of telcos that China’s 5G technology is cheaper and more advanced than anything else on the market. The US once led the world in wireless cellular technology, only to drop the ball and allow China to surge ahead. It must rectify this mistake and ensure that the same thing does not happen in associated strategic technologies such as quantum computing and artificial intelligence. Australia can play a leading role in both fields through our world class research and expertise.

Chris Richardson another:

Former Defence secretary Dennis Richardson has warned of a “technological Cold War” between China and the West marked by the emergence of rival communication networks for 5G and beyond.

Mr Richardson, a former director-general of ASIO and ambassador to Washington, said the consequences for Australia could be negative, with the country­ denied access to some of the best available technologies.

He also argued that Beijing was on track to eclipse the US as the dominant military power in the western Pacific, but argued Australia would “get it wrong” if policymakers responded by treating Beijing as a threat.

“There is a risk that we are going to move into a technol­ogical Cold War,” Mr Richardson told The Australian. “What you see happening is the Chinese and Huawei on the one hand and the US on the other.”

So where is the ScoMo Government on the subject? All over the place. As noted by Jennings, DFAT is a China groveler. This is not surprising. It long ago lost any policy independence from government. Therefore the important point to make about DFAT is that it will be reflecting pro-CPC views within parts of the ScoMo Government. Such as Trade, at the AFR:

Trade Minister Simon Birmingham will join global colleagues to push the US and China to end their damaging trade war without striking a deal that damages other countries economically.

“Now is the time for a demonstration of action and through that demonstration of action we can best improve confidence in the system, especially in those countries that have doubts about it at present.”

…The Australian Financial Review revealed last week Indonesia, with Australian backing, was rallying support within the G20 to prevent the US and China cutting a peace deal that hurt other countries’ trading relationship with the two superpowers.

…”Whilst we continue to encourage the US and China to engage in negotiations to address their bilateral concerns and that’s important to minimise the harm that an ongoing trade dispute between those two economic powers could cause to global economic growth, we also urge them to recognise that the rest of their trading partners and much of the rest of world do rely upon the rules of the WTO and the structures of the rules-based trading system to be able to effectively trade and engage with each other,” Senator Birmingham said.

“We hope in their negotiations they are mindful of WTO rules and respecting their other economic partners around the globe.”

And Treasury at Bloomberg:

Treasurer Josh Frydenberg told Bloomberg Television Friday that it was possible to navigate a path that maintained strong ties with the U.S., the largest investor in Australia, and China, the country’s biggest trading partner. At the same time, he acknowledged that international trade was stalling because of the increasing frictions between the two nations.

“There’s no doubt that the escalating trade tensions have weighed on the global economic outlook,” Frydenberg said in an interview in Fukuoka, Japan. “But what we are confident of is that both China and the U.S. will continue to be strong economic partners for Australia.”

But there are some hawks as well, Senator Concetta Fierravanti-Wells wrote at The Australian last week:

The decision to approve the visit to coincide with the 30th anniversary of the Tiananmen Square massacre was not only insensitive but demonstrates that Beijing can dictate terms and we just acquiesce. Scott Morrison’s cabinet of groupthinkers and those responsible for the decision have sought refuge in appeasement. They were totally outman­oeuvred by Beijing.

…However, it is gratifying to read the recent comments by Don­ald Trump’s former political adviser, Steve Bannon, confirming it was Australia in 2017 that alerted the US to Beijing’s behaviour in the Pacific. One hopes the recent visit to our country by US Principal Deputy Assistant Secretary for East Asian and Pacific Affairs Patrick Murphy will help stiffen the spine of the Morrison government in dealing with Beijing’s influence in the Pacific and the South China Sea.

The supine nature of the decision to approve the visit reinforces the concluding words in Clive Hamilton’s book, Silent Invasion: China’s Influence in Australia, “Our naivety and our complacency are Beijing’s strongest assets.”

A certain mount of chaos is to be expected given how lazy we’ve been for years and how quickly the sacred cows of great power relationships have been slaughtered under the Trump Administration. Yet underneath that there is a more worrying strain of thought. Anybody familiar with Coral Bell’s extraordinary history in Dependent Ally will know that Australian foreign and strategic policy tradition is defined by the manipulations and cajoling of the client to the dominant state as the nation shifted its great power allegiance from the UK to the US during WWII. It is not that we were powerless in our fate but that we are most adept, and defined, by this kind of geopolitics.

It is not terribly comforting when one considers that dependency of this nature might be comfortable transferring again. Australian pragmatism is deeply nihilistic. The tensions we are seeing today in our various arms of government are a flailing about for stability within this tradition.

Then again, perhaps such a tradition may prove itself very useful in navigating a path between two great powers. It is a great tragedy for the nation that legends of the Cold War such as Coral Bell and Own Harries are not longer with us to provide guidance.

But we are not even at the point where we can say sufficient measures to give ourselves those choices have been undertaken. On the security challenge, let’s refer back to Malcolm Turnbull’s foreign interference legislation:

The Legislation

The legislation I am introducing today is designed to reinforce the strengths of our open democratic system while shoring up its vulnerabilities.

I mentioned earlier that our Counter Foreign Interference Strategy has four pillars: sunlight, enforcement, deterrence and capability.

Of these, sunlight is at the very centre.

To ensure activities are exposed to sunlight, following an extensive review by the Attorney-General, we are introducing a new Foreign Influence Transparency Scheme.

The principle is quite straightforward.

If a person or entity engages with the Australian political landscape on behalf of a foreign state or principal then they must register accordingly.

This will give the Australian public and decision-makers proper visibility when foreign states or individuals may be seeking to influence Australia’s political processes and public debates.

The link could be a financial relationship or some other form of arrangement.

Registration requirements are carefully structured so that the closer you get to the heart of Australian politics, the more likely it is that you must register.

Being registered under the scheme should not be seen as any kind of taint. And certainly not as a crime.

To the contrary it is applying the basic principles of disclosure to allow the public and policymakers to assess any underlying agenda.

But if you fail to disclose your ties to a foreign principal then you could be liable for a criminal offence.

This is not about shutting down legitimate debate, but rather enabling it.

Interference, espionage and sabotage

Sunlight is the most reliable disinfectant but it will not be sufficient on its own.

We are also introducing, for the first time, offences for acts of foreign interference. Addressing a clear gap, we will criminalise covert, deceptive and threatening actions by persons acting on behalf of, or in collaboration with, a foreign principal aiming to influence Australia’s political processes or prejudice our national security.

Acts of foreign interference are often intertwined with espionage.

But our espionage laws are so unwieldy they have not supported a single conviction in decades, even as the threat reaches unprecedented levels.

So we will also introduce a range of carefully structured espionage offences as well as new provisions for secrecy, sabotage and treason.

Any one of these three pieces of legislation—the foreign donations legislation, which Senator Cormann will introduce into the Senate, transparency, and interference-related criminal offences, would mark an enormous improvement in our ability to counter foreign interference.

Together, they add up to the most important overhaul of our counterintelligence legislative framework since the 1970s.

They should be seen as interlocking components. All are important and none will fully succeed without the others.

Finally, we need a central hub to not only enforce the law but do so in a way that maximises deterrence.

This is where our new Home Affairs portfolio will come in.

There is no national security threat outside war time that demands an integrated all-of-government capability like this one.

By enacting this legislation, and building the capability to properly use it, we are sending an unmistakable signal:

We will not allow foreign states to use our freedoms to erode freedom; our open democracy to subvert democracy; our laws to undermine the rule of law.

The centrepiece of the all-of-government push to deal with CPC influence was the creation of the National Counter Foreign Interference Coordinator with Home Affairs under former ASIO honcho Chris Teal:

The National Counter Foreign Interference Coordinator delivers an effective, efficient and consistent national response to foreign interference by providing a focal point for coordinating policy and program development and leading engagement with private sector areas.

Alas, afterwards, the office has not been funded properly raising all kinds of questions about why? What should be a half billion dollar operation to ensure the Australian Government is operating as single entity in its dealings with the CPC is instead a dozen under-resourced people.

The economic challenge is just as ominous. Our policy settings are still geared 100% towards Chinese engagement with export growth dominated by commodities and education plus little or no thought given strategic industries such manufacturing. The political economy is overrun by property interests that are desperate CPC-lackies horrified at being cut off from Chinese flow of peoples.

Then there is the mass immigration intake which directly feeds CPC influence into the Chinese diaspora, in which the CPC seeks allegiance to Beijing against Australia. The last election was some comfort that that has so far failed, given Chinese electorates rejected the huge Labor parental visa bribe. But it is very obviously an ongoing challenge.

It is the understatement of the century to say that Australia needs to do much more to a secure an economic hedge against China.

Let’s conclude with a glimpse into one possible future if we allow the current drift and chaos to continue, via The Guardian:

Riot police have clashed with protesters in Hong Kong after hundreds of thousands of people marched through the streets in a massive demonstration against a proposed extradition law.

Critics say the proposed law will allow mainland China to pursue its political opponents in the city, which has traditionally been a safe haven from the Communist party.

A largely peaceful scene outside the parliament and government headquarters in the Admiralty business district changed dramatically in the early hours of Monday as police wearing riot gear moved in with batons and pepper spray on protesters who hurled bottles and metal barricades.

Earlier on Sunday a sea of people, many wearing white, stretched for almost two miles as they marched from Victoria Park, in the east of Hong Kong island, to the government HQ. Thousands more struggled to board packed public transport from outer Hong Kong and Kowloon on the mainland.

After seven hours of marching, organisers estimated that more than 1 million people had taken part, far outstripping a demonstration in 2003 when half that number successfully challenged government plans for tighter national security laws. A police spokesman said they estimated that 240,000 were on the march at its peak.

Small groups of young protesters had planned to stay outside the government HQ until Wednesday, when the extradition bill is due to have its second reading, but police moved in on them after their permission to protest expired at midnight. Within minutes scenes of chaos unfolded as protesters fought with officers who were soon backed by riot police.

An hour or so later riot police moved into clear out the remaining protesters. There was little resistance after the earlier violence, although some pockets of people remained sitting.

Earlier police had closed metro stations and funnelled people through narrow thoroughfares, prompting accusations that they were deliberately attempting to reduce the scale of the protest. Anger grew and the crowd shouted for police to free up more space as the march came to a dead stop for large sections in stifling heat. Further down the road, crowds jeered at a pro-China broadcast on a large outdoor screen.

The bill creates a system for case-by-case fugitive transfers between semi-autonomous Hong Kong and regions with which it does not already have agreements, including mainland China.

Critics say the proposed law would legitimise abductions in the city and subject political opponents and activists to China’s widely criticised judicial system. They fear that a pro-Beijing Hong Kong government would not resist requests of a political nature.

Chants and placards targeted Carrie Lam, Hong Kong’s chief executive, who has pushed for the amendments to be passed before July. Rocky Chang, a 59-year-old professor, told Reuters: “This is the endgame for Hong Kong. It is a matter of life or death. That’s why I come. This is an evil law.”

But the “evil” persists, at Bloomie:

Hong Kong’s leader pledged to press ahead with Beijing-backed legislation easing extraditions to China despite one of Hong Kong’s largest protests since the former British colony’s return more than two decades ago.

Chief Executive Carrie Lam told reporters Monday that the government “could see people are still concerned about the bill,” which would allow Hong Kong to enter into one-time agreements with places such as mainland China and Taiwan to transfer criminal suspects. She said the legislation has previously been amended to protect human rights and said it was up to Hong Kong’s elected Legislative Council to make further changes.

What a disaster it would be if we drifted into this future through sheer inertia.