Reports from a Turbulent Decade

INTRODUCTION

The biggest compliment that can be paid to the Lowy Institute is to say that, ten years after its establishment, Australia’s international policy landscape is unimaginable without it.

The Institute was not the first think tank to be established in Australia, but they were certainly thin on the ground when we arrived and there were no prototypes to follow. However, a feasibility study written in 2002 provided a road map and a set of founding principles: that we would aim to influence international policy as well as informing the public; that we would be independent, non-partisan and evidence-driven; that we would be host to the widest range of opinions but the advocate of none. And we had a clear mission from our founder and Chairman, Frank Lowy: to deepen the debate in Australia about the world and to give Australia a greater voice abroad.

Our job was to address the political, strategic and economic dimensions of international relations in an integrated way. Above all, as our first executive director, Allan Gyngell, reminded us, our goal was to influence policy through applied research. Our work needed to be relevant and accessible to all of those engaged in the world, including government, business, the media, non-governmental organisations and, importantly, the broader community.

In terms of the specific subjects we chose to research, the Institute’s staff members were given a relatively free hand and were challenged to make judgements about what was important. Proposed research did, however, have to be relevant to the concerns of policymakers, in Australia or abroad, and show that we had something meaningful and original to contribute. We have never done research for research’s sake – we always had to answer the question ‘So what?’ In that regard, we were fortunate to have no shortage of issues from which to choose. The decade of the Lowy Institute’s existence has been a dynamic period in global affairs, from the war on terror and the wars in Afghanistan and Iraq to the rise of China and India and the global financial crisis.

As we developed our agenda of research and events, our Chairman repeatedly interrogated us on one key point: how do we know we are succeeding? Most think tanks struggle with this question. We don’t make widgets and there is no profit or loss to account for at the end of the financial year. Nevertheless, looking back over the last decade, there are several indicators of success that we can point to.

First, others have been willing to invest in us. When we were established, the Lowy family provided all of our funding; today, half of it comes from other sources, including government, corporate members, foundations and individuals. We see this as one important reflection of the relevance and quality of our work. It had always been the Chairman’s goal that the Institute become a valued part of Australia’s public policy infrastructure and not simply remain a generous philanthropic gift to the nation. The Federal Government’s recent decision to support a new Institute initiative on engaging Asia is a major step towards achieving that goal.

Second, the best think tanks and universities in the world seek to work with us, from the Brookings Institution and the Council on Foreign Relations in the United States to Tsinghua and Peking universities in China. We have won significant grants from the world’s leading foundations, including the MacArthur and Gates foundations and the Nuclear Threat Initiative. In the only annual ranking of think tanks worldwide, our peers have recognised us as the leading think tank in Australia and among the top fifty in the world.

Third, the Chairman’s example has moved others in Australia to establish new research institutions. Since our founding, the think tank scene in Australia has expanded significantly. In other words, we have helped to make the market.

In the final analysis, however, it is the quality of our ideas that represents the most important measure of our success, and this is what we have tried to reflect in this volume. You will find in the following pages examples of how the Institute has shaped public debate, such as through our polling on attitudes to climate change. There are examples of our researchers showing particular prescience, such as Mark Thirlwell’s work on the rise of the Indian economy at a time when Australians were still largely focused on the rise of China. Jenny Hayward-Jones’s paper on the need for a rethink of Australia’s policy towards Fiji has changed minds. Rory Medcalf’s research has contributed to the strengthening of the Australia–India relationship.

We have addressed big global policy questions, such as Linda Jakobson’s work on the new Chinese leadership and Warwick McKibbin’s work on climate change policy. We have identified new issues for policymakers to consider, for example through Michael Fullilove’s research on global diasporas, or ‘world wide webs’. And we have provided close analysis of some of the world’s most complex problems, as illustrated by the paper by Malcolm Cook, Raoul Heinrichs, Andrew Shearer and Rory Medcalf on Asia’s changing power dynamics.

Nevertheless, this anthology represents only a small proportion of the Lowy Institute’s work. In the last ten years the Institute has published over 370 research papers. Institute authors have written over 1000 op-eds and articles for Australian and international newspapers, magazines and websites, including Foreign Affairs, the American Interest, the New York Times, the Financial Times and the Washington Post.

It was, therefore, difficult to decide what to include. We applied a number of criteria, of which readability and accessibility for the nonspecialist reader were the most important. This has meant leaving out some of the denser and more technical papers published by the Institute.

We wanted to give a sense of the breadth of the Institute’s back catalogue. We did this by choosing mostly excerpts from our longer papers; we hope this will lead readers to the full papers, all of which can be found on the Institute’s website. We have included a large number of op-eds, many of which summarise a longer piece of research undertaken by the author. We have also included a number of posts from our highly successful blog, The Interpreter. In its five years of existence, The Interpreter has established itself as one of the world’s liveliest forums for the discussion of foreign policy.

Nevertheless, there are many issues that the Institute has researched that have been left out. For reasons of space we also took a decision not to include longer articles written by Institute staff for international policy journals. This meant leaving out notable pieces such as those by Michael Fullilove on the role of US special envoys in Foreign Affairs, Alan Dupont and Mark Thirlwell on food security in Survival, and Anthony Bubalo and Malcolm Cook on ‘Horizontal Asia’ in the American Interest.

Not everything in this volume was written by our staff members. The Institute is the leading Australian venue for speeches on international issues, and we have incorporated major speeches and papers delivered at the Institute, including by the three Australian prime ministers who were in office during our first decade. A number of the Institute’s nonresident and visiting fellows, past and present, are also represented, including columnist Paul Kelly, and Owen Harries, the editor emeritus of the leading American policy journal the National Interest.

Finally, we also felt it important to include a reference to the important polling work that the Lowy Institute has conducted in the last decade. The annual Lowy Institute Poll is one of our most important publications and a vital record of Australian attitudes to the world. In what is the only contribution written specifically for this volume, Fergus Hanson and Alex Oliver have provided a summary of some of the most interesting results from the annual Lowy Institute Poll and the country polls we have conducted in China, Indonesia and Fiji.

For Australia, and for the world, the next decade is likely to be as challenging as the last. For Australia, in particular, our elevation to the world’s most important economic and political forums, the G20 and the United Nations Security Council, will give the country a new prominence in global affairs and new opportunities to realise our prosperity and security.

But this will also test Australia as a country. Our political and business leaders and our government officials will need to engage at a higher level, and a faster pace, than they have ever done before. To justify our place at the big table, Australia will need big ideas. The Lowy Institute’s job is to help provide those ideas and to shape the debates about Australia’s international policy and its place in the world – and to make an international mark.

Michael Fullilove and Anthony Bubalo

Bligh Street, Sydney

Australia and the World

WASTING OUR TIME UP A DIPLOMATIC DEAD END

Allan Gyngell

Sydney Morning Herald, 15 December 2003

The important diplomatic question of the month is not whether Zimbabwe will come back into the Commonwealth, but why on earth Australia does not get out.

Australia’s prime minister, John Howard, accompanied by a substantial entourage, has just spent nearly a week in Abuja – that’s Abuja, Nigeria – for the biennial meeting of Commonwealth Heads of Government. This meeting, known by the unattractive acronym CHOGM, is at the heart of what is, by any measure, the most useless international institution to which any senior Australian political leader must commit time and energy.

And what was the outcome of those long days on the road? Little more than a bitter debate which left the group deeply divided about its own membership criteria and whether Zimbabwe should be there.

You probably didn’t read the communiqué issued at the end of the Abuja meeting. I’m not surprised. Seventy-two turgid paragraphs of motherhood statements – ‘Heads of government appreciated the need for constructive dialogue and co-operation to achieve sustainable development’ – and meaningless diplomatic compromise – ‘Heads of government of those member countries that have ratified the Rome Statute establishing the International Criminal Court urged other states, which have not yet done so, to accede.’ I know it’s unfair to quote Commonwealth communiqués as though they were actually intended to mean something. But hours of diplomatic time were expended to produce these words, even those that were simply cut and pasted from the last effort. The heads of government also got together and produced something called the Aso Rock Declaration, which sounds much more interesting than it turns out to be. This lengthy statement on ‘Development and Democracy: Partnership for Peace and Prosperity’ rated not a mention I can find in any Australian newspaper. (The Aso Rock Declaration draws on the work of the ‘landmark declarations in Singapore, Harare and Fancourt’, if that helps you.)

The New Zealand secretary-general of this hapless organisation, Don McKinnon, made a valiant attempt to claim that the meeting would have ‘a key role in the area of trade’. But not even he sounded convinced.

Asked how the outcome squared with his pre-meeting hope that the gathering would contribute to resolution of global trade problems, Howard was able to declare only that it was ‘broadly consistent with the things I have been saying’.

So what was Australia doing there? Given its vigorous criticisms of most multilateral organisations, the Howard government has been remarkably gentle with the Commonwealth, an organisation of legendary lethargy and waste. One reason, no doubt, is the historical links to Britain and its institutions. But then I noticed that one of the most vehement critics of Howard’s strong line on Zimbabwe was president Joaquim Chissano of Mozambique. If, like me, you can’t remember the time Mozambique had any constitutional connection to Britain or its empire, your memory does not fail you. (It was admitted in 1995 because many of its neighbours were members.)

Membership of the Commonwealth, it is sometimes claimed, is a price we pay for good relations with a wide variety of different countries and regions with whom we would not naturally come into contact. It is assumed that this might come in handy when Australia is standing for appointment to important international posts. But, in fact, Commonwealth membership has led – this time at any rate – to little more than a deepening rift between Australia and the southern African members. Does that matter? Not much, probably, but nor is it much of a return on membership dues.

Perhaps spending a few days a year in a remote corner of the world is a small enough sacrifice for any Australian prime minister to make for those garlands of gold, silver and bronze medals weighing down our athletes at the Commonwealth Games. But that argument is wearing thin. Even the most one-eyed Australian sporting fans recognise cheap success when they see it.

The main reason we are still a member, of course, is that the Commonwealth doesn’t matter. No one cares enough. It’s hard to get fussed about it. It would require more effort to walk away than it does to let things run on.

The Commonwealth is a fine example of one of the immutable rules of international organisations, which is that it is a good deal easier to start them up than to finish them off. They hardly ever go away. The Warsaw Pact, admittedly, has bitten the dust, but its principal adversary, NATO, has simply redefined its objectives and marched off with sprightly steps in a new direction.

In a polite and tentative sort of way, successive Australian prime ministers have gone into Commonwealth meetings urging change and reform. But the problem is not format; it is function. It is the impossibility of finding anything much, short of platitudes, on which such a diverse group can agree, or any matters of real substance on which they need to work.

There is a serious issue in all this. Australian prime ministers have limited time and energy, and the country’s bureaucratic resources are finite. The objectives of encouraging a broad spread of Australian diplomacy around the world and helping to strengthen democratic institutions and the rule of law are excellent. But they can be met in other, more effective, ways.

It is time we abandoned the profitless project of trying to reform the Commonwealth from within. Otherwise, Commonwealth Heads of Government Meetings in Malta and Uganda lurk in the future for Australian prime ministers. At least we know what will be in the communiqués.

AUSTRALIA IN THE WORLD

John Howard, Prime Minister of Australia

Inaugural Lowy Lecture [extract], 31 March 2005

Churchill once said that ‘we make a living by what we get, but we make a life by what we give.’ The Lowy Institute for International Policy is testimony to the generosity of a man whose life is a compelling Australian story of hard work and global achievement.

Frank Lowy came to our shores in 1952. Behind him lay a childhood darkened by the Holocaust and service in the fight for a newborn Israel. But this young man’s eyes were fixed firmly on the future.

Frank’s journey from delicatessen owner in Sydney’s west to head of the world’s largest retail property group has made him a true corporate legend. Now, with a grand investment in ideas, he has added a new chapter on patriotism in a remarkable contribution to Australia in the world.

Others have written their own names into the larger narrative of Australia’s global engagement in recent times.

Last December, Lieutenant Colonel Georgeina Whelan was appointed commanding officer of the Australian Army’s 1st Health Support Battalion. Three weeks later, amid the devastation caused by the Boxing Day tsunami, she was running the Anzac Field Hospital in Aceh. This terrible tragedy claimed more than 200 000 lives in Indonesia alone, including those of hundreds of staff from the Banda Aceh public hospital. Over eight weeks, Lieutenant Colonel Whelan’s team treated some 3600 patients, performing countless life-saving operations. Her battalion has now returned to Holsworthy, in southwestern Sydney, leaving a functioning medical facility in the hands of those who will provide long-term care.

When we think of Australia in the world, we should also think of the Australian Electoral Commission’s Paul Dacey. Paul is our representative on the international steering committee that oversaw Iraq’s first ever democratic election, at the end of January. He and his colleagues are now working to strengthen Iraq’s democratic processes in advance of voting on a constitution in October and for national elections in December.

Tony McDonald is another Australian serving his country with distinction overseas. Under our Enhanced Cooperation Program, Tony is working with Treasury officials in Papua New Guinea to improve economic forecasting and budget processes – reforms crucial to that country’s long-term development.

Through their work, these dedicated Australians provide a window onto the breadth, complexity and practical focus of our global engagement in 2005. They challenge us to think beyond old prisms to grasp the true reach and moral seriousness of Australia in today’s world – our power and our purpose.

Global engagement begins at home

When I became prime minister nine years ago, I believed that this nation was defining its place in the world too narrowly. My government has rebalanced Australia’s foreign policy to better reflect the unique intersection of history, geography, culture and economic opportunity that our country represents. Time has only strengthened my conviction that we do not face a choice between our history and our geography.

History’s legacy is a global outlook. We are, overwhelmingly, a country of migrants and their descendants. We are an open economy, dependent on global markets. And we are a Western liberal democracy with a profound interest in the structures and ideas that govern the international system.

It is true that Australia’s most immediate interests and responsibilities will always be in our region. But we have global interests that require strong relationships with all centres of global power.

This is clear from our economic interests. Australia’s largest trading partner, as a single entity, is the European Union. Our largest investment partner is the United States. Our largest export market and our fastest growing economic relationships are in Asia. The Middle East is one of our most rapidly growing markets for advanced manufactures over recent years. In a world more interconnected than ever before, the balanced alignment of Australia’s global and regional engagement is a measure of our strategic maturity.

My address tonight naturally focuses on relationships and issues that are fundamental to Australia’s security and prosperity. But I want to begin elsewhere, with what I regard as the true pillars of our standing abroad. The success of Australia’s global engagement is shaped decisively by some core national assets: resilient yet adaptable individuals, stable yet responsive institutions, and enduring ideas and values that bind together our diverse yet cohesive society.

First, our people. What has allowed Australia to produce the Frank Lowys, the Robert Mays, the Charlie Bells, along with so many lesser known achievers like Georgeina Whelan, Paul Dacey and Tony McDonald? A social scientist might say the answer is overdetermined – by explanations from bush ingenuity of old to the waves of immigration that have changed and enriched our society. In any case, we come back to an elusive yet crucial factor: the character of our people. Australians have a reputation for hard work, directness and adaptability that has helped them flourish internationally. This theme of our people doing well and doing good in this age of globalisation is one that I know the Lowy Institute has explored in work on the Australian diaspora.

Second, our institutions. Though a young country, Australia is one of the world’s oldest continuing democracies. We have adapted to our distinctive setting the great bulwarks of liberal democracy: a vigorous parliamentary system, a free market economy, the rule of law and impartial courts, a free press and a vibrant civil society. The genius of these institutions lies in their capacity to preserve fine traditions while meeting the challenge of great global change. Reforms making our economy more resilient, flexible and open have been vital to the quality of our international engagement.

Economic reform, sustained growth and strong budgets have seen Australia not just ride out global shocks but respond decisively to crises abroad. Economic strength allowed Australia to be one of only two countries to contribute to all three IMF programs in our region following the Asian financial crisis of 1997. It meant we could lead in bringing security and self-determination to East Timor and also embark on a new era of engagement in the Pacific. And it has seen Australia become the world’s largest official donor in response to the Asian tsunami, with an initiative for Indonesia that is the largest single aid package in our history.

Australia’s machinery of government – especially our national security apparatus – has performed strongly in the face of such challenges. A reason I often highlight is that we are spared the silo syndrome in foreign policy that can afflict some other countries. Our diplomatic resources are significant and respected around the world.

Third, Australia brings with its role in the world certain ideas and values. Our place in the international system is informed by who we are, and by what we stand for. Australia has a proud history of supporting political and economic freedom. We believe that these freedoms produce a more stable and prosperous Australia, and that they also produce a more stable and prosperous world.

We support freer trade and investment for the material benefit these can bring to ourselves and to others. We support countries making the often difficult journey to democracy, conscious that they will choose the path that fits with their history and culture. We seek cooperation with other nations based on the same values of mutual respect and tolerance that Australians strive to uphold at home.

For some, this emphasis on the domestic foundations of our global engagement may appear a little unsophisticated, even unsettling. Politicians drawing such links have long aroused suspicion from observers of democracies and their foreign policies. De Tocqueville famously described democracies as ‘decidedly inferior’ to other governments in their conduct of foreign relations, given their propensity to ‘abandon a mature design for the gratification of a momentary passion’. The likes of Harold Nicolson and George Kennan expressed similar sentiments, and echoes are heard periodically in Australia.

The responsibility of elected leaders is to serve the interests and promote the values of the people – as we see them and as best we can. This does not mean adjusting policy to opinion polls. But it does mean that foreign policy cannot be conducted over the heads of the people.

In uncertain times, we should take heart from how democracies can find renewed power and purpose abroad from institutions and instincts at home. This was, after all, a key thread of American grand strategy in winning the Cold War.

HOWARD’S DECADE: AN AUSTRALIAN FOREIGN POLICY REAPPRAISAL

Paul Kelly

Lowy Institute Paper 15 [extract], 6 December 2006

Howard: a new form of Asian engagement

Despite the intensity of his ties with the United States, the final years of Howard’s decade have been distinguished by a concentrated Howard–Downer Asian diplomacy that drew upon both their strategic convictions and changed events in the region. Howard, in effect, claimed ownership of his own engagement with Asia. This sense of ownership was palpable, and it had two defining features.

First, it was with a different Asia – Indonesia with a democratic constitution, China as a power transforming the region, Japan moving towards ‘normalisation’ as part of a nationalistic assertion and India evolving as an economic power.

Second, it was an engagement in which Australia operated far more conspicuously as a US ally than had occurred under Labor. For example, Howard and Downer sought closer strategic links to Japan within an overarching US alliance framework; Howard’s closer ties with India were explicitly linked with the historic new relationship that the Bush administration had opened with India; on climate change the Howard government worked with the Bush administration to realise the US idea of an Asia-Pacific partnership on clean development and climate that included China, India, Japan and South Korea; and even in Australia’s assistance to Indonesia after the 2004 tsunami the Howard government was linked with the ‘core group’ proposed by the Bush administration that included India and Japan.

Howard was comfortable with Asia’s new directions. They took place on his watch and he was a participant in the evolving regional politics. By 2004–06 there was evidence that Australia’s bilateral ties with Japan, China, India and Indonesia had rarely been as soundly based despite the manifest challenges they confronted.

The two great obstacles retarding Australian public attitudes towards Indonesia had been removed – the Soeharto regime and Jakarta’s repression of East Timor. The accord between Howard and President Yudhoyono was close. Howard began to act as a confident leader with Indonesia, putting his own stamp on the relationship, virtually inviting himself to Yudhoyono’s inauguration and demonstrating an astute diplomacy with his generous response to the tsunami that had struck early in the Yudhoyono presidency. This was reinforced by cooperation at the police level in the aftermath of the Bali attack and Downer’s concerted diplomacy with Jakarta and his efforts to win a new security agreement with Indonesia.

The ‘tsunami’ diplomacy was a case study of the new regionally confident Howard. He moved quickly; Australia’s contribution in per capita terms was the highest of any nation; the UN was ruled out as the immediate coordinating body because it would have been ineffective; and the Howard government fitted into the Bush administration’s plan for a ‘core group’ to spearhead assistance. It was a study in multilateral cooperation outside the UN with Australia and the United States at its centre.

However, Australia–Indonesia relations were qualified by mutual public distrust revealed by the Schapelle Corby issue, the trials of Australian drug traffickers and tensions arising from Papuan asylum seekers. On Papua, it was stunning to witness the role reversal: Howard, the populist on East Timor, was branded an Indonesian appeaser by the media. He failed with his proposal to limit Australia’s acceptance of Papuan refugees, his bill the subject of a rare Coalition revolt and out of step with public sentiment. The Coalition parties had accepted the Iraq war but drew the line at the Papuan refugee restrictions.

This cast Howard in the Australian tradition – as prime minister championing bilateral ties with Jakarta in the teeth of populist, media and political rejection. That Howard embraced this traditional role testified to the enduring responsibility of the prime minister in dealing with Indonesia and the alarming alienation of Australia’s public and media from a democratic Indonesia that it saw as untrustworthy, erratic and explicitly Islamic.

From the start Howard accorded Japan a foreign policy priority yet struggled to give expression to his ambitions. The depth of his pro-Japan sentiment arose from the trade links, Japan’s security alignment with the United States and the Menzies government’s historic 1950s role in creating a different Australia–Japan relationship. Howard aspired to broaden these ties, and he met a willing partner, finally, in prime minister Junichiro Koizumi, under whom Japan’s tensions with China deepened while its ties with the United States strengthened.

Japan, keen to balance the rise of China, backed Australia’s entry into the East Asian Summit. Australia supported Koizumi’s deployment of peacekeepers abroad, and Australia and Japan cooperated for the first time in a shared mission in Iraq’s Al-Muthanna province. Howard supported Koizumi’s more assertive foreign policy. An upgraded ministerial-level trilateral security dialogue involving America, Japan and Australia met for the first time in Sydney in early 2006, an initiative over which Howard and Downer were enthusiasts. China was concerned, and those concerns are unlikely to be assuaged by US secretary of state Condoleezza Rice’s assurances that America