Is Albanese up to the Trump challenge on AUKUS?
There’s more at stake than AUKUS if and when the two leaders meet, and Anthony Albanese has his work cut out to make the case for the pact with Donald Trump.
Anthony Albanese is the most unambitious national leader in foreign affairs, defence and national security Australia has had at any time since World War II, perhaps in all our history. This singular lack of ambition is about to crash into the turbulent sea of Donald Trump’s presidential persona at the G7 meeting in Alberta, Canada, in the next few days.
This will happen, or not, just as Israel has launched an attack on Iran and the Trump Pentagon undertakes a critical 30-day review of the AUKUS submarine pact to determine whether it fits into Trump’s America First policy priorities. Amazingly, Albanese still has not secured his first one-on-one meeting with Trump.
The AUKUS submarine deal is on the ropes, although it’s such a good deal for the US it’s hard to imagine Washington abandoning it altogether. But much more than AUKUS is at stake. The ultimate meaning of the US-Australia alliance has never been more clouded, certainly not since the near breakdown under Gough Whitlam in the early 1970s. Nor is there any sign the Albanese government can profitably navigate the complexities of the Trump administration. Its strategy seems to be to curl up into a tiny ball and hope Trump never notices it.
The Pentagon’s timing in announcing its review is the most reassuring sign a Trump-Albanese meeting may proceed. It would be an unbelievable snub if Trump and Albanese both attended the G7 and Trump didn’t see Albanese. The Pentagon publicising the inquiry just days before Albanese and Trump may meet is designed to put pressure on Albanese, to maximise Trump’s leverage.
It’s not absolutely clear what Trump may want from his Australian counterpart. Certainly the Americans are contemptuous of Australia’s dismally low defence spending. Australia is a laggard, an alliance outlier, here. Mark Rutte, the secretary-general of NATO, wants a full commitment from every NATO member nation to get defence spending to 3.5 per cent of GDP. The Europeans are generally moving in that direction.
Canada, which really faces no existential security threats because it lives next to the most powerful nation on earth, the US, has traditionally been the NATO laggard. But Canada’s new Prime Minister, Mark Carney, from the centre-left, has committed to bringing defence spending to 2 per cent of GDP, Australia’s current level, by March next year.
Australia is almost infinitely more exposed than Canada, with no powerful ally nearby and the would-be regional hegemon, China, undertaking the biggest military build-up since World War II. Yet the Albanese government is spending only 2 per cent of GDP, a sum it routinely and ludicrously represents as a historic high. It’s historically high in dollar terms only because of inflation and the natural growth of the Australian economy. As recently as the Keating government Australia was spending a higher proportion of GDP on defence in much more benign circumstances. As recently as the Hawke government Australia was spending more than 2.5 per cent of GDP on defence.
The Trump administration cannot possibly pronounce Canberra’s dismal defence spend adequate at a time when it’s demanding other allies significantly lift their military budgets, and almost all are complying.
While pretending it has nothing to do with Trump’s pressure, the Albanese government will likely make a series of defence spending announcements in the near future that will represent some increase.
These will focus on necessary expenditures to make adequate preparations to host a rotational presence of US and British nuclear submarines through HMAS Stirling naval base near Perth. That’s good, but if that’s all it is, it still does nothing for Australia’s military capability.
It’s not absolutely clear that Trump’s demands of Albanese will be only, or even primarily, about defence spending. Australia is not a high priority for Trump. Albanese seems to be a particularly low priority for him. Trump was elected six months ago and the two men have had two telephone conversations, perhaps three.
At the same time Australia is not a headache to Trump, or to Washington generally. Australia is genuinely popular across the US. Our soldiers over more than a century have earned a legacy of enduring goodwill, especially in congress.
Similarly, Australia has joined with the US in almost all conflicts it has been involved in since World War II. We routinely and hugely overstate our achievements here. In most conflicts Australia’s military commitment has not been remotely proportional to the US commitment. In two of the biggest wars the US was involved in, Vietnam and Korea, Australia was one of the chief beneficiaries as the US stabilised Asia and prevented communist expansion.
Legendary Singapore leader Lee Kuan Yew argued that the stable and prosperous Southeast Asia of recent decades could not have developed if the US hadn’t delayed communist conquest in Indochina by more than a decade.
In any event, Trump likes Australia, so far as it goes. More important, so does virtually the whole of congress, most of the American public and almost all Republicans (Democrats prefer France). Over the years Australian sporting and cultural figures such as Greg Norman, Lleyton Hewitt, Mel Gibson, Hugh Jackman, Paul Hogan, Nicole Kidman, Margot Robbie, Cate Blanchett, diverse as they are (not least in their views), have contributed to an extremely positive image for Australia in the US, a kind of soft power, difficult to measure but very real. We may not be the Taylor Swift of nations in popular American culture exactly, but we rank somewhat higher than a Beach Boys cover band.
For a president who emerges from the worlds of reality TV, entertainment, beauty pageants, golf and real estate, there’s a natural affinity with Australia. But of course Trump is brutally unsentimental. He likes the English king, partly because of country estates and castles, and he likes Norman because of golf.
Trump dislikes China but has just done a trade deal with it that he says will be stable. According to Trump, the US will charge 55 per cent tariffs on Chinese imports, while China will charge 10 per cent tariffs on US imports. Trump also said China would resume export to the US of rare earths minerals, which are used in batteries and many hi-tech applications.
It’s impossible to know if Trump is accurately describing the deal or how stable it will be. The Wall Street Journal reported this week that Trump had changed his position on tariffs 50 times since the “Liberation Day” tariffs he announced on April 2.
This all affects how Albanese will try to negotiate with Trump. A major offer of the Albanese government to the Americans is for a rare earths stockpile. But very little development is happening of Australian rare earths deposits. Americans would already be welcome investors in the sector. The government is likely to announce something, but whether it ultimately amounts to much is unclear.
However, if Trump and Albanese do have any kind of formal sit-down meeting, both will want “announceables” to take away from it.
Trump administration trade grievances with Australia are fairly petty. The US would like better access for its beef, no or minimal restrictions on social media companies, better prices for its drugs and compensation for American investors in NSW mining leases cancelled by the state government some years ago.
Albanese is getting divided advice on what trade strategy to follow. Australia, like nearly all other nations, faces a general US 10 per cent tariff and has no exemption from industry-specific tariffs the US is applying globally, such as 50 per cent on steel.
Parts of the Australian system are steeped in the lore of trade negotiations and free trade agreements and feel that by fighting the Trump tariffs they are saving the world’s trading system, which is a key part of the liberal international rules-based order.
But that ship has long since sailed. It seems pointless to have Trade Minister Don Farrell relentlessly campaign and fail with the Americans. Similarly, it’s no use the government intoning that allies deserve better; these are not the actions of a friend. That style gets nowhere with Trump.
More important, given how unstable policy is under Trump, if Australia turns itself inside out to get some kind of deal, it’s by no means clear it would last very long. And the impact of US tariffs on the Australian economy is pretty minor anyway.
The germ of wisdom here is for Australia to do its best on trade arrangements with Trump, and by all means give him some goodies if they’re not too costly, but not to get into too much of a sweat about it. So far the Albanese government is managing the alliance poorly.
One insider describes the great success Japanese Prime Minister Shinzo Abe had with Trump. He would make his pitch something like: the US-Japan alliance is going to Make America Great Again, and make Japan great, too, and here are all the things Japan is going to do to help you, Mr President.
Incidentally, the G7 itself really had significance for Washington only when it could line up the democracies against Russia and China. With Trump beating up on Canada and Europe on tariffs, that’s not plausible at this meeting.
Several senior Australians think that, because Trump is so fixated on China, this puts Australia in the box seat. They may be overestimating this. The Pentagon certainly regards Australia as an important ally against China.
But the Americans don’t regard Australia as important because of anything it does, just purely because of where it is. They know Australia’s anaemic military capabilities contribute almost nothing to allied deterrence. They are deeply frustrated that Australia is making such a pitiful effort on defence.
US Defence Secretary Pete Hegseth told Defence Minister Richard Marles to increase defence spending to 3.5 per cent of GDP. US Under Secretary of Defence for Policy Elbridge Colby had earlier told congress that Asian allies, including Australia faced a much bigger security challenge than the US’s European allies but was spending a smaller percentage of its GDP on defence. They’re also frustrated Albanese never explains to the Australian people why AUKUS is necessary or indeed why defence spending is necessary.
Hegseth reiterated these points in recent public statements. US allies must do more for their own defence. “We can’t want their security more than they do,” he declared.
But Australia is a very useful place for some US troops, planes and ships to be based, as part of Washington’s strategy to disperse its forces in the region.
Our geographic location was the basis for the key allied communications facility at Pine Gap. Billions of dollars have been invested in Pine Gap. It plays a key role in signals intelligence, especially in detecting missile launches and the like. US satellites communicate directly with Pine Gap when their position in orbit means they can’t communicate directly with US ground stations.
However, whereas once that was necessary for US global intelligence and military warning time, now satellites can communicate more easily with each other. So Pine Gap is still immensely useful but no longer necessary. The US could live without it.
Albanese’s weakness with Trump is that he has no positive vision to sell to the President, beyond possibly a deal on critical minerals. Albanese has no story to tell Trump about Australian military investment; no story to tell about the Australian economy, which is once more in per capita recession and still experiencing negative productivity growth; no story to tell about Australian industry when Australia has been effectively deindustrialising with grossly excessive energy prices; and no story to tell about Australian regional leadership. The minor exception is the continuation of Canberra’s efforts to keep Beijing’s strategic footprint in the South Pacific as small as possible.
The Albanese government no longer even mentions this in public as it has apparently decided never to say a disobliging word about the Beijing government except when Marles is speaking in person in front of the Americans. Certainly no disobliging word about Beijing passes Albanese’s lips these days.
So Albanese has nothing to offer Trump, no policy ambition he can present in a Trump-friendly fashion, no personal connection with Trump or with anyone significantly in Trump’s inner circle.
With Australia’s appalling military budget, there’s nothing for our natural allies around Trump, notably US Secretary of State Marco Rubio but also, increasingly, Hegseth, to argue a pro-Australian case with. As many commentators have pointed out (including most recently the anti-American Hugh White), Albanese shows great discomfort when confronting national security or foreign affairs issues. He often gets facts wrong if he moves beyond tightly scripted talking points and cannot enlarge on strategic purpose or context.
It would have been normal Australian diplomatic practice for Albanese to seek a Washington visit and a White House appointment with Trump before or after the G7.
But the Albanese government didn’t do this. The assumption must be that Albanese is scared of having a White House sit-down with Trump, especially if journalists get to ask Trump if he thinks the Australian defence budget is adequate. Or what he thinks of Australia imposing sanctions on Israeli government ministers. Or to compare and contrast Washington’s and Canberra’s views of China.
Indeed, Albanese wouldn’t want a direct question on China where he couldn’t easily equivocate. Or a million other things. But it is frankly pathetic, almost wickedly unambitious, for an Australian leader to avoid the White House because he doesn’t think he has the skill to finesse the presidential encounter.
Albanese’s blushes may be saved altogether. There’s every chance Trump won’t attend the G7. Israel has launched a military strike against Iran, and Iran has threatened to retaliate against US bases in the Middle East. And Trump is also in the midst of domestic political conflict, with demonstrations spreading through numerous coastal cities against his deportation of illegal immigrants.
Trump’s numbers don’t remotely approach the deportations carried out under Barack Obama. In 2013, Obama’s administration deported more than 35,000 illegal immigrants a month. But for those who hate Trump, his deportations are uniquely wicked.
Apparently Trump has not formally booked any bilateral appointments at the G7 meeting yet, so it’s possible Vice-President JD Vance or Rubio could attend in his place.
Could Colby possibly recommend the US ditch AUKUS? Colby is a China hawk and believes the US needs to lead a coalition in the Indo-Pacific to prevent China achieving regional hegemony. This, in Colby’s view, and more importantly in Trump’s view, would be bad not only for the region but for the US. Yet Colby has a perfectly sane belief that the US will be short of nuclear submarines in the 2030s and won’t have any spare for Australia.
In his congressional confirmation testimony, Colby remarked of AUKUS: “If we can produce the attack submarines (the Virginias) in sufficient number, then great. But if we can’t, that becomes a very difficult problem.”
As Malcolm Turnbull pointed out this week, the US Navy in March gave evidence to congress about the pace of nuclear attack submarine construction. It’s going at about 1.1 boats a year. It needs to be two a year just for the US to catch up, over some decades, to what it needs for itself. To meet that and have three to five more to sell to Australia, as the AUKUS agreement specifies, it needs to go at a pace of 2.3 a year. There’s no sign the US can get up to that pace any time soon. It takes seven years to build a nuclear submarine. Under the provisions of the AUKUS pact, the US sells a nuclear sub to Australia in 2032 only if the President determines this sale won’t harm US national security.
But the Albanese government says it’s not committed to joining any US conflict with China in the region. Unless we have by then reached a time of universal peace, why on earth would any US administration take nuclear subs out of the US line of battle and sell them to Australia?
Mainly to keep the Americans committed to the deal, Australia has committed to paying the US $5bn to help it expand its industrial capacity. Marles has already paid the first $800m. This is one reason Washington may keep AUKUS going. But it could still be that we don’t get the subs. Washington could keep taking the Australian money, help Australia establish nuclear submarine maintenance facilities, gainfully use Australian sailors and tradesmen, and then in good faith decide it can’t spare us a Virginia in 2032.
The US might reasonably conclude we’re not ready. It might sell us a much older boat for training purposes. Or it might promise to increase the rotation of its own subs through Stirling. It’s not remotely guaranteed we get any subs. The British program, which is supposed to furnish the balance of the eight subs fleet (manufactured unbelievably in Adelaide) in the 2040s and 2050s, is of course way behind schedule itself. Given the AUKUS time lines are so distant, while the maximum threat is likely in the next decade, you could make the case that AUKUS is a fantastic waste of time.
But that would miss its real purpose. The deep truths of Australian strategic culture seemingly never change. Before and after World War I the Australian public held fundraisers and, with the government, contributed money directly to Britain’s Royal Navy in the hope it would defend Australia because we couldn’t defend ourselves. Pretty much the first AUKUS.
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