Tensions must not stop us from Chinese engagement

Beijing is not taking a step back in Hong Kong. Picture: AFP.

Can we solve the Great China Conundrum?

Many among Australia’s opinion-forming elite recently have become agitated almost beyond forbearance, by the no-longer-new notion that we are trapped — needing to choose between our security ally the US and our large economic partner China, and that declining to do so displays hapless indecision.

They worry night and day about Scott Morrison’s failure so far to land the invitation that at last, they believe, would resolve our China challenges — strategic, economic, even our identity as Australians.

No fix, however, is in sight that is guaranteed to last long. We don’t need to seek disputes or to talk disrespectfully. But we do have to learn to live with a continuing degree of tension, at the official level, with Beijing.

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Those who can’t accept this believe that Morrison must do what it takes to land himself on the red carpet walking towards Xi Jinping, general secretary of China’s ruling Communist Party, in the Great Hall of the People in the heart of Beijing.

Billionaire businessman Kerry Stokes says: “Our whole standard of living is virtually determined by the exports we make to China … The sooner our Prime Minister visits China and has a new dialogue, the happier I will be.”

Opposition defence spokesman Richard Marles, following a recent visit to Beijing, says: “The relationship has been managed terribly. We are falling down their ladder of relevance. Right now, we have a massive trust deficit.” Opposition foreign affairs spokeswoman Penny Wong urges a China “plan”.

Former Australian prime minister Kevin Rudd. Picture: AAP

Former prime minister Kevin Rudd warns of “neo-McCarthyism” in the China relationship, and Michael Spence, vice-chancellor of the University of Sydney, where one in four students comes from the People’s Republic of China, warns of a return to the White Australia policy.

The cry is being raised: someone DO SOMETHING! Australia’s elite is working itself up into something of a tizz about China.

Lowy Institute executive director Michael Fullilove, a foreign policy realist, says less excitably that “it will take time to find the settling point between Australia and China”.

The chief challenge for Canberra in developing a plan for China, returning to a relationship of “political trust” hailed by then prime minister Tony Abbott five years ago as he hosted President Xi, or even attaining a “settling point”, is that China is changing mightily and rapidly.

Xi says: “Party and government, military, civilian and learning — east, west, south, north and centre — the party is leader of all.” Xi is not a politician in the Western understanding, he is a true believer. His advancement of the party is a sacred mission, one that he has inherited via his “red genes”.

During Mao Zedong’s Cultural Revolution, Xi’s family was driven out of the Garden of Eden — out of the leaders’ compound of Zhongnanhai, and into domestic exile in Shaanxi province — despite the valorous service of his Long March veteran father, Xi Zhongxun.

The younger Xi learned from this chastening experience a different message from the conventional one. Rather than concluding that Mao was a monster who had skittishly punished his family for being “rightist”, costing Xi his high school education, he resolved instead to become “redder than red” — to apply himself wholeheartedly to demonstrate his absolute devotion to the party.

Chinese President Xi Jinping. Picture: AFP

As the party advances today, the people who run China’s universities, government ministries, corporations, most organisations altogether, are themselves changing, and are operating within a world of changed KPIs.

Most, must now spend an hour or more daily answering questions about Xi Thought on the Xuexi Qiangguo (“Study the Strong Nation”) app that they have to install on their smartphones, and they are evaluated regularly on their performance.

Many Westerners are celebrating again the “downfall of communism” with the 30th anniversary of the fall of the Berlin Wall. But the PRC is more formidable, more capable and more purposeful than the Soviet Union ever was.

Beijing, for instance, is not taking a step back in Hong Kong, amid widespread anticipation that it will intervene more brutally, Tiananmen 1989 style. It has conceded almost nothing to the protesters, whose leaders remain locked out of the formal political process. The “Umbrella Movement” student protests in Hong Kong in 2014 were triggered partly by Xi’s white paper that insisted: “As a unitary state, China’s central government has comprehensive jurisdiction over all local administrative regions, including Hong Kong”, whose judges were to understand that they were essentially “administrators”.

Hong Kong’s young protesters have proven far more persistent than Beijing could have anticipated, far more prepared to imperil their own economic future in an attempt to retain their freedoms, however apparently doomed.

But it is hard to see Xi retreating over Hong Kong. For he is ensuring that the party’s writ rules throughout the People’s Republic — an old empire of diverse ethnicities transformed into a single-minded nation-state.

And he is weaponising China’s economic heft to maximise its global influence and opportunities, including through his hallmark Belt and Road Initiative — aware that this needs to be pressed rapidly as the economy inevitably slows.

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Agenda for today’s The Australian’s Strategic Forum

The agenda for today's Strategic Forum.

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Some of those chronicling the 1989 “downfall of communism” as final claim that the PRC is not real­ly communist, despite its hammer and sickle, red flag and Marxist vocabulary.

This, however, is to demean the sincerity of China’s rulers, not least Xi himself, who talks constantly about learning from Marx and pursues a palpably Leninist approach to power. China has succeeded economically by rethinking Marxism, where Russia — whose economy is similar in size to Australia’s today — failed.

For instance, instead of focusing on ownership of the means of production, the party today seeks to influence through the capacity of its branches, embedded within every meaningful corporate or other organisation in China, to direct — or at least veto — strategies and the appointment of key personnel.

The recent eagerly anticipated fourth plenum of the 19th party central committee focused not on economic reform but on “modernising governance” — meaning deepening party control.

Today’s China is far more globally engaged than the Soviet Union was — including with Australia. Our connections are now immensely thick and diverse, running through business of most sorts, education, tourism, migrants and beyond. That all continues — albeit occasionally suffering strains – despite politically driven problems.

In the meantime, Beijing — meeting with some pushback in Canberra — instead is engaging more intensely with those diverse autonomous layers that Australia, unlike China’s unitarian structure, provides: with state and local governments, companies and universities. This has delivered the state of Victoria as the first sub-national authority globally to sign up to the BRI.

On October 1 a prominent Melbourne police station hoisted the PRC flag to celebrate its 70th anniversary. The local mayor and state and federal MPs beamed as the PRC anthem, the March of the Volunteers, was sung: “We run towards the communist tomorrow! Hold high the flag of Mao Zedong, march on!” They then cut a PRC birthday cake together at the nearby city hall. Nearby, a Xinhua book store was selling party products in Chinese and English.

Clearly, Beijing hasn’t given up on Australia.

The improvement of relations following spats between China and governments elsewhere in our region, for instance Japan and South Korea, indicates that Australia is hardly unique in encoun­tering such challenges, and that across time they may be ameliorated.

I recently participated in a meeting in Melbourne involving 28 planners and economists from around China. Their interests and concerns were practical — “Do you subsidise your farmers?”, “How do you manage people displaced in mining automation?” — without even a hint of their needing to register political displeasure.

But Canberra needs to accept the prospect of living with tensions with Beijing, perhaps as long as Xi, 66, chooses to remain leader. It is not always easy to pursue our interests as we also protect our values, but we need to learn to do both, routinely.

The centre of gravity in Australian community attitudes to the PRC has shifted, as Beijing has changed — as indicated by, for instance, the increased wariness expressed in the Lowy opinion poll this year. This should ring some warning bells for Australian leaders of all shades who respond readily to any Beijing overture, without weighing the inevitable conditions.

There are some in the corporate world and in some university managements who still believe that Canberra could and should do their de-risking for them — removing, by routinely prioritising economic gain, political risks that they have incurred, including in cases by over-depending on a single market.

That wouldn’t resolve this conundrum. Even if Canberra, say, backtracks by inviting Huawei to take a core role in our 5G platform, another test of the relationship soon would take its place.

We should shun the binary game of choosing between “our security provider and our biggest trading partner”, as the now-tired truism goes, and relate to the world on a commonsense basis as issues emerge, on the basis of our interests and of our values.

We must not readily expect, at this stage, to build — or rebuild — an intimacy in our formal relationship with the PRC unless we leave our values out of play, or Beijing itself changes, something we can’t at this stage anticipate.

But we can work to manage tensions that arise while learning that we may have to live with them for much longer than any of us would choose — and while redoubling our efforts to engage with Chinese individuals, with all that China means beyond the PRC apparatus, and with our own highly diverse ethnic Chinese population.

Rowan Callick is a former China correspondent of The Australian. His paper, The China Challenge, is published by the Centre for Independent Studies.