Too anti-China? Hawkish think tank fears budget cuts

Prominent American politicians and military leaders have rallied behind an influential Australian think tank known for its hawkish views on the Chinese Communist Party and defence policy as the Albanese government considers overhauling government funding for national security research.

Prime Minister Anthony Albanese’s department in February commissioned former Department of Foreign Affairs and Trade head Peter Varghese to review national security strategic policy work.

Lieutenant-General Stephen Sklenka said the Australian Strategic Policy Institute’s work had helped shape his thinking on strategic issues in the Indo-Pacific. Credit: Alex Ellinghausen

Australia’s strategic policy community has since been abuzz with speculation the review was driven in part by a desire to rein in the Australian Strategic Policy Institute, a Canberra think tank established in 2001 and led by former Liberal Party staffer and public servant Justin Bassi.

Officials from the Chinese embassy in Canberra included government funding for “anti-China” research at the institute on an infamous list of 14 grievances provided to journalists from Nine News and this masthead in 2020.

Senior government ministers have bristled at some of the institute’s work, including a report released last week that accused the government of leaving the nation exposed by moving too slowly to increase defence funding.

In an April submission to Varghese’s review, the top members of the US House of Representatives’ committee on strategic competition between the United States and China, Republican Mike Gallagher and Democrat Raja Krishnamoorthi, said: “Thanks in part to the work of essential strategic policy think tanks like ASPI [the Australian Strategic Policy Institute], the US-Australia alliance has never been stronger.

“Now more than ever, the work of think tanks like ASPI is essential to helping policymakers respond to shared threats and to our shared values and national interests.”

Gallagher, who also served as co-chair of the Congressional Friends of Australia Caucus, has since retired from Congress but has been widely mooted as a possible senior official in a possible second Donald Trump administration.

Underlining fears the institute’s funding could be cut as a result of the review, US Lieutenant-General Stephen Sklenka said in a submission that he had found its work “particularly beneficial and needed over the past five years as a senior leader and decision-maker in the Indo-Pacific region”.

Sklenka, the deputy commander of the US Indo-Pacific Command, said the institute’s “trenchant analyses have been instrumental in providing me with greater understanding of this region and craft US operational strategies accordingly”.

“ASPI distinguishes itself not merely as a group of thinkers, but as an institute comprising national security practitioners,” Sklenka said, singling out the institute’s widely cited research on the oppression of Uyghurs in Xinjiang province for praise.

The institute receives about $8 million a year in government funding – more than half its annual budget – with most coming through a block grant from the Defence Department.

The institute — which publishes regular policy papers, hosts conferences and provides media commentary — raises funds from foreign governments, defence firms and other sponsors.

In its submission to the review, the institute said it should be noted that “Australian government departments and agencies have a tendency to avoid funding topics that they consider sensitive (especially if it’s a topic involving China)”.

“They should therefore be incentivised to fund research on sensitive topics (including those that might upset Australia’s trading partners, notably China),” its submission said.

“Think tanks can delve into issues beyond those considered to be politically convenient for governments of the day.”

Some of the institute’s staff, who asked to remain anonymous to speak freely, are concerned the review may recommend scaling back funding for think tanks that are not attached to universities.

Opposition home affairs spokesman James Paterson has warned that any cuts to the institute as a result of the review could be viewed as a “capitulation” to Beijing.

Asked at an Australian Strategic Policy Institute conference in Canberra this week whether the government valued frank outside advice, Defence Minister Richard Marles said: “Fearless advice is always welcome.

“That’s probably the way I would sidestep that question,” he added, drawing knowing laughter from Defence insiders in the room.

The Varghese review is also examining government funding for other think tanks such as the Lowy Institute, the University of Sydney’s United States Studies Centre and the Australian National University’s National Security College.

A source in the Defence community, speaking on condition of anonymity, said: “There’s a lot of chatter about what the review is about and where it’s going. There’s a lot of talk about this being an anti-ASPI thing.”

A spokesperson for the Department of Prime Minister and Cabinet said the review was not aimed at any one organisation and “will consider all Commonwealth funding to non-government organisations to conduct national security-related research, education and engagement activities”.

“This is an independent and ongoing review that will be delivered to government for consideration,” the spokesperson said. “As such, it is not appropriate to speculate about potential findings.”

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