The issue of how Australia should position itself between the current primary power in the Asia–Pacific (the US) and the rising contender (China) has returned suddenly and forcefully to Australian policy debates. If anything, the issue has become more hydra-headed—because influence operations are now a regular part of the discussion, alongside the shifting regional strategic order, and Chinese investments in Australian critical infrastructure.

On this blog, both Michael Shoebridge ^[1] and Hugh White ^[2] have recently posted their respective views on the topic.

Michael sees in China’s actions in the South China Sea—and in the pace of its military modernisation—developments that undercut Australia’s traditional policy line of ‘not having to choose’ between our major ally and our major trade partner. He argues for a reformulation of Australian policy on China—one that reaffirms mutually beneficial economic links, but that won’t ‘assist [China’s] growing military capabilities’ now that those capabilities are beginning to be used in ways that aren’t in Australia’s or the region’s interests.

Hugh’s approach is refreshingly direct: he believes that the core of the issue is that ‘China wants to replace the United States as the primary power in Asia, and we don’t want that to happen’. Both Australians and Americans, Hugh believes, have been in denial about that challenge for over a decade, with Washington awakening to a sense of its new rivalry with Beijing only recently—and unfortunately under an administration driven by the isolationist nationalism of ‘America First’.

Elsewhere ^[3], Hugh has outlined the core of the problem for Australia as follows:

As China’s power in Asia grows, its capacity to impose costs on us will grow, and that will give it greater and greater influence over our choices. That’s the reality of power. So our task, as we learn to live with China’s power, is to learn how to make those choices well, so that we can preserve maximum independence over our most important issues at minimum cost. From now on, that is what our foreign policy will be all about.

With all due respect, that sounds like a monochromatic foreign policy—one based on the tactical management of Chinese heavy-handedness rather than on the strategic pursuit of Australian interests.

So let’s start one step further back, by recasting the problem in terms of Australian grand strategy. When we look at the sort of region that China wants and the one we want, what’s the main difference? One—reductionist—answer would say that China wants a prosperous, stable Asia with Beijing at its core, whereas Australia wants a prosperous, stable, liberal Asia where power is checked and balanced.

Building consensus on the goal of prosperity isn’t difficult in either capital. Most states can usually agree to make money together. But the other adjectives suggest a more contentious relationship. What should regional stability look like? How should power be checked and balanced? True, institutions, rules and norms are certainly one part of it, but another part—especially important if the region’s primary power doesn’t accept limitations on its authority within its own domestic polity—derives from the existence of competing centres of power.

Now, what’s the problem? Well, China’s relative power is surging, and future projections of its wealth and clout are sufficiently daunting as to deter some regional players that would prefer a different future from pursuing their goals. Asia’s continuing preference for bilateralism over multilateralism magnifies China’s ability to dominate its smaller neighbours (by dealing with each individually). Meanwhile, the relative power of the US—the principal guarantor of the existing stable, prosperous, liberal regional order—is in decline.

What’s to be done? Keeping the US engaged in the region is a good strategy, simply because it’s the world’s strongest single power, and the designer of much of the current security architecture. But keeping it engaged might be difficult if strategic retrenchment really is the electoral flavour of the decade in America. On the other hand, we probably can’t do much to slow China’s growth.

So how do we get the Asia we want in the face of growing Chinese power and potential American distraction? A range of strategies were fleshed out ^[4] in the 2017 Foreign Policy White Paper ^[5]—defending the existing ‘rules’, encouraging economic interdependence, power balancing, and enhancing national and regional resilience.

Yes, rules temper power. And yes, economic interdependence helps prevent the emergence of separate, competing economic blocs. But we need to admit, too, that strategies of engagement haven’t produced the ‘mellowing’ effects that we initially hoped they would. Illiberal great powers—Russia and China—now chip away at the existing international order ‘demanding a modified order ^[6] that better accommodates the ambitions and appetites of their illiberal domestic regimes’.

So we need to ask ourselves a hard strategic question: what relationship should we have with a rising authoritarian great power that isn’t mellowing? If we’re unwilling to trade away our preferred vision of a prosperous, stable, liberal region, we’ll need to invest more heavily in the other strategies mentioned in the white paper: balancing and resilience.

Our objective should be to shape a regional balance of power more favourable to our interests. Ideally, that means recruiting new supporters to that coalition of powers that favours a stable, prosperous and liberal Asia. A sense that such a coalition exists—even though formalised patterns of security cooperation between its members will probably fall well short of a proper alliance—might stiffen the sinews of Asian policymakers willing to push back against China.

Moreover, we should be exploring options to increase Australia’s own power assets—because a more powerful Australia is also a more resilient one.

It might turn out that none of those strategies avail us. But they suggest a foreign policy that is both creative and consistent—and more satisfying than a bald choice between which great power to follow.