You do have to pick a side... but spending half your military budget on 8 subs that probably makes no difference makes little sense to me. Much more effective ways to spend the money
Has majority of Australians picked a side? Or the side has been automatically picked by virtue of its Anglo-Saxon heritage (and monarch)? I wonder if Australians are really in charge of their own fate and direction, or in reality tethered to the prevailing Anglo Saxon empire (Five Eyes?).
Australia was pretty anti-communist so was very much aligned during the cold war. With so much business and trade with China it is a.very different kettle of fish. Paul Keating (former PM) has interesting views on this
Australia will join the philippines and japan as the frontline against the war against China, and all 3 nations will be within striking distance of Chinese hypersonic and possibly conventional missiles. Depending on how far this conflict could escalate, infrastructure will definitely be a target, ie. refineries, power grids, port terminals and ammo depots. These 3 countries will bear all of the consequences of a possible war in the pacific and no american civilians will die.
With this situation at hand, it's obvious where the investment theme is if you can invest in it, and that's in Russian natural resources and agriculture. I spoke to a russian finance professional and they're very bullish on the current situation in regards to the underutilized russian agriculture complex. The main impediment to Russian natural resource and agricultural exports to the PRC is the bad railroad infrastructure. The upgrading of this infrastructure will have to wait until the ukraine war is over, I think there will be a lot of interest from the PRC in pushing for the Russians to replace Australia coming soon with the current political and military posturing.
I spoke to a person in US officer corps before about this conflict a year ago and he said that the higher ups seemed to be morbidly excited for a real conflict to kick off to face off against a peer competitor, we'll see if some aging US generals and admirals get their wish.
I really hope it does not come to War. And yes, one of the reasons China is not against the war in Ukraine is that it helps them secure more resources. Traditionally, Russia and China have been at best "frenemies" - but this does seem to be pushing them closer
The war will be decided by the US state department, the whole reason tensions are flaring is because they have allowed it, because the whole Taiwan scenario is entirely predicated on the implicit guarantee of support from American Troops if the DPP decides to push for their independence bid. It's gotten so bad that during Pelosi's visit Lawmakers in legislative yuan were speaking out openly against it and recently Ma Jing Yeou, the former president of the ROC (He still likes to be addressed this way) went on a China visit to his ancestral village as a private person.
As for the Russia-China Axis, I believe the major impediment is the Russian oligarchs themselves who are more interested in being part of the Europe than participating in Asia and also due to the crackdowns and common prosperity drive for the wealthy in China. If there's further integration between Russia-China there will be huge questions in Russia why are the oligarchs in russia allowed to behave the way they're allowed to behave and not under the thumb of state authority. The reality is the russian oligarchs mostly are there due to their ill gotten gains during the privatization during the collapse of the USSR in the 1990s.
Hi Clement you definitely right on the soybeans part, the iron ore part I am more unsure. For strategic reasons you may see a pivot and some sort of substitution. The real world recent example I would use is the Canadian Oilsands and the US. The oilsands were always there but generally uncompetitive vs conventional oil and international deposits. Pre 2000 nobody cared about them, then the whole narrative about peak oil came and there was massive investments into the Oilsands with improving technology and infrastructure that was built over a decade. Now Canada is the US's biggest oil exporter and is responsible for 56% of US oil imports in 2019 (https://www.eia.gov/todayinenergy/detail.php?id=43995). So where there's a political will, there's a way.
As for Russia readily supplying energy to China, that's been a work in process and their existing infrastructure isn't really built for the full export to China through pipelines yet. The power of Siberia is only recently complete and operating in 2019. For Crude oil the only direct link is the ESPO which is only around 1.6mil bbl/day. that pipeline is also not only for China but for the asia region, even thought China probably buys about 80% of the volume. The majority of Russian energy infrastructure is setup to export to the EU-27, this is why Russia could not easily turn off the taps in the beginning of the Ukraine war.
When I look at a lot of the BRI Investment into Pakistan, it seems designed in the long term for China to access middle east oil without needing to ship it through the indian ocean. As zhaozhe says - where there is a will there is a way
That is true. However Iron Ore and Soybeans are the two achilles heels of Chinese imports? How will Xi attempt to substitute them? Therein is the investment opportunity.
I think it's better to be a geologist for this! any neighbouring country with large iron ore deposits will be a huge investment draw. As for Soybeans, that's a different story.
The problem as I said is geology, I'm not a geologist (was in mining in a previous career but have some geology knowledge) the banded iron formations that are the mainstay of high grade haematite deposits are constrained to Brazil, West Africa, Australia and to a more limited extent in India and South Africa
Russell if we look at every example in the last 20 years, where there is s conflict between security alliances and economic interests: security has won out. Yes, Australia siding with the US against China over a Taiwan conflict will have serious ramifications. But in the event of a Chinese military blockade or invasion I don't see a situation where iron ore and LNG will continue to be shipped to China. Just like Nord Stream 2 may have made economic sense but no political sense.
Perhaps this is why the Australian dollar is relatively weak despite a high terms of trade after all?
This is really about thinking 20-50 years ahead, and I wonder whether Taiwan would be relevant then?
Australia may be a desert island, but this desert island produces very efficiently everything the world needs - and it depends on trade - is the US always going to be there to secure sea lanes? The UK was the guarantor for many years, more recently the US, but isn’t it in the best interest of Australia to be capable of caring for itself?
In my mind this is about the long term strategic interests of Australia and the message to all powers is - Australia is happy to trade with anyone and everyone, it can take care of itself in a way that it is best to leave it well alone and just trade with it. A ‘fortress Australia’ if you will, prepared for whatever the crazy world out there throws at it.
A nice little fleet of nuclear subs makes a lot of sense in such context - certainly more sense than for the Brits to have nuclear subs?
I mean, fundamentally war is stupid and a waste - and if humans ever become as rational as they claim to be, this nonsense would stop, but until such second coming, it makes sense for Australia to build itself into a position where everyone is happy to trade with it and no one is tempted to mess with it.
Anyhow, the key point here is not to think of the next 10 years, where these subs are not relevant, but much longer term, where chances are Australia would also support a much larger population and be a more significant strategic player.
Nuclear subs are a superior technology that would give Australia a more potent tool to respond to aggression. Considering the distance from potential aggressors the message is that Australia would be able to strike back anywhere. It also serves future strategic aims if the Antarctic becomes a focus of conflict. This is about a much longer term thinking than just Taiwan which would hopefully be settled one way or another by the 2040’s.
For its size and extremely long coast Australia should go for the most superior technology.
Building a military force that is declared to be purely defensive, with no counter attack capabilities IS the real waste of money - what’s the point of THAT?
No doubt it is a superior technology - I am sure it is why defence chiefs jumped at the opportunity to acquire it.
The question is what aggression are we talking about? Australia is mainly desert and a long way from anywhere.
So my point is that the nuclear subs are obviously there to respond to an attack on taiwan - but this is not the stated reason for the purchase.
Like I said if we are going to spend half the military budget on one bit of kit - we better be sure its the right one. But if we cannot clearly define the objective.how is.that possible?
Thanks for sharing. I had no idea the sub fleet would be only 8 boats and not functioning until 2040. That seems almost irrelevant, especially given the time line.
Forgive my ignorance, please, but why so furious? Do you feel the deal betrays societal norms? Or, puts Australia at unnecessary risk?
As an American that once worked within the military-industrial complex, I think I'm just desensitized to these arms deals. They have been a way of life in the US... part of the water in which we swim.
If you willing to watch an hour with our former prime minister, Paul Keating, he sums up my thoughts exactly.
The cost of these submarines are unbelievable, and as an Australian, I hate Australia's obsequious fawning behaviour in the name of continued U.S. imperialism.
From what I see/read, the main driver of the US-AU sub deal is just to get the sub port established in Australia so that US subs can berth there. Selling US subs is just the icing and not the main factor. That's also probably why Australia did the entire undersea scan of the Indian ocean and thereabouts post MH370 disappearance (which makes you think what really happened to MH370)
Well thats the question isn't it? Since world war II US policy has worked for Australia. But while I can see nuclear subs as a beneift for the US.- a.bit harder to see the benefits for Australia
If you think you don't have to pick a side, you're delusional.
You do have to pick a side... but spending half your military budget on 8 subs that probably makes no difference makes little sense to me. Much more effective ways to spend the money
Has majority of Australians picked a side? Or the side has been automatically picked by virtue of its Anglo-Saxon heritage (and monarch)? I wonder if Australians are really in charge of their own fate and direction, or in reality tethered to the prevailing Anglo Saxon empire (Five Eyes?).
https://en.wikipedia.org/wiki/Alleged_CIA_involvement_in_the_Whitlam_dismissal
Australia was pretty anti-communist so was very much aligned during the cold war. With so much business and trade with China it is a.very different kettle of fish. Paul Keating (former PM) has interesting views on this
Please post a link
https://www.youtube.com/live/VmgxAoa1n-8?feature=share
https://www.youtube.com/live/VmgxAoa1n-8?feature=share
Considerate and well spoken, Russell. Thanks!
Interesting analysis - internal debate is clearly required.
1. The thoughts of ex PM Malcom Fraser
https://nationalinterest.org/feature/america-australias-dangerous-ally-11858
https://www.amazon.com/Dangerous-Allies-Honourable-Malcolm-Fraser/dp/0522862659
2. Australia's Defence Policy In 2023 shredded
https://www.youtube.com/watch?v=sgspkxfkS4k&ab_channel=WorkingDogProductions
Yes. The hard question that needs to.be answered is "do we.defend.Taiwan no matter.what"....
Could you please provide the sources for the countries' military spending and naval fleet data?
Will dig up. Given the differnece in spending it looked right to me
Thank you. It looks right to me as well I just want to access the sites for my own interests.
Australia will join the philippines and japan as the frontline against the war against China, and all 3 nations will be within striking distance of Chinese hypersonic and possibly conventional missiles. Depending on how far this conflict could escalate, infrastructure will definitely be a target, ie. refineries, power grids, port terminals and ammo depots. These 3 countries will bear all of the consequences of a possible war in the pacific and no american civilians will die.
With this situation at hand, it's obvious where the investment theme is if you can invest in it, and that's in Russian natural resources and agriculture. I spoke to a russian finance professional and they're very bullish on the current situation in regards to the underutilized russian agriculture complex. The main impediment to Russian natural resource and agricultural exports to the PRC is the bad railroad infrastructure. The upgrading of this infrastructure will have to wait until the ukraine war is over, I think there will be a lot of interest from the PRC in pushing for the Russians to replace Australia coming soon with the current political and military posturing.
I spoke to a person in US officer corps before about this conflict a year ago and he said that the higher ups seemed to be morbidly excited for a real conflict to kick off to face off against a peer competitor, we'll see if some aging US generals and admirals get their wish.
I really hope it does not come to War. And yes, one of the reasons China is not against the war in Ukraine is that it helps them secure more resources. Traditionally, Russia and China have been at best "frenemies" - but this does seem to be pushing them closer
The war will be decided by the US state department, the whole reason tensions are flaring is because they have allowed it, because the whole Taiwan scenario is entirely predicated on the implicit guarantee of support from American Troops if the DPP decides to push for their independence bid. It's gotten so bad that during Pelosi's visit Lawmakers in legislative yuan were speaking out openly against it and recently Ma Jing Yeou, the former president of the ROC (He still likes to be addressed this way) went on a China visit to his ancestral village as a private person.
As for the Russia-China Axis, I believe the major impediment is the Russian oligarchs themselves who are more interested in being part of the Europe than participating in Asia and also due to the crackdowns and common prosperity drive for the wealthy in China. If there's further integration between Russia-China there will be huge questions in Russia why are the oligarchs in russia allowed to behave the way they're allowed to behave and not under the thumb of state authority. The reality is the russian oligarchs mostly are there due to their ill gotten gains during the privatization during the collapse of the USSR in the 1990s.
Russia is not a big producer of soybeans or corn, Wheat is not what China needs.
Iron ore has to come via sea from Australia, Brazil or West Africa. There are no banded iron formation deposits of any scale in Russia.
Energy, yes, Russia has a lot of that and can readily supply China
Hi Clement you definitely right on the soybeans part, the iron ore part I am more unsure. For strategic reasons you may see a pivot and some sort of substitution. The real world recent example I would use is the Canadian Oilsands and the US. The oilsands were always there but generally uncompetitive vs conventional oil and international deposits. Pre 2000 nobody cared about them, then the whole narrative about peak oil came and there was massive investments into the Oilsands with improving technology and infrastructure that was built over a decade. Now Canada is the US's biggest oil exporter and is responsible for 56% of US oil imports in 2019 (https://www.eia.gov/todayinenergy/detail.php?id=43995). So where there's a political will, there's a way.
As for Russia readily supplying energy to China, that's been a work in process and their existing infrastructure isn't really built for the full export to China through pipelines yet. The power of Siberia is only recently complete and operating in 2019. For Crude oil the only direct link is the ESPO which is only around 1.6mil bbl/day. that pipeline is also not only for China but for the asia region, even thought China probably buys about 80% of the volume. The majority of Russian energy infrastructure is setup to export to the EU-27, this is why Russia could not easily turn off the taps in the beginning of the Ukraine war.
When I look at a lot of the BRI Investment into Pakistan, it seems designed in the long term for China to access middle east oil without needing to ship it through the indian ocean. As zhaozhe says - where there is a will there is a way
That is true. However Iron Ore and Soybeans are the two achilles heels of Chinese imports? How will Xi attempt to substitute them? Therein is the investment opportunity.
I think it's better to be a geologist for this! any neighbouring country with large iron ore deposits will be a huge investment draw. As for Soybeans, that's a different story.
The problem as I said is geology, I'm not a geologist (was in mining in a previous career but have some geology knowledge) the banded iron formations that are the mainstay of high grade haematite deposits are constrained to Brazil, West Africa, Australia and to a more limited extent in India and South Africa
Russell if we look at every example in the last 20 years, where there is s conflict between security alliances and economic interests: security has won out. Yes, Australia siding with the US against China over a Taiwan conflict will have serious ramifications. But in the event of a Chinese military blockade or invasion I don't see a situation where iron ore and LNG will continue to be shipped to China. Just like Nord Stream 2 may have made economic sense but no political sense.
Perhaps this is why the Australian dollar is relatively weak despite a high terms of trade after all?
This is really about thinking 20-50 years ahead, and I wonder whether Taiwan would be relevant then?
Australia may be a desert island, but this desert island produces very efficiently everything the world needs - and it depends on trade - is the US always going to be there to secure sea lanes? The UK was the guarantor for many years, more recently the US, but isn’t it in the best interest of Australia to be capable of caring for itself?
In my mind this is about the long term strategic interests of Australia and the message to all powers is - Australia is happy to trade with anyone and everyone, it can take care of itself in a way that it is best to leave it well alone and just trade with it. A ‘fortress Australia’ if you will, prepared for whatever the crazy world out there throws at it.
A nice little fleet of nuclear subs makes a lot of sense in such context - certainly more sense than for the Brits to have nuclear subs?
I mean, fundamentally war is stupid and a waste - and if humans ever become as rational as they claim to be, this nonsense would stop, but until such second coming, it makes sense for Australia to build itself into a position where everyone is happy to trade with it and no one is tempted to mess with it.
Anyhow, the key point here is not to think of the next 10 years, where these subs are not relevant, but much longer term, where chances are Australia would also support a much larger population and be a more significant strategic player.
Nuclear subs are a superior technology that would give Australia a more potent tool to respond to aggression. Considering the distance from potential aggressors the message is that Australia would be able to strike back anywhere. It also serves future strategic aims if the Antarctic becomes a focus of conflict. This is about a much longer term thinking than just Taiwan which would hopefully be settled one way or another by the 2040’s.
For its size and extremely long coast Australia should go for the most superior technology.
Building a military force that is declared to be purely defensive, with no counter attack capabilities IS the real waste of money - what’s the point of THAT?
No doubt it is a superior technology - I am sure it is why defence chiefs jumped at the opportunity to acquire it.
The question is what aggression are we talking about? Australia is mainly desert and a long way from anywhere.
So my point is that the nuclear subs are obviously there to respond to an attack on taiwan - but this is not the stated reason for the purchase.
Like I said if we are going to spend half the military budget on one bit of kit - we better be sure its the right one. But if we cannot clearly define the objective.how is.that possible?
Thanks for sharing. I had no idea the sub fleet would be only 8 boats and not functioning until 2040. That seems almost irrelevant, especially given the time line.
Its a lot of money for not a lot... and much more expensive than the french subs.
And costs are always dramatically overrun
As an Australian, I'm f****** furious about that "deal."
Forgive my ignorance, please, but why so furious? Do you feel the deal betrays societal norms? Or, puts Australia at unnecessary risk?
As an American that once worked within the military-industrial complex, I think I'm just desensitized to these arms deals. They have been a way of life in the US... part of the water in which we swim.
If you willing to watch an hour with our former prime minister, Paul Keating, he sums up my thoughts exactly.
The cost of these submarines are unbelievable, and as an Australian, I hate Australia's obsequious fawning behaviour in the name of continued U.S. imperialism.
https://www.youtube.com/live/VmgxAoa1n-8?feature=share
Thanks for sharing. 2.0x on YouTube is a wonderful tool. I'll add it to my watch list.
Congratulations for speaking so frankly!
From what I see/read, the main driver of the US-AU sub deal is just to get the sub port established in Australia so that US subs can berth there. Selling US subs is just the icing and not the main factor. That's also probably why Australia did the entire undersea scan of the Indian ocean and thereabouts post MH370 disappearance (which makes you think what really happened to MH370)
To berth and refuel? Hence, Australia needs to have its own subs to make that work?
The US has plenty of bases in the pacific - why does it need Perth?
Own subs - just to make it sound like Australia is defending its own turf rather than US using Australia as a forward base?
Well thats the question isn't it? Since world war II US policy has worked for Australia. But while I can see nuclear subs as a beneift for the US.- a.bit harder to see the benefits for Australia
Based on wikipedia, they don't have any covering Indian Ocean / Antartica
https://en.wikipedia.org/wiki/United_States_Navy_submarine_bases#:~:text=United%20States%20Navy%20submarine%20bases%3A%201%20Naval%20Submarine,Station%20Norfolk%20at%20Norfolk%2C%20Virginia%20%281917%E2%80%93present%29%20More%20items
Interestingly, they used to have in Australia during WW2 but maybe cannot support nuclear subs?
Closed United States Navy submarine bases:
San Pedro Submarine Base (1917–1923) San Pedro, California
Naval Air Station Key West (1917–1919), (1942–1945)
Fremantle submarine base (1942–1945) at Naval Base Perth
Auxiliary Albany Submarine Base (1942–1944) at Albany, Western Australia
Brisbane Submarine base at (1942–1945) Naval Base Brisbane
Naval Base Darwin (1942–1945)
Cavite Submarine Base (1919-1960s) at Naval Base Cavite, Philippine
Iliuliuk Submarine Base at Dutch Harbor Naval Operating Base (1941–1945) in Alaska
Kodiak Naval Operating Base at Womens Bay, Alaska, now Coast Guard Base Kodiak in Alaska[13]
Wake Submarine Base on Wake Island (11 December 1941– )[14]
Submarine Base Midway at Naval Air Facility Midway Island
Yokosuka Submarine Base (1945–?) at Naval Base Yokosuka, Japan[15]
Majuro Submarine Base (1944–1945)
Ulithi Submarine Base (1944–1945)
Eniwetok Submarine Base (1944–1945)
Coco Solo Submarine Base (1914-1960s) at Panama Canal Zone
USN Submarine Base, Ordnance Island, Bermuda (1942 to 1945)
Submarine Base Bangor (1942–2014) at Bangor, Washington
Exmouth Submarine Base, (1942–1943) advanced submarine base
Milne Bay Submarine Base in Papua New Guinea (1942–1945) advanced submarine base
Merauke Submarine Base Dutch New Guinea, advanced submarine base
Thursday Island Submarine Base, Thursday Island in Torres Strait, Australia advanced submarine base
Holy Loch Submarine Base (1942–1945) in Scotland (1961 to 1992)
Naval Support Activity La Maddalena, La Maddalena, Italy on Santo Stefano Island (1972–2008), advanced submarine base
There is no way to refuel a nuclear sub in Australia presently....
Seems like Australia might be missing some diplomatic influencers, bring back a Herbert Evatt type politician (all is forgiven).