7 hours Ago By Peter Hartcher
Under provocation from Donald Trump, Australia is, so far, managing to remain sane. But can it remain safe? Trump’s new tariffs on Australian steel and aluminium are marginal economically in their direct effects on Australia, yet they are highly meaningful politically. They are marginal economically in a direct sense because they affect only one-fifth of 1 per cent of national exports.
Trump’s decision on tariffs should force Australia to reassess its relationship with the US. Credit: Matthew Absalom-Wong But, politically, this is a teachable moment. Trump has given Australia a timely reminder of the advice of the 19th century British prime minister Lord Palmerston – nations have no permanent friends, only permanent interests.
Australia must reassess its relationship with the US. It’s not just the tariffs themselves – after all, Trump is imposing them universally – but the manner of it. Refusing a phone call from the prime minister is not the act of a friend, much less an ally.
So much for the “perfect relationship” he promised Anthony Albanese. Trump has done us the favour of delivering this insult in peacetime. So we have the chance to rethink now rather than discovering US bad faith in the midst of a crisis.
Ask Ukraine how that feels. Macquarie Bank analysts expect the effects will be “generally manageable”. It’s the larger effects of a global trade war that could be a greater problem , which is why the share markets of the world are falling.
But this, too, should be generally manageable with the same policy tools that Australia has used to weather a string of global recessions. Australia’s government has kept a cool head. Some countries are retaliating against the Trump tariffs .
Australia is not. This is the sane course of action. As the Albanese government reminds us, tariffs are acts of “self-harm”.
If Australia retaliates by applying a 25 per cent tariff to American products entering Australia, what does that do? It forces Australians to pay more for US products. We have enough inflation without concocting more. Should Albanese return the insult, at least rhetorically? Canada’s Justin Trudeau called Trump’s tariffs “very dumb”, for instance.
But Canada’s politics are different to Australia’s. Trump has promised to annex Canada; he’s only put tariffs on Australia. In any case, Trudeau was in his last week in office.
For Australia, it might be emotionally satisfying to be rude to Trump but it would achieve nothing useful . Peter Dutton is blaming Albanese for the tariffs. The opposition excitedly claimed a great “gotcha” – that Albanese was the only leader of a Quad country who hadn’t met Trump in person.
This overlooked the fact that they’d all been slugged with tariffs whether they’d met Trump or not. No country was spared, although it seems Trump and Vladimir Putin have been discussing an aluminium deal. Joe Biden put a 200 per cent tariff on Russian aluminium after it invaded Ukraine, killing Russian sales to the US.
But two weeks ago, Trump mentioned “the possibility of Russian major economic development transactions with Russia”. Putin then announced that he’d “offered” to sell Trump a thumping two million tonnes of aluminium. It’s another reminder that Trump has cast aside old friends and embraced traditional US enemies, Russia most conspicuously.
Lord Palmerston would not have been surprised. Trump has gone even further than Palmerston’s adage would advise. Trump is demonstrating that America doesn’t have permanent friends, but also that it doesn’t have permanent interests.
Until Trump, the US for 80 years designed and operated a system of international institutions and rules. Now Trump is upending the systems. He’s withdrawn from the World Health Organisation, for example, because the US no longer believes in science.
He’s refused to reaffirm NATO because the US no longer believes in the West. And he’s now demanding an overhaul of the World Trade Organisation because the US no longer believes in the rules of trade – rules that the US designed. Trump is overturning all the verities on which Australia built its policies.
Including, most fundamentally, its national security, on which our liberties depend. Generations of Australian prime ministers have spoken of the ANZUS treaty as our “security guarantee”. This has always been political propaganda.
The treaty obliges the US and Australia to do nothing more than “consult” in the event that one is attacked. Today, even this thin excuse for Australian security would be close to meaningless in a crisis. In the meantime, the government oozes complacency in its half-hearted response to the recommendations of its own Defence Strategic Review.
We may still be sane, but not necessarily safe. As Chinese President Xi Jinping likes to say, “the world is undergoing changes not seen in a century”, adding during a handshake with Vladimir Putin: “We are the ones driving those changes.” As Xi’s hero, Mao Zedong, liked to say: “World in great disorder – excellent situation.
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