Picking the PM: If China could choose

Kevin Rudd's return will be welcomed by the US but he brings baggage to the relationship with China. Would foreign policy neophyte Tony Abbott fare better with Beijing?

Foreign policy rarely rates as an election defining issue, unless one includes asylum seekers arriving on our shores. Even so, those in the business community would want to know how the two prime ministerial candidates would fare in the relationship with China. In reality, neither have vastly differing ideas about how best to manage the bilateral relationship. The more important distinction is in their temperament and style of leadership.

Kevin Rudd will always see himself as a foreign policy leader with an indomitable belief in his own vision and foreign policy nous. Tony Abbott sees himself as a pragmatic and steady hand on the tiller, relying on teamwork and a ‘no surprises’ approach. Many will question the self-perception of one or both leaders. But let’s take each at their word. Rudd would be the more interesting leader in managing this critical bilateral relationship compared to Abbott – but also the more dangerous and volatile.

With respect to Rudd, we already have a recent historical record to look at and it is not impressive. At the heart of the problem with Rudd (Mark I) during his first period as prime minister is the often made criticism that he has a hyperactive and impatient personality untempered by self-doubt. Believing that he is invariably the smartest person in the room, Rudd conducted policy with little regard for consistency or consequences.

When he became prime minister, one of his first foreign policy acts was to unilaterally withdraw from the Quadrilateral Initiative involving the United States, Japan, India and Australia. That the initiative was already a sinking idea is beside the point. The optics of then Foreign Minister Stephen Smith announcing Canberra’s unilateral withdrawal whilst standing alongside his Chinese counterpart at a press conference was gleefully noted in Beijing. Likewise, the fact that Rudd chose Beijing as his first Asian port of call while ignoring the tradition of visiting our most important security partner in Tokyo sent an unmistakable signal to Beijing: Canberra was redefining its relationship in the region and moving closer to China.

In fact, Rudd had no such intention. While he initially charmed Beijing by speaking about a reorganisation of fundamental relationships among great powers that would offer China a greater strategic role in the region, we now know from WikiLeaks that he was saying something very different to his American counterpart Hillary Clinton; that America and its allies should be ready to use force against a recalcitrant China.

Indeed, Rudd’s Asia Pacific Community idea was classical ‘policy on the run’ in this context. Having been given only a few hours notice about the concept and his role as envoy to sell it, Richard Woolcott was dispatched to a bemused region. China initially embraced the idea as it would presumably give Beijing a greater seat at a new institution. The Southeast Asian states were generally hostile to the idea since it threatened the primacy of the Association of Southeast Asian Nations (ASEAN), and were immensely peeved that they had not been consulted on this issue. Importantly, Rudd informed the Americans that the APC was there to keep the Chinese in check, not to necessarily offer Beijing a greater say in regional affairs.

Rudd’s confidence and highly tuned sense of  mission can occasionally detract from his diplomacy. After all, disappointed by the intransigence of China at the Copenhagen Climate Change Conference in December 2009 and weary after a sleepless night of failed negotiating, Rudd shocked reporters and others around him by notoriously declaring that ‘Those Chinese f.... are trying to rat-f.... us.’ As expected, word about the comment got back to Chinese Premier Wen Jiabao extremely quickly. One can only imagine what the Chinese leader thought about Australia’s first Mandarin-speaking prime minister.

The problem for Rudd Mark I was twofold. First, he told China one thing and leaders in other capitals such as Washington another. Great powers, and especially China, find this two-faced approach unacceptable.

Second, in search of grand ideas, Rudd made policies without consulting his colleagues, senior bureaucrats or regional capitals. There is a mantra that unintended consequences in foreign policy are the most damaging and difficult to fix.

There will always be intractable issues between Australia and China and no prime minister can resolve these completely. Giving Beijing a consistent idea of how Canberra will respond is often the best that we can do in the short-term. If Rudd Mark II has truly learnt these lessons and can rein in his immense desire to be the Henry Kissinger of Australia-Sino relations, then his second coming will be far more successful than the first. But he remains immensely distrusted in Beijing and will begin again with enormous baggage.

Abbott is harder to read simply because he has no background or demonstrated instinct for foreign policy. But his self-proclaimed ‘fair dinkum’ personality came to the fore in his one visit to China as Opposition Leader. In July last year, Abbott ruffled a few diplomatic feathers by declaring that China would prosper even more if "its people enjoyed freedom under the law and the right to choose a government". Even if one might agree with that sentiment, many will still chide Abbott for diplomatic irresponsibility. After all, what about the danger of the ‘unintended consequences’ of confronting comments delivered in the capital of our largest trading partner?

Strangely enough, Abbott’s forthrightness will stand him in good diplomatic stead with Beijing which hates diplomatic deceit more than it does disagreement. Lowering expectations that Canberra will simply fall into line with its largest trading partner is a sound approach.

The trick will be to ensure that his obvious distaste for China’s authoritarian system does not translate into counter-productive policy outcomes. One danger area is Chinese foreign direct investment into our country. Polls such as one conducted by the Lowy Institute recently continually show that the majority of Australians remain troubled by Chinese FDI even if there are no genuine national security implications at stake. The Nationals within the Coalition will place pressure on an Abbott government to restrict Chinese purchases of farmland even though the proportion of farmland under foreign ownership remains at roughly the same levels as it was two decades ago.

The point is that Abbott’s instincts for directness should not be a burden on sensible economic policy making vis-à-vis China. It is one thing to lower expectations. It is another to erect obstacles to sensible cooperation.

Finally, there is an equally important second pillar when it comes to middle powers like Australia managing relations with a much larger country: our relationship and alliance with America.

This is where Rudd has considerable positive baggage. He is highly regarded at the top levels in Washington, and admired for what they see as his vision and energy in foreign policy. Officials there were completely bemused and shocked that he was removed so ruthlessly by his own party in 2010. The Barack Obama administration will welcome a Rudd return. This is not to say that there would be any hostility towards an Abbott government: only that they are deeply comfortable with working with Rudd.

The upshot is that Rudd already has the ear of the American president and anything Rudd Mark II proposes will be given serious consideration. Without a foreign policy pedigree, this will be a more difficult task for Abbott, but far from impossible.    

So the final assessment: Rudd Mark II needs to temper his ambition with consistency, humility and consultation. Abbott needs to ensure that his upfront approach is accompanied by economic policies that are pragmatic. Washington would prefer Rudd. But if Beijing had the final say, they would choose Abbott.

Dr John Lee is the Michael Hintze Fellow and adjunct associate professor at the Centre for International Security Studies, Sydney University. He is also a non-resident senior scholar at the Hudson Institute in Washington DC and a director of the Kokoda Foundation in Canberra.

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