Discussion

on

 

Discussion

The above information demonstrates that the biggest U.S. military supplier, Lockheed Martin (and BAE Systems – see Appendix), and its beneficial owners, the Big Three (dominated by Vanguard and BlackRock) benefit both from war and perceived conflicts that threaten war. They are capable of using their influence to escalate those perceptions – and thus to promote their weapons sales - through their connections - both financially and politically - via their key personnel that are in strategic positions – e.g., via “think tanks” (such as CFR and CSIS in the US and ASPI in Australia) or directly through established political and financial relationships.

 

Of particular concern for Australia (and its taxpayers) is that U.S.-based investors’ interests extends to Australia indirectly via AUKUS (and directly via their major share ownership of Australia’s top 100 companies), and other extensive and escalating military expenditure promoted via a perceived anticipated conflict with China especially centred on China’s interests in Taiwan and the South Pacific.

 

There is substantial evidence that Lockheed Martin, via its directors and major shareholders, has played a significant role in influencing if not materially forming those perceptions to maximise its weapons sales both in the United States and now in Australia.  One of the biggest suppliers to the Australian Defence Force (ADF) is Lockheed Martin and those supplies are exponentially expanding now on almost a daily basis. Another major supplier is BAE Systems, and both Lockheed and BAE in partnership have some of the largest recent defence contracts in Australia (see Appendix below).

 

Military expenditure in Australia is ultimately borne by taxpayers, in part to maintain the perception of an alliance with the United States. This money could be spent on other priorities, such as social housing, healthcare, manufacturing (for self-sufficiency), or education. As many have pointed out, the existing alliance has potential to lead to Australia being dragged into conflicts that it does not want to be involved in.

 

Several authors argue that Australia's military alliance with the U.S. – established via the 1951 ANZUS Treaty - undermines Australia's sovereignty. For example, in September 2001, Australian PM John Howard invoked the ANZUS Treaty, unilaterally extending its application to support the United States anywhere in the non-specific ‘war on terror’[1] which resulted in the invasion of Iraq in 2003[2] which is now described as “one of the two great failures of Australian foreign policy since the Second World War.” (The other is Menzies’ decision to send forces to Vietnam.)[3]. Sovereignty is expressly ceded under Australia’s 2014 Force Posture Agreement with the United States[4], which among other things has allowed the “permanent rotation” of US forces and efflorescence of US military bases on the continent. Indeed, AUKUS itself envisions permanent rotations of US bombers (which may or may not carry nuclear weapons) and US and British submarines beginning later this year.[5]

 

China is Australia's largest trading partner and is our fifth largest foreign investor, with 5 per cent (including Hong Kong) of the $4.5 trillion total[6]. However, the levels of Hong Kong (SAR of China) and Chinese investment in Australia have grown significantly over the past decade. For example, China is the second largest shareholder in Fortescue Metals Group Limited (9%) and has majority shareholding in mining giant Rio Tinto and several coal mining companies. Since 2004, Yancoal has generated over $10 billion in Foreign Direct Investment (FDI) for Australia and now owns, operates or participates in nine producing coal mines across NSW, Queensland and Western Australia.[7] Australia mines about 53% of the world's lithium supply and sells almost all of it to China for refining and using in products like electric vehicles and mobile phones.[8]

Some have argued that the US-China rivalry has the potential to escalate into conflict, and Australia could “sleepwalk” into this conflict with resulting loss of trade and investment (notwithstanding the other obvious catastrophic consequences[9]). The following is an extract from The capitalists of the 21st century an easy-to-understand outline on the rise of the new financial players [Werner Rügemer, 2019][10]



 In the meantime, however, Lockheed Martin and the Big Three (and their investors) benefit financially through weapons sales and the profits to be made from consequent reconstructions.  In comparing weapons build up as either a deterrent or an exacerbation of conflict, weaponry suppliers win both ways: 

  •         On the one hand, it is argued that weaponry proliferation can be seen as a deterrent to conflict. Countries that possess powerful weapons may be less likely to be attacked by other countries, as they know that the attacker would face a strong retaliation. This is known as the deterrence theory. For example, the nuclear weapons possessed by the United States and the Soviet Union during the Cold War are often credited with deterring a nuclear war between the two superpowers. However, to remain a deterrent armament stocks and potency needs to be on par with those who are to be deterred – hence an ever-escalating arms such as occurred between the US and the Soviet Union.[11]

  •          On the other hand, weaponry proliferation can also be seen as a provocation of conflict. Countries that are concerned about the proliferation of weapons in their region may feel the need to acquire their own weapons in order to defend themselves. This can also lead to an arms race, which can increase tensions and make conflict more likely. For example, the proliferation of nuclear weapons in the Middle East is a major concern, as it could lead to a nuclear war between Israel and its neighbours.[12] 

The sales strategy of weapons suppliers (and their investors) selling to governments and their defence departments is therefore relatively simple: convince the relevant department and governments that there is “tension” with the governments and weapons purchasers of other territories/interests.  We are currently witnessing world military expenditure reaching new record highs[13]. Shares of companies such as Lockheed Martin and the UK’s BAE Systems have rallied strongly, with FTSE 100-listed BAE alone up more than a third year-to-date. [As for BAE, see Appendix below].

 “To be an enemy of America can be dangerous, but to be a friend is fatal.”— Henry Kissinger[14]. Friendship between countries – other than with the weapons supplier country - is bad for business. However, friendship with the weapons supplier country is apparently pretty good for (their) business [15]

 


The Table below shows change in military spending in the countries with the highest military expenditure 2013-2022 corresponding with LNP government (and spanning Trump years). Australia ranks fourth highest in the world (47% change): [16]


 

On 24 May 2023, 110 Australian academics and scholars called on the Albanese government to rethink its nuclear-powered submarine plan, arguing it is risky, expensive and will increase dependence on the US. [17] The letter, coordinated by Macquarie University sessional academic Vince Scappatura, says:

 

Text Box: “AUKUS will come at a huge financial cost and with great uncertainty of its success. It is likely to compound Australia’s strategic risks, heighten geopolitical tensions, and undermine efforts at nuclear non-proliferation. It puts Australia at odds with our closest neighbours in the region, distracts us from addressing climate change, and risks increasing the threat of nuclear war. Australia’s defence autonomy will only be further eroded because of AUKUS. All of this will be done to support the primacy of an ally whose position in Asia is more fragile than commonly assumed, and whose domestic politics is increasingly unstable.” 

 

 

 

 

 

 

 A high-profile group of leading Labor luminaries in addition to a number of prominent peace organisations has called for in independent enquiry into the AUKUS submarine defence agreement, ahead of the ALP National Conference just last week. Former Federal Senators Doug Cameron, Margaret Reynolds and Claire Moore and former ACT Chief Minister Jon Stanhope, and former Queensland State MPs Clement Campbell and Rod Welford and several national peace organisations, have penned an open letter (extract below) to the Australian Labor Party that questions whether there has been adequate assessment of the many risks associated with AUKUS and its impact on Australians.[18]

 

Text Box: “There are no publicly-available impact studies showing how AUKUS will affect the social, environmental and economic conditions of all Australians, now and into an unknown future. Professionals with relevant expertise have not been asked to provide the Australian Government with essential detail for managing such a large-scale military venture. There are no risk assessments about the serious threat to those port communities in the event of a reactor accident. There are no plans to guarantee safe transport and disposal of nuclear waste. Current planning about AUKUS is shrouded in secrecy...”

 

 

 

 

 

 

 

 “It is paramount that in pursuing national security, Australia not inadvertently undermine the global security provided by the NPT (The Treaty on the Non-Proliferation of Nuclear Weapons) regime or undermine the very international order the AUKUS partners are seeking to uphold.”[19]

 


Comments

Post a Comment