Australia and New Zealand — losing an empire, who will protect us now? Part 2. US saviour and defender

2. US saviour and defender — From one empire to another

After World War II, Britain was so depleted that these relatively young and militarily weak nations needed a new alliance that could protect them from possible invaders in the radically altered geopolitical landscape that came out of the war. The obvious candidate for this role was the USA which, in economic and geopolitical terms, was the only real winner of the two world wars. So, in 1951 Australia and New Zealand signed the Australia, New Zealand and United States Security Treaty (ANZUS Treaty) with the USA “to protect the security of the Pacific”.

While the ANZUS treaty ostensibly added to an ongoing British obligation as leader of the Commonwealth to help defend both countries, in effect, although Australia and New Zealand remained within the British Commonwealth with the English monarch as head of state, the fact that Britain had very little military presence remaining in the region meant that for all intents and purposes responsibility for the defence of these nations had transferred to the USA. The United Kingdom, being seriously weakened by the war, turned its economic, political and military focus towards Europe and the NATO alliance—which was in turn focused on the new great enemy of the day, communist USSR. Through the 1950s and into the 1960s both New Zealand and Australia committed troops and military assistance to Britain and the USA in wars in Korea, Malaysia and Vietnam.

The post-World War II period saw a change in Australia economic activity involving a shift towards manufacturing geared to the domestic consumer market, including the establishment of an automotive industry, while the key export industries remained agricultural and mineral commodities. Mainly US foreign investment saw the Australian economy quickly recover from the war years and the continuance of the mass immigration policy began in 1946, and the signing of a range of new trade agreements with nations outside the British Empire, including West Germany (1955), Japan (1957) and the USSR (1965). In 1955, Australia began exporting coal to Japan, and by 1967 Japan had surpassed Britain as Australia’s main market. For New Zealand, the post-war years marked a period of slow recovery and economic stagnation while exports remained dominated by the shipping of agricultural commodities to Britain. In late 1967, the export price for wool fell by 30%, triggering rising unemployment and inflation in New Zealand. Both country’s access to the British market was compromised by the UK’s desire to join the European Economic Community (EEC). Britain’s share of New Zealand’s exports fell from just over 50% in 1965 to 36% in 1970 and less than 15% by 1980. 

For both nations, the 1970s represented a period of stagflation which was primarily caused by developments in the international economy; the Oil Crisis, Britain’s entry into the EEC and growing economic competition in their traditional export markets. To a large degree, while the 1950s saw the decline of Australia and New Zealand’s defencse reliance on Britain, the 1970 saw the end of the economic reliance as well. In 1984, following a snap election in New Zealand, the incoming Labour government faced a financial crisis that radically transformed the country’s economic landscape. In what we would now recognise as a neoliberal coup, the country’s foreign and social policy where the interventionist policies of the outgoing conservative National government were replaced by a raft of free-market economic polices that turned what had been reputedly the most protected economy in the Western world into the least protected.

On the defence front, the ANZUS treaty unravelled in 1987, when New Zealand’s Labour government declared the country a nuclear-free zone and refused to allow US nuclear-powered ships and submarines to visit its ports. Two years later, Australia and the USA agreed to continue to honour their mutual obligations under the treaty and the USA subsequently suspended its treaty obligations toward New Zealand. In spite of being cast into the military and intelligence cold by the US government for some 20 years in punishment for its temerity, New Zealand maintained extremely close defence ties with Australia through this period and was somewhat restored to favour in recent years through its military assistance to the US in places like Afghanistan, Iraq and Syria. As a member of the Five Eyes Alliance, New Zealand is host to two US spy bases on its territory and contributes to “the exchange by default of all signals intelligence they gather, as well as methods and techniques related to signals intelligence operations” (see Newly Disclosed Documents on the Five Eyes Alliance and What They Tell Us about Intelligence-Sharing Agreements).

In spite of the differences concerning nuclear technology, since the 1960s the military establishments of both nations have been fully committed to the US sphere with most significant weapons systems and military aircraft being sourced mainly from the key US manufacturers. However, while Australia has continued to support a full strike capability with jet fighters, frigates submarines, frigates and destroyers, New Zealand’s defence spending and capability is cut to suit a more modest budget. Around 2003, New Zealand mothballed its small fleet of 17 aging A4 Skyhawk jet fighters and a decade later disposed of them (along with its fleet of nine Aermacchi jet training aircraft) with no intention of replacing these with a comparable jet fighter strike capability. The differences in defence spending and capabilities between Australia and New Zealand reflect the differing economic, geographic and geopolitical factors for each nation. Australia with is larger population (25.1 million vs 4.7 million) and GDP (USD1,432.2 billion vs USD305.02 billion) is clearly able to support a much larger defence capability. However, Singapore, which has a population of 5.9 million and GDP of USD364.16 billion spends USD10.5 billion on defence, which equates to 2.88% of GDP or USD1,772 per capita—vastly more than either Australia or New Zealand when considered on a GDP and per capita basis.

However, notwithstanding their differences it is evident that both Australia and New Zealand fill a key role in the US empire in that, to admittedly differing levels, they provide validation of the legitimacy of the USA’s wars and other hegemonic actions in the global scene.

Continued in Part 3

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