Dinky-di domination: Australian imperialism and the South Pacific

The Pacific economy outranks the Atlantic economy on virtually every count: GNP, population, resources, trade share, industrial capacity, and growth rate.^[1] In large part, the statistics reflect the prodigious growth of the Japanese economy, with its close inter-relationship with the American. But they also bear witness to the growing transformation of the region from sleepy backwater, a watery waste populated in Western eyes by “coolies” and Gauguin-style islanders, to a dynamic sector of the world economy.

The Pacific region is vast, encompassing 165 million square kilometres and bordering both superpowers. Within the PacRim region lie some of the world’s most dynamic Newly Industrialising Countries. The zone has considerable military importance for the Western imperialist nations, both as a buffer against Russian expansion eastwards and as a testing ground for nuclear capabilities.

Politically as well as geographically, the Pacific has its “ring of fire”, with struggles flaring dramatically in the Philippines, South Korea, China, Central America and, on a lesser level, Chile and Taiwan. The growth of an industrial sector cannot be separated from the growth of a working class that, as the Korean experience shows, is capable quickly of learning, and surpassing, the traditions of its brothers and sisters in the more developed world.

The Australian economy is increasingly linked to those of Asia – more than 48 percent of trade is with the region. At the end of 1988, Japan was Australia’s biggest customer for its three most lucrative exports (wool, coal and aluminium) and second-biggest for its fourth, beef.^[2] As Prime Minister Bob Hawke put it: “Whether we like it or not, we are enmeshed with Asia and we have to make sure that we develop our capacities”.^[3] It is a dynamic that led in November 1989 to the first, tentative meeting of the Asia-Pacific Economic Co-operation Organisation, an initiative for which Hawke could take much of the credit.

The task of coming to grips with the details of such complex interrelationships is enormous. The aim of this article is, therefore, much more narrow. It sets out to trace the patterns of imperialist interference in, and domination of, the region – particularly the South Pacific – and then attempts to locate the role of the Australian ruling class within this history. This involves examining the extent to which Australia is independent of its Western allies; the inter-relationship between Australian military and economic aims; and the inter-relationships between its military, economic and political interventions.

Although this will involve looking at the relationship of the Australian ruling class and economy to the Asia-Pacific region as a whole, the focus will be on the South Pacific, including Papua New Guinea – our rulers’ own back yard.

Imperialism and the South Pacific

The European nation states that moved on to the world stage from the sixteenth century onwards were maritime powers. Long before they had carved empires out of the lucrative lands of Africa and Asia, their ships were traversing the globe, heralds of the age of European imperialism that was to come.

Magellan sailed westwards across the Pacific in 1521 to what is now Micronesia and the Philippines. He was followed, as the pace of exploration quickened in the seventeenth and eighteenth centuries, by De Quiros and De Torres (the New Hebrides, Torres Strait and Tahiti), the Dutchman Abel Tasman (Tasmania, New Zealand and north-west New Guinea between 1642 and 1659), Roggeveen (Easter Island, Samoa and the Solomons, 1721-1722) and Bougainville (Polynesia and Melanesia, 1766-1768).

The expeditions mounted by James Cook between 1768 and 1779 opened up the east coast of Australia, New Caledonia and Tonga to British influence and laid the basis for the colonisation and settlement of Australia from 1788.

Further north, armed British might – decisively demonstrated in the Opium War of 1840-42 – opened the Chinese market to the West, while Japan was prised open by US military intimidation with the Treaty of Kanagawa in 1854.

The quickening pace of the thrust into the region, its final conquest and subjugation in the nineteenth century, flowed from the general economic and military competition around the globe between the major industrialised powers, a process summarised by Lenin as imperialism. Imperialism is capitalism at that stage of development at which the dominance of monopolies and finance capital is established; in which the export of capital has acquired pronounced importance; in which the division of the world among the international trusts has begun, in which the division of all territories of the globe among the biggest capitalist powers has been completed.^[4]

The Pacific was certainly being divided, but imperialism had quite different priorities in China and Japan than in the far-flung islands. While they were a source of picturesque tales, they were marginal from the first in terms of capital export, trade and profits. The islanders in the Northern Marianas and the Carolines, for instance, were subjugated by the Spanish, the Germans, the Japanese and the Americans in tum over the 60 years from the l880s, yet “copra and phosphate apart, the attractions of Micronesia to the colonial powers were not economic: they lay instead in its geopolitical position across the western Pacific”.^[5]

Further south, the sandalwood trade, and the vile “blackbirding” business that sprang from it, in turn enabling the growth of the sugar industry in Queensland and Fiji, produced intense misery for islanders throughout the nineteenth century but was peripheral to British imperialism. Even Australia, for the first 40 or so years of its existence as a British colony, was attractive more for its suitability as a port of call for the British military and merchant fleet than for any intrinsic worth. Not until the emergence of the wool export industry was this situation to change.^[6]

The South Pacific was in essence a backwater, a zone from which one’s imperial rival had to be excluded in order to prevent them gaining a strategic advantage rather than one that was immensely profitable in itself.

The case remains broadly true today despite the Soviet Union’s partial disengagement from East Asia, of which more below.

Like it or not, the South Pacific countries. including Australia and New Zealand, lie in an area of the globe now regarded as having strategic value for other powers, whether it be for satellite or weapon tracking sites, deep water harbours, nuclear testing grounds or other purposes. In fact, the area may well have as much or more strategic significance as trade value.^[7]

The historic aim of the semi-defunct ANZUS alliance has been to minimise the Russian presence in the region rather than to control assets of central strategic importance to the US. The total population of all the Pacific island states amounts to little more than 5 million – 3.5 million of whom are in Papua New Guinea. Imports and exports combined were worth around $US4.3 billion in 1986 – a pinprick compared to the total for world trade that year of $US4 trillion.^[8] Profits are there to be made, but on a relatively small scale only.

The Pacific does, however, retain its strategic value. The United States deploys 250,000 army, air force and navy personnel in the Pacific and Indian oceans.^[9] The Pacific has long been regarded as “an American lake”. The emphasis, however, has been on the North Pacific – in the South Pacific, US policy has concentrated on maintaining relations with Australia and New Zealand and no military facilities have been sought from the island states^[10] although there is military co-operation with some like the Solomon Islands and PNG.^[11] (It is yet to be seen to what extent the New Zealand Labor government’s estrangement from ANZUS will lead the Pentagon to alter this policy.) The sheer scale of the US military machine, however, means that even “low-priority” operations can be vast – Kangaroo ’89, the US/Australia joint exercise which ran from June to September 1989, mobilised 28,000 troops.

US aid south of the equator has been modest, running at $US9 million in 1987, although considerably more ($US60 million) was expected to flow from a five-year fishing agreement signed in 1986 with island states.^[12] The level of aid is an indication of the relatively low priority the US gives the area, as aid is the key to influence there.

The pattern is not a new one. Although American economic interests in the Pacific were considerable before World War II, the war and the post-war settlement saw the Pacific zone come a poor second to Europe in both military and political terms.^[13] The recent upheavals in Eastern Europe can only reinforce Washington’s priorities. While economically they remain a liability, the US retains direct control or effective hegemony over a series of Pacific islands, including Palau, the Northern Mariana Islands, Guam, the Marshall Islands, American Samoa and the Federated States of Micronesia, for reasons which can be only strategic.^[14] The Kwajalein atoll in the Marshall Islands is the target of missile test launches from the Vandenberg USAF base in California.^[15]

The general American presence is designed to ensure control over the western Pacific. In return Washington picks up the bill of a lifestyle that, at least for some, is considerably better than that in similar, but independent island nations. Per capita income in American Samoa is only $US1,850 – but that is 3.5 times more than in independent Western Samoa, some 130 kilometres away.^[16]

US pre-eminence in the Pacific has been taken for granted so widely in the West for so long that Mikhail Gorbachev’s Vladivostok speech of July 1986 indicating a new Soviet intent to look eastwards as a Pacific power in its own right produced a flurry of panic.^[17] Much of the sting of that policy position has since been drawn by Soviet military withdrawals from the area – real and promised. Reports in January 1990 indicated that all submarines and large warships, plus two air squadrons, had been withdrawn from Cam Ranh Bay in Vietnam.^[18]

While the region has its attractions for the Russian ruling class as a source of joint venture capital and as a destination for exports^[19] the West’s cold war warriors never had much by way of proof to fuel their fears.

Mikhail Gorbachev’s historic trip to China [in May 1989] is a big step in his drive to end Russia’s isolation in the Far East, to make it a legitimate great power in the entire South-East Asian and Pacific regions. The Kremlin’s friendships, to date, have been with a clutch of impoverished and often unstable states in Indo-China [Vietnam, Laos and Cambodia] and North Korea. It utterly lacks America’s enormous network of financial, trading and strategic allies. The Russians have practically nothing to offer beyond raw materials.^[20]

The Russian Pacific fleet, the country’s biggest, has three ports. One, Petropavlovsk, is not ice-free all year, while Vladivostok and Sovyetskaya Gavan are accessible only through vulnerable straits.^[21] With the withdrawal from Cam Ranh Bay, the navy has lost much of its manoeuvrability. The reality is that no Russian surface military craft were sighted in the South Pacific in the 1980s, and Moscow has been reduced to small-scale agreements with island states. Indeed, the Dibb Report (Review of Australia’s Defence Capabilities), issued in the year of Gorbachev’s Vladivostok speech, discounted any Soviet political threat to Australia, a view many commentators regard as valid for the island states too.^[22]

In 1985, the USSR concluded a one-year fishing agreement with Kiribati at a cost of SUS1.6 million. It was not renewed the next year. In January 1987, it signed a one-year $US1.5 million fishing deal with Vanuatu. The agreement caused friction between Vanuatu and Australia which led to Vanuatu banning visits by Australian military ships and planes that May. But to put the importance of the USSR deal in perspective, it is necessary only to compare it with the level of aid flowing from Vanuatu’s main donors – France, $US1.3 million; Britain, $US3.6 million; Australia, $US5.5 million.^[23]

In May, it was reported that the Soviet Union had held talks with the regional fishing body, the Forum Fisheries Agency, and with Vanuatu over the renewal of their fishing deal. These moves, however, far from being a challenge to Australian regional hegemony, were explicitly linked to the negotiation with Canberra of a fishing agreement with port access, a deal that was struck in February 1990, bringing up to 12,000 Soviet sailors into Australia annually.^[24]

The Soviet Union has also made (non-residential) diplomatic deals with minor island states like Kiribati, Nauru and Tuvalu, and has also reached agreement on an embassy in PNG – scarcely a major tilt at Western regional hegemony.^[25]

If the Russian attempts to undercut US influence in the region have been overblown, the probings into the area by Libya have been played up to the point of farce. The Hawke government’s closure of the Libyan People’s Bureau and the expulsion of Libya’s two diplomats in Australia in May 1987 was justified by what the Prime Minister called Libya’s attempts to destabilise the South Pacific region.

The excuse was the decision of Father Walter Lini’s government in Vanuatu to establish diplomatic links with Libya (at the same time as doing so with both the US and the USSR) – despite the fact that Australia had been conducting substantial trade with Libya since 1979.^[26]

By contrast, the role Israel has played in the region receives scant publicity – and, given Hawke’s commitment to Zionism, no criticism from Canberra. Israel had, as of winter 1987, diplomatic links with eight island states, including PNG, and is an arms supplier to the region. PNG military personnel have received training in Israel, and Israel has conducted civil aid courses for Kiribati, PNG, the Solomons and Tonga.^[27]

Long before the two coups in 1987, Fiji was a happy hunting ground for Israeli influence. Fijian soldiers serving with United Nations forces in Lebanon and the Sinai took holiday leave in Israel and there was talk of discharged Fijian soldiers undergoing training on Israeli farms before returning home. Israel provides Fiji with agricultural and financial advice. Time magazine reported that two containers of Israeli-made Uzi sub-machineguns arrived in Fiji three days before Colonel Rabuka’s first coup. The aid was presumably repaid when Rabuka, following the second coup that consolidated his power, agreed to permit the opening of an Israeli embassy in Suva.^[28]

One state that has done far more to carve out and use its influence in the South Pacific is France. The French government maintains the only permanent foreign military presence in the region. Its continued testing of nuclear weapons, although essentially no more sordid than the activities of the British government in the 1950s and 1960s and the US government up to today, has continued to earn it the most widespread condemnation.

The need to use Mururoa atoll for atomic tests (more than 110 between 1966 and 1987)^[29] ensures implacable hostility in Paris to any serious move towards independence for French Polynesia. It also underlines the fact that France’s primary interest in the South Pacific is not the economic advantage that flows from its colonies in New Caledonia and Tahiti (both territories represent a major drain on the metropolitan economy)^[30] but the opportunity it gives the French ruling class to maintain the nuclear capability and general strategic military presence it regards as essential to maintain overseas investments and its place in the world pecking order. As President Mitterrand put it:

To ask for an end to nuclear experiments is to ask for the end of France’s nuclear weapons. These tests allow us to have arms capable of maintaining ourselves at the level of credibility we require.^[31]

The nickel mining industry in New Caledonia has meant fat profits for many years for the French multinational SLN (New Caledonia is the world’s third-largest nickel producer, although far behind Canada and the Soviet Union) but the single largest employer by far in the colony is the French government with 9,000 workers.

The reason? US General MacArthur’s description of New Caledonia as a wonderful aircraft carrier gives it away – the colony commands major Pacific routes to Japan and Singapore.^[32] It is this imperialist imperative, rather than the innate nastiness of French political culture^[33] that explains France’s aggressively active policy stance in the region and its willingness to use state terrorism – as shown in the 1985 Rainbow Warrior affair.

Australian nationalism

So far it has been argued that for the imperialist powers, the South Pacific has been more important for containing the influence of rivals than for what it can offer economically. But how far is this true for the Australian ruling class, whose fate is geographically intertwined with the region in a way that does not hold true for the others?

The International Socialist Organisation has long been distinguished from the mainstream of the left over the question of Australian nationalism. We have opposed the idea, which has long held hegemony, that the fight for some degree or other of Australian “independence” should be central to any left strategy. From the extreme position held by the Maoist fragments that Australia is an outright colony of American, British, and increasingly, Japanese capitalism, to the left nationalist sentiments of the Stalinist and ALP left that multinationals are threatening Australian manufacturing, “buying” the country and relegating Australia to a subservient, service economy, nationalist ideas are central to cementing class collaborationist politics in the working class movement.^[34]

Our analysis rejects the concept of Australia as colony or as oppressed nation. Australian nationalism cannot take a progressive trajectory. There is no national liberation struggle to be waged.

On the contrary, the Australian ruling class, far from being some comprador layer – fawning upon and beholden to some foreign master – is playing an increasingly aggressive role in the world economy. TNT is the largest transport firm in Brazil, and one of the largest in Canada; BHP has interests in every continent; Wormald makes more than 60 percent of its profits overseas.^[35] Peter Abeles, venturing into the new, open Hungarian market, Rupert Murdoch, busy constructing one of the largest communications companies in the world, and the National Australia Bank and AMP, buying big in the UK banking and insurance market, are players in their own right.

While the Australian state is still formally tied to the British, with all the royalist paraphernalia such a relationship entails, the balance of Australian economic and financial interests has been tilting away from London since the 1940s. The military dependence on the US in the course of the war led inexorably, given Washington’s crushing hegemony on the world scale post-1945, to a closer financial relationship.

From 1949 key new loans were raised in the US and in 1956 the UK-Australia Trade Agreement cut advantages for British goods – the end, effectively, of imperial preference. In manufacturing, US firms began to make their mark, especially with the establishment of General Motors’ Holden plant. In 1950, American-owned factories employed 48,000 across Australia; by 1962 the figure was 98,000, or 8.5 percent of the manufacturing workforce. While it was not until the 1960s that capital inflow from America finally overtook that from Britain, the shape of the new post-war relationships had already been formed.^[36]

Figures of this sort give comfort to the left nationalists. They argue that Australia was merely transformed from a state dependent on Britain to one dependent on the US. The leap to arguing that in the 1990s Japanese capital is increasingly playing the dominant role in shaping and directing Australian society is therefore a very easy one to make. Such an analysis misses the mark on two points.

Firstly, while the Australian ruling class has always been dependent on imported capital, it has had no problem using that capital in order to build its control of the economy and the state. No serious sector of the Australian bourgeoisie contradicted Treasurer Keating when he hit out at critics of Japanese capital inflows – foreign investment in manufacturing has helped the growth of Australian manufacturing, infrastructure and services; foreign investment on the land helps guarantee markets for Australian pastoralists.

Without capital inflows there would be no Australian capitalism; and Australian capitalism is firmly under the control of the Australian ruling class and its state – subject, it is true, to the vagaries of the world economy, but an independent player nonetheless.

The second weakness of the nationalist argument is to miss the inter-relationship of the Australian to the world economy. Foreign capital certainly has a role to play in Australia, and has been attracted in large amounts, partly by the high interest rates of recent years, but Australian capital plays a role elsewhere. Direct investment overseas by Australian bosses each year has risen from $14 million in 1959-60 to $391 million in 1979-80 to $3.7 billion in 1986-87. At June 1987, total Australian investment overseas stood at $60 billion. $21 billion was in the US – $l for every $2 of American capital here.^[37]

The apparent contradiction – Australia as capital-importer, yet independent power, which finds its political reflection in the seemingly paradoxical role of the left as the fiercest critic of imperialism and the stoutest defender of nationalism – has its roots in Australia’s origins as a colonial-settler state, an outpost of white, British imperialism.^[38] Australia could come into existence only through the subjugation of the Aboriginal population and the exclusion of other European and Asian powers by British imperialism. Yet there were times when the efforts of the settlers to defend the rights and prospects of imperialism led them into conflict with the “mother country” – precisely because it seemed to the colonialists that the British were threatening to betray them by backpedalling from their own imperialist interests.

That contradictory relationship, and the profound and inherent racism it involved, permeated and informed the development of Australian political life and its labour movement. The positions of those with even the most formally left wing politics were distorted by the origins of the state. Industrial militancy could, as often as not, be directed against attempts to use non-white labour rather than against the employer as such.

The Maritime Dispute of 1878 was a direct result of shipping employers attempting to have “aliens of inferior mental and physical capacity or endurance…supersede…the indomitable valour of British seamen”. The rotten nature of this “labour dispute” was demonstrated by the cross-class support for the strike, the Mayor of Sydney being elected chair of a protest meeting attended by many “leading citizens”.^[39] And the true cutting edge of these attempts to apparently defend jobs and pay rates – racism – was demonstrated in the hostility, for instance, of the Melbourne Trades Hall Council to the attempts by Chinese workers to organise.^[40]

If the result of the imperialist legacy was to orient working class organisation more to the White Australia policy than to class struggle, the same was true many times over in Australia’s foreign policy. Time and time again, when the Australian ruling class took a line independent of the British, it was not to assert a break with British imperialism but to force it to act more decisively in the interests of Empire, and therefore of Australia.

The attempted annexation of eastern New Guinea by the Queensland government in 1883 is the classic case – an attempt to push Britain into acting more decisively in its own interests so that Australian interests could be safeguarded more soundly.^[41] As the colonial premiers argued to London at the time: “Further acquisition of dominions in the Pacific south of the equator by any foreign power would be highly detrimental to the safety and well-being of the British possessions in Australasia and injurious to the interests of the Empire”.^[42] Their position was eventually accepted by Downing Street, with the south coast of New Guinea (Papua) being taken under British control in November 1884 and handed to Australia in 1904.

Australia put pressure on Britain to seize colonies on other occasions – in Fiji, the New Hebrides (Vanuatu), Samoa and the Cook Islands. Throughout most of the nineteenth century there were calls for the annexation of New Zealand. Shortly after the New Guinea episode the Australian Natives Association tried to finance exploration of the Antarctic to forestall any German claim.^[43] The Royal Australian Navy was founded in 1911 as much to subsidise the cost and defend the interests of Empire as to assert any independent Australian interest.^[44]

The end of both world wars brought realignments among the imperialist powers and instability to Australia’s Pacific sphere of influence. The desire, heavily reinforced by racism, to exclude Japanese influence from former German possessions in New Guinea and the islands south of the equator after 1918 saw frantic lobbying to defend Australian interests in the Treaty of Versailles.

Australia convinced Britain to accept limitations on its use of German possessions in order similarly to limit Japanese influence in the North Pacific. Australia also won the creation of a form of mandate rule, under the auspices of the League of Nations, that was unique to the Pacific. Under the C-class mandate, the controlling nation could run the ex-colony as though it were its own – meaning that the White Australia policy could be applied to the former German-held section of New Guinea, excluding both Japanese immigrants and Japanese capital.^[45]

At the close of World War II, American influence was king across the Pacific. While the Australian Labor government was cautious about accepting the British proposal for dividing the world – the US getting the Pacific in return for Britain retaining hegemony in the Middle East – its main concern was not to exclude the US but to draw it further in. When Washington demanded an exclusive 99-year lease on the fortified island of Manus, north of Papua (then Australian, now part of PNG), at Australian expense, Foreign Minister Evatt refused. His motivation was to force the US into a general plan for the use of bases across the region.

His discretion about the American request illustrated his desire not to endanger the usefulness of Manus Island as a bargaining point in favour of a comprehensive American commitment to the south-west Pacific… Australia had first opposed the United States, but only because it sought to draw the United States more deeply into the region.^[46]

In the post-war era, Australia has intervened to strengthen imperialism and therefore its own strategic interests. The government was opposed to Indonesia supplanting direct Dutch rule in what is now Irian Jaya, with the Labor opposition calling for a declaration of war against Indonesia.^[47] In the 1960s

the cornerstone of Australia’s policy was seen as a compelling necessity to commit the power of the United States to the Asian area, and thus to commit her to a practical guarantee of active support for Australia through the ANZUS and SEATO treaties.^[48]

In 1962 that meant Canberra sending 30 officers to advise the South Vietnamese on jungle warfare, with the number rising to 100 by 1964 at the US’s request. In 1965 that meant Prime Minister Menzies committing 800 combat troops

ostensibly at ‘the invitation of the South Vietnamese. Since the message had reached Canberra only a few hours before the public announcement and well after all the essential decisions had been made, the invitation provided only a semblance of legality to the United States’ wishes and to Australia’s enthusiasm to have the USA committed to war in South-East Asia.^[49]

It was a practical demonstration of Australia’s willingness to throw its weight into the argument among American rulers in favour of escalating the Vietnam War. Once again, the interests of Australian capitalism lay in an alliance with imperialism, especially a white imperialism that could provide some defence against the “threat” from Asia. When America eventually began to withdraw ground troops, the Australian government initially kept its contingent at full strength – nationalism at its reactionary best.^[50]

Australia, therefore, first as a colony, then as an independent and unified state, played the role of a junior partner to imperialism – sometimes out of line, but always loyal to the overall aims of British and (after 1941) American interests. The point is spelled out in Canberra’s thinking:

The major criticism of Australian strategic thinking toward the region has been that it is dominated by Australia’s perception of itself as a member of the Western Alliance. There is evidence, however, that Australia is moving to adopt a more sensitive, pro-Pacific stance. Nevertheless Australia will always stand somewhat apart from the other Pacific island countries, but hopefully will form a bridge between the super-powers and the small Pacific states… Australia remains the major military power [in the region] and is looked to by members of the Western Alliance to maintain a favourable strategic environment in the region. There are a number of ways Australia might do this, including ultimately military intervention.^[51]

Professor Fedor Mediansky of the University of New South Wales describes Australia’s role today as approximating to that of regional policeman.^[52] That does not give the true measure of the situation: Australia is not simply a frontier post for Western imperialism, it also has its own capitalist interests. The result is a dialectical process: in defending its own interests it is forced to pull its imperialist allies even further into the region. The result is both greater security for Australian capital and an even greater penetration of imperialist capital. That penetration is both a challenge to Australian capital and the precondition for its consolidation, expansion and self-assertion.

Humphrey McQueen’s summary, although needing updating in the era of US influence, is still valid: “Australian nationalism was not anti-imperialist but was merely opposed to non-British expansion”.^[53]

Australia and the South Pacific

What has this meant for Australia’s relationship with the South Pacific? I would argue that the pattern that holds for the general relationship of imperialism to the region – a desire to exclude rivals being more important than the profits to be made – holds, too, for Australia. It is an attitude aptly summed up by former Defence Minister Kim Beazley as Australia’s Monroe Doctrine,^[54] a term that had been used as early as 1901.^[55] From the point of view of Australian capitalism, and in the words of the government, the South Pacific is important

because of its geographic proximity to Australia. Important lines of communication with Australia’s major trading partner, Japan, and with our major ally, the United States, run through the region. The countries in the region lie across important trade routes and approaches to Australia’s east coast, where most of our major population centres are located. An unfriendly maritime power in the area could inhibit our freedom of movement through these approaches and could place in doubt the security of Australia’s supply of military equipment and other strategic material from the United States.^[56]

It is surely no coincidence that Beazley presided over what has been described as Australia’s biggest military build-up in peacetime, including the $5 billion frigate program and the construction of six submarines with an option of a further two.^[57] The incisive tone of the official analysis owes something to the fact that:

Until the mid-1970s, Australia had adopted a benign, paternalistic attitude to the region…events since the early 1980s have forced a re-appraisal of policy towards the region. The Australian government is responding to the increased complexity and diversity of the region, and an awareness has grown in the general public that the Pacific is “pacific” no more.^[58]

It is not insignificant that the level of Australian aid to the islands was quadrupled by the Malcolm Fraser government in 1976 and increased again in 1980 as a direct response to the feelers the Soviet Union was extending to some of the newly-independent island nations.^[59]

This is not to say that two centuries of Australian profits from plunder, exploitation and trade have been unimportant in themselves, but that they pale beside the strategic military and political imperative over the years to preserve sea lanes and a line of defence against the feared “Asiatic hordes” or hostile Western imperialisms.

(By 1912 the fear of Asian invasion was such that a Royal Commission defended tariff protection for the sugar industry primarily on the grounds that it would facilitate the settlement and defence of the north.^[60] Today, the ruling class’s priority is to benefit from the dynamism of Asian capital, and therefore the rhetoric has been substantially toned down.)

Although Australian merchants were trading with the islands from early in the nineteenth century, there was little in the way of capital export, with the exception of the Fiji sugar industry, until the 1909 to 1914 boom.^[61] In 1986-87, Australian exports to Japan topped $9 billion, well ahead of exports to the entire EEC of $5.6 billion. While exports to Niue (population 2,000) were, at $136,000, well ahead of those to Albania ($3,000), exports to all the island states that financial year, excluding PNG, totalled only around one third of those to Hong Kong.^[62] Put it another way: in the last six months of 1988, Japan took 28.5 percent of Australian exports – Fiji 0.2 percent, Vanuatu 0.1 percent. Exports to Kiribati, Nauru and Tonga were too small to register as a percentage in government statistics.^[63]

Big Brother

The Australian ruling class’s overall strategic concerns in the South Pacific are partly obscured by the sheer scale of domination by the Australian economy.

The island nations’ imports from Australia are running at three times the rate of exports and the trend is, if anything, worsening (although Australia’s overall market share is beginning to be undermined by Japan and Singapore);^[64] three-quarters of the value of those exports is made up of phosphates and gold from just two countries; while the islands have promoted tourism, Australia continues to be the largest source of visitors; island tropical fruit has to compete with Australian produce. (Australia’s trade treaty with the islands, SPARTECA, imposes import duties and low quotas on precisely those crops which the islands can export profitably. A similar problem hampers Fijian garment exports to Australia.^[65])

Australian aid is an important economic component for most island states, even if it is dropping as a proportion of Australian GDP. In 1986 Vanuatu, Western Samoa, Tuvalu, Solomon Islands, Fiji, Tonga and Kiribati all got substantial sums; for some nations sums that represented upwards from 10 percent to 22 percent of their total aid income.^[66]

Australia is the largest aid donor to the islands, although Canberra cannot afford to become complacent – other states like Malaysia, Indonesia, Japan, China and France are also trying to buy friends and influence: the island states receive the highest level of aid in the world on a per capita basis.^[67] By 1985-86, $US24.1 million of that was coming from Japan,^[68] with $11 million, for instance, going to build a four kilometre causeway linking atolls in Kiribati.^[69] The islands also have access to loans from the World Bank, the Asian Development Bank and the EEC (with the cumulative total to date running at well over $1 billion).^[70]

The most graphic example of imperialist plunder still, however, falls to Australia’s account. Nauru is literally being dug out of existence, with the phosphates that make up much of its land mass being shipped away to make fertiliser. Australian farming interests take 50 percent of Nauru’s sole export, which will be exhausted by 1995.

In the period, from 1919 until its independence in 1986, that the island was under joint British, Australian and New Zealand control, phosphate worth $89 million was extracted – and $3.4 million was paid back in royalties.^[71] The island’s battle for compensation has finally plodded its way to the International Court of Justice.^[72] In its generous fashion, the Australian government once offered the Nauru people an island off the coast of Queensland.^[73]

Australia’s interests (excluding PNG, which will be dealt with more fully below) are most substantial in Fiji. From its annexation by the British Empire in 1874, the island group has been the target of huge sums of Australian capital. CSR dominated the sugar plantation business from the beginning, today Qantas controls the tourist business, John Elliott the breweries, Rupert Murdoch the papers, Australian banks the banking sector, and so on.^[74]

Burns Philp and Company Ltd, established in 1883, and aided initially by government money disguised as mail subsidies,^[75] has been a leading component of the Australian expansion, with major trading interests not just in Fiji but throughout the islands, including PNG and New Zealand. Its subsidiary that covers Niue, Fiji, Tonga and Samoa has interests as wide-reaching as coconut oil processing, soap manufacturing, biscuits, plastic products, plantations, beef breeding, sales and distribution, and car assembly.^[76] Its 1988-89 profit was up 188 percent in the wake of the Fijian coups.^[77] In Fiji, the other major trader and shipper, Morris Hedstrom, is also Australian-owned.^[78]

There has been a new flurry of interest by Australian investors since the launch by the Fijian government of tax-free zones: where wages for women workers are as low as $20 a week and exporting companies are not required to pay company tax for 13 years.^[79]

Once again, the profits that flow from all these sources are not inconsiderable. But compared to the main thrust of Australian trade and capital investment, Fiji, like the other islands, provides a mere booster. Westpac dominates the banking business in the region, owning for instance 51 percent of the profitable Bank of Kiribati and being the first commercial bank on Niue^[80] – but who could doubt that the bank’s long-term interests will be better served by its toe-hold into the South Korean financial sector?

The poor relations

There are profound weaknesses in the economies of the island states, excluding possibly PNG and Fiji. Capitalism has uprooted traditional patterns of land ownership, created relatively substantial and certainly dominant urban centres, and raised expectations without providing the wherewithal to be able to carry through the transformation.^[81] The result is a series of island economies dependent on the export of low value-added commodities that fluctuate wildly in price, varying degrees of tourism, and therefore, outside aid. Kiribati, Tuvalu and Niue, for example, all have per capita aid incomes higher than per capital GNP.^[82] It is a vicious circle which capitalism has no interest in breaking.

Aid and remittances from islanders working abroad only help shore up an increasingly rickety economic structure.^[83] Indeed, general standards of living have declined since the early 1970s.^[84] Economies of scale are virtually impossible; the development of specialised industries or agricultural markets is hugely difficult. Only PNG and Nauru, thanks to their mineral resources, are not running a balance of trade deficit. Shipping schedules between and from the islands are poor. Physical disasters like cyclones can have a disproportionately large impact.

In the case of Kiribati, which consists of 33 atolls and five million square kilometres of ocean, salt spray even prevents most agriculture. Its economy is so ephemeral that the confiscation and resale of a US boat fishing illegally in its waters in 1987, plus fines, added one eighth to its national budget.^[85] Around four times as many people from Niue live in New Zealand as on their own island.^[86] As Robin Bromby put it in The Australian:

The economic avenues open to these micro-states are usually limited to just fishing and tourism. Most tried postage stamps but that trade is now largely discredited by serious collectors. And tourism is hard to promote if you have few hotels and poor air connections, with skyhigh fares.^[87]

It is therefore hard to disagree that

Although Fiji, Solomon Islands and Vanuatu have relatively rich resources which might enable them to follow the “world path”, the microstates of Kiribati, Tuvalu, Tokelau, Niue and Cook Islands are so small that they have little hope of viability in world market terms.^[88]

Three economic routes have been suggested as possible avenues of growth for the island states – the improvement and diversification of primary production; the development of small-scale industry; and tourism.^[89]

Primary production is an extremely risky area, with terms of trade capable of shifting sharply in favour of the importing nations. While minor improvements may be possible, they could just as easily be wiped out in even a mild world recession. Small-scale industry is, if anything, even more problematic. Economies of scale, skill levels and transport all militate against success. And in many areas, for example value-added timber products, the Australian competition alone could be enough to sink projects before they secure a niche in the world market and reach viability.

Tourism is a more attractive proposition, and potentially much more lucrative – it is the second-largest earner for less-developed countries after oil.^[90] But tourism is a fickle friend. The Fiji coups had a devastating effect on the trade there – cutting international arrivals in 1988 by 25 percent^[91] – and Vanuatu experienced similar problems in the wake of the Santo rebellion in 1980 and the Sope/Sokomanu “revolt” of 1988-89. For many smaller islands tourism means putting even more pressure on their balance of payments as visitors’ tastes can be satisfied only with imported goods. One dollar forward, many cents back.^[92]

That does not mean the micro-states will not continue to try. The potential prize is worth the effort – the GDP of the US-owned Northern Mariana Islands is around five times higher in real terms than in the late 1970s, largely thanks to a huge influx of Japanese tourists.^[93] If the $100 million tourism proposal for Christmas Island put forward by a group of Melbourne businesspeople goes ahead it will revolutionise the Kiribati economy.^[94]

Another major role some islands have carved out for themselves is as the Switzerland, or more appropriately the Bermuda, of the Pacific. Treasurer Keating’s April 1989 statement contained measures to restrict the use of island havens and it remains to be seen how effective the new legislation will be. But one thing is certain – given the islands’ limited economic openings, exploiting the desire of Australian and Asian capital to avoid taxes can be relatively lucrative. More than 400 people, mostly local, work for the Vanuatu finance centre, which generates 12 percent of the island’s gross domestic product.

The hard currency fees paid by the 100 banks and 1,200 companies in Port Vila are a useful counterbalance to the island’s trade deficit ($US25.8 million in the first six months of 1987). Similarly, the Cook Islands have 1,600 companies, including 20 banks, registered. Tonga, Nauru, Western Samoa and Kiribati are now considering following in their neighbours’ footsteps. Vanuatu has gone one step further by offering itself as a flag-of-convenience nation.^[95]

Perhaps even these money-making activities are less unpalatable than the use of parts of island groups like the Cook Islands and Tonga as dumping grounds for industrial waste – a use becoming increasingly likely because of pressure from industrialised countries and the islands’ shortage of cash.^[96]

Papua New Guinea

Papua New Guinea, thanks to the relatively larger size of its economy and population and its more central strategic importance for the Australian ruling class, stands in a category of its own – a category that the victorious rebellion on Bougainville has thrown into sharp relief. PNG has been tied to Australia with chains much tougher than those that have bound the island nations. As argued above, the attempt to take at least part of the country under the British flag was provoked by the fear that the island could become a forward base for the German Empire. “Australian strategists perceived the arc of islands as an ‘inert shield’ (in T.E. Millar’s apt phrase) which were important because of their location rather than their economic potential.”^[97]

The resulting decades of colonisation subordinated the economy to the needs of Australian capital, actively discouraging exports like sugar and bananas that could challenge Australian crops, and ensured that PNG would remain an exporter of primary products, like cocoa. Australian capital began to trickle into Papua in the boom years before World War I – the Bank of New South Wales opened its first Papuan branch in Port Moresby in 1910.^[98] But the weakness of the Australian economy meant that there was no substantial export of capital until the 1960s, keeping PNG in tremendous economic backwardness.

Australian dominance, 15 years after formal independence, is real; the Australian government still exerts significant influence among senior public servants in all PNG government departments;^[99] the CRA-controlled Bougainville copper mine contributed at least 17 percent of the country’s internal revenue and 45 percent of export earnings before it was mothballed last year;^[100] Australian corporations are responsible for 45 percent of all foreign investment in mining, manufacturing and the service sector.^[101] Australian investment in the South Pacific doubled between mid-1984 and mid-1987 and it was PNG that took the lion’s share.^[102] Some analysts are forecasting capital investment of $4.5 billion over the next five years.^[103] Graham Beringer, Australia’s senior trade commissioner to PNG, reported:

It’s mind-blowing to think what will happen when some of the major [mineral and oil] projects on the drawing-board become a reality. People [both Australian mining companies and those Papua New Guineans who will represent a much expanded market for Australian exports] will suddenly become very rich.

PNG is the largest buyer of Australian rice (120,000 tonnes a year), but more importantly is Australia’s third-largest market, after New Zealand and the US, for what are known as “elaborately transformed manufactured products”. Exports to PNG have risen from $523 million in 1985-86 to around $1 billion in 1989-90-with the overall trade balance running 4:1 in Australia’s favour.^[104]

But for the Australian ruling class as a whole even these pickings – and the minerals bonanza to come – are not of pivotal importance. In the last six months of 1988 those exports to PNG represented 2 percent of the total: compare this to 3.6 percent for Taiwan, 4.7 percent for Korea or 8.5 percent for the ASEAN countries, let alone the proportion heading for Japan or the US.^[105] Earnings from Bougainville are crucial for the PNG government, for CRA they represent perhaps 15 percent of profits (although the company does have other interests in PNG which would be threatened by general unrest).^[106]

Yet in 1988 the Australian government gave PNG $275 million, plus half its military budget. In May 1989, Australia agreed to give PNG $1.5 billion in assistance over five years.^[107] This cannot be accounted for simply as “guilt” for the colonial past or as a payment to allow for the extraction of future profits. The central explanation is that put by Roy Eccleston in The Australian: “The Australian government clearly believes it is in its interests to do so [make the payments]…a stable PNG is seen as crucial from a defence point of view”.

It is an explanation the Liberal Party has no qualms in confirming. Their then spokesperson for Defence, Peter White, called in March 1989 for the doubling of the $25 million military aid budget to PNG in the interests of “national security”. He added: “It’s not good enough that you have a country showing chronic signs of instability on our doorstep.^[108] No doubt his appeal for better air transport and training for PNG troops flowed partly from concern to protect CRA profits on Bougainville – but his starting point was one Australian bourgeois politicians have shared for two centuries.^[109]

With the upheavals on Bougainville, the “chronic signs of instability” – pay revolts among the security forces, popular disaffection – have turned into a nightmare for both the PNG and Australian ruling classes. The PNG government is facing financial disaster, which it is attempting to pass on to its working class through currency devaluation, wage curbs and a 10 percent cut in the public service.^[110] But although the main public focus has been on the CRA mine, Canberra’s concerns have in fact ranged much wider. There was little hesitation about moving to PNG’s defence against the insurgents. Mark Baker summed it up in Melbourne’s Sunday Herald (4 February 1990):

The underlying Australian involvement…is through the direct and indirect aid grants that are providing a major part of the cost of training, equipping and deploying the 700-odd soldiers and police now fighting on Bougainville.

About 100 Australian defence personnel are on secondment to the PNG Defence Force in training and maintenance positions and PNG officers are trained in Australia.^[111] Four ex-RAAF Iroquois helicopters provided by Australia spearheaded military attacks against suspected rebel strongholds on Bougainville. They were flown by Australian pilots paid for by special Australian aid funds.

Australia’s endorsement of a military solution to the Bougainville crisis was left in no doubt after the annual PNG-Australia ministerial forum in Port Moresby two weeks ago [January 1990] – attended by both the Defence Minister, Mr Beazley, and the Foreign Minister, Senator Evans. The meeting paved the way for an extra aid grant of $15 million this year to the PNG police and defence forces, in particular to pay for the rapid training of an extra 450 troops to bolster the combat capability of the forces on Bougainville.^[112]

Gone is the pretence that military aid is not for internal repression.^[113] But it would be a mistake to see Canberra’s generosity simply in terms of CRA’s interests on Bougainville, substantial as they may be. Not only are there the wider Australian commercial interests in PNG to be considered: the very existence of PNG is being called into question by the success of the Bougainville Revolutionary Army.

Before the BougainviIIe issue took on such importance, the Hawke government was already shifting the balance of its aid to PNG. Donald Denoon, of the Australian National University, has summarised official policy as reducing budgetary subsidies while increasing money tied to specific projects, with Canberra drawing in other major Western countries via the World Bank to spread the burden.^[114] The Joint Declaration of Principles signed by Hawke and Prime Minster Paias Wingti in December 1987 accepted the scaling down of aid and its replacement by trade – but it also upgraded the military relationship between the two countries.

Where the Fraser-Somare “understanding” of 1977 skirted round the question, the 1987 agreement came much closer to an alliance, with the implication of Australian assistance if PNG was under threat.^[115] At Minister Beazley’s insistence, a clause was inserted affirming that “the two Governments will consult at the request of either, about matters affecting their common security interests in the event of external armed attack threatening the national sovereignty of either country”.^[116]

The “inert shield” should now become an active partner.

The change in position presumably reflected the advice of the Dibb Report of 1986. Its effect became clearer in 1988. In November, the Hawke government gave the PNG police about $1.5 million. This was despite its brutal record, in collaboration with the military, during strikes at the Ok Tedi gold mine and the Lihir mine site in July and August, and despite its hand in killings, beatings and the destruction of villages in the Highlands during Lo-Met ’88, an “anti-crime” drive that started in September.^[117]

At the same time, Canberra agreed to station a second Australian army engineering unit near the Irian Jaya border, ostensibly to help with road-building but evidently to deter Indonesian border incursions; agreed to help the PNG Defence Force to set up the helicopter squadron mentioned above; and offered two further patrol boats.^[118]

Brian Toohey’s Eye reported that SAS and ASIS personnel were training special units of PNG troops to deal with Free Papua Movement fighters resisting Indonesian control of Irian Jaya.^[119]

For the Australian ruling class, the continued existence of a relatively stable, relatively pliable PNG is essential both because of investments there, but even more because of its crucial strategic defensive position. PNG is of central importance in the region. The “secessionist disease”, as Senator Evans put it in late January 1990, could fragment PNG and foment regional instability. (The struggle on Bougainville has already led to successful reparation and profit-sharing demands by locals around two gold mines – Porgera in the Highlands and on Misima Island, east of the mainland.^[120]) The stakes in Bougainville were “extraordinarily high” and the national interest meant a deterioration of the situation there had to be avoided “at all costs”.^[121]

The South Pacific said the Dibb Report, is Australia’s “area of direct military interest”.^[122] Dibb’s conclusions now clearly dominate official thinking. Evans says:

For Australia, the South Pacific must be a region of the highest foreign policy and security significance; we have fundamental, long-standing and largely unchanging interests here, which deserve strong bipartisan support.

…We have clear geo-political, or strategic, interests in preserving and promoting peace in the region; in promoting internal political stability and the peaceful evolution of democratic political systems in the island states; in keeping the region free from any destabilising activity by any extremal power or group; and in minimising superpower tension in the region.^[123]

The theory was expressed in September 1988. The practice meant that by February 1990, Canberra was increasing military aid to a regime in Port Moresby responsible in Bougainville for widespread killings, beatings and torture, and the razing of more than 1,600 houses.

Dinky-di domination

PNG is far from being the only part of the region where Australia’s economic domination leads to a series of political and military conclusions. Canberra has diplomatic links with all the island states and has been able to dominate policy-making at the South Pacific Forum – whose membership includes New Zealand and 13 other nations – on crucial issues like the South Pacific Nuclear Free Zone and the New Caledonia conflict. Mediansky reckons that Australia and New Zealand together can count on around eight to 10 votes from island countries on regional issues at the United Nations.^[124] Th e Forum is also a useful place to lobby for Australian commercial interests.^[125]

Financial clout does not, however, always guarantee political harmony – Australia failed to carry the island states with it on a response to the Fiji coups or in attempting to bar Libya from the region. On the latter question, the governments of PNG, Vanuatu and the Solomons formed a Melanesian alliance in the run-up to the 1987 meeting of the South Pacific Forum and argued against Australian interference.

At the forum itself, held just 11 days after Australia’s expulsion of Libyan diplomats, PNG Prime Minister Wingti laid into Canberra for failing to back up its claims against Libya. “They [Australia and New Zealand] can no longer take them [the island states] for granted”, he argued. Vanuatu Prime Minister Father Walter Lini had already gone on record as saying that Australian and New Zealand neocolonialism was one of the grave threats to regional security in the South Pacific, alongside the French role in New Caledonia.^[126]

Fiji, too, has been prepared to thumb its nose at Canberra since the coups: Radio Australia news material was excluded from its radio bulletins, Commonwealth Bank managers “on loan” to the National Bank of Fiji were told to pack their bags.^[127]

While clearly these attacks contain more than an element of impotent bluster, they are indicative of a shift in mood in the region that means that no Australian government can expect to get its way simply without opposition.

Australian military aid throughout the region, excluding PNG, amounted to $25.6 million in 1988-89.^[128] Canberra has also offered patrol craft to states including PNG, Fiji, Vanuatu, Western Samoa, the Solomons, and the Cook Islands to help them police their territories, although the latter two have not yet decided whether to accept. These “gifts” went hand in hand with a general stepping-up of the Australian military presence flowing from recommendations in the Dibb Report. From early 1987 the islands were also offered greater technical support, naval advice and training, and the number of RAN ship visits and surveillance flights were increased. ^[129]

Anti-riot gear was sent to bolster Father Lini’s government in Port Vila in May 1988.^[130] Australia nearly became involved in the Santo rebellion at the time of Vanuatu’s independence in 1980 because of its close collaboration with the PNG Defence Force, which was called on to intervene.^[131]

There is a possibility that Australian influence may be extended even further – into those sections of Polynesia that have traditionally leaned towards New Zealand. Wellington’s indecision over the purchase of four new frigates from Australia has apparently pushed countries like Tonga and Samoa to sound out closer defence ties with Australia. Such ties would presumably involve broadening the pattern of RAN ship visits.^[132]

Aid, military or otherwise, clearly does not flow from benevolence but from the need of the Australian ruling class to maintain – without hostility from the islands – a political and economic presence, combined with a naval force to guard its sea lanes to the US and East Asia.^[133] “Human rights” considerations get short shrift. When the president of Fiji, Ratu Sir Penaia Ganilau, warned late in 1988 that his country would turn to Asia if Australia put strings on aid packages, Canberra quickly backed down. A $10 million aid package that had been held up for, among other considerations, constitutional and human rights reasons was put on stream,^[134] although half was withdrawn in May because of lack of progress on constitutional reform.

And tolerance of the repression on Bougainville further underlines the “flexibility” of the Hawke government’s thinking.

Conclusion

Three points in conclusion. Gareth Evans has argued that there are three choices for Australian policy in the South Pacific:

a) to act as the guardian of perceived Western alliance interests to deny access to the region by the Soviet Union or other countries potentially hostile to Australian interests, on the assumption that our interests are indistinguishable from general Western interests;

b) to seek an independent position of dominance or hegemony as a proximate Western but essentially external power; or

c) to maintain and develop a partnership with Pacific island countries which promotes regional stability through economic development and the encouragement of shared perceptions of strategic and security interests. In the past, our approach had elements of all three options… The logic of geography, of principle and of events impels us toward option c)… The value of such an approach is that it identifies Australia as an integral part of the region, strengthens our capacity to promote the national interest within it and provides a firm basis for the resolution of differences.^[135]

This is no more than liberal window dressing. If “shared perceptions” can win Australia firm allies in the South Pacific, then for Canberra that’s to the good. If not, then there are military and economic weapons to bring into play. For, whatever Evans might say for public consumption, the general strategic position of the Australian ruling class is still predicated on its position as an independent but junior partner to the Unholy Trinity – Britain the mother country, America the key ally, Japan the major trading partner.

It is a position that flows from the 202-year-Iong process of developing an independent nation out of a colonial settler state. On the one hand, the Australian ruling class wishes to act in its own interests. On the other, those interests are best served by pulling its partners, military or economic, into a closer relationship. Hence the loyalty to the US military alliance. Hence the abandonment of the crudest anti-Asian racism in order to attract greater Japanese capital.

Secondly: Australia dominates much of the South Pacific, but, economically at least, the South Pacific does not dominate the interests of the core of the Australian ruling class. On the contrary, it has been the central theme of this article that Australia’s military concerns in the region rank far higher, linked as they are with access to the markets and military supplies to the north.

Finally: In the island states emergent working classes and the oppressed are beginning to organise and fight back against their own rulers and against the devastating impact of Western imperialism. Socialists in Australia can only gain from the weakening of the key imperialist player in the region. And that means playing our part in the struggle by focusing on the main enemy – the enemy at home.