The AUKUS stress test: Alliance pressures and Australia's strategic choices

So, is what we’ve just heard about the strength of Australian-UK relations and commitment to AUKUS fabulous news that reduces the risks and problems around the nuclear sub pact? No.

Does the new 50 year treaty, named after Geelong, a town in Richard Marles’ electorate, “cement the AUKUS submarine pact and bolster shipbuilding in both countries”? No.

The new treaty, signed by Australian and UK ministers last week, is a necessary piece of paperwork on the AUKUS journey. Its timing and the optimism from ministers look more like papering over the challenges and contradictions in the AUKUS plan rather than facing them.

Talking up Australian-UK commitment is no doubt also a useful signal to Washington now, even if the main progress is new paperwork.

Is the treaty a cunning “Plan B” for AUKUS in case the Trump administration pulls the plug on the deal?

No: Australia and the United Kingdom need to formalise some undertakings in a treaty-level document to make the “Optimal Pathway” happen. But the fact the question is being asked shows the uncertainties around the deal and America.

But let’s get into some of the substance that is the background for this celebration of Aussie-UK unity and progress.

It doesn’t take much to look behind the curtain and see the scale of the challenges our UK partner faces.

First, this new treaty relies on the United States doing the heavy lifting to make AUKUS happen for the next 20 years. The treaty is to enable the United Kingdom to proceed with designing the new SSN-AUKUS boats and continuing work to build the first of these subs for its own Navy by sometime in the late 2030s, before delivering the first SSN-AUKUS to Australia in the early 2040s. Between now and then, the United States is the one on the hook to put hundreds of Australians into the crews of its own submarines, and for selling to Australia between three and five Virginia class subs out of its own Navy’s fleet (five would be because SSN-AUKUS experiences the kind of delays that look very possible).

Beyond the hype, there’s the reality of a weakened UK military looking at the hill it needs to climb to increase Britain’s commitment to European security. A disturbing admission in the Starmer government’s June Strategic Defence Review was that two decades of underinvestment has hollowed out the UK’s armed forces to an alarming level that must be addressed.

Then there’s the fact that, while UK nuclear powered attack submarines are soon meant to be frequent visitors to Australia rotating through Western Australia, the Royal Navy is struggling to deploy any of its seven attack subs. As of now, none are at sea. Maintenance and delivery troubles continue to affect UK capability. And that means no UK sub is escorting the UK’s aircraft carrier in the Talisman Sabre exercise.

This ugly reality about UK submarine production and maintenance makes the Starmer government’s assertion that it will increase the UK attack sub fleet to 12 boats and deliver new boats at the rate of one every 18 months look like vapourware. But that didn’t stop the announcement being taken to the bank in the AUKMIN communique.

The United Kingdom takes 10-11 years to build each Astute sub now. The considerably bigger, more complex SSN-AUKUS design will probably take longer. The UK’s submarine reactor program has been rated as unachievable for the last three years by the UK government’s watchdog, and UK submarine maintenance facilities are backlogged, so even the subs it has can’t get back to sea.

None of these problems look like being solved, making commitments to build even more – and bigger – subs much more quickly look courageous. The United States experience shows how hard it is to even move the production dial up at all, despite pouring additional billions into its submarine industrial base for years. Britain is well behind the United States in this effort and coming from a lower base.

And it’s beyond awkward that in its new strategic policy, the UK government has ditched its ambitious “Indo-Pacific shift” to bolster European security driven by Russian President Vladimir Putin’s threat to Europe and America’s unreliability on European security.

That UK aircraft carrier in Darwin now may be the last one we see for some time in the Indo-Pacific (it’s been 28 years since the last one). And even if it does come back, it’s likely to struggle to have a full complement of fighters. The UK has shifted its plans from more carrier capable F-35Bs to 12 F-35As, because they help the UK beef up Europe’s nuclear deterrence.

Beyond rhetorical flourishes and airy commitments not anchored in industrial or military capacity, a note of pragmatism shone through statements from the UK visitors to Australia. This treaty on the road to AUKUS was good for Britain because it was good for jobs, bringing $40 billion into the United Kingdom (paid for by those generous Australians). Jobs featured ahead of security when UK ministers discussed the treaty. And back home, UK Defence Minister John Healey was reported as enthusing that even people “not yet born” would benefit from jobs secured through the deal.

There are obvious parallels with the French celebration of their cancelled sub deal as the “contract of the century” because of the billions that’d flow into the French coffers.

I don’t know if public confidence in AUKUS is advanced by the performances and announcements we’ve just seen. It doesn’t take much to look behind the curtain and see the scale of the challenges our UK partner faces. Instead of clear-eyed acknowledgement of the challenges and credible plans to address them, London and Canberra’s PR machines have put the spin cycle on “High”. If only hoopla and rhetoric were the main ingredients for nuclear submarines.

China is currently undertaking the largest military expansion in its modern history. According to a recent US Intelligence Community assessment, Beijing’s objective is to become the “preeminent power in East Asia” – gradually displacing the United States and reducing its influence across the Indo-Pacific. Given the scale and velocity of China’s military build-up, and the increasing demands on US forces globally, it is becoming increasingly clear that Washington cannot deter Beijing alone. Deepening defence cooperation with allies and partners will be essential to maintaining a favourable balance of power.

In this context, the Australia–United Kingdom–United States (AUKUS) partnership –focused on the development of nuclear-powered submarines and cutting-edge technologies including artificial intelligence, cyber tools, and autonomous systems – has the potential to become the cornerstone of Western efforts to counter China’s growing military footprint.

But the promise of AUKUS will only be realised if the political will among the three governments remains firm and consistent.

I first became aware of the AUKUS proposal in August 2021, shortly after being confirmed by the US Senate as Principal Deputy Administrator of the National Nuclear Security Administration (NNSA). The NNSA, in partnership with the US Navy, is responsible for building and maintaining the nuclear reactors that power America’s aircraft carriers and submarines. During one of my initial AUKUS briefings, it became immediately clear that Australia’s decision to pursue nuclear-powered submarines was a strategic game-changer in the Western Pacific.

The AUKUS submarine partnership represents a serious counterweight to China’s growing maritime power

The rationale is straightforward. Any military conflict with China would almost certainly centre on air and naval operations. Nuclear-powered submarines would dramatically enhance Australia’s ability to contribute meaningfully to such a fight. These submarines, powered by sophisticated US and UK reactor designs, are extraordinarily difficult for adversaries to detect. Unlike conventionally powered submarines, which require regular refuelling and have limited operational endurance, nuclear submarines can remain on station for months – limited only by food supplies and crew endurance.

Under the current plan, Australia will acquire up to eight nuclear-powered submarines. These platforms would not only give Australia capabilities it has never had before, but also the operational capacity necessary to conduct high-tempo, sustained military operations in contested waters. Strategically, this represents a major win for the United States and its allies – especially in a region where naval presence and endurance are increasingly critical.

Beijing’s fierce opposition

The strategic significance of AUKUS is best reflected in Beijing’s reaction. Since the initiative was announced, China has waged a sustained diplomatic campaign to derail or discredit it – especially the submarine component.

Chinese officials have incorrectly accused the AUKUS countries of violating the Nuclear Non-Proliferation Treaty and setting a dangerous precedent for transferring weapons-grade nuclear material to a non-nuclear-weapon state. They’ve pressed the International Atomic Energy Agency (IAEA) to launch formal reviews and drawn misleading comparisons between AUKUS and Iran’s nuclear program. Chinese diplomats have also targeted countries in Southeast Asia and the Global South, warning that AUKUS could trigger a regional arms race.

In bilateral forums, China has labelled Australia a “pawn” of the United States and warned of “severe consequences” for hosting nuclear submarines. At the same time, Chinese state media have pushed narratives suggesting that AUKUS is little more than an Anglo-American attempt to revive Cold War-style bloc confrontation.

To date, US, UK, and Australian diplomats have done a commendable job parrying these attacks and explaining the defensive nature of the pact. But Beijing’s intensity underscores what is at stake: the AUKUS submarine partnership represents a serious counterweight to China’s growing maritime power.

Operational and logistical challenges

Despite its strategic promise, AUKUS faces real implementation hurdles – particularly in three areas: Australia’s limited nuclear infrastructure, program cost, and US shipyard capacity.

Australia has no prior history operating nuclear-powered vessels and only operates a single nuclear research reactor. From the outset, one of the key questions I raised in briefings was how Australia could develop the technical base and personnel pipeline necessary to support nuclear-powered submarines.

Encouragingly, progress is being made. The Royal Australian Navy has already begun sending sailors to the US Navy’s Nuclear Power School in Charleston, South Carolina. So far, 12 Australian officers have graduated, with six currently serving aboard US Virginia-class submarines. These early steps are critical and show that the long-term investment in capability-building is already underway.

Enhancing allied burden-sharing, countering China, creating US jobs, and generating investment in the American industrial base – these are all key pillars of Trump’s worldview.

Financially, the program is ambitious. AUKUS is projected to cost between $268 and $368 billion over the next 30 years. That includes the purchase of US Virginia-class submarines, the domestic construction of SSN-AUKUS boats in Australia, and significant investments in naval infrastructure. Though the price tag is high, successive Australian governments – both Liberal and Labor – have shown strong bipartisan commitment. Prime Minister Anthony Albanese, in particular, has embraced the strategic logic of AUKUS and signalled that Australia is prepared to meet the financial demands.

Still, a key bottleneck lies in US shipyard capacity. As part of the deal, the United States is expected to sell three- Virginia-class submarines to Australia in the 2030s as an interim step until the SSN-AUKUS submarines, which will be built in Australia, come online in the 2040s. Yet the US submarine industrial base – having atrophied since the end of the Cold War – currently lacks the capacity to meet that demand. The US Navy can currently only produce 1.2 boats per year, but needs to reach a sustained rate of 2.3 to fulfil both US and AUKUS requirements.

Here too, progress is being made. The United States has launched a major push to modernise shipyards and expand the submarine industrial workforce. Australia has pledged to invest in the US industrial base to help boost production capacity. While it remains uncertain whether these efforts will close the gap in time, the right actions are being taken, and political momentum remains strong.

The Trump administration and AUKUS

In June, The Financial Times reported that the US Department of Defence was reviewing the feasibility of fulfilling AUKUS commitments given submarine production shortfalls. That review reportedly surprised many within the US government, including officials at the White House, State Department, and Department of Energy. The move raised concerns in Canberra and London about the durability of US political support for the agreement – especially under a second Trump administration.

Yet AUKUS should align naturally with President Donald Trump’s “America First” foreign policy and overall Indo-Pacific strategy. Enhancing allied burden-sharing, countering China, creating US jobs, and generating investment in the American industrial base – these are all key pillars of Trump’s worldview. US Secretary of Defence Pete Hegseth has stated that China remains the pacing threat for the US military. Having a capable ally like Australia field nuclear-powered submarines in support of US strategy should be a no-brainer.

Moreover, Australian investments in the US industrial base will help rebuild America’s submarine capacity and sustain thousands of high-paying jobs. If Trump is looking for a tangible win in US defence and industrial policy, AUKUS is it. To signal the critical importance of the partnership, Australia might consider naming its first Virginia-class submarine the HMAS Donald J. Trump.

AUKUS represents one of the most significant advancements in allied military cooperation since the end of the Cold War. It will enhance deterrence in the Indo-Pacific, help counterbalance China’s growing maritime power, and rebuild critical defence-industrial capacity in the United States and Australia. While the program faces real operational and political challenges, the strategic benefits far outweigh the risks. This is a generational investment in allied capability and credibility – one that will shape the regional balance of power for decades to come. Washington, Canberra, and London must stay the course.

A weekend report in the Financial Times that US Under Secretary of Defence for Policy Elbridge Colby has been privately pushing Australia and Japan for pre-commitment to support the US in a future Taiwan Strait contingency have raised serious challenges for Prime Minister Anthony Albanese during his much-anticipated visit to China.

It appears that Colby has focused on extracting “pre-commitments” from Canberra that yet- to-be delivered US-supplied submarines under the AUKUS deal support US forces in a war against China in the Indo-Pacific. The Albanese government is right to reject such calls as intruding on Australia’s sovereignty.

No matter the importance of the alliance with Washington, what Australia decides to do with its military capabilities – and, contrary to Colby’s narrative, US-supplied submarines, when they eventually arrive, will be Australian property – is a matter for future Australian governments. The idea that a government today would lock in a future government to committing Australian military forces to a war that may or may not occur is ludicrous.

Rather than being the actions of a rogue official, there is every reason to assume that Colby’s private pressure has the broader imprimatur of the Trump administration. The optics of the overt linkage with Colby leading a snap Pentagon review of the AUKUS agreement cannot be lost on observers.

Allies may disagree, sometimes fervently, on substantive issues but those interactions should remain behind closed doors.

Trump’s fixation with US allies “paying their dues” has manifested in intense pressure on NATO countries to bolster defence spending. Some in the United States claim that this pressure has worked, with European countries committing to growth of their defence budgets in coming years. It now seems that it’s the turn of America’s Indo-Pacific allies to feel the heat from Washington.

Australia has already been subject to pressure from US Secretary of Defence Pete Hegseth to publicly commit to higher defence spending. Irrespective of whether Australia should boost its military expenditure, singling out committed allies (and it is harder to think of a more committed US ally than Australia) for special treatment is politically unwise. A baseline ingredient of successful alliance management is not placing political leaders of committed allies in a difficult position domestically. This is particularly the case for governments led by centre-left parties whose leadership is committed to the US alliance but who must manage influential internal constituencies that in many cases are more ambivalent about the alliance.

Navigating this is in everyone’s interest who supports the Australia-US alliance. This includes the United States, something that previous US administrations going back to the 1980s seem to have understood.

Allies may disagree, sometimes fervently, on substantive issues but those interactions should remain behind closed doors. The background sources quoted for the Financial Times story were all US officials, so it’s clear that the Trump administration is intending to pressure the Albanese government publicly.

This ham-fisted approach is, paradoxically, likely to have the opposite effect of what it’s intended to achieve. Conscious of the deep unpopularity of the Trump administration in Australia, domestic pressures for Australia to demonstrate its sovereignty within the alliance, anxieties over the future of AUKUS, and questions about how Canberra is balancing the economically critical relationship with China, the Albanese government will now need to avoid being seen to kowtow to Washington.

This is an unfortunate distraction and is placing unnecessary (and completely avoidable) strain on the alliance. The best we can hope for is that the Trump administration learns from this episode and exercises greater prudence going forward. However, if the past is any guide, this is unlikely to happen.

At an estimated $368 billion cost, a Pentagon review underway and talk of the United States seeking a guaranteed commitment in the event of conflict, Australia’s push for nuclear-powered submarines under AUKUS is never far from the headlines. But the idea that Canberra is hostage to American whim is off the mark and lacks self-awareness. Australia must consider how our AUKUS partners view us.

Are our actions instilling confidence in this critical deal? Our real test is proving we can hold up our end: expedite infrastructure, build confidence and show allies and voters alike that Submarine Rotational Force-West (SRF-West) will be ready in 2027, less than two years away.

Since the AUKUS announcement in September 2021, significant progress has been made. Within 18 months, the three partners agreed on an optimal pathway and concluded a binding treaty, no small feat. Training is well underway, with Australian submariners reportedly progressing through the US system, and Australian shipbuilders working at Pearl Harbor to build the skills needed to maintain and eventually construct nuclear-powered submarines at home. And perhaps most remarkably, despite persistent headlines of doubt, the latest Lowy Institute Poll shows more Australians support the acquisition of nuclear-powered submarines than oppose it, a striking shift for a country long defined by its anti-nuclear stance.

Yet for all this progress, a looming infrastructure crunch threatens to derail momentum. The Australian government must now lean in, decisively, to ensure the foundations are in place to sustain what has been achieved.

Australia’s patchy performance on naval infrastructure, shipbuilding and sustainment has bred a reputation for delay and indecision.

Worries are growing in Canberra, and Washington, that upgrades at HMAS Stirling and the new Henderson defence precinct are drifting off-schedule. Addressing the Lowy Institute, CSIS president John Hamre warned that many in Washington feel “the Albanese government supports AUKUS but isn’t really leaning in”, a perception he said is “more widely felt … than people realise”. Days later, former US Navy secretary and current Austal chair Richard Spencer drove the point home highlighting that policy alone won’t build submarines: “it has to move from politics to military to construction,” Spencer said. “We need to start moving dirt”.

These worries are hard to verify because Canberra still hasn’t published a real schedule for HMAS Stirling or the new Henderson precinct. The December 2024 Naval Shipbuilding and Sustainment Plan and the March 2025 AUKUS Submarine Industry Strategy trumpet job numbers but stay silent on real infrastructure deliverables. Even the Parliamentary Standing Committee on Public Works, which examined the Stirling upgrade in June 2024, seems to only address the scope. Publicly available detail on Stirling timelines amounts to a single line: “major construction is expected to start in 2025”. With no dated milestones, assurances that we are “investing in both sites” look aspirational, and the perception gap widens.

With no published timelines, even loyal supporters are left wondering whether Canberra can meet its AUKUS obligations, first hosting SRF-West, then taking delivery of an Australian-flagged Virginia-class boat in 2032. Our credibility problem is hardly new: the public and industry still recall years of slipped schedules and blown budgets in naval shipbuilding and infrastructure.

The 2020 Force Structure Plan flagged the need for a second dry-dock in Western Australia, an urgency only amplified by AUKUS, yet five years and two governments later we still lack a start date. Dry-docks are neither cheap nor quick to build, but they are essential if we hope to maintain nuclear-powered submarines on home soil. Meanwhile the promised east-coast submarine base has vanished from the agenda. Although not critical to the AUKUS pathway, submarine access to both the Indian and Pacific Oceans is central to any credible Australian maritime strategy.

Shipbuilding and sustainment are hardly healthier. Both Australian Navy replenishment ships have been idle since 2024 with engine and shaft failures, and an ANAO audit says the landing helicopter docks suffer “ongoing deficiencies” and “critical failures” thanks to poor contract management. The first 1,640-tonne Arafura offshore-patrol vessel took three-and-a-half years to move from launch (December 2021) to commissioning (June 2025), an extraordinary pause for such a simple platform. Steel for the Hunter-class frigates was cut in 2024, yet the lead ship is not due until 2032 because Canberra will not expedite the program. Meanwhile the Collins-class submarine life-of-type extension looks increasingly unlikely to proceed as originally scoped, if it proceeds at all.

Every shortfall has its own back-story, too complex to detail in this space, but the record is clear: our patchy performance on naval infrastructure, shipbuilding and sustainment has bred a reputation for delay and indecision. Rather than continually seeking reassurance that Washington and London will meet their AUKUS commitments, Canberra should confront the tougher question: do we inspire confidence, or are we becoming the weak link in the trilateral partnership?

The government’s refusal to lift defence spending, insisting we are “doing enough” despite allied doubts, erodes the very confidence we need to build. Any military planner can see the ADF’s ambitions are kneecapped by a budget that falls well short of our stated strategy.

Much has been achieved since AUKUS was unveiled, but we are now on the critical path: without timely upgrades at HMAS Stirling and Henderson, the first phase stalls. From the outside it is impossible to judge progress, and partners are openly sceptical, hardly surprising given Australia’s patchy record on recent naval projects. Repeating that we are “doing enough” no longer cuts it. If Canberra wants to shore up confidence, it should publish a detailed schedule for the Stirling and Henderson works. Transparency, not talking points, will keep AUKUS on track.

Get used to it. The world has changed and is not going back to some golden age.

The rules-based order is fragmenting. The chief guarantor has clearly signalled that greater burden sharing among allies and partners is necessary with no expectation that the United States will come to the aid of an ally or partner. America First means that America is now a great power pursuing a narrower set of national interests according to its own rules. The importance of allies and partners to American security is variably acknowledged, particularly in the European theatre. At the recent NATO summit, the failure of the United States to reaffirm Article 5 in return for European commitments to spend more on defence was telling.

In the Indo-Pacific, American leaders have been more positive about the role of allies and partners in the coalition to deter China. But the end-state of American policy is not clear. Is it to pivot more permanently to the region and reassert hegemony? Is it to stabilise the relationship with China in a more sustainable way? To what extent is America’s grand strategy hostage to the endgame on China-US trade?

During recent trade negotiations, China flexed its muscles, using its dominance of rare earths supply to wring concessions out of the United States. China is adept at putting more pieces on the table. It may proffer a grand bargain on trade in return for security assurances, think Taiwan and the South China Sea.

In such an environment, a dual-track strategy is emerging in Australia. The alliance with the United States remains in place and AUKUS is a priority. Simultaneously, Australia is creating optionality by deepening ties with other countries and groupings. We have resuscitated the Australia-European Union FTA talks and are open to discussing security cooperation with the European Union. We are also doubling down on our relations with Southeast Asia, Japan and other regional partners. Prime Minister Anthony Albanese’s trumpeting of independence within the relationship with the United States in a weekend speech about Australia’s wartime leader John Curtin will fuel the theme of optionality.

We don’t have the luxury of time: AUKUS is eating into the rest of the defence budget and that is not sustainable.

In these circumstances, spending more on defence is not only about contributing more to the Australia-US alliance but also reinforcing sovereign capability.

There is no magic number when it comes to defence spending. The United States is spending around 3.4 per cent of GDP which has become the default number for other countries. But context is important. Japan has already committed to doubling defence spending to 2 per cent as a proportion of GDP by 2027 and is ducking meetings with US President Donald Trump on defence matters. Australia is raising spending to 2.4 per cent of GDP by 2033–34 and is committed to AUKUS, the most ambitious military industrial project in our history. Debt and deficits are rising, so more guns mean less butter.

US Defence Secretary Pete Hegseth is asking Australia to increase spending to 3.5 per cent of GDP (an extra $40 billion a year), as soon as possible. In other words, it’s not enough to promise an uptick in spending down the track. More is needed immediately, with Hegseth calling out a “real and potentially imminent threat from China”.

Not surprisingly for a Defence Minister, the Deputy Prime Minister Richard Marles welcomed Hegseth’s remarks while Prime Minister Anthony Albanese reminded everybody that Australia will decide for itself what is the appropriate level of defence spending. The government’s formula is that we should know what we want to buy before we commit to extra spending. The other way to look at this is to determine the capabilities that best fit our evolving circumstances and raise spending accordingly. But we don’t have the luxury of time: AUKUS is eating into the rest of the defence budget and that is not sustainable.

Squaring the circle will not be easy and makes forthcoming discussions with US leaders at AUSMIN, the annual 2+2 talks between foreign and defence ministers, potentially uncomfortable. But risk is also opportunity. AUSMIN does not need to get into the weeds but a principal’s level discussion of complementary capabilities that can be delivered in the near and medium term would be apposite.

Complementarity can be framed by the needs of the Indo-Pacific Command and its assessment of tensions in our region. We can also explore new presidential initiatives such as the Golden Dome missile defence system for any potential Australian role given the American assets we host on Australian soil. AUKUS Pillar Two, which covers advanced capabilities, can be woven into this discussion. The Americans are keen to see some marquee projects announced to demonstrate progress on this pillar. Now is the time for political heft to get Pillar Two moving in a way that the public and defence industry can see.

With an America First president in the White House, allies like Australia need to reinforce that America’s essential security interests are bound up with its alliances and partnerships in the region, something that at least Hegseth has acknowledged. Identifying ways to contribute to new US security priorities is part of that process.

This can go hand in hand with an assessment of ways to strengthen relationships with like-minded democracies in other groupings that may/may not include the United States. A new rules-based order may not be in the offing, but we have agency and should exercise it.

Invoking John Curtin’s famous Melbourne Herald article declaring Australia looked to America as Japanese forces swept south, Prime Minister Anthony Albanese’s speech delivered on Saturday adroitly positions Australia for a testing time in foreign policy. Visiting China later this week, and with President Donald Trump’s tariff demands becoming more truculent as a new 1 August deadline approaches, Albanese’s speech affirms that in the competition between the United States and China, Australia will act in its own interests.

Though often interpreted only as a plea for American help in the war against Japan, Curtin’s 27 December 1941 article was indeed also and more importantly an assertion of Australian independence in foreign and defence policy. As Albanese rightly said: “Curtin’s famous statement that Australia ‘looked to America’ was much more than the idea of trading one strategic guarantor for another.”

The context of the 1941 article by Curtin was not American participation in the war against Japan. America, after all, had been attacked by Japan three weeks earlier. Nor was it the willingness of the United States to defend Australia. That had already been signalled by Roosevelt. Nor was it the release of Australian troops in the Middle East to join the Pacific war. That had been suggested by Churchill shortly before.

Albanese also has in mind a context, also unspoken. This includes not only the US imposition of tariffs on Australian imports, in violation of the bilateral free trade agreement, but also what has been interpreted as an American demand that its military allies increase defence spending.

The context was the meeting then taking place in Washington between Churchill and Roosevelt. The leaders were discussing the allied response to Japan’s attack at Pearl Harbour and British territories in Asia. Churchill’s objective in those talks was to ensure America was not distracted by the war in the Pacific. He wanted reaffirmation of the Germany First understanding already reached between the UK and the United States. On that point he was reassured, not least because it was Roosevelt’s policy as much as his own.

Aware of the general idea of Germany First and the subordinate status of the Pacific War in allied planning, concerned that Australia was not part of these conversations, Curtin was determined that Australia be heard by the two allied leaders. He was also better informed than either Churchill or Roosevelt of the looming military disaster in Malaya. Disputing earlier British assessments he judged the Japanese “a powerful, ably led and unbelievably courageous foe”.

Curtin’s article was a demand for Australia – not the United Kingdom – to be America’s principal partner in the war against Japan. As he wrote, Australia refused to accept “the subordinate status” of the Pacific war, and insisted that formulation of strategy for the Pacific war should be “primarily one in which the United States and Australia must have the fullest say”, a claim that notably excluded the United Kingdom. It was a wildly ambitious demand – though Australia became more significant to the United States as Japan conquered British and Dutch possessions in Asia. Australia then remained as a useful America ally in the south Pacific, while the United Kingdom was left with no serious role in the Pacific war other than to resist any diversion of forces from the war against Germany.

Referencing Curtin, Albanese said during his speech on Saturday that Australians have “the confidence and determination to think and act for ourselves. To follow our own course and shape our own future”. In this declaration Albanese also has in mind a context, also unspoken. This includes not only the US imposition of tariffs on Australian imports, in violation of the bilateral free trade agreement, but also what has been interpreted as an American demand that its military allies increase defence spending. More broadly there is a suggestion from this administration that friends of America should not also be friends of China, and that they should diminish their economic engagement with China. The Albanese government has shown little interest in these propositions. Nor did the Morrison government which preceded it.

Albanese also pointedly referenced the post war planning policies of the Curtin and Chifley government, focused as External Affairs minister Herbert V. Evatt proclaimed, on the rights of small and medium powers in a rules-based order. In a world of increasing competition between the two great powers, Evatt’s work was worth recalling.

John Edwards is author of John Curtin's War, Volumes I and II, published by Penguin.

We could be less than a week away from a crisis in US-Australia relations.

On 12 June, the Financial Times published a scoop: the Pentagon is reviewing the AUKUS agreement, a deal which includes the supply to Australia of three to five US-built Virginia-class nuclear-powered attack submarines. The FT story said the review “was set to take 30 days”. That period expires on Friday, 11 July.

Chances are, some face-saving solution will be found and a crisis averted. But President Trump and his administration are mercurial.

Why a crisis? For one thing, because US Undersecretary of Defence Elbridge Colby, who is leading the review, has previously expressed scepticism about selling submarines to Australia. When news of the review emerged, Representative Joe Courtney, chief advocate for AUKUS in the US Congress, immediately spoke as if the entire deal was under threat: “To walk away from all the sunk costs invested by our two closest allies, Australia and the United Kingdom, will have far-reaching ramifications.”

Observers were also quick to point out that US Defence Secretary Pete Hegseth’s speech to the Shangri La Dialogue in Singapore on 31 May did not reference AUKUS. But in Hegseth’s meeting with Australian Defence Minister Richard Marles at the same forum, the American did make a rather brusque demand for a hike in Australian defence spending. Finally, there’s the fact that US shipyards are struggling to increase production of submarines to meet demands from both the US and Australian navies.

All of this has encouraged the idea that the review is designed either to pressure Australia to commit more money to the American shipyards that produce Virginia-class submarines (and to its defence budget generally), or to create a pretext for cancelling the submarine sale. 

The best reason to think nothing will change is the one offered by Representative Courtney: “There is no ticking clock that says that a decision has to be made in 2025.”

A few caveats: first, the initial FT report said that the Pentagon was not prepared to comment on the timing of the review, so it might take longer than 30 days. Or it might already be done. Second, we shouldn’t necessarily expect a detailed public report at the end – this is an internal review. Third, and most importantly, while this review could provoke a crisis, the odds are still against it.

The preferred Australian government interpretation of this review is perfectly plausible: this is simply what new administrations do when they want to run the ruler over decisions made by their predecessors. Furthermore, as Courtney said: “There is no ticking clock that says that a decision has to be made in 2025.” The United States has plenty of time to cancel the submarine transfer, he seems to be saying, so why act now?

Of course, that rationale will not be particularly reassuring to Canberra because if the plug were to be pulled, Australia would need all the time it can get to arrange an alternative. 

Even if cancellation of the Virginia deal is unlikely, the review could still provoke a crisis. Prime Minister Anthony Albanese has repeatedly defended his government’s defence spending, and pointedly rebuffed Hegseth’s demand for more by saying that “we’ll determine our defence policy”. If the Pentagon’s review really is designed to leverage higher defence spending out of Australia, the PM will either have to perform a humiliating backdown or stand his ground, thereby threatening the submarine sale. The speech Albanese delivered on the weekend suggests he is not preparing to back down. 

Chances are, some face-saving solution will be found and a crisis averted. Or maybe the review will simply find that the project is on schedule, and recommend a “steady as she goes” approach. But US President Donald Trump and his administration are so mercurial that a dramatic reversal of support for the Virginia-class submarine deal, or the intensification of the administration’s campaign to get Australia to spend more on defence, are both distinct possibilities. Canada, Denmark, Ukraine, Panama and NATO have all suffered crises in their relations with Washington in recent months. Why would Australia be exempt?

This article is not the first to see trouble ahead. Evan Feigenbaum of the Carnegie Endowment made many similar points in June, when he argued that Washington seems unaware of the differences in Australian and American worldviews lurking beneath the apparent unity of purpose. But Feigenbaum’s conclusion (“The United States and Australia have everything to gain from a vastly enhanced alliance”) belies his own analysis. Given the risks exposed by this Pentagon review, Australians should be asking: wouldn’t the alliance be more secure and easier to manage without the Virginia-class submarine project? 

Prime Minister Anthony Albanese doesn’t have much in common with Tony Abbott, but as a way of offering a little perspective on the problems that Albanese faces in getting a meeting with US President Donald Trump, the current PM might be interested in some earlier comments by his predecessor.

On coming to office in 2013, Abbott pledged that he would be an “Asia-first” prime minister. Indonesia, China, Japan and South Korea would be the opening ports of call for his official visits.

“Only after our regional and trading partners have been suitably attended to would I make the traditional trips to Washington and London,” Abbott promised.

And so it transpired.

Abbott also held talks with China’s Xi Jinping on the sidelines of an APEC meeting only a few weeks after coming to power, a summit that then US President Barack Obama skipped, sending Secretary of State John Kerry in his place.

No one back then raised the kind of questions Albanese now faces about the ordering of his meeting schedule, and whether he should meet face-to-face with Trump before taking up an invitation from Xi to travel to China. Sky News on Wednesday reported that Albanese’s trip to China is expected in August. Other reports say the visit will be this month, while the next chance for a Trump meeting won’t but until the Quad summit in India, or the UN General Assembly in September.

“It seems that this government and this Prime Minister is better able to, and is more interested in, getting a meeting with the President of China than the President of the United States,” declared shadow defence spokesman Angus Taylor.

It’s an easy story for the media to tell – how many phone calls, or how many meetings? – in a realm that is so often defined by opaque and iterative measures.

Trump’s decision to leave the G7 meeting early last month in the midst of the Israel-Iran conflict, consequently missing a first-time meeting with Albanese, has compounded a perception problem. Australia is hostage to a handshake. This week, in media interview after interview, the PM has been grilled about whether he is kicking himself for not getting on a plane to Washington earlier, or if the lack of facetime with Trump has become embarrassing.

Put together, the theme suggests a government under pressure over the management of the US alliance, adding to concerns about the Pentagon’s review of the AUKUS deal, Defence Secretary Pete Hegseth’s demands for additional defence spending, and whether Australia can secure a carve-out of the Trump tariffs.

But it’s also an easy story for the media to tell, and a good talking point for an opposition eager to stir. It involves a tangible outcome. (How many phone calls? How many meetings?) Foreign policy stories are rarely so simple. Such a count allows a quick quantitative judgement in a realm that is so often defined by opaque and iterative measures.

Does the order of meetings matter? Prime ministerial visits are invested with all sorts of symbolism, sometimes deliberately and sometimes in a manner that is constraining.

Australia’s recent diplomatic habit, for example, is to make Indonesia a first port of call for a new PM. But Albanese chose to attend a Quad summit in Japan just days after he was elected in 2022. Maintaining the Indonesia tradition took some mental gymnastics. Jakarta instead became the PM’s first “bilateral” visit. He made up for any slight by making sure to go to Indonesia first after he was re-elected in May.

Back in 2013, Abbott had the advantage of having met Obama before his prime ministership, when the US President delivered a speech to the Australian parliament in 2011. Abbott was also looking to shake off a reputation for being too focused on the Anglosphere.

It was a time too when Australia’s relations with China had a markedly different quality to today. Xi hadn’t yet ordered artificial islands to be built in the South China Sea. No Chinese warships had circumnavigated Australia. No diplomatic freeze of the type that also left Scott Morrison dangling.

That’s the reality that confronts Albanese. It’s also fair to observe that there clearly isn’t a strong personal rapport between the Australian PM and his US counterpart, which will reverberate throughout their respective systems. Nor will it have gone unnoticed in Washington that the debate in Australia about Albanese meeting Trump offers a leverage point in the relationship.

Also – and the government won’t say this part out loud – there are probably doubts in the PM’s office about the value of being too cozy with Trump, given (a) Lowy Institute polling showing how unpopular the US President is with Australians, (b) having already campaigned in the election against imported Trumpian politics, and (c) Trump’s junkyard dog propensity to wag his tail one moment and bite savagely the next. The international leaders currently seen as close to him might just as soon find themselves smarting.

The other point Albanese is trying to make, carefully, is that Australia need not dance to Trump’s tune. Relationships are a two-way affair. Just as Trump likes to invoke America First, Albanese has his own version.

“We’re working on a date to have a face-to-face meeting, but of course our officials continue to engage,” Albanese said.

In other words, don’t judge the whole relationship via the calendar appointments of two busy leaders. Even if Albanese would doubtless much prefer to have a firm circle around a date.

When members of the Australian Turf Club turned down a $5 billion offer from the New South Wales state government to buy Rosehill Racecourse in May, few punters would have thought their votes could set up a showdown between developers and the Navy.

Not even five years’ free membership – plus a $5,000 bar tab – could convince ATC members to hand over their western Sydney racecourse to develop 25,000 new homes.

The NSW Government quickly scrambled to find alternative locations to help meet its target of 337,000 new dwellings by 2029 amid a housing affordability crisis. One of its new proposed development sites: converting the port at Glebe Island, which sits at the western end of the iconic ANZAC Bridge, into 10,000 new homes close to Sydney’s CBD and public transport.

But there’s a hitch: Glebe Island is the last working deepwater port in Sydney Harbour – an important piece of commercial and defence infrastructure. Defence analyst Jennifer Parker explained its significance:

“We saw during World War II that the US Army from about 1942 onwards pushed about a million troops through Sydney Harbour, and this was predominantly through Glebe Island … if we are to have another regional conflict … and Glebe Island disappears, we lack that surge capacity for our maritime activities.”

The issue is an unexpected conjunction of two seemingly disparate policy issues: housing affordability and maritime security.

But Australia now faces converging domestic and global pressures that are making these kinds of trade-offs – between Australians’ social security and Australia’s international security – both more common and harder to resolve.

Often these pressures manifest in difficult discrete choices. As with Glebe Island, the binary between national security and economic efficiency is a common point of tension.

Take the Port of Darwin. The government faces an invidious choice between either tolerating the security risks of Chinese ownership of critical infrastructure or undermining the confidence of foreign investors.

Similarly, looming Foreign Investment Review Board decisions regarding Santos and Austal pit sovereign control of energy supply and shipbuilding against Australia’s ongoing need to attract foreign capital.

Such choices are symptomatic of more fundamental dilemmas that Australia cannot defer much longer.

The Albanese government faces twin political pressures, to grow expenditure both on the care economy – a pillar of its electoral platform – and on defence.

One of these is to find a settling point between two poles of economic policy: openness to trade and investment and accepting the primacy of market forces on one hand, and on the other, an activist industry policy, a government-led rebuild of domestic manufacturing, and sovereign capability and infrastructure.

Australians appear unprepared to reconcile this trade-off, with the Lowy Institute’s polling delivering a perplexing result: more than three-quarters of Australians support free trade – but also making more goods in Australia.

Even tougher choices lie, however, in public spending.

Australia faces ongoing budget deficits, with the greatest structural pressures in defence spending, the care economy and servicing public debt.

Treasurer Jim Chalmers is right to say that the “best defence against global volatility and the best way to lift living standards is with a more productive economy, a stronger budget, and more resilience.” The government’s productivity roundtable in August is the first step towards this, aiming to address fiscal sustainability by boosting economic growth.

The problem is that the Albanese government faces twin political pressures to grow expenditure both on the care economy – a pillar of its electoral platform – and on defence.

The prime minister and treasurer recently rejected US calls to lift defence spending to 3.5 per cent of GDP. However, four factors make further growth in defence spending seem inevitable: a deteriorating strategic outlook, the cannibalisation of the defence budget to fund AUKUS, NATO members’ commitments to reach 5 per cent, and growing expectations from the White House on allies.

So, with meaningful tax reform yet to crystallise and Australia facing persistent productivity stagnation, any pathway that avoids ballooning public debt will more than likely necessitate ruthless prioritisation of spending.

To date, the government has sought to manage the growing confluence of international and domestic pressures through a “whole-of-nation” framework for foreign and defence policy that seeks to harness all dimensions of Australian statecraft. Though this framing is welcome (not least because I’m complicit in its perpetuation!), its underlying assumption is essentially positive sum: through a more effective alignment of national means we can realise greater international ends.

Sometimes, however, decisions are zero sum.

The increasingly sharp reality is that maintaining Australia’s international security is clashing more and more with domestic economic and policy objectives.

The Albanese government has started both its terms with major domestic economic policy roundtables: the Jobs and Skills summit in 2022, and now its 2025 sequel focused on productivity. But to seriously consider how Australia should balance its security with its prosperity and social safety net, a bigger discussion about the national interest is required.

Australia cannot afford to wait, however, until 2028 for such a major national conversation.

In the next year, the government will have to confront many difficult choices – plus others yet to materialise. Each decision will generate winners and losers, so the government must soon engage voters with a stark reality: to be safer in the world, Australians might need to be less secure at home.

Three years ago, having seen Australia subjected to a long campaign of Chinese economic coercion and trade blockages, the newly elected Labor government adopted a phrase to describe its approach to the Asian superpower: “cooperate where we can, disagree where we must, and engage in the national interest”.

The approach captured by those words has framed Australia’s relationship with its largest trading partner ever since. It reflects a high degree of caution, given China’s military assertiveness and human rights record, as well as the reality that no country can ignore China if it wants to continue to grow economically, transition its energy supply, or prevent the next pandemic.

Today, Australia again faces unjustified tariffs from a superpower. But this time, it is Australia’s principal ally that is wielding the stick.

Australia would do well to apply the same pragmatic approach to the United States – a country that remains pivotal to many of its interests, but also one with which Australia finds itself increasingly at odds.

Even as the United States drifts further from its historical expression of national principles, Australia does not have the luxury of disengaging.

The recently released 2025 Lowy Institute Poll suggests many Australians already look to the United States with a good measure of pragmatism.

With Donald Trump in the White House, only 36% of Australians trust America to act responsibly – a 20-point drop since last year and the lowest level in two decades.

Despite this, the vast majority (80 per cent) continue to view the US alliance as important to Australia’s security. And more Australians think the country should remain close to the United States under Trump (57 per cent) than those who think it should distance itself (40 per cent).

The question is: where must Australia disagree, and where should it continue to cooperate with America?

A long list of disagreements

Many of Trump’s actions directly undermine the rules-based order under which Australia has prospered.

Of all the policies tested in the Lowy Institute Poll, Australians were most disapproving of Trump’s attempts to acquire Greenland (89 per cent), an objective he has repeatedly refused to rule out using force to achieve.

As the purported leader of the free world, publicly flirting with territorial expansion at the expense of smaller powers undercuts a fundamental prohibition on the threat or use of force, as well as allies’ arguments against respective Russian and Chinese designs on Ukraine and Taiwan.

Trump’s decision to strike Iranian nuclear facilities in the absence of an imminent threat to the United States has again ignited concerns about eroding constraints on the use of force – whatever the merit of the objectives, how they are achieved matters, as do the consequences such actions could unleash in the Middle East.

On Ukraine, Trump has blamed the war on Ukrainian President Volodymyr Zelenskyy, shown sympathy for Vladimir Putin, haphazardly sought a peace agreement at Ukraine’s expense, and voted with Russia against European allies on UN resolutions on the matter.

Australians, on the other hand, continue to stand firmly against Russia’s aggression. Australia can and should do more: a strong majority back continued sanctions on Moscow (84 per cent), providing military aid to Ukraine (73 per cent), and participating in a potential European-led peacekeeping mission (71 per cent).

On trade, the divergences are sharp. A vast majority of Australians (81 per cent) disapprove of Trump’s use of tariffs to pressure other countries. Beyond seeking exemptions from US tariffs, Australia must continue to champion the cause of open, rules-based trade – a system it has long prospered from.

On climate change, the positions are hard to reconcile. Trump is an ardent climate denialist and has ordered America’s withdrawal from the Paris Agreement. By contrast, the Albanese government is bidding to host next year’s UN climate summit with Pacific nations – an initiative that carries strong public support (70 per cent). If Australia secures the hosting rights, it will find itself leading global climate action when the United States – the world’s second largest emitter – is backtracking on its commitments.

Finding common ground

If we believe US Defence Secretary Pete Hegseth’s recent speech at the Shangri-La Dialogue, deterring Chinese aggression in the Indo-Pacific remains a top priority for the US administration.

A majority of Australians agree. Seven in ten think it likely China will become a military threat to Australia in the next 20 years, while 60 per cent think Australia should do more to deter China militarily.

But there are mixed signals here, too. With the Pentagon conducting a review into AUKUS, some believe a program for Australia to acquire nuclear-powered submarines – which two-thirds of Australians favour – is now at risk.

The United States has also called on Australia, among other allies, to significantly bolster its defence spending. Half of the public (51 per cent) think Australia should increase its defence budget.

Yet, while allies scramble to respond to US pressure on spending, a fundamental question lies unanswered: does America have the resolve and focus to continue leading deterrence against Chinese aggression? If China sought to take Taiwan by force, few analysts are confident that Trump would put US troops into the fray.

Closer to home, Australians remain somewhat optimistic – 63 per cent think that if Australia were attacked, the United States would come to its defence.

Engaging in our national interests

Clearly, Trump has dispensed with the notion of values in American foreign policy. Notions of loyalty or “mateship” no longer hold currency.

But even as the United States drifts further from its historical expression of national principles, Australia does not have the luxury of disengaging. It should continue to seek cooperation, both on mutual economic interests and the common cause of deterring armed conflict in Asia.

At the same time, Australia’s leaders must be ready to stand their ground, including on global security, open trade, climate action, and the preservation of the rules-based order.

Australians expect nothing less.