 Yeah, we're building our diplomacy with France here in Global Connections. I'm J.F.I. Dell, this is ThinkTech at 5 o'clock and we are joined by Carl Baker, who has spent his life in diplomacy and being diplomatic and with Pacific Forum and a whole bunch of things that qualifies him to comment on what in the world happened with France. Good afternoon, Carl. Thank you for joining the show. Yeah, thanks for having me on. It's out of my area a little bit when we start talking about U.S.-French relations, but I think the impact on how we're thinking about Asia and how Australia fits into this is what makes it fascinating. Yeah, what we really want to talk about today is this new agreement called AUKUS, which is sort of an acronym in itself, Australia, UKUS Defense Agreement, to promote ties between the three countries in several areas. But the big news from this statement, and that's all there is, there's one page of the three country leaders saying what they're going to do in this defense relationship, and the big news, of course, is that we're going to sell or no, it's not even going to sell, we're going to explore the possibility of Australia getting eight nuclear-powered submarines, which of course, France says it's completely surprised by this because it has a deal, a 66 billion dollar deal with Australia to build 12 diesel-powered submarines that were supposed to be delivered sometime in the early 2030s, but the deal was actually originally made in 2016. So Australia has a lot of sunk costs as through the French in this deal that suddenly is gone by the wayside via an announcement by Prime Minister Morrison, Prime Minister Johnson, and President Biden. So what does a nuclear submarine mean in the context of Australia and Asia in general? And why is that preferable to a diesel submarine? Well, that's one of the questions that's now being asked, because there's a lot of technical questions involved when you switch from a nuclear to or from a diesel to a nuclear submarine. I mean, clearly the nuclear submarine is better in the sense that it has more distance. You can travel faster, longer distances, more staying time on target because it doesn't have to come up and breathe like an electric powered diesel submarine does. So I mean, the big advantage of the nuclear submarine is it goes further. And so of course, this is where it starts playing into what is the larger strategy, the military strategy behind this? And beyond the military strategy, how does this fit into a larger strategy in the Indo-Pacific? Clearly, Australia is the one that initiated the whole idea of coming out with this defense agreement. As we've learned over the last couple of weeks that everybody who's ever thought about the Indo-Pacific has chimed in to provide their input on how this came about and all the strategic implications. So anyway, so what we know or what we think we know so far is that Australia actually came forward with this proposal because it wanted to get out from under the agreement it had with France on the diesel powered submarines because there's been a lot of problems. And according to the Australian version of this history is they've been reminding France that there's a lot of problems. Number one, the price is almost doubled from the original agreement of 30 some billion. It's now 60 some billion. And of course, the submarines aren't even being built yet. How could the price have doubled if the submarines aren't being built? That sounds like a strange negotiation. Well, it's just that as they start looking at the cost of how they're going to get it done, the price has gone up. I mean, if you think about the rail in Hawaii, it's probably a good example of how these things happen. So it's not that unusual in terms of the negotiations between the two. It's let's low ball the price and then go from there. And of course, if you go back and look at what happened with the original deal is Japan really thought it should get the deal. And then France kind of came in the side door and got and won the bid. So it's been a shaky project in some sense from the beginning. So anyway, so Australia wants to get out of the deal. And it convinces the UK who's trying to project itself is global Britain in the post Brexit to show that they have an international presence. Of course, this is the best we can tell one and only example of global Britain in the post Brexit. And the United States says, ooh, we could we could sell them our nuclear technology. And here's the real thing is the only other country, of course, that has ever gotten the US nuclear technology is great Britain. So the UK, the United States and Australia now have a deal to investigate the possibility of providing Australia with a nuclear submarine nuclear powered submarines. But of course, Australia has no capacity to to develop nuclear power, because it has been one of the strong advocates in the world for the non proliferation treaty and for for disarmament and doesn't have any nuclear power capability at all. So it's not a big question. It's a big change in policy, isn't it? It's a huge change in policy. Because because first of all, like I said, only the UK has the United States has only ever shared the nuclear technology, the naval nuclear technology with with the United Kingdom. So Australia is now coming on board, but it has no real experience in in nuclear power and navy nuclear power. And I say the other part of this, Carl, isn't it that these submarines that we're going to we're going to provide to Australia are not going to be somewhere that they're going to be non nuclear missile submarines. It's not they're not only the propulsion attack subs, they're not going to be SS. They're not going to be nuclear. They're not going to launch nuclear missiles. I mean, they they they launch torpedoes and they launch cruise missiles. So they're they're basically attack submarines. And a diesel submarine can do that same mission. It's just that again, it's it's extended time on on station and distances can be traversed faster because the boats themselves are much faster than the diesel powered submarines. But the point is, is that clearly the United States sees this as augmenting its nuclear its nuclear powered submarine capability in Asia. And of course, this means that Australia can now reasonably be expected to patrol South China Sea and and areas beyond its its the continent of Australia itself. Well, can I raise the you know that the central, we want to call it the central figure in all of this is China. If you talk about South China Sea, you're talking about China, you're talking about nuclear submarines in that area. You're talking about concerns by Australia, New Zealand, Philippines, what have you in Japan, for that matter. It's all about China. This is this really threatened China that Australia would have nuclear powered submarines, but not nuclear missiles. Or is this just kind of fooling ourselves? Is Australia fooling itself here? Well, it's not clear to me. And honestly, the the the conversation in Australia is quite heated. But there's a lot of different opinions that are being voiced right now about the technical issues associated with having nuclear powered submarines, because it's just not clear what the mission of these things are going to be. Is it really just to augment the American presence in Asia? I mean, clearly the United States, that's the United States's advantage. But I don't think that's really in Australia's best interest. But again, we don't know because it's not part of a larger package of strategic of a strategy for dealing with the rise of Chinese military. And certainly not a strategy for how the United States is going to pivot or transition its capabilities to Asia. You know, that's that's what the big that's what the big story is in the United States is that this is the first step in the Americans effort to pivot to Asia away from the Middle East now that we're out of Afghanistan. But again, the questions remain of how does this fit into a larger US strategy? Unfortunately, of course, it's focused on military technology. And that again, highlights the lack of strategy by the United States for the economic side of this. How does how does this benefit the United States's in economic engagement or diplomatic engagement in Asia? Because now you created a problem with with Japan, because Japan says, Oh, those guys get nuclear power, but we don't know nuclear powered submarines. And of course, South Korea, which has wanted nuclear powered submarines for some time, is now looking at and saying, wait a minute, we actually have a civilian nuclear power capability, but they're giving it to the Australians. So so they've sort of alienated two allies in Northeast Asia. And in Southeast Asia, of course, the Philippines has actually said this is good, because they see it as as an augmentation to submarine capability in the South China Sea. But the rest of Southeast Asia sees this as a risk, because now you've got you've got the United States and Australia focusing on South the South China Sea as a focal point for competition with China in the submarines. Yeah, one thing strikes me and maybe I haven't been watching, but so you have this big deal, multi billion dollar deal. I didn't know about the French deal, didn't know anything about it. I don't think they did a lot of media on it. And now you have this big media thing, where this is announced globally worldwide. That is, you know, every little, every little person, every little country knows now about this, you know, US, Australia, UK deal. Was it necessary to publicize it? Was it necessary to tell the world about it? Would a would a perhaps a more careful strategy have been not to tell the world about it? A more careful strategy would have certainly would have separated out the cancellation of the French deal with the deal to to explore these areas of higher technology, because it isn't just submarines. I mean, the only the only thing you hear about is the submarines. But remember, the other capabilities are cyber artificial intelligence, quantum computing, and other undersea domains is what the is what the statement says. So these are all important areas. And these are areas, of course, where United States is competing technologically with Japan or with I'm sorry with China. You know, this is this is the big area of areas of competition. But it certainly isn't the case that only the United States, the UK and Australia can provide some input into that those kinds of technology. But I mean, Japan, South Korea, Taiwan, although India, all those countries can provide some capability by by sectoring off the three the three English speaking countries, you rise, you raise all these racial racial issues. The the French, of course, have always been sensitive, you know, to the five eyes in some in some explanations by by analysts in the United States are saying, well, this has to be because of the five, you know, five eyes, just to just for clarification is intelligence sharing system between the United States, the United Kingdom, Canada, New Zealand. I got the three. Yeah. Yeah, those are the five, those are the five eyes. And that's always been a a an intelligence sharing group. And that's always been sort of looked at in a very unfavorable way by those that are left out. Japan has been trying to get in, South Korea has been trying to get in. And of course, the French feel that they should be a part of it also. So so you know, so they're saying that they have to separate this out because of because of the sensitivities of the intelligence behind it. But again, you have you have the sufferings as the highlight, not the other area. So so certainly to get back to your point, it would have been much better to to separate this out and to include it in a broader strategy, a broader strategy of how you're going to integrate economic defense diplomacy into a broader US strategy in the region and highlight how some of these other countries can in fact help and and are are helping in in developing different things in different areas, rather than saying this is a this is an exclusive three country club. And we're going to focus on a very technical issue on nuclear powered submarines. You know, whatever whatever other effects it might have, this agreement is a projection of American power into Asia, you know, a significant projection nuclear power. And not only that, but the expression of relationships between UK and in the US and Australia. So we have a great, as you said, we have a greater presence. So the question I have is what does this do to our existing and maybe rocky relationship with China? Does this exacerbate, you know, the friction with with China? Does this make them respond by cowering in the corner and say, Oh, my goodness, the Americans are back. Does it make them respond by increasing the size of their navy, which is already quite substantial? What kind of reaction do we get from that? Well, one, one, I mean, one, I don't think this is this is a correlation. But what the what the Chinese did about two days after, of course, is they put in their application to become part of the comprehensive and progressive trans-Pacific partnership, which of course is the old TPP that the United States walked away from the first day of the Trump administration. You know, so so that's what China is. Of course, it's going to is of course, it's going to exacerbate military competition. But China is also strength has always China's strength has always been the economic component. And that's where the United States continues to fail. It continues to focus on on the military, whether it's intentional or or not. The fact is, is that this is another military aspect of the U.S. engagement in Asia. And it's exactly what what Southeast Asia doesn't want to see. Certainly, China isn't going to say, Oh, we better pull out those those structures we built in the South China Sea and go home, because the United States now has eight more nuclear powered attack subs that are going to patrol the South China Sea. Of course not. You know, so so it's just a remarkable failure to understand the strategic need for a comprehensive strategy for the United States to engage Asia. Well, you know, one I even today, I saw an article somewhere that touched on the issue of how close are we to a war? And how, you know, there are factors and vectors, and maybe it's not right now, but it's over five, 10 years that if these things these frictions can continue, we will wind up in more than just an economic competition or even a military competition will be, you know, throwing weapons at each other. And I know it's hard to get to that it is kind of a, you know, a very troubling notion. But it seems to me that if you focus on the military competition, rather than the economic, and I certainly agree with you, then you're you're taking a step further toward military friction. Yeah, I mean, military actions result in counter military actions. You know, and so it's so sure. It's just it's just a cycle that with a vicious cycle that we need to get out of. And if you if you accept the General Milley's bona fides and calling Beijing or speaking to Beijing about Trump's intentions, you know, it's out of a movie, you think, well, my goodness, did he really feel it was necessary to do that? Did he really feel that they felt that, you know, there was the possibility of fisticuffs here? And you wonder what we don't know about the, you know, the cutting edge of that of that relationship as we may be closer than we think. Yeah. Yeah. And, you know, in the meantime, of course, France, you know, feels very offended. France, to be honest, France actually has a substantial presence in the Indian and the Pacific Ocean. You know, it it has forces all the way from the east coast of Africa to to New Caledonia to to French Polynesia. You know, so so all all the area that we're talking about in the Indo Pacific, France has has territory and they have they have military forces and they and they have a very big interest. And so to slap France in the face in this in the process, it just it just is baffling. Well, you say slap them in the face. I mean, was this done in a tricky manner? I really I'm afraid I don't know whether the United States told France before it told the world or whether the United States snuck around here and told the world before France even knew what hit him. Yeah, that's that's kind of open to debate. You know, the Foreign Minister Leon, you know, said it was a stab in the back. I mean, that's his quote. He said it was an stab in the back. And and of course, they withdrew the ambassadors from from both the US and Australia. Now now they've they've they've brought the ambassador to US back after Biden's phone call. Biden, you know, said they would help with the with the they would support French activity in the Sahil in Africa. And they would work to to better the relationship. It's it's it's a little bit hard to tell. You know, I've seen I've seen both sides that that the Australians have said, look, we we've been telling the French all along that we have we had a problem with it with the diesel sub program France. I mean, France clearly is saying, no, you didn't you didn't say you were going to cancel it. And they've shown some evidence that that they were making making positive statements two days before the announcement came out. So but I you know, I think that that that in some ways, France is more heaved with with Australia. And the United States looks like sort of a gullible player in this whole thing that it didn't understand the broader strategic context, you know, and what we've seen since the announcement is everybody who fancies themselves as the strategist has come out with what this is this is what it means. This is the implication for for the broader Indo-Pacific strategy of the United States. And the United States hasn't even put out that strategy. Right. What about what about Brexit, you know, Brexit with not without some, you know, irritation, if you will. Yeah. Is is there an irritation resulting from Brexit or around Brexit between France and the UK that enters into this some. Oh, absolutely. You know, and this and this is the other the other impact that it's had is France has really become more important, obviously, to the European Union. And France has been promoting what's what's called European Union sovereignty. And so it's been promoting a strategy for European Union engagement with Asia. And in fact, you know, this this whole announcement about AUKUS sort of overwhelmed a released document by the European Union for its engagement with the end of its Indo-Pacific strategy. You know, one thing of interest is that, you know, with with the resignation or the retirement, if you will, of Angela Merkel, all of a sudden and the fact that her successor, you know, there's no clear coalition for her successor. And Germany is in a bit of a pickle about getting a sack together. And where Angela Merkel was, you know, clearly and Germany, the leader of the EU over a period of years, she was there when 15 years and so now that's not happening. And it's not likely to happen. And it leaves a power vacuum among the countries in the EU. And and where I read that, you know, who is going to succeed Germany as the leader of the EU? Well, it may very well be France. And maybe Macron has it has it in his head that he will succeed. Angela Merkel as the leader of the EU. Does that enter into this? France, France very much has tried to tried to take that very position, especially on the Indo-Pacific, you know, because begin because it has those interests, because it has those territories, it has a big interest in Asia. So so it clearly is trying to move itself into a position of leading the European Union in into its engagement with China and the broader Indo-Pacific. So so certainly, I think that that this is this is something that's very important. And the relationship between France and the UK was greatly damaged by Brexit. And the response by France has been exactly that, to promote a stronger European Union absent the UK's participation. So here, let's turn to the Biden administration. You know, I hate to say it, but as much as I want to support him and believe in him and see him as the savior of democracy in this country, you know, he's been right or wrong, he's been criticized. And this seems to be a subject of possible criticism where, as you were saying, this isn't really necessarily a military strategy, ideally, it's a it's a comprehensive strategy, but they left out the economic. And this is this is a problem because it it sounds like the military is driving the diplomacy here. And Tony Blinken is taking signals from the military instead of the other way around. What are your thoughts about that? Well, exactly. I was thinking about that, too, that it clearly is is a failure to think strategically by by the State Department. I mean, that's the real that's the real conundrum I see. And unfortunately, it follows on, as you've been watching Millie's testimony, you know, he basically pinned on State Department saying they waited too long to to do the the non non essential evacuation order. And so it's a strategic failure by State Department in Afghanistan. You know, and now this is I think another example of of the State Department just doesn't seem to to have its strategic act together. I mean, this was a very tactical move. And State should have should have seen alarm bells that this was going to that this was going to create problems for for the US relationship with with with its allies in Asia and with with the European Union. You know, so so yeah, and you've got to to put it you've got to put it in the doorsteps of the State Department. Yeah, well, which means Biden. But let me ask you this, though, it was extraordinary and very newsworthy that McCron decided to withdraw recall is the word the ambassador from Washington to Paris. And that is that is extraordinary because our national relationship with them goes back to their investment in Washington's army. It goes back to the very beginning of our Republic, they have always been our our friend, our ally through thick and thin for 240 years. And so you really wonder, and this has never happened before. So it has to mean something, no? Well, careful now. Don't forget that that France withdrew its military from NATO because it felt like it wasn't being treated fairly by the United States with with the nuclear forces. And also don't forget Freedom Prize in 2003. So so we've had we've had a good relationship. But but it's it there have been bumps in that in that US French relationship. And you know, and I think this this exacerbates that this this and it reminds the French, you know, one more time, you know, these Americans sometimes we just can't trust them. You know, and so I think that that that and that's that's what I think we should be worried about that that with with France trying to promote itself as the leader of the European Union. And and it trying to to ensure that the European Union is is strong and has some capability of responding to us that that we need to be careful that that we need to remember that that France, while it's been a faithful ally, we have we have had some run ins with them. And that's what I mean when I think when I say that that somebody at state should have said, wait a minute, this may not be such a good idea and unpack this thing a little bit and say, Australia, if you don't like your your deal with the French, you go undo your deal. Don't don't undo your deal in the context of us promising you nuclear powered submarines. Yeah, so on the other hand, you know, Macron, that was pretty abrupt, wasn't it? Did he go you think he went over the top? Could he have handled that in a better way? Well, yeah, sure. But but I mean, that was a very domestic thing for him to do, I think, you know, because because I mean, this this is he's he's got politics to play to I think. And so for French politics, I think it was was very, very much in line with him trying to promote himself as a strong defender of France. But it goes beyond that. It wasn't just just playing to the domestic audience. It was also reminding people that France matters in the world, you know, that you don't you don't do this to France. And then and then the other thing is is he, I think, as we talked about, he's trying to Europeanize this, he's trying to say this is an affront on on the European Union. It's not just it's this is this is the UK and the United States teaming up against us to take advantage of Australia. You know, and so I think that Macron, yes, he overreacted, but it was I think very calculated on his part. Well, it also follows the Trump administration where where Trump was, you know, lost no opportunity to beat them up and diminish the NATO, diminish the EU, diminish every country there. And God, that was insulting. Their feelings were hurting, you know, for four years. And now untie they and they have great hopes that Biden will correct that. And this then this happens. Yeah. And so and so there's there's French commentary that have said said exactly that that this this is this is a problem in America. It goes well beyond Trump here. This is this is this America first mindset. And and we need to we need to be very wary of it. And so it doesn't it doesn't help us in any immediate way, I don't think. And then and then we haven't we haven't even gotten to the real the real problem is this whole business of trying to transfer this technology. There's going to be a lot of discussion about this in Australia in the very near future, because because Australians are not going to just roll over and say, OK, yeah, we'll just take this American technology and and we're not going to touch it. And it's going to be a mess. Why? Why, Carl? Well, because there's a very strong anti nuclear movement in Australia. And what what what I've seen talking about the technical aspects of this nuclear submarine is what the Americans are trying to say is they're going to provide them a nuclear reactor for these naval ships, which by the way, the United States is the only country that uses highly enriched uranium in naval reactors. And that that uranium that uranium is not accessible to the IEA because there's a cut out in the IEA agreements for the US for high in highly enriched uranium. And so what the United States is saying they're going to do is they're going to package this highly enriched uranium in a reactor and you won't have to touch it for 35 years. This is this is unique to the United States. This technology only the United States is developing this kind of technology. So so Australia is going to end up with a ship that with a reactor that they can't do anything with. They have to send it back to the United States if it needs anything done. That's not going to work. You know, so there's a whole lot of unknowns about how this whole thing is going to play out. And in the meantime, they're saying at best, you're going to get a nuclear submarine to Australia in late 2030s. So you don't have nuclear submarines patrolling South China Sea anytime soon. So there's a whole lot of questions left there. Yeah, it strikes me too. Yeah, as you say, this reactor will make the way it's set up will make them dependent on us going forward. It will also limit their ability to that reactor. So in the case of a diesel submarine, you can get diesel fuel everywhere anywhere. It's ubiquitous. But in the case of a nuclear submarine that depends on having this reactor around, you're really limited. And furthermore, it's an object of sabotage, an object of failure, an object of explosion. In the case of some extreme weather, who knows what. So it's got it's kind of technical technical weaknesses. Yeah, there's there's a huge technical side to this thing. I mean, and it's more detail than we need to get into. But but that's that's going to become a big issue here in the next in the next 18 months as they think about how they're going to do this. You know, there's been some discussion that what's going to end up happening is they're going to lease a US submarine. And so then they're talking about a Los Angeles class. Now, I'm certainly it's not going to be a Virginia class, which is what they really want, because they're they're just too precious to the United States. So, you know, so there's there's questions about how you're going to deal with the transitional period, because right now Australia has has what's called the Collins class sub, which is which is really dated. Those things are really old. And so they're not there. They're problematic. They're not and they've been, their shelf life has been extended already. And now they're trying to extend the thing into into the 2030s. So so it's going to become a real technical issue between the United States and Australia before we're done with this. Matt McCron may have the last laugh on this or China or China. Thank you. Well, so one thing is really remarkable that we should discuss it is Biden's very adept maneuvers after it hit the fan to regroup with Prince and to say what had to be said and do what had to be done to bring them back into the fold and have them retract their retraction and send the ambassador back to Washington. What happened, Carl? Well, I mean, I don't know. I don't know any inside details of how he did that other than as I said earlier, you know, they agreed to support French, French military in the Sahel in Africa. And they're they're they're promised to to work through issues with France on better relations with the European Union and NATO and all that. And that's that's about all I have a recollection of seeing somewhere that McCron made that made the point that he that France lost a lot of money in this deal. They had arguably profit coming out of this deal. Maybe that's one of the reasons that the price went up. And somehow Biden said to him it was it was it was transactional as far as I remember. Biden said to him something like we're going to make good on that. We're going to help you out because we know you lost money. We're going to we're going to help to help to compensate you in some way. Well, Francis also said that they're going to build the Australians for for work that's been done. So so they've also they've also put out fair warning to the Australians that that they're not going to just let them walk away without without covering some of their costs too. So Carl, you know, I could answer this based on what you've said, but let me let me ask you to say it again. What what are the lessons here? What are the lessons we've learned about projecting power in the Pacific? What are the lessons we've learned about making military deals without comprehensive policies, comprehensive strategies? What are the lessons about dealing with our allies? There are a lot of lessons here. It's it's not as if we you know we can immediately forgive ourselves. Well, and the lesson is is that you know the let's use the butterfly effect. I mean, when you do something tactical, it has strategic implications. And so when you when you do something, think about what you're doing in terms of your broader strategy. And I think it's really really that's a fundamental principle that we seem to have lost. And I was thinking about why is that why why is that we do that? And you know, and I think it goes back to the simple fact that everybody is thinking short term. Everybody's thinking about we got to do something before 2022 elections, we got to do something before the end of this election cycle. You know, and it just becomes so self destructive. And as the United States becomes so, so politicized and everything, this this this activity at the tactical level becomes becomes overwhelming. And we never get to the point where we actually develop a strategy. You know, and the strategy is is too late and too little. And so I think that that the the real lesson is is if you want to lead the world, you have to think like a leader and leaders think strategically. And they think they think 20 years out, they think 30 years out. But they don't make tactical mistakes in the on the way to those 20 years. You know, they recognize the tactical they recognize the tactical issues before they become an issue. And that's why and I think that's why we saw this this deluge of commentary at the strategic level of what this means in terms of the American Indo Pacific strategy, the European Union Indo Pacific strategy, how Australia fits into this this broader context. I mean, look at what's happening with the quad, you know, suddenly the whole the whole idea of the quad the the India, Australia, US, Japan has been thrown into turmoil. What what is their role in this thing? I thought I thought the quad was going to become an important security mechanism. You know, how does this how does this office thing fit into that? Japan has been left out India, of course, has always felt left out. These this doesn't help. So anyway, yeah, so I think, you know, the real the real bottom line is tactical actions have strategic implication. Oh, that is so right on that. Thank you so much for those comments that wisdom really appreciated today. Thanks for coming on. I really feel we have all learned a lot from this discussion. And I hope to see you again. I hope I don't have the same kind of issue again. But I hope to see you again soon. Something something kinder and gentler maybe like where's the United States and its economic policy in Asia. Yeah, that's coming soon. Thank you, Carl Baker appreciate your your being here.