 Good afternoon ladies and gentlemen and welcome to today's event. I'm Michael Fully Love. I'm the Executive Director of the Lowy Institute. Let me first recognize my board member Mark Ryan, the British High Commissioner, men of Rawlings, a number of Consoles General and a lot of friends of the Lowy Institute. It's wonderful to see a full house today. Who knew, Alan, that you there would be such enormous public interest in you and me? Of course we know that's not true. We are honoured to have with us today the 24th Prime Minister of Australia, Paul Keating. Ladies and gentlemen, Paul Keating was first elected to the House of Representatives as the member for Blacksland in 1969. He was a Minister briefly in the Whitlam Government. He served as Treasurer from 1983 to 1991. When he became Leader of the Labor Party, he served as Prime Minister from 1991 to 1996. I was lucky enough to work for him as an advisor in the last 18 months or so of his Prime Minister ship. Paul was a reforming Treasurer and Prime Minister whose brushwork on the big picture of liberal economic policy, engagement with Asia, native title and the Republic was always applied with imagination and courage. And in the two decades since he's left office, he's continued to make important and sometimes lethal interventions in the national debate, often on the question of Australia's place in the world. I believe he is also the only Prime Minister who has had a musical written about him. So welcome Paul Keating. Let me also welcome Alan Gingel, one of Australia's most distinguished practitioners of foreign policy and now also an historian of Australian foreign policy. In 1969, in the same year that Paul was elected to represent Blacksland in the House of Representatives, Alan joined the then Department of External Affairs, making him part of the famed class of 69. He served as a diplomat in Rangoon, Singapore and Washington. He was an analyst in the Office of National Assessments, a senior official in the Department of Prime Minister and Cabinet and from 1993 to 1996, he was international advisor in Paul's office. From 2003 to 2009, he was the first executive director of the Lowy Institute and my boss in our beautiful sandstone clubhouse just down the road, which in a previous incarnation was actually Paul's post-prime ministerial office. Alan then served as director general in the Office of National Assessments until 2013 and he's now ensconced at the ANU in various roles, including director of the Crawford Australian Leadership Forum, which is coming up in June. Alan is here today and the excuse for this event is his publication of this important new book, Fear of Abandonment, published by Black Inc., which is a history of Australian foreign policy from 1941 to 2016 and let me acknowledge Maury Schwartz, the publisher of Black Inc. who is with us today. Alan, we're delighted to have you back here at the Institute, particularly as you brought Catherine and Dom with you. So ladies and gentlemen, please join me in welcoming Alan Gingel and Paul Keating. So ladies and gentlemen, we'll have a conversation up here on the stage and at some point I will come to the audience for a few questions. So please put your thinking caps on now. Let me begin with you, Paul, if I can. In the central theme of Alan's book is that a principal driver of Australian foreign policy is our fear of being abandoned by great and powerful friends. So can I ask you, do you recognise that in your reading of the history of Australian foreign policy? How important is that as a theme and what are the other big themes in Australian foreign policy? I think that's been the primary theme. Alan's been right to identify it and the title of the book says it all. As he says in the book, this all began with imperial adventurism in the first place. What he calls the audacious claim to a continent. Here we arrive 400 yards away from here in a couple of little wooden boats and we claim the Australian continent. It's pretty audacious. And of course we, being a lot of good little Britons, we continued with the whole idea of the British Empire until, of course, the search for a strategic guarantor until, of course, it led us down in Singapore in 1942. So then we then found another guarantor, the United States. And of course, we were dragged to Asia by the Second World War. Some, as Alan points out, some of us learned that lesson and some of us didn't. I've always believed we had to find our security in Asia and not from Asia. But also, I think Alan charts the internationalism which we had. I mean, even the mere fact we were looking for a strategic guarantor meant we were not closed. We were out there at least on the highways and byways. And he records in the book the things which we've done in the past four years, the Chemical Weapons Convention, the Cambodia Peace Accords, the APEC structure, including the leaders meetings, the G20, Kevin's involvement with that, and the East Asia Summit. I think it's getting harder for us to do those things. But what's, the underlying thing is what fed it all is fear of abandonment. And of course, this quasi-religious view now, the sacramental view we now have of the American alliance is fed by that. I'm going to come back and ask you about the alliance and also about our relationship with China. But let me bring you in, Alan, and maybe I guess tell us why it is that you wanted to write this book. I was struck by a comment you made, I think, in the introduction. You say that the story Australians know best of their country's engagement with the world is one of war and battles. From Gallipoli to the Western Front to Dakota and Vietnam right through to Afghanistan, war is central to Australians' image of their nation in the world. Whereas you write, there is something about foreign policy that has always made Australians a little uncomfortable, the ceaselessly interactive processes of foreign policy, the adjustments and compromises it requires, the close attention it demands, its back room dimensions, its unheroic nature. These don't sit easily with Australians. Is it that Australians feel uncomfortable about foreign policy or is it just that they get a bit bored by it? Because I'm struck that in many countries there's something about the history of war and fighting that's more immediate and visceral than the history of foreign policy. That's obviously right. There's a sort of a general reality that stories of battle and heroism are more interesting than stories of diplomacy and Peter Weir's film Gallipoli is always going to do better than Peter Weir's film The Negotiation of the Chemical Weapons Convention for obvious reasons. But I did want to write the book because it has always frustrated me that the world that Australians actually live in today, the world where China is our largest trading partner, where the United States is our close ally, where we belong to the largest group of the top 20 countries in the world, these are things which shape our daily lives but have not been set on the battlefields of the Middle East or the South Pacific, an entirely different set of dynamics and I may be unusual in this. I think I probably am unusual but I find this set of dynamics as interesting as the military set. Paul, in fear of abandonment, Allen writes a view that Keating's view of the world was one international relations theorists would recognize as realist. Economic weight mattered and power moved the international order. He says as Prime Minister he had little interest in the raw intelligence that can titillate some politicians. What mattered was the big picture and in this regard you're a little different from some Labor foreign policy makers who are more focused perhaps on institutions and perhaps questions of human rights. So what was the big picture for you on foreign policy when you served as Prime Minister? I had a great start of course. I wasn't a lawyer so that meant I had a much bigger feel of you and legalism has informed these institutional issues far too much in Australian terms. At the core I think Allen's description of me is right. I mean power come from economic agglomerations and we saw these shifts of power from Britain to Europe and then from Europe to the United States in the last gasp of the 19th century and the turn of the 20th century and we've now seen the same great influence happen where you've got a shift of economic power from the west to the east and in broad economic terms at least a sharing of economic power between the United States and China but broadly from the west to the east and so therefore you know when these things happen the strategic settings change you know. There's another thing I think you know you pick up ideas in public life and one of the things I think I've picked up was that great states need strategic space and if you don't give it to them they'll take it and this has been true of all the ones Britain, the United States, Germany etc Japan and you can see it now to some extent with China. So I think these things drive drive drive drive policy and also just having a clear idea about motive people's motives looking behind behind the screen and see what people really mean, what their aspirations are really about. There's the sort of things I used to focus on. Well let me draw you out question of personality. One of the strengths of Allen's book is that he brings to life some of the characters in the history of Australian foreign policy and I was speaking to you last week and you were saying that two of the individuals that influence you a lot as a young man were Churchill and Roosevelt. What was it about those two characters and the way that they viewed the world that you learned from that blew your hair back as it were? Well Churchill was an adventurer and fundamentally I'm an adventurer too so I liked I liked him you know but the thing I but he had the commanding of Europe the great thing about him was the moral clarity you know I mean he got the job the Tory party gave him the job fundamentally to do a deal with Hitler this was Halifax and not so much Chamberlain but certainly Halifax in that group and his job unstated wasn't to negotiate a position with the Nazis where the Nazis would have a Gemini over Western Europe Britain would be allowed to keep its empire but not as navy and to that question he said no so you know on that no went went Western civilization I mean the key thing about Churchill Churchill didn't win the Second World War but at the critical moment he didn't lose it he didn't lose it yeah on the other hand Roosevelt apart from taking America out of the collapse of of of the golden age and of so-called golden age of of capital of capital Robert Barron capital and reconstructing some basis of confidence and viability in the US economy it was Roosevelt who determined at the Atlantic Charter that he would do all he could to put an end to colonialism and this was the point that he and Churchill fell out on because Churchill thought the British would go back to India after the war you know the Dutch would go back to Indonesia the French to Indochina and Roosevelt had no bar of that and this was why he was so accommodating to the Soviet Union when he was building the UN structure you know so he just had a in the end Roosevelt had a much bigger world view than than Churchill had but the two of them were fantastic you know what about in Australian history when when you were serving as Prime Minister were there Prime Ministers that you'd look back on in terms of the way they managed Australian foreign policy and you thought that was something very impressive that that PM did nothing ever very impressive about Australian foreign policy that's the truth of it you know that's the truth of it I mean there's nothing impressive about it the best we've ever done was of course curtain and his his arrangement with the Americans in the prosecution of the war but look at Menzies and Suez you know I mean look at him again in Vietnam you know I mean or the confrontation in Indonesia you know I mean these are not anything you'd yodel about are they and the break I suppose the break is say Whitlam's recognition of China and his determination to have a relationship with Asia and China is the first real sign because Alan makes a point this all starts with the Treaty of Westminster which is what 1943 is it 42 so before that you've got Casey saying the foreign policy of Great Britain is a foreign policy of Australia you know you know that was that's where we were and so there's much now made by the Libs about the American Alliance but it was like putting your foot into an old shoe by that stage you know of course we had I mean in those days you know in those days there weren't there weren't many sort of European societies with a big continent like us so there's no way the Americans were going to let us go you know I mean it wouldn't have taken too much effort I don't think to sort that one out so you say well what are the big things in Australia foreign policy well I think scrambling off the ground getting the apex structure together getting the East Asia Summit together Kevin's involvement with the G20 are the first bloom if you like of Australian foreign policy been in a much more independent frame of mind where where where self-reliance and self-starting is the motivation not sitting back waiting for a friend as we're still doing to tell us where we should go Alan let me bring you in what do you think are the most impressive points in the history of Australian foreign policy what what is it that that impressed you when you were writing this book foreign policies like any any other sort of sort of policy I mean that the the the things you're looking for are people who recognise that a moment of change has come who then have views on what should be done about it and have the leadership capacity then to drive that change forward and you know in Australian foreign policy history you'd look I think at what Evans did at San Francisco I think you'd look at what Spender Spender did with Colombo Plan and and and Anzis Whitlam on the recognition of of of China well Paul's been through a lot of them APEC I'd add I'd add which I wouldn't have done at the time but I would now add after having looked at it John Howard and and and these Timor and the way that that was handled it didn't end up where anyone expected it to end up but I think it was I think it was important and G20 I agree as well all right and let me ask you a similar question to the one I put to Paul who do you think have been the most impressive and effective figures in the history of Australian foreign policy both ministers or PMs but also officials as someone who was associated with the now Department of Foreign Affairs and trade for much of its existence who really stands out for you as as really impressive exceptional individuals on the on the on the ministerial side I think the ones I've I've named really ever you know sort of nightmare to deal with in many many ways but but when he was on his game he made absolute changes Spender because he basically ignored Menzies I mean I think Menzies was really wrong on almost every one of the big changes during the during the 50s and 60s and his ministers the ministers who were successful were those who worked around him like McEwan and like and like Spender Barwick to an extent as well. Whitlam although I think Whitlam stuffed up badly on on in the response to the independence of to the Indonesian invasion of of East Timor in their different ways. Hawk and well I've a vested interest in the man sitting beside me but I think obviously him of officials sort of hard to say these are not figures known to many people but people like Tom Critchley Arthur Tang I think preeminently among them has like was a brilliant official but a lousy minister which is which you might not have expected. Paul you mentioned the alliance earlier and the question of independence and self-reliance and of course you got a lot of attention at the end of last year when you said that Australia should cut the tag with the United States but of course you yourself have a long history of of defending the alliance in other forums in the Forum of the Labor Party over many decades and and I know one of your motivations in trying to stand up the APEC leaders meeting was to to to ensure the United States remains engaged with with the region so what did you mean when you said Australia should cut the tag with the United States and how important do you think the alliance is to Australia's national interests? Well to cut the tag was in the flow of flow of thoughts and words I said we've got tag-along rights and we should cut the cut the tag meaning we should have rights which are not tag-along rights by cutting the tag I didn't mean cut the alliance but of course the way stuff's reported in Australia is all sort of thing. Now look the the alliance if we had no document anymore we would remain friends with the United States into the future you know we've been in every battle as everyone knows since since 19 since the First World War we've got a whole lot of cultural and historic common ground and so the idea but the idea that we have to that as a sort of client state we have to shape up all the time or ship out in other words the view which is pretty much ingrained these days in Canberra that is you know we have to sort of get along with them otherwise they'll show us away I mean look at the French attacks upon the United States over Iraq and yet France enjoys a normal relationship with the United States today the Canadians are same but this idea that we've got to be you know that we've got to sort of you know be the riot heaps of this world you know dragging along behind them whereas we should be running an all-together independent foreign policy and much more independence within this alliance structure but but the idea that you know that that that we need signals from from Washington to or we get caught up in another one of their skirmishes I mean I had one of these American diplomats in to see me recently I said look you guys you're a little bit of self-reflection and do well here fellas you know I mean Vietnam there was never the downward thrust of Chinese communism through Vietnam there's a thousand years of history to tell you why that wasn't right you know but I said before you did that you knocked off the Labor Party Prime Minister of Iran Mossadeq and brought in Shah Rooza Pahlavi and we know where that ended you know and on the way through you made sure you pushed Indira Gandhi into the hands of the Soviet Union I wouldn't have regarded that as a particularly clever trick you know and and and and so it goes and of course we're finally with Iraq so the idea this is a state which has done fantastic things for the world but also makes mistakes and therefore Australia should be running putting its interest first and within a within the context of this alliance which is never going to go to fade away you know the point is the United States is entirely important to the to the governance of East Asia it's important they remain in this part of the world and the force you know I've always thought that but the Americans had a chance at the end of the Cold War of reshaping the world you know but they completely failed the opportunity you know if I were them and I said this to Bill Clinton at the time the United States should have framed and guaranteed they should have been the framer and guarantor of the Atlantic right they had the pond itself the Atlantic they had NATO they had the European Union the one task for them was to bring Russia into Europe and they would have consolidated their power in there but they could never be the framer and the guarantor in Asia in Asia they should be the balancer and the conciliator because the idea that China is going to be a strategic client of the United States is nonsense it's nonsense I mean China is returning to where it was before the industrial revolution it's returning to being the primary economic state in the world and it's now a long way on that task right and what they're doing the South China Sea they're marking out the space like a tiger does you know the tiger mark rubs itself against the trees and let anyone that any other ones turn up this is our space right to which and of course the Americans have taken the same view about Cuba and the Caribbean and what have you but and of course as we know any American cruiser could take out each of those in placement on these islets the Chinese have created you know in an instant so strategically they don't matter but but the point is the Chinese are trying to superintend the corner of one ocean and the Americans are trying to superintend three oceans the Atlantic the Mediterranean and I think it can't be done and it won't happen so the pivot which I criticised on the night it was announced was bound to fail and will fail and this is why nor but nor do we want China to be the dominant state in East Asia this is why we need the United States here as the sort of as the floating good guys you know floating their boats around I mean I always say to the American animals you know every great battleship went down in the first week at sea in the Second World War you know the Bismarck the Tirpitz the Amato when Churchill sent the renowned repulse to Malaysia it wasn't their first week at sea but their first conflict they went down to just like these American carriers are going to go down when the real when a when a nasty fight starts and I said to this Admiral they all sound the same you know in the end he said what do you mean I said blood blood blood blood and and of course this is this is forced projection there's an important point to make here that that in these Westphalian systems of balance what constitutes balance within a sort of Westphalian type structure Europe and America had more or less had that as a sort of a replica a replication of the Roman Empire after you know after after the Charlemagne returned after the Huns and the Vesigoths the shape of Europe broadly remember broadly aped the Roman Empire and there was a natural balance of states within it but Asia's never been like that it's always been a hierarchy with China at the top you know and so therefore in this part of the world we what constitutes balance what constitutes a Westphalian system of balance in East Asia is hard to know but it should include the United States but there is one important fact about East Asia was never true about Europe that when Bismarck put together that system of alliance as he had Germany was a central state in the metropolitan zone of Europe the United States is not a state in the metropolitan zone of East Asia it's on the other side of the Pacific and so its projection is forced projection and of course a strategic projection so I hold the view that that the shape of Asia will never that Asia will never be reshaped by non-Asian power and certainly not by the application of American military force if we accept that point that means that we keep the Americans as the floating good guys we keep them in a balancing role but we determine the foreign policy of our own that looks after Australia's interest in the new order the new order which will have China at the center as a center of gravity what about all of China's neighbors do they have to accept China's prerogatives for example in South China Sea well they can't they probably won't but they'll probably do a trade with the Chinese you know probably come to some settlement with them but the idea though that we go steaming through the South China Sea in settlement of these I mean look at look at the the Philippines president and his attitude that we go steaming through in a fight that's not our fight you know this is not our fight you know so telling the Americans this is not our fight we're not in it you know there's something just we should do you know but of course the problem is and this is particularly true of the current government it has an attitude to the United States and our relationship with it which is not at any way at odds with that which obtained in the Cold War nothing has changed for you know as if China hasn't happened you know there's great state rising in the east and its magnetic power both strategic and economic power and this is a bit of nonsense that Howard used to go on with oh we don't have to choose between China and the United States we're choosing every day you know the choices are on all the time so you know the China has walked away from I mean there's a very important point to make here I think China believes in globalization but it doesn't believe in globalism and what what the Americans set up was a system of a global system at the end of the Cold War which didn't have a very long life it went from it went from 1989 to 2009 you know this was the end of history the Washington consensus and of course it all blew up with a financial crisis in 2008 when the Chinese were called in to get the checkbook out and try and save the world you know at the G20 so the Chinese will not accept a place in an ordered American system an exclusive American system which is set up around Atlantic institutions that is all over let me ask you one thing that has changed is that we have a different kind of president sitting in the Oval Office one who over many years expressed views on alliances and free trade and the US role in the world that put him quite at odds with pretty much every president since the end of the Second World War I was very interested that again I think in that same interview at the end of last year you said that Mr Trump had at least two good foreign policy ideas you said what first to get on better with China and second to get on better with Russia so three months into his presidency how do you think President Trump's foreign policy is shaping up well I've taken some heart from the fact he seemed to develop a reasonable relationship with Xi Jinping and this meeting they had in Florida and also the fact that the Chinese have put their hand up again to do something about North Korea is giving the Trump administration some sucker and support which which I think is very good you see the strategic competition between the United States and China in in the Pacific in the in a broad sense is I think almost over almost over I mean no important or sensible American thinks that China is going to become a strategic client of the United States as envisaged in the Nixon-Mow deal the Nixon-Mow deal was created to deal with Soviet divisions on China's borders when the Soviet Union was dissolved in 1991 the underpinnings of the Nixon-Mow deal fell away except the Chinese were not powerful enough to push the Americans away then but they're powerful enough now so and you can just see American impotence at the fact that notwithstanding the pivot which President Obama announced in our parliament and the fact that the Chinese are now built these islets in the South China Sea you know they gave the Americans a test they said we're going to go and we're going to build these islets and the Americans fundamentally failed the test you know Obama made a hairy chastise speech about it in Tokyo and nothing nothing else happened so that that that I think is it will never be written in a document we'll never find a document which has agreement between the prerogatives and the powers of the United States in China and the Pacific it'll never be written this will only become from testing and understandings the Chinese have done their testing they think they had Obama's measure you know the islets are a fact of life now China's real story is in the West down the Silk Road it's not in the East you know and and and of course the idea of any American infantry on the Chinese mainland is a joke I mean the central stabilizing force in East Asia is China not Japan is China and I think this will dawn on the Americans so we're already reaching that point of understanding I think therefore if Trump can get on better with or get on well enough with Xi Jinping and find common cause in things I think that's good so that's a good idea Russia he had the right idea about Russia I mean the Americans should never have expanded NATO you know I did a speech at the University of New South Wales at the time Eleanor and I were discussing this and we used to say to the Americans you know this is a great mistake you know biting off bits of the pie crust off the Soviet Union was bound to create a reaction and of course they created Putin in a way so the great challenge for Europe and the United States in any consolidation of the Atlantic given that they can't consolidate Asia has to be a settlement of some kind between Russia and Europe maybe a guy like Trump can do it because no one else ever wanted to do it not Clinton not your W not Obama you know so so I give him marks for that I mean a lot of people disparage him but he beat Hillary and he's got the job so what you've got to do now is work out what you can do with him but one thing is not one thing not to do with the Americans is keep bowing down this is just bad behavior bad bad bad behavior Alan let me bring you in you quote in your book a friend and colleague of ours Peter Varghese in a speech in 2015 when he said Australian Australia has shied away from the exercise of power we have tended to see power as belonging to others and when we have engaged with the projection of power we've traditionally been more comfortable in the slipstream than in the lead why is that why why don't you hear Australian politicians talking about power much do you think I think it's thought to be bad form I think there's a there's a it's goes back partly to Paul's point about tagging along a view that we will leave others to shape the world for us and when the message gets through to us we'll we'll go along and and follow on they've been in those that sort of list I go before of Australian foreign policy achievements they're not all not enough of them examples of Australia deciding for itself what it wants in the world and then working out how to get there now we're never going to be able to get there in the same way that the United States or China can get there because we don't have that power we have to put together coalitions of interests in in the world and to shape our way more more cunningly than that and I think there's been insufficient confidence in our ability to do that it takes time and and effort to do it and it requires political leaders who are prepared to expend political capital and time to to do these things as Paul did with the APEC leaders meeting and and you know people get distracted in in Canberra you know other things come on the table a daily telegraph headline this morning was talking about something else and you and you go off and do it and let me ask you one other question then I'm going to give the audience an opportunity to ask a question you mentioned the APEC leaders meeting prior to the creation of the APEC leaders meeting I think I'm right in saying that the the principal regular meetings at the Prime Minister of Australia attended with the South Pacific Forum and Chogham I think now the the Prime Minister has a radically different travel schedule and as you say in the book it's completely seems normal and unsurprising that we would host the leaders of the G20 countries the the 20 most weighty economically economic countries in the world but also the East Asia summit and the whole Asian summit season how much has this changed the the the role of the Prime Minister in foreign policy does it create extra opportunities for an Australian Prime Minister to be imaginative the fact that he or she is bumping into counterparts all all the time it absolutely does and the and Chogham the Commonwealth Heads of Government meeting which was the sort of the which remains really the the sort of the last tenuous vestiges of imperial of imperial conferences had a deleterious effect for a for decades in Australian foreign policy because the only opportunity that the Australian Prime Minister had to tread on the world stage was at meetings of of Chogham and this was entirely distortionary of the priorities that Australia had with the advent of APEC leaders meeting and since then the East Asia Summit the G the G20 there's an inbuilt incentive within the Australian system at the centre within the Prime Minister's office and and department to start looking out on this on this largest stage so it's a very good and positive thing for Australia but it just people need to grab the opportunities that are there and utilise them all right let me so let me go to the audience and give you an opportunity to ask a question either of Mr Keating or Mr. Gingel there are microphones in the room and I'm going to ask you to wait until a microphone comes and then if you can then mention your name and your affiliation if you can limit yourself to a question rather than a statement that will be great I saw this gentleman first if you could just wait for a microphone sir Paul Patterson from Digital Economics Advisory a question for Mr. Keating and thanks both the panellists for a wonderful insight into foreign policy Mr. Keating you said great states need strategic space just what do you mean by that and how do they achieve it well they certainly let me put the corollary they what they certainly reject containment you know and you can see this with you can see this with the perhaps in the 18th century the most important power in the world Britain not only did it have preserved its own strategic space around the British Isles but of course it it projected that through naval power all through all through the Atlantic and the Mediterranean then ultimately into the Pacific you can see you can see it with we can see it with Germany you can see it with Russia Russia Russian foreign policy is all about all about the shock absorber down the northern European plane you know the plane that Bonaparte came across into into Moscow the Hitler came across and of course that the Red Army came back into Berlin over you know and it's all about where that where that goes I mean the NATO's border was what 1200 miles from Moscow it's now 70 miles so Russia's concerned all the time about that and that's why that's why we found that in the end they cost they wouldn't they couldn't accept the Ukraine the the offers by the European unions and the Americans the Ukrainians you know so you see it there and you can see it with China you know you know who knows in history where where China's old boundaries were or were obtained but China is was always the great central state of East Asia and and it had its strategic space by virtue of the deference system it created you know China China was they regard themselves as a central kingdom of the world the central state and the other states were derivative states you know so they had it and you can see China doing it now to the east they've put they've marked the tiger's space out on the islands and to the west they're now going down with the belt on the road the belt particularly where they're going to develop road rail infrastructure and national projects through the the 57 countries between themselves and Baltic the Baltic coast of Poland so they're going to expand Chinese strategic and economic power down those road down the down through those places so one of our issues in the world is that the United States has never had to deal with a state as large as itself and its whole idea about its exceptionalism to deal with a state which has been always organized on different principles and so therefore this whole respect for the the prerogatives of a great power are an important informant in policy I think that's my point let me go to you and Graham from the Lowey Institute thank you my question goes to to both Mr Keating and to Mr Gingel Mr Keating when you were prime minister you were associated with the attack on the cultural cringe if it's not reducing your position on the alliance it sounds rather like it's a strategic cringe that you're finding fault with if that's the case are we culturally equipped and the mindset is essentially the problem are we culturally equipped to fall to avoid falling into the trap of a strategic cringe towards China well well I I should certainly hope so I mean you know Alan records me saying in the book and I used to say this to the cabinet when I giving out cotton it's not many people got one but we got one you know we have a border with no one a border with nobody and so therefore we don't have the kind of disputes the ceremonial disputes that most states have China look at the number of countries on its border any of the great powers I've just mentioned save the United States which got Canada and Mexico we don't have these issues right so therefore it gives us enormous flexibility and and also there's a rising center of economic gravity in Southeast Asia as well particularly in Indonesia right so we can make our way in this part of the world and I've I've been saying for years Southeast Asia and the ASEAN group of states is where we should be devoting much more time and attention but but that that said the economic rise of China is without precedent in human history we've never seen anything like it and never will and we haven't seen it at its full bloom yet I made the point in the interview you mentioned I said you know when we went to school the teachers would often put iron filings on a piece of paper and put a magnet underneath and very quickly all the iron filings would would line up in the magnetic field of the of the magnet that will happen in this part of the world now we will line up in the magnetic field in economic terms as well and it's important that we're able to because China is going to have enormous influence in the shape economic shape of this part of the world but China is a is a big lonely state and it's always looking for friends and therefore if we conduct go back to the business of creating apex and East Asia summits and we start thinking again you know in in say somewhere like ASEAN for instance we could do a lot with ASEAN you know we could we could make that whole thing work much better they would be happy we would make it work better the United States would be happy if it was working better in other words self-reliance and helping ourselves should be the keynote of our foreign policy you know and we don't want to become a tributary of China in the old tributary system they had in the 17th and 18th century you know we've got to resist that and we don't want China being the predominant the sole predominant economic power that's why it's so important for the United States to remain involved in the western Pacific so important you know so a clever state does this dance that's only the dumb states that get caught up in the get caught up in some you know signalling system of the kind we've always seen to found ourselves in you know Alan do you want to come back on that question as well or not no I think that's all right let me call on men at Rawlings the high commissioner from the UK thank you very much to both of you that was absolutely fascinating I might take issue Alan with your comments about Chogham another time we can debate the Commonwealth's relevance elsewhere I know I look forward to it but my question I've got two if I may one is for you Alan I've heard a lot about power and interest what role do you see for values in Australian foreign policy today and how might that affect some of these big relationships with China Russia in the US and for Mr Keating I just love to know what would you like Malcolm Turnbull to say to President Trump on USS Intrepid on May 4th of May thank you well let me start with values in a democracy I don't think a foreign policy can be devoid of values you know raison d'etat is not going to cut it for any public like Australia so values are important values and interests are sometimes defined as sharply different they're not there are certainly you can we can certainly see values which are also in Australia's interest but they're also there are also distinctions between between values and interests we value democracy but you can't trade away absolutes and and so values are less useful in the routine work of diplomacy than than interests are values the way we define ourselves but they're not necessarily the way in which we shape our relationships with with others China is I think highly unlikely in my lifetime or that of that of my children to become a Jeffersonian democracy but I don't see that as an impediment to our dealing with and and and developing a close relationship with them look I would say if I was Turnbull I would I would encourage encourage Trump to grow the kind of relationship he seems to be beginning with Xi Jinping to accept the legitimacy of China and the rise of China is a completely legitimate event you know and it doesn't suit the United States or Australia for it for it to be delegitimized because of US strategic interests so I'd say the most important thing for Australia is that is that there is peace in the Pacific between the two major powers and that's what I would be encouraging Trump to do more of what seems to be a natural inclination Paul can I follow up and ask you about Europe we've talked a lot about Asia but of course you're a great fan of European culture and it's been a pretty tough year for Europe I'm not I don't want to pick on men are but but obviously Britain has decided to exit the European Union where will that leave Europe as a will that make Europe stronger or weaker and what kind of role can we hope for Europe to play in the globe in years to come well it'll leave Europe weaker in my opinion Britain Britain was the second most powerful country in the European Union and it brought with it a whole lot of strategic kit intelligence nuclear weapons you know centuries of centuries of sort of strategic history that's not to say of course Britain can't have a a conducive relationship on these matters with with Europe but it's not like being in the actually inside you know so Europe the Americans are going the Marshall plan and all that came out of the Second World War modern the shape of modern Europe has been a large measure their creation but then they let it go at the end of the Cold War you know they took no interest in the development of the euro I mean the peripheral country should never have been the euro I wrote to Metron and to Cole in 1996 was it no it might have been wasn't 90 it wasn't Metron but Cole and his successor saying that the euro should be built around France Germany and the Benelux countries you know and we should repel borders until then and bring them in later on because if you hitch up the peripheral states Greece Italy Portugal Spain to the German productivity train and you have a one-price it's all monetary policy and a single currency all the adjustments all the depreciations which they used to do by the currencies have to be internal so wages and unemployment property values the adjustment occurs but it occurs in a very very bad way and so this has happened all across the peripheral countries now whereas because in the end the euro was too expensive for Italy too expensive for Greece too expensive for all these countries so I don't really think that and of course nearly all of the countries where where these referendums a referendum of tested questions of sovereignty they've been voted down so so the multilateral construct of Europe is looking much weaker particularly with Britain out and with the euro still and there is there is a monetary union there is no fiscal union there's no banking union you know and the Americans have got no influence there as as they've got strategic influence but they've had no economic influence in it and the meanwhile of course you've got Mr Putin who's now angry about their circumstances and and all of that's just bad karma for for Europe you know so Europe is not what it looked like 20 years ago when the champions of united Europe were there now it looks I think a much weaker construct with the with Germany carrying the burden of of its management you know and this is why the current French election is so important about the outcome so you know I don't I don't think the EU is going to collapse but the euro cannot go on the way it is let me ask you finally just to bring it back to Australian foreign policy I asked you initially about characters in history that had really impressed you what about the prime ministers and the presidents that you dealt with as prime minister if you could choose one figure that really left his mark on you that really impressed you who would you choose well there were two I left to say two you're allowed to yeah helmet cold because he saw the opportunity of a united Germany and he managed Gorbachev with with with a plum and dexterity and he negotiated with the Americans to pull them all down and to see the Soviet Union the Soviet Union collapse without celebration you know so I give Cole I mean he was a allows economic reformer Cole but he did grasp the big strategic opportunity and and he was materially important in the settlement at the end of the Cold War between what was in the Soviet Union with Gorbachev and the United States the other one of course is Jurongji the Chinese Premier Jurongji the Chinese have got Jurongji for his four years as I think it's four years of Deputy Premier and five years as Premier they have they have to thank him for 25 years of progress you know there was no one like him he loved Australia he loved the Australian economic model he loved the things we were doing here you know and took a lot of the lessons out of here that's why he used to come here a lot now and I want to give you the final word as this is the Sydney launch of in a sense of of your book I know that it's there's a lot of people that go into making a successful book so I do want to give you the opportunity to say a few words yeah now thanks thanks Michael I I did want to first thank you and the Lowey Institute an important part of of my my life but writing the book was a real reminder of the difference that the establishment of this institute made in the early part of of this century if you looking at the nature of the debate of the inputs to the debate before and after the the Lowey Institute was established it's it represents a really important change and has also helped to sort of generate you know other other think tanks as well so I'm very grateful to Frank Lowey and the and the family for for this creation I secondly wanted to thank my publishers Murray Schwartz and Chris Feaker here today from Black Inc and Latrobe University Press they took a punt on two deeply unfashionable subjects history and and foreign policy and also showed that there are and this astonished me really there are still publishers around to invest in editing and and that's that was a reassuring a reassuring thing I want to thank the electors of the the members of the United States Electoral College for a timely reminder that foreign policy does still matter and finally I do want to thank Paul for for coming along today and for the lessons I've learned there are a few jobs in that I can imagine more more satisfying than being foreign policy advisor to to a leader like like like him I went in with some expertise in foreign policy and I came out of the job with a glimmering of an understanding of statecraft and statecraft is what we need today thanks well ladies and gentlemen can I say some thanks to first of all let me join Alan in thanking the electors the members of the Electoral College of of the United States because I've as I've said to some of my colleagues whether or not Mr Trump is good for the world he's certainly good for foreign policy think tanks I want to thank Alan Gingel for coming back and for doing us the honor of of coming to the Institute to for the Sydney launch of this important book Alan is a very important figure in the history of the Institute we're delighted that he chose here to launch the book it's a really fantastic read as well as a genuinely important publication and I think I'm right that Alan is is happy to sign copies of the book that you can buy from our friends at Glee books at the conclusion of this event so thank you Alan and secondly I want to thank Paul Keating for for again for doing us the honor of speaking to us I always every time I interact with Paul I learn something and I hope everybody here feels the same way it's very impressive to encounter somebody who has a strategic view and a consistent view of the world and whether you agree with everything or not it's thought out and it's deeply informed by history and experience and we're very grateful for it there's a few lines that will stick in my head always think the smart it's the smart states who do the dancing it's the it's the dumb states who don't do the dancing I will I will think of the sound of battleships going down Paul as I'm going to sleep tonight and finally he gave us a wonderful piece of career advice for any young people interested in international relations and that is don't go to law school so ladies and gentlemen let me congratulate Alan again on the publication of his book thank you for coming and please join me in thanking Alan Gangel and Paul Keating