The Link Between Military Security and Economic Development in the Asia Pacific
The Honorable John C. Moore
Minister for Defence
Australia
Security and development, as a conference topic, together represent a well-trodden path.
This morning's topic offers some interesting possibilities for consideration and discussion.
As with other like-minded democratic governments, the Australian Government believes that both security and economic development are the business of the elected government.
And that civilian control of both military forces and military command is a prerequisite to the effective civilian control of national economic policy.
Democratic government, therefore, provides the most effective link between military security and economic development. That is a theme to which I shall return several times during this presentation.
I, for one, do not agree with the position advanced in the brochure setting out the aim of this morning's session. I was surprised to read the following:
"diplomacy, business interests, and military capability are becoming increasingly intertwined".
Except in some military dictatorship, such as Burma and Pakistan, military and economic development are not becoming more intertwined.
Perhaps the most pressing security interest in the Asia-Pacific region today is forging an effective separation between economic development and military capability.
In fact, in most developed and developing economies in the Asia-Pacific area we see a clear emphasis on keeping the military away from the levers of the economy.
These governments are pursuing national defence policies aimed at maintaining adequate military capability for two purposes:
* Use as a last resort in national defence, and
* For deployment for multilateral or coalition efforts to preserve regional stability.
In this presentation, therefore, I would like to offer four key propositions that determine the relationships between security and prosperity. They are:
* Effective national defence is intrinsic to economic development
* Economic inter-dependence is not a guarantee against the use of armed force in the conduct of international affairs.
* Economic failure is a prime cause of internal disorder which may require action by national security forces; and finally,
* Economic prosperity is more likely if the military focuses on external defence and keeps their hands off the levers of economic and political power.
In some respects, these ideas are self-evident. Nonetheless, failure to take proper account of sound economic management at both the national and regional levels probably constitutes the most significant risk to long term strategic stability.
A government's credibility as the manager of the national economy depends on two things: its ability to take its responsibilities for the entire welfare of the nation seriously; and its ability to provide the basic regulatory structure for sound and long term economic development.
This means that it must pay as much heed to the fundamental contract it has with the community to provide for its long term security as it does to providing the level playing field for commerce and trade.
At last year's PBEC Conference in Hong Kong, my colleague Peter Costello, the Australian Treasurer, spoke in some detail on the measures taken by the Australian Government to protect the Australian economy against the effects of the Asian economic crisis. He made the point that the Australian Government had maintained tight controls on public pending, strict adherence to the principles of competition in both the domestic and international markets, and a clear focus on the benefits of structural adjustment in a global economy.
He concluded that these policy settings had combined to insulate Australia from the flow-on effects of the Asian economic crisis and to position Australia for continued economic growth. The past year has seen continued strong growth in the Australian economy.
At the same time, Australia has maintained a credible defence capability.
Indeed, in the broad ranging series of budget measures designed to deliver continued budget surpluses in Australia, defence is the one arena that has effectively escaped the knife.
We have preserved defence spending at pre-crisis levels because we recognise that a credible capacity for national defence has two major benefits:
* It protects the nation against future uncertainty;
* And it affords the government options for contributing to international efforts to maintain regional security.
And make not mistake, for countries like Australia, a secure regional strategic environment is a critical precondition for economic prosperity.
The past nine months or so have been significant developments in South East Asia.
Of paramount interest was the referendum in East Timor and its aftermath. While I do not propose to deal with the INTERFET operation in any detail, allow me simply to note that the Australian Government moved quickly and decisively to support the united nations security council resolution to restore stability in East Timor.
We did this because we understood both the humanitarian issue and the potential for serious economic consequences regionally.
Put in its starkest terms, continued chaos in East Timor only threatened the safety of the citizens of East Timor:
* It also raised serious questions about the willingness of the international financial institutions to continue to provide much-needed economic assistance to Indonesia.
And here let me re-assert one of the fundamentals of Australia strategic policy: a stable, secure and prosperous Indonesia is essential to Australia's long-term security.
It is perhaps a truism to say that the world has become a smaller place.
The speed of modern communications and the affordability of international travel have combined to bring nations and peoples together in a way that our parents could never have imagined. But this is only the tip of the iceberg.
Economic competition and the globalisation of international markets have combined in an even more profound way to create patterns of economic inter-dependence that were simply unimaginable a generation ago.
Economic inter-dependence has fed the ambitions of multinational corporations to the extent that a number of them command financial resources that dwarf the national economies of most developing countries.
Yet national governments, not multinational corporations, remain in control of the key economic levers.
* Governments pass the national laws that are so necessary to protecting investors and corporations alike.
* Governments sign up to international treaties and agreements regulating the working of the international markets.
* Governments define the boundaries with which national markets work.
* And governments decide when disagreements over economic issues - whether over resources or the interpretation of bilateral or multilateral agreements - are escalated to the point of military involvement.
Only the unreconstructed optimist could conclude that disputes over resources and international trading rules would never in future lead to the use of armed force.
We have, in the South China Sea, a current example of continuing tension over seabed resources. Notwithstanding significant levels of economic interaction between each of the claimants to territory in the South China Sea, such inter-dependence has not prevented the continued use of armed force in pursuit of national economic objectives. And it is important in this context not to mistake the wood for the trees:
* The armed stand-offs in the South China Sea have much more to do with future economic interests than they do with territorial claims per se.
Of itself, economic inter-dependence does not serve to shore up national security or provide any indirect assurance against the use of armed force by some nations in pursuit of their future economic aspirations.
The Asia-Pacific region is replete with examples of national economic failure leading to public unrest, instability, and, in all too many cases, the direct intervention of armed forces either to maintain public order or to replace elected governments.
This provides a sad corollary to the obvious fact that sound economic management and the equitable application of laws and regulations to ensure that the national economic playing field is level provides the most effective foundation for domestic security.
At one level, intervention by national military forces to secure public order might seem to be a legitimate use of armed force in the national interest.
* After all, the personal safety and the livelihoods of the people are a key national concern.
It is my contention, however, that personal safety and a secure livelihood are the business of governments, not the military.
Through sound laws and an independent justice system, governments are best able to provide the critical preconditions for national economic prosperity. As noted earlier, that is one of the key businesses of government.
Direct military intervention into the business of government is one of the most destablising developments affecting regional strategic stability. The appearance of institutions, which are not constrained by the ballot box or the will of the people, but rather are positioned to subvert national political and economics to their own ends, raises levels of regional insecurity.
This, in turn, virtually forces regional governments to invest more money in defence, thereby removing funds that might otherwise be employed in national debt repayment, infrastructural development or the reduction taxes.
National defence capabilities and the forces that operate them are similar to having a fierce guard dog - you need to keep them on a short leash and to control access to the cupboard.
Unless you wish to court danger yourself, you do not give your guard dog unfettered access to your property. Nor do you give it unfettered access to your larder.
My point here, of course, is not disrespect for the military.
Rather, it is to reinforce the point that modern democratic societies have recognised the need to ensure that national military forces operate within the rule of law, and that the elected government controls both the funding of military forces and the operations they conduct.
In our societies, elected government provides the answer to the fundamental political question "who guards the guardians".
It is also the case that modern democracies provide the driving forces for economic development and economic prosperity. This is not so much a defence of capitalism as it is a restatement of a fundamental political and economic fact.
Democratic societies, with their emphasis on personal freedoms, the rule of law, the independence of the judiciary, legal frameworks to ensure level economic playing fields, and honest, accountable government, provide the best environment for the creation of wealth.
Military forces that have 'extra-budgetary" sources of income are, in an ultimate sense, unaccountable.
The involvement of military forces in broad-based economic activity, whether through control over the means of production, independent investment through trust arrangements, or direct ownership of parts of the economic infrastructure, constitutes a danger to representative government.
That is because their economic independence gives them both a political voice and a capacity of unconstrained action. And because that is tantamount to a threat to representative government, it is also a threat to economic prosperity in the longer term.
It is an interesting fact that currently a number of governments in the Asia-Pacific region are trying to exercise control over the financial and economic independence of their military forces.
For those governments understand that military forces are not institutions best designed for effective economic management. The opportunities for both mismanagement and corruption are great.
Moreover, preoccupation with financial performance may not be the best means of ensuring that military forces are capable of doing what they are ultimately responsible for - fighting and winning.
Hence it is my view that military forces that focus on the demands of effective external defence, and keep their hands off the levers of economic and political power, provide the most appropriate defence of national economic prosperity.
To return to the subject of this presentation, I am convinced that the best way to link military security and economic prosperity is to keep military forces under firm government control.
Yet history provides many examples of the wrecks of both economies and nations where militarism has been allowed to drive national policy.
It is my firm view that the most effective guarantor of long-term economic prosperity is sound economic management by elected governments, governments that provide appropriate funding for national defence by military forces that are themselves under firm government direction.
While, in extreme circumstances, governments might need to fall back on their military forces to defend their peoples against external aggression, that is not to say that economic development is in any sense dependent on strong military forces.
Rather, competition, free trade, and sound economic management provide the most secure path to economic prosperity.
It is in this sense, therefore, that the linkage between military security and economic development is accountable democratic government.