There’s a pattern here. Centre-left governments will give Defence whatever it says it needs, for fear that a “No” will result in them being labelled a bunch of peaceniks. The Clark government for instance, not only re-equipped the Army with more armed personnel carriers than it could possibly use, it also spent $771 million on a fleet of NH90 helicopters that proved too difficult to transport anywhere and were unfit to fly in the Pacific conditions found in the humanitarian work envisaged. Oh, and MoD also got a spanking new building thrown in by the Clark government as well.
No real surprise then that yesterday, the coalition government announced that it will be buying replacements for the P-3K Orions, at an initial cost of NZ$2.3 billion. Here are five reasons why this purchase is a mistake.
1. The actual cost will be far higher.
The $2.3 billion cited yesterday is an artificially low estimate. How so? Well, if you look at the bill for the purchase announced by the Pentagon in April 2017, the estimate for the planes (and the basic list of extra goodies thrown in with them) is $US1.46 billion (That’s $NZ2.13 billion on yesterday’s forex values) a figure not significantly less than yesterday’s $NZ2.3 billion price tag. Presumably, the slight difference is due to a small allowance for currency fluctuations in a purchase that’s been denominated in US dollars.
In the main, the extra goodies appear to be navigational aids that are defensive in nature. For example:
Five (5) Guardian Laser Transmitter Assemblies (GLTA) for the AN/AAQ-24(V)N; five (5) System Processors for AN/AAQ-24(V)N; thirty (30) AN/AAR-54 Missile Warning Sensors for the AN/AAQ-24(V)N; ten (10) LN-251 with Embedded Global Positioning Systems (GPS)/Inertial Navigations Systems (EGIs);
Meaning: there is no mention in this package of the antisubmarine “weaponising” capability mentioned at yesterday’s post-Cabinet press conference. So the cost of those missiles, missile mountings, training, test firings etc. will be additional. Similarly, there is no mention of the additional costs cited in this column a fortnight ago. Those will include: the cost of (a) shifting RNZAF No 5 squadron from Whenuapai to Ohakea, (b) of resealing and strengthening the Ohakea runway (c) of renovating the hangars at Ohakea (d) of building and sustaining the accommodation for the Poseidon crews, the maintenance staff and the skilled techies required to process the data that the new planes will be gathering. Since all those costs will be additional, the final bill (not counting the operational costs) will look far more like $3 billion, at least.
2. There is no external military threat to New Zealand or to the Pacific.
It is just not the peaceniks, or the Green Party who is saying so. The NZDF Defence Assessment Plan published in mid-2015 said the threats that New Zealand faces are (a) limited and (b) of a nature that would give us ample time to upgrade and to prepare, should that ever prove necessary. As NZDF put it:
66. New Zealand does not presently face a direct threat of physical invasion and occupation of New Zealand territory. The likelihood of such a threat to the Cook Islands, Niue, Tokelau and territory over which we have a sovereign claim, emerging before 2040 is judged to be very low, and would be preceded by significant change to the international security environment. New Zealand could therefore expect to have a reasonable amount of time to re-orientate its defence priorities should this be necessary. Although there is no direct threat to our territorial integrity, New Zealand faces a range of other threats from state and non-state actors, including cyber threats and terrorism.
Similarly, in this 2015 speech, then- Defence Minister Gerry Brownlee flatly said there was no external military threat to the South Pacific.\
New Zealand maintains a direct interest in security and prosperity in the South Pacific. We do not expect that the South Pacific will face an external military threat.
We are willing though to buy and maintain some very expensive gunboats to keep law and order among our Pacific neighbours:
However, a breakdown in law and order or state failure resulting in instability or conflict would negatively impact New Zealand’s interests in the region. The New Zealand Defence Force has been called upon for stability and security operations to restore law and order in the Pacific in the past, and stands ready to do so if needed in the future.
Hmmm. Do we really need to kit ourselves quite out so expensively, merely to play the role of sheriff in the South Pacific?
3. The cost of meeting imaginary threats will crowd spending on actual social needs.
So much for the coalition government chiding us not to expect that every social need can be met during its first term of office. But everything that Defence says that it needs? Hey, different story. Basically, these four Poseidon aircraft are going to cost four to five times the estimated cost of the nurses pay claim.
The re-assurance given yesterday by acting PM Winston Peters that this comparison was ‘wrong” because the costs of the Poseidons will be spread over several Budget years (out until 2025, apparently) is misleading in that (a) the annual sums are still big enough to crowd out some of the social spending that would otherwise be affordable and (b) the decisions on other big-ticket items (the Hercules air transport replacement, the new frigates) are also due to be announced at year’s end.
Meaning: the related costs for those items too, will be falling due during the same budgetary periods. Also, and to repeat: the cost involved is denominated in US dollars. While Peters has said a certain amount of currency hedging has been done, the timeframe envisaged here is ten years, and there is simply no way of hedging that far ahead.
Therefore, if and when our currency dips and as the interest costs kick in for the extended period of payment envisaged, this situation cannot help but become an “either/or” choice. Either we purchase these gold-plated pieces of defence gear to counter a non-existent threat to this country, or we put the money into meeting the backlog of costs in health, housing and education. That should be a no-brainer.
It is also irrelevant for Peters to claim that the benefits of the Poseidons purchase will be delivered over 30, 35 years of their operational life. After all, investing in nurses right now is an even more valuable investment in our future. Plus, it has the advantage that more money for nurses and public health will do far more to preserve our actual well-being and security.
4. The big-ticket items envisaged won’t protect us from the real military threats.
Basically, the Defence wishlist of big-ticket items (the Orion replacements, the C-130 Hercules replacements, the next fleet of frigates) will spend most of their operational time doing humanitarian work and maritime surveillance that could be done by cheaper means. More to the point, this new gear is being expected to perform military roles with our traditional allies that were conceived over 50 years ago. Essentially we will be buying armaments expected to last until 2050, in order to maintain alliances that were forged a century before, during the Cold War of the 1950s.
Look again at the Defence Assessment Plan quoted above: it says that the actual defence threats to the country are from cyber intrusions and terrorism. Such threats do not require anything like the same levels of spending. To put it mildly, a frigate can’t stop a cyber threat, but a cheap cyber threat can interfere with andimmobilise the command and control capability that makes that expensive frigate good for anything more than tootling round the Asia Pacific, and showing the flag.
Ironically the vulnerability of the big ticket items to cyber disruption was cited in the Defence procurement analysis by Sir Brian Roche released last week:
Defence should give more awareness and attention to projects classified as enablers or dependencies. For example, the delivery of high-value capability such as the Future Air Surveillance Capability or the Frigate Systems Upgrade are both dependent on network domain projects that deliver the means to communicate safely (such as Cyber security).
Essentially, we’re spending up large to combat phantom threats (or unlikely failed state scenarios) in the Pacific, and this new stuff will (a) not guard us against the actual threats from cyber intrusions and disruptions but in all likelihood (b) they will be vulnerable to them. Unless we spend even more money in that area, too.
5. The Poseidons will duplicate the work of our allies.
Not only can we not afford this expensive gear, it is likely to replicate the information available more cheaply – drones anyone? – or from our traditional allies. Australians have also bought Poseidons. A few weeks ago, the Aussies also announced that they’re buying a fleet of drones to carry out tasks of maritime surveillance and submarine detection (everywhere from the Indian Ocean into Asia and across the Pacific) and – crucially – the Aussies said they were willing to share that info with their 5 Eyes allies, which include New Zealand. Evidently, these maritime surveillance/submarine detection jobs will overlap, and will to some extent duplicate the relevant data. It seems odd to put so much store on the value of belonging to 5 Eyes, and then spend up large to replicate the data that it provides.
Finally, are these new planes really the best fit for the humanitarian purposes meant to partly justify the cost? If we’re going to be using these planes to roam the Pacific Ocean and Tasman Sea on rescue missions, they may not be such a great idea. It was, for instance, suggested at the post-Cabinet press conference yesterday that the old Orions can actually do that job better than the Poseidons, largely because they can fly slower, at lower altitudes. If the Greens are serious about challenging this purchase, they might like to explore this point further.
The Strategic Statement
Apparently, the purchase of the Orions replacement was signed off by Cabinet last week, days before Defence Minister Ron Mark unveiled the government’s Strategic Defence Statement 2018.
To date, most of the media coverage of this document has been about the gentle criticism contained therein, of China.
The media’s sensitivity on this point is misplaced. Recently, Australia’s defence establishment has said a whole lot more about China, and far more harshly. Defence is a hotter issue across the Tasman. For the past year, Australia and China have been swapping fighting words over (a) alleged Chinese interference in Australian politics (b) fractious naval encounters within an increasingly militarised South China Sea, and (c) the expansion of China’s cheque book journalism in the Pacific, to the point this year where a wharf that China built in Vanautu was supposedly being kitted out as a potential Chinese military base.
In a foreign policy white paper released last November, the Australian government strongly criticised China’s creation of artificial islands in the South China Sea. For its part, China has not been slow to respond in public.
China’s top commander has accused Australia of compromising peace and stability in the disputed waters of the South China Sea. People’s Liberation Army Navy commander Lieutenant Admiral Shen Jinlong levelled the claim during a meeting with his Australian counterpart Vice Admiral Tim Barrett in Beijing on Thursday, the Ministry of National Defence said. “The situation in the South China Sea is positive, but a series of moves by the Australian military this year has compromised the overall trend of peace and stability in the area,” Shen was quoted as saying.
Seen in this light, the reservations in Mark’s document about China’s growing foreign policy/military role in the Asia Pacific seem mild enough, and do not extend much beyond similar comments made in the recent past by former Defence Minister Gerry Brownlee, and which also drew the expected rebukes from Beijing at the time.
Arguably, the real audience for Mark’s statement last week was in Canberra, not in Wellington. In effect, Mark was lining us up behind Australia as a team player – just in case Canberra should be feeling at all worried that a centre-left government in New Zealand might be even more inclined than usual to drag the chain on defence spending.
Trumping Our Defence
There were other verbal gymnastics on display in the Strategy 2018 document. Forget China for a moment. How on earth would the Defence Strategy deal with how the growing mood of US isolationism might threaten the “international rules-based order” that the document says (para 6) is “the foundation for New Zealand’s security and prosperity”.
As we have been given ample cause to believe, US President Donald Trump doesn’t like international rules and agreements, or the organisations and liberal democrats who lead them. As we also know – and are likely to see again at this week’s NATO gathering in Brussels – US President Donald Trump dislikes each and every one of the multilateral institutions that underpin the “international rules-based order” that we value so much.
That hate list includes the UN and its pesky conventions about human rights and refugees; NATO, the European Union, the World Trade Organisation, the global pact on climate change, the World Health Organisation, NAFTA etc etc All are seen by the current White House as unwelcome barriers to the exercise of US military and economic power. Incredibly, even a recent WHO resolution promoting breastfeeding brought the wrathful threat of US sanctions down upon the head of Ecuador, who had innocently sponsored the resolution. (Breastfeeding apparently, poses a threat to the profits of US infant formula companies.) Only when Russia offered to sponsor the WHO resolution did the US back off its threat of sanctions.
How, then, did our Defence boffins acknowledge that the Trump presidency is a game-changer for our own foreign policy and defence settings? Answer: very, very delicately. Yet the concern is there, even if the word “ Trump” is absent. According to the document, the pressure on the international rules-based order can be related (para 12.2) to the fact that “Western liberalism [is being] driven by increasing disillusionment with existing arrangements within those societies [that] threaten to reduce the willingness of open liberal states to champion the rules-based order”. That’s Trump’s America, in a nutshell. At para 75, the statement laments the contrast between China’s increasing confidence, and the tendency of “populism and nationalism to cause some Western nations to look inwards at the expense of outward engagement”.
Yep, that also sounds like the United States under current management. At paras 89–91, these concerns are finally addressed directly in a discussion of the US. Populism, and nationalism driven by income inequality is linked to “cultural anxiety associated with immigration” and “public distrust of institutions and elites, questions around the credibility of information [fake news!] and increasing political polarisation, in some cases exacerbated by foreign influence campaigns [Russia!]”. All this handwringing wimps out though, with this bland conclusion:
“Uncertainty about the future international role of the United States has disruptive implications in itself, as states re-assess how they should realise interests in a shifting strategic environment. The United States national security strategy acknowledges a more competitive security environment that will test its ability to remain a peerless global military power.”
You think? The Trumpian threat to the existing rules-based international order that is supposedly “the foundation for New Zealand’s security and prosperity” deserved better attention from the MoD, within this strategy document. This week, the fate of NATO – which provided the umbrella for most of our military efforts in Afghanistan – is also being studiously avoided by the coalition government in general, and by Foreign Minister Winston Peters in particular. They should be worried. After all, why should we keep on spending billions on ships and planes to play our part in traditional commitments that seem to be increasingly meaningless to the current leader of the Western alliance to which we subscribe?
Lost, Last Lions
Theresa May has had a very bad week. While the lyrics on Neko Case’s excellent new album are almost impenetrably personal, I can’t think of a better term than “Last Lion of Albion” for the state of the U.K. right now, its football team excepted.
As sad songs go, this song by Case is worth checking out again, too. You cry like guns across the water, indeed.