There’s been a lot of talk about the US-Australian alliance, especially with AUKUS nuclear submarines attracting bi-partisan support in Australia.
Libertarians typically split on the issue of foreign affairs, geopolitics and military action.
(L to R) Australian PM Albanese, US President Biden, UK PM Sunak
Group one says we should maintain a self-reliant, self-defensive military and not engage in foreign entanglements. Adopting a non-interventionist policy in matters foreign, this school of thought argues alliances can put a target on our back so seeks to defend Australia if and only if directly attacked. For want of a better term, we’ll call them the “Neutrality” group.
Group two says free countries are rare, face authoritarian foes and Australia, a free nation, is vulnerable with its large coastline and sparsely-populated continent. Arguing for a robust military but knowing Australia can’t by itself defend such a land mass with few people, this school seeks foreign alliances, which include international obligations, to fully protect our freedoms. We’ll call them the “Alliances” group.
So, here’s the flash poll.
Do you support the United States-Australian military alliance?
Yes or no.
Once you’ve voted, I’ll share some thoughts on this.
An entrepreneur who has employed 1,470+ people, Kenelm was admitted to the BRW Fast 100 three times with businesses in Australia, NZ, Singapore and New York, where he lived for 12 years. Kenelm’s investment firm performs mid-market leveraged roll-ups. He was a regular columnist for the Australian Financial Review. Kenelm is the Founder of Liberty Itch.
This is Part 3 of my 3-Part series on geopolitics.
You really need to read Part 1 and Part 2 before ploughing into this article.
5 Ways To Maximise Peace In The World is Part 1. There, I gave you a menu of options for handling international politics. If you haven’t read it yet, go back and read it now.
Now, in this third and final part of the series on geopolitics, 3 Wacky Crazy Ideas Creeping Into International Politics, I’m going to eviscerate some of the more stupid ideas coming out of the commentariat. Then I’m going to tell you what positions any sensible thinking classical liberal or libertarian should have when it comes to international relations. Then a call to action.
Australian libertarians need to be outwardly-focused, alliance-building policy advocates, and dedicated to early warning defence systems and a deterrent with punch.
Ready? Let’s do it!
Just to prove how centrist classical liberals and libertarians are, and how off-the-charts the Guardian is when it calls us ‘far right’, here are 3 Wacky Crazy Ideas Creeping Into International Politics, all which fall outside the Overton Window as far as I’m concerned:
WACKY, CRAZY IDEA #1: NAÏVE, PEACEKEEPER, WHITE FLAG DEFENCE There are at least 11 senators in the Australian Parliament who, for whatever reason, believe non-aggression means we wait until a foreign-invader’s amphibious craft land on our beaches before we protect ourselves. They are called the Australian Greens. If they had their way, the Australian Defence Force would be relegated to fractional peacekeeper capacity. I have heard some in the freedom-movement, usually young and unschooled in the realities of a harsh world, a tiny group, who share this view. They don’t understand statecraft and chokepoint strategy.
The threat to Australia isn’t from a landing on Bondi Beach. It’s the South China Sea shipping lanes through which passes critical fuel from South Korea on the way to our last two government-subsidised refineries in Brisbane and Geelong. A blockade for 53 days would deplete fuel reserves, preventing trucks from replenishing supermarket shelves. Imagine 25 million starving people in 53 days!
And Australia has other chokepoints which could be squeezed from afar by a foreign actor.
And in this regard, we depart from our US libertarian friends with isolationist tendencies, the ‘no foreign entanglements’ brigade. This might be arguable from the bosom of a 330 million populated, 5422 nuclear warheaded nation. For nuclear-free Australia with a 25 million population strewn across the same continental land mass, it just doesn’t fly. Australian libertarians need to be outwardly-focused, alliance-building policy advocates, and dedicated to early warning defence systems and a deterrent with punch.
WACKY, CRAZY IDEA #2: ANTI UN RHETORIC Can we just stop with the Ricardo Bosi conspiracy theories? Enough. The United Nations is absolutely worth keeping. In fact, it’s a great innovation of the liberal movement of which libertarians are front and centre. We just need to update its software. Classical liberals and libertarians are supporters of cooperative arrangements between nations whether free trade or to prevent of war. Stop with the nutjob UN bashing and start talking UN reform It is a voluntary organisation, not an Orwellian world government.
WACKY, CRAZY IDEA #3: AN ACTUAL WORLD GOVERNMENT This is the biggest of the wacky crazy ideas. Can you imagine the horror of a ‘world president’, world laws, world surveillance, no reprieve from the totality of it all? We have enough of a problem with nation states. As I’ve said, the Structural Realist Theory sacrifices freedom for the security of a global Big Brother. Mad!
A blockade for 53 days would deplete fuel reserves, preventing trucks from replenishing supermarket shelves. Imagine 25 million starving people in 53 days!
A FOREIGN POLICY ON WHICH LIBERTARIANS SHOULD AGREE Australian libertarians ought to advocate the following positions on international relations:
A strong, technologically-advanced Australian Defence Force. Defence is a legitimate role of government. Let’s do it properly, building a domestically-located defence manufacturing capacity delivered by the private sector, space industry included;
Formally-negotiated and robust multi-lateral defence alliances including with Indonesia, Singapore, Philippines, Japan, South Korea, India, New Zealand, PNG, the Pacific Islands and of course the United States, the United Kingdom and the Anglosphere countries. Make clear that alliances will not be granted with countries which permit strategic advantage to apparent foes;
Instant free-trade agreements with those who become our formal allies;
The creation of a Preferential Alliance Citizenship. If a citizen of any of our formal allies wishes to migrate to Australia and has the skills we value, he is given preference. Let’s create a more cohesive cultural and economic region of strategic importance;
Zero foreign aid to any country apart from our formal allies, if that be strategically advantageous;
Trade with our apparent foes, but no Preferential Alliance Citizenship;
A fresh look at the UN Security Council admission criteria.
THE UNLIKELHOOD AND PRECIOUSNESS OF FREEDOM There are 195 countries in the world. Freedom House says 17 of these are true democracies, Australia being one of them. Corruption, tyranny and authoritarianism are the norm, not freedom. We need every possible strategy at our disposal to maintain our precious legacy and to hand it to our children.
Classical liberals and libertarians must continue to operate in the context of the world as it is. We must have our wits about us. We must cooperate and engage and project ourselves as a free people. We must negotiate and trade around the world for mutual benefit, lifting people out of poverty as we do it. We must find the common ground of our humanity. We must continue to show the greater part of ourselves and inspire those with whom we come into contact. We built this modern world. We continue to unlock human potential and flourishing. We must be open to those who value our freedom. We must also deter and resist those who don’t. We must neither aggress nor harm, but we also must not withdraw into the timid shadows of fear at yet another foe, for we have seen so many of them off.
If not entrepreneurial, nation-building classical liberals, if not liberty-loving, deep-thinking libertarians alert to coercion wherever it may lurk, who?
An entrepreneur who has employed 1,470+ people, Kenelm was admitted to the BRW Fast 100 three times with businesses in Australia, NZ, Singapore and New York, where he lived for 12 years. Kenelm’s investment firm performs mid-market leveraged roll-ups. He was a regular columnist for the Australian Financial Review. Kenelm is the Founder of Liberty Itch.
Jim Rickards, an esteemed American investment banker and author with expertise in finance and precious metals, recently brought to light an intriguing prediction regarding the BRICS+ countries:
“I recently revealed that the so-called “BRICS+” countries will announce the creation of a new currency at its annual leaders’ summit conference on August 22–24. This will be the biggest upheaval in international finance since 1971 … the world is unprepared for this geopolitical shock wave. It appears likely that the new BRICS+ currency will be linked to a weight of gold. This plays to the strengths of BRICS+ members Russia and China. These countries are the two largest gold producers in the world, and are ranked sixth and seventh respectively among the 100 nations with gold reserves.”
Understanding BRICS+
BRICS+ is a group of states consisting of Brazil, Russia, India, China, and South Africa. “BRIC” was coined in 2001 for fast-growing, potentially dominant forces in the global economy by 2050. South Africa’s later inclusion expanded it to BRICS+.
Over 17 years, BRICS+ has endeavoured to become a counterbalance to western hegemony. Its institutions like the New Development Bank (NDB) and Contingent Reserve Arrangement are alternatives to the World Bank and the IMF.
This alliance boasts:
Combined economic influence and abundant resources
Seven countries in the membership queue, with 13-14 awaiting consideration
Come August, Saudi Arabia’s inclusion will mark:
50% of the global population within BRICS+
30% of global landmass
54% of global GDP
Two top oil producers: Russia and Saudi Arabia
15%-20% of global gold reserves.
Moreover, an amalgamation involving the Eurasian Economic Union and Shanghai Cooperation Organisation seems on the horizon.
After their first formal meeting in 2009, BRICS+ asserted the necessity for “a stable, predictable, and diversified international monetary system.” Rickards postulates that BRICS+ is gearing up to unveil its currency.
BRICS+ Currency
Recently, Rickards gave a fascinating interview on the YouTube channel Wealthion. In this interview, he was adamant that the BRICS+ currency, (which he termed a BRIC, for convenience), “is not a gold standard”.
“The value of the BRIC is not determined with reference to any other currency. It is determined with reference to gold, by weight of gold”.
The implication of the BRICS+ currency being tied to a weight of gold means that, regardless of anything else going on financially and economically in the world:
1 unit of BRICS+ currency = specified weight in gold
Trade between 50% of the world’s population will transition to BRICS+ currency, which will be defined in gold, so half the world’s trade will be transacted in BRICS+ currency.
Gold’s Unwavering Stature
Warren Buffet, an investment giant, once opined on gold: “Gold…has two significant shortcomings, being neither of much use nor procreative.”
Despite Buffet’s scepticism, gold’s reputation as a store of value has persisted for 5,000 years. He is missing the point of gold. Gold is not an investment, it is real money, unlike the 600 odd fiat currencies in the history of the world that have gone to zero.
Gold fulfills money’s 6 characteristics:
Durability
Portability
Divisibility
Uniformity
Limited Supply
Acceptability.
BRICS+’ gold linkage suggests, in the medium to long term, a potential for spikes in gold demand and the nominal currency price of gold.
A Waning USD?
Let’s take a look at the world’s current world currency, the U.S. dollar. The USD does not fulfill the attributes of money.
The U.S. dollar’s decline is palpable. In 1913, when the US Federal Reserve was established, the fixed price of gold was US$20.67. President Nixon infamously broke the gold peg that was US$35 in 1971. Today, gold hovers around $1,914 per ounce. The dollar’s worth is now 1.8% of what it was in 1971, a staggering 98% fall over 52 years.
Rickards’ analysis paints a bleak dollar future, in contrast to the BRICS+: “This is a bet that the dollar is going to collapse against you over time. I think that’s a very good bet … this is not a three-month forecast … you want to launch this new currency and you say hey long term the dollar is going to collapse in terms of gold. I’ll hook my horse to this wagon called gold by weight, and I’ll just reap the benefits.”
Libertarian Lens
The essential question for libertarians is “What can we do, so that we and our families survive and thrive?”
As Murray Rothbard insightfully shared, “I see a great future for gold and silver coins as the currency people may increasingly turn to when paper currencies begin to disintegrate.”
Allowing for one year’s living costs in cash, keep spare gold in hand (not as ETFs or in banks, which carry counterparty risks). Then, you have a store of value that has well and truly proven itself over millennia.
Meaghan became a staunch anarcho-capitalist after a collection of life experiences that left her disabused of any vestige of goodwill towards the state and its attendant institutions. Notable experiences included university gender studies, and living under social democracy. Now, she writes to advocate for the abolition of the state.
Libertarianism is all about the freedom of individuals from coercion. Libertarians believe the proper role of government is defined by JS Mill’s harm principle: ‘The only purpose for which power can be rightfully exercised over any member of a civilised community, against his will, is to prevent harm to others.’
Within a country this is relatively straightforward – reductions in tax and increases in liberty are supported, increases in tax and reductions in liberty are opposed.
But things can get complicated when it involves matters outside the country. How is libertarianism affected by national borders? Can it apply to relationships between sovereign states?
To what extent should Australian libertarians seek to oppose coercion in other countries?
In his 1801 inaugural address, US President Thomas Jefferson declared that the US should consider its external military alliances to be temporary arrangements of convenience to be abandoned or reversed according to the national interest. Citing the Farewell Address of George Washington as his inspiration, Jefferson described the doctrine as “peace, commerce, and honest friendship with all nations—entangling alliances with none.”
Thomas Jefferson. 2nd President of the United States. Author of the Washington Doctrine of Unstable Alliances.
Known as the Washington Doctrine of Unstable Alliances, this thinking dominated US foreign policy right up to the Second World War. And although America now has longstanding alliances with many countries, including Australia, the doctrine remains influential in some political circles.
In particular, many libertarians support it. In their view, a country should not invest blood and treasure in squabbles beyond the country’s borders unless there is a clear threat to the country and its ability to engage in trade and commerce. It should certainly not maintain military capabilities in excess of what is needed to defend the country.
This is rationalised in terms of libertarian values. History has repeatedly shown that a standing army is a threat to liberty. Moreover, maintaining a military force capable of more than simply defending the country is expensive, necessitating higher taxes than if the Washington Doctrine applied.
They point to wars such as Vietnam, Iraq and Afghanistan, where it is difficult to show any enduring benefits from military involvement by America or Australia. They also criticise current support for Ukraine’s fight against Russia’s invasion.
Ukraine’s ambassador to Australia, Vasyl Myroshnychenko, inspects an Australian Bushmaster armoured vehicle
There is a problem with this thinking though: nationalism and national sovereignty are actually collectivist concepts. They are not libertarian and, Jefferson’s other qualities notwithstanding, neither is the Washington doctrine.
What that means is there is no libertarian justification for doing nothing about coercion merely because it is occurring in another country.
Coercion should always be our concern, wherever it occurs.
That does not necessarily mean rushing military aid to those subject to coercion in other countries. There are many reasons why that might not be possible, practical or advisable. But it is perfectly legitimate for libertarians to consider whether there is anything they can do, militarily or otherwise.
Some interventions have made a major difference. But for America’s entry into the Second World War, for example, Germany and Japan would have imposed their dreadful dictatorships on most of the world. But for America’s intervention in Korea, the people in the south would now be suffering the same miserable fate as those in the north. And but for Australia’s intervention in East Timor, the country would be suffering under Indonesia’s heavy-handed military rule, now obvious in West Papua.
Australian Peacekeeping Handover of East Timor
There are also some current examples to consider. One of the consequences of the climate change panic, for example, is that around 40,000 children in the Democratic Republic of Congo work in appallingly inhumane, slave-like conditions in cobalt mines. The cobalt is used in lithium-ion batteries required by electric vehicles.
In China, the government has imprisoned more than a million Uyghurs since 2017 and subjected those not detained to intense surveillance, religious restrictions, forced labour, and forced sterilisations. Forced labour is used to produce solar products.
It is estimated that China has 98 percent of the world’s manufacturing capacity for photovoltaic ingots; 97 percent for photovoltaic wafers; 81 percent for solar cells; and 77 percent for solar modules. Many of the largest global producers of photovoltaic ingots and wafers, solar cells, and solar modules directly source polysilicon from entities believed to use forced labour in its production.
Even a boycott of products associated with such coercion would be more consistent with libertarian values than doing nothing based on the “no entangling alliances” idea.
JS Mill was also an advocate of utilitarianism in addition to classical liberalism. This philosophy, generally attributed to Jeremy Bentham, is often summarised as seeking the greatest good for the greatest number. For libertarians, it should mean the greatest liberty for the greatest number.
David Leyonhjelm was an Australian Senator from 2014 to 2019 representing New South Wales for the Liberal Democratic Party. Notable for his libertarian consistency, David’s work in Senate Estimates attracted acclaim worldwide for its forensic examination of government
waste. Professionally, he is a veterinarian and agribusiness consultant.
