Progress in the AUKUS project is likely to slow down over the next year as divisions in Congress and campaigns for the next US Presidential Election will dominate the political agenda for 2024.
During a briefing at the Indo-Pacific Maritime exhibition in Sydney on 8 October, hosted by US shipbuilder HII and consultants KBR, experts warned that there are risks for the AUKUS nuclear-powered submarine program, due to changes in the US political environment.
However, whilst they said that there are concerns about the situation in Washington, they also said there is no need to panic, as the immediate short-term prospects for AUKUS are good. The US administration has allocated US$3.4 billion for the development of its submarine industrial base, and this has been sufficient to break the logjam with the US Senator for Mississippi, Roger Wicker, who is the leading Republican on the Armed Services Committee.
Wicker and his allies had been blocking submarine transfer proceedings in the US FY2024 National Defense Authorisation Act (NDAA). The amendments would allow the sale of two US Virginia-class SSNs to Australia until the government provided a plan to boost SSN production to support both countries.
On 20 October 2023, Wicker welcomed the new injection of funds but stated that further investment is required to support his call for the doubling of SSN production capacity. It is expected that the NDAA will pass by the end of the year or early 2024 at the latest as it is one of the few elements of legislation that broadly receives bi-partisan support in the US.
Whilst there will be export controls under US ITAR, it is expected that Australia will be able to work with them and the AUKUS project is being used to overcome the legislative obstacles and is significant as a driver to get Australian and US industrial cooperation more closely aligned. The Australian Embassy in Washington is working on the legislation and Australia’s shadow defence minister, Andrew Hastie, has urged for an acceleration of the NDAA strategy release.
The late-Senator John McCain had pushed for National Technology Industrial Base (NTIB) legislation that would treat the UK and Australia as part of the US industrial base, similar to Canada’s ITAR exemption status. His vision was for something along the lines of a defence free-trade area between like-minded partners with a greater integration of the respective industrial bases. However, this NTIB has been unsuccessful because not enough export control restrictions were removed that would have allowed it to be effective as McCain had envisaged.
As the NDAA legislation works its way through Congress, Australia is also reviewing its own export controls to provide the US with assurances relating to the security of its technologies. Australia wants to be a serious power and go to Washington DC offering support rather than with requests for financial or technological handouts.
However, industry in both countries does not have the kind of close working relationship and connections that the defence forces have. Australia still does not know how to work in the US system centralised on Washington DC, where concerted campaigns are needed to fix or address issues rather than try and target one person to resolve them. With every AusMin bilateral discussion with the US there needs to be a corresponding industrial primes discussion alongside to deepen the relationships. The engagement of the large US primes in Australia is encouraging but there is more work to do otherwise AUKUS Pillar One and Two will be much harder to achieve.
Whilst short-term progress is expected, further into 2024 it will become more difficult to progress as raw politics takes over. In Washington DC all eyes are on a potential government shutdown and then the Presidential Election.
In Congress, the Republican infighting surrounding the removal of Speaker Kevin McCarthy after his compromise to fund the US government shutdown highlights the more extreme nature of some of the factions in the GOP. The compromise candidate of new Speaker Mike Johnson could present problems.
Johnson has little experience, having only been in Congress for six years and some of his policy positions are very pro-Trump. The immediate test for Johnson is to manage the House and the potential for a government shutdown on 16-17 November, which could happen in the middle of the Asia-Pacific Economic Cooperation (APEC) Summit in San Franscisco, which President Biden and PM Anthony Albanese are attending.
The wider issue with the McCarthy defenestration is that voters are rewarding politicians who refuse to compromise.
The Presidential Election is expected to be strongly contested by Biden and Trump with the two candidates neck and neck in aggregate polls so far. Former President Trump is ahead in some swing states on indicators such as the economy and foreign policy and some overall polling suggests that voters believe the country is going in the wrong direction due to the cost-of living crisis despite good job growth performance.
A change of administration in the US could have serious ramifications for NATO and Europe. But fortunately for AUKUS there is a lot of cross-aisle support in Congress for the US Indo-Pacific strategy to counter China in the region and there is expected to be a continuity of policy whether is a change in administration or not.
Source : Australian Defence