The Australia Way: Rewriting the Old Mates Act

In December 1941, as the Japanese swatted the British aside and swarmed across the Pacific, Labor Prime Minister John Curtin declared a seismic shift in Australia's view of the world.

"I make it quite clear," he said, "that Australia looks to America, free of any pangs as to our traditional links or kinship with Britain."

A year earlier, before Japan attacked Malaya and Pearl Harbour, New Zealand was reaching similar conclusions.

But we said it in our own way.

The Governor-General of the day, Viscount Galway, telegraphed the Secretary of State for Dominion Affairs in London, suggesting a New Zealand mission be sent to Washington, if HM Government in Britain saw no objection.

Are we cursed, as expatriate American Dr Howard Frederick recently postulated, with our character of modesty and understatement?

Christopher Niesche, the Wellington correspondent of The Australian, gives a distinctly transtasman view.

Dismissing a New York colleague's suggestion that an incident in which a woman presented police with the testicles she had bitten from an unfortunate male could have just as easily happened in New Zealand, Niesche wrote: "Never. Kiwis are much too polite to do that sort of thing."

This may say as much about our relationship with Australia as anything else. For all our similarities, we reflect different national personalities. It may not be Mars and Venus, but anyone who has ever endured a recession in both countries, or even a good thumping sporting defeat on either side, cannot help but notice.

Is it, as Australian academic Professor Geoffrey McNicholl suggested in a landmark 1993 transtasman study, the same as the division of character separating the United States and Canada?

He quoted an American conclusion that America reflects the influence of its classically liberal, Whig, individualistic, antistatist, populist, ideological origins.

Canada could still be seen as Tory-mercantilist, group-oriented, statist, deferential to authority ...

Australians are more Whiggish, New Zealanders more Tory, though Tories can still be radical, Professor McNicholl noted.

We tend to assume Australians do things better, and admire and envy them for it.

Australians make the same assumption.

Even with Fisher & Paykel in their kitchens, Marlborough sauvignons in their glasses and The Warehouse in their suburbs, they like us quaintly hick and odd-accented, living in a 25-year-old world of eternally rusting Morris Minors and faded weatherboard bungalows.

When we challenge those perceptions, we upset Australia - and when that happens, it can get very personal.

"NZ turns back on tradition of Anzac," The Australian thundered when Wellington dumped its strike jets in favour of a better-equipped Army and a larger, but different, Navy.

Sandy Macdonald, chairman of the Senate foreign affairs, defence and trade committee, was even more outraged, relating Government policy to Phil Goff's appearance at this year's Gallipoli commemoration.

"To have your foreign minister get up - he's a very nondescript little fellow - in his crass suit and purple tie and purple shirt and talk about his commitment to nuclear disarmament ... showed a lack of understanding of what the real world is," he said.

"I think he and Helen Clark must be floating in the same boat."

The same sorts of emotions are aroused by the Qantas bid for Air New Zealand.

Australia believes its best interests must automatically also be New Zealand's, and that New Zealand's apparent preference for Singapore is not commercial or strategic policy, but another bout of Aussie-bashing.

Because we hear such language - and use it ourselves in return - and because the most recent issues to affect the relationship have been defence, aviation and the decision to place, for the first time, limits on the acceptance of New Zealanders in Australia, it is easy to suggest we are heading for a parting of the ways.

But while these may add to a redefining of the relationship, this is a process that has been going on for 150 years and may not be for the worse. The ties of history, kinship and nostalgia that were once almost our sole bonds have been replaced with real and thoroughly pervasive cables.

From the time New Zealand gained its own direct shipping links to Britain and broke with New South Wales until the joint advent of affordable transtasman air travel and the New Zealand-Australia Free Trade Agreement (Nafta) in the 1960s, the only time we got together was in war.

Now there is a common labour market, social bonds as deep as between most Australian states, economies tied with a large degree of interdependency by one of the world's closest and most successful free trade agreements, and companies that operate and invest in either country on purely commercial considerations.

Political and official ties, even with spats and personality clashes between prime ministers, are tight to the point of intimacy.

New Zealand ministers sit on 27 Australian federal-state ministerial councils responsible for determining national policy, from agriculture to health.

Police ministers now meet in the Australasian Police Ministers Council; the National Police Research Unit was renamed the Australasian Centre for Policing Research with the arrival of New Zealand on the board in 1999; our police commissioner sits on the board of the National Exchange of Police Information.

The two countries have similar composition and rates of crime, and face, with varying degrees of scale and emphasis, similar trends - organised crime, drugs, fraud, money-laundering - expanded by migration and the internet and adding to long-established transtasman crime flows.

As crime became a truly international industry, Australia had not only to cope with crime between state jurisdictions, but with transnational gangs of increasing wealth and influence, leading to the evolution of federal crime-busters and national and international intelligence, monitoring, coordinating and research bodies.

NZ is now plugged into that system.

The big companies of both countries are household names either side of the Tasman, nationalities blurring in a corporate blender - Air New Zealand, Qantas and Ansett, Goodman, Lion and Foster's, Telecom and AAPT ...

The Australian dairy industry trembles at the rise of Fonterra; New Zealand winces every time Australia rethinks the four pillars policy that prevents the merger of the four big banks that own all but a fraction of our financial system.

Our fears are similar. We agonise over the drain of brains and talent across the Tasman; the Aussies wring their hands over a similar exodus to America and Europe. We fret that Tower may join the rush of head offices to Australia; they worry that BHP will follow a similar path north when it merges with London's Billiton.

We both worry about replacing the people that we lose.

That problem is more pressing for New Zealand. In the 1990s, the population of both countries grew an average of about 1.1 per cent a year. But ours took a steep dive mid-way through, plunging from 1.6 per cent in 1995-96 to 0.5 per cent in 1998-99, mainly because of the transtasman exodus.

Long term our prospects are similar.

Fertility in both countries has fallen below replacement levels, putting new emphasis on the migration that already provides one-quarter of Australia's population and one-fifth of New Zealand's.

The largest source of migrants for both countries has been Britain. Australia widened its pool earlier than New Zealand, with large-scale migration from Europe and the Mediterranean, but both countries now compete for similar applicants with broadly similar targets and requirements.

Since 1996, 16 per cent of new Australians have come from Indonesia, Hong Kong and China - the largest group after Britain and New Zealand.

A similar percentage of New Zealand's migrants have come from Japan and China, with a further 5 per cent from South Africa and 4 per cent from India.

The past decade has also brought our economies closer together. As the larger partner, Australia consistently runs a healthy surplus, but transtasman exports from both countries continue to climb.

Last year, Australia sold us $A6.6 billion ($7.96 billion) worth of manufactured goods and bought $A4.5 billion worth (up 9 per cent) from us. Australia's services exports soared 18 per cent to $A2.23 billion, ours went up 12 per cent to $A1.64 billion.

New Zealand, with $A11 billion in stock in 1999, is Australia's eight-largest foreign investor. Australia, with $A15 billion in New Zealand, is our third-largest investor.

Both our export economies are dominated by commodities - ours by agriculture and forestry, Australia's by agriculture and mining.

We have both dramatically reshaped our economies, selling or privatising state assets, lowering protection and demanding efficiencies and accepting the pain to farmers and manufacturers.

Australia has been more cautious, readier to buy investment with tax and payroll incentives, more given to pump-priming through large infrastructure projects, and more reluctant to use interest rates to cool exuberance.

With a larger and more diverse economy, and an irrepressibly optimistic population whose spending kept the Asia crisis at bay, Australia has also for the past few years achieved higher economic growth.

And while the relative efficiencies, productivity and performance of each other's economies are another unending source of debate, longer-term trends suggest we are not that far apart.

In its annual assessment of the global economic environment Canberra's key commodity adviser, the Australian Bureau of Agricultural and Resource Economics, forecast average growth for the next five years of 3 per cent for New Zealand, and 3.5 per cent for Australia.

Beyond that, both countries are also trying to tie their futures to knowledge and innovation, linking a similar high level of computer use to expanding IT sectors, boosting education and training and attracting foreign money.

In both countries, policy moves are designed to shift cultural thinking towards the sciences and to lift research and development budgets that lumber well behind the rest of the developed world.

Australia is well ahead in this, with long-standing Government support for centres for research excellence, investment incentives, tax breaks for R&D, support for small-business innovation and large amounts of money for research in such key areas as biotechnology.



But for all the closeness and similarities, we remain separate nations.

Both of us, from the Boer War on, sought the friendship and protection of a big brother - first Britain, then the United States - and, especially since the Second World War, followed policies that took us to war to preserve those friendships.

Australia, bombed and close to invasion in the 1940s, on the brink of war with Indonesia in the 1960s, suspicious always of China and now with the arc above its head inflamed with violence and insurrection, has tied its security to the United States.

It was to keep the US in the western Pacific and ready to help that Australia went to Vietnam, became an immovable ally during the Cold War, was among the first to join the Americans - twice - in the Gulf, was almost alone in supporting US intervention in the Taiwan Strait during the missile crisis with China, and now is a lonely voice in support of America's plan for a ballistic missile shield.

This sense of vulnerability is why Australia attaches so much importance to defence, and why Canberra feels so dismayed by what it regards as New Zealand's abandonment of common cause.

Weakening defence ties, the elimination of most other serious thorns in the relationship, Australia's growing sense of identity with Asia and the pursuit of much larger trade and diplomatic partners have lowered New Zealand on the nation's horizon.

Since the mid-1980s, New Zealand's path has been very different, pursuing small-power diplomacy, and developing a new internationalism that eschews military alliances and questions Australian perceptions, while developing Australia as our major partner.

For all that, our interests frequently coincide. We worked closely together in Bougainville, the Solomons, Fiji and Timor, we cooperate effectively together in a broad range or international forums, and we operate almost as a team in efforts to liberalise world trade.

But we also remain rivals. We compete fiercely for markets, investment, tourists and foreign students.

We are not always friends: Canberra did not take it kindly when we signed a free trade deal with Singapore (though it is now also chasing one), and we darkly suspect Australia is using its military alliance to stitch up a bilateral free trade pact with the United States.

But that's life across the 21st century Ditch.