Guns still point to China: Ukraine a backdrop for national security panic merchants

by Marcus Reubenstein | Mar 4, 2022 | Government

After a two-decade wait, Australia’s ”defence and strategic policy think tank” ASPI finally has a new war, one that will be a financial boon for its murky weapons maker backers. Backed also by Scott Morrison and Peter Dutton, this “independent” think tank is a key player in drumming up a pre-election China threat, writes Marcus Reubenstein.

The Australian Strategic Policy Institute (ASPI) is busy not so much with a conflict on the other side of the globe but finding a way to spin the misery of the people of Ukraine into anti-China propaganda. It’s just the kind of propaganda Scott Morrison wants, and the prime minister clearly thinks he needs, in the run up to a likely May federal election.  

For years ASPI has suckled at the teat of the weapons industry; but far and away the most generous of ASPI’s benefactors is the Morrison government.

That makes sense because ASPI is not an independent research group. It is an Australian Commonwealth company, which reports directly to Defence Minister Peter Dutton and the appointment of its executive director must be ratified by cabinet.

When Morrison replaced Malcolm Turnbull as prime minister in 2018, ASPI was receiving around $1.6 million in annual government contracts over and above its core Defence Department funding of $3.5 million.

Faced with the real prospect of losing the 2019 election, Morrison and then defence minister Christopher Pyne changed the funding agreement to lock in $4 million of Defence funding for each year over five years.

What both ASPI and the government failed to mention was the Morrison government was about to embark on a gargantuan funding top-up strategy through the awarding of numerous government contracts.

Department of Finance figures show ASPI was awarded $9,497,783.88 in Commonwealth contracts in the 2020-2021 financial year.

The 500 per cent increase in Commonwealth contracts awarded to a group parroting, and amplifying, the key national security message of the Morrison government suggests ASPI has been politically shifted from strategists to propagandists.  

Prior to a detailed examination of ASPI’s funding sources published by Michael West Media in 2020, there had been zero disclosure as to the level of funding ASPI received from its benefactors.

These amounts are not insubstantial; in total ASPI has generated more than $100 million in revenue.

With a light shining on its finances ASPI now discloses the payments it gets from its funders. Outside Australia, that is principally a handful of foreign governments, weapons makers, and tech companies with a vested interest in crippling China’s rise as a global technology provider.

Buried on page 152 of the latest ASPI annual report is the claim that it received $2,620,978.73 in funding from government contracts. This does not reconcile with the Department of Finance’s figure of almost $9.5 million.

According to the Department of Finance, ASPI racked up 25 Commonwealth contracts while ASPI claims the figure is 21 contracts. ASPI’s accounts are audited by the Australian National Audit Office and there is no suggestion of impropriety in its reporting of income.

Three substantial contracts, two from Defence and one from the Department of Foreign Affairs, were multi-year agreements totalling $8,969,783.80. For reporting purposes, it appears there’s no requirement for disclosure of these specific payments in that reporting period.

One oddity is a contract of $1.5 million (CN3757203) awarded to ASPI in March 2021. Outside Defence, it is far and away the biggest single Commonwealth contract ever awarded to ASPI, yet there is not a single mention of it in the 2020-2021 annual report.

Transparency has never been ASPI’s strong suit.

Putin, payments and propaganda

No sooner had Prime Minister Scott Morrison announced Australian taxpayers were doling out $70 million to NATO for weapons to be sent to Ukraine, the Australian Strategic Policy Institute (ASPI) jumped in with its comprehensive analysis.

In line with its constant drone of “independence” from Canberra policy thought, ASPI challenged the wisdom of Defence Department policy. However, the main tenet of its criticism was that the Australian government has not bought enough missiles.

And who makes the shoulder-launched anti-tank Javelin missiles, en “kangaroo” route to Kyiv? Long-time ASPI sponsors Lockheed Martin and Raytheon.

The latter for years was the world’s biggest manufacturer of child-killing cluster munitions. Though they stopped making them in 2016, Raytheon cluster bombs have been stockpiled and reportedly are still being launched on civilian targets in the forgotten war in Yemen. 

Raytheon is no longer an ASPI sponsor but there was zero disclosure in the ASPI missile piece that it took money from Raytheon between 2013 and 2019. Annual reports reveal Lockheed Martin – which makes the dud F-35 Strike Fighters which have soaked up billions in Defence spending – has been pouring money into ASPI’s coffers for the past 18 years.

ASPI presumably justified its non-disclosure of these sponsors because it had not identified they manufactured the Javelin missile in the report.

In late January, independent US website In These Times reported the CEO’s of Raytheon and Lockheed Martin both “boasted” on conference calls with Wall Street analyst that conflict between Russia and Ukraine was a “boom for business.”

One analyst reported Raytheon CEO Greg Hayes had said, in reply to a question about arming US allies: “Obviously we have some defensive weapons systems that we could supply which could be helpful, like the patriot missile system”. While commenting on rising geopolitical tensions, including both Ukraine and China, he said: “I fully expect we’re going to see some [financial] benefit from it.”

Spike in spruiking

When ASPI criticises Australia’s armed forces for the purchase of one type of weapons system it usually suggests an alternative — often the alternative just happens to be made by an ASPI sponsor.

In this case, ASPI’s Marcus Hellyer argued Australia’s shoulder-launched Javelin missile largesse had missed the mark. According to Hellyer, Australia has the wrong missile; instead we should be armed with Israeli-built Spike missiles, which were ordered two years ago by the ADF. There’s no sign of them yet.

And who makes the Spike? Another ASPI sponsor, Rafael. ASPI did disclose this at the end its article, in rather meek terms, that Rafael had hosted a workshop for the think tank in the previous year.

One thing ASPI has consistently never publicly discussed is the money its weapons industry sponsors get from the Australian government. In its 2018-19 annual report, ASPI boasted that it facilitates access to highly placed government officials for its sponsors. Between ASPI’s establishment and 2020, its sponsors collected more than $80 billion in Defence Department contracts.  

ASPI’s China syndrome

ASPI’s analysts have been all over this latest conflict running two familiar lines: Western nations need more weapons and China is the real threat.

On  February 24, ASPI executive director Peter Jennings, who is a columnist at Murdoch’s The Australian, wrote an opinion piece in which he asserts “China wins from this conflict.” Clearly there are geopolitical ramifications for China that will concern Australia, but to effectively put China front and centre in an eastern European conflict is straight out of the ASPI playbook.

In that same article Jennings argued that the failure of the Afghan military forces against the Taliban boiled down to one crucial factor — a lack of military hardware.

Imagine the price tag on hardware needed to fight a war with China that some of our politicians and security establishment as apparently salivating for.

Marcus Reubenstein is an independent journalist with more than twenty years of media experience. He spent five years at Seven News in Sydney and seven years at SBS World News where he was a senior correspondent. As a print journalist he has contributed business stories to most of Australia’s major news outlets. Internationally he has worked on assignments for CNN, Eurosport and the Olympic Games Broadcasting Service. He is the founder and editor of China-focussed business website, APAC News.

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