Despite desperate efforts by Prime Minister Anthony Albanese to play down the issue, his Australian Labor government is moving to implement the Trump administration’s public demand for a sharp increase in military spending as part of US war plans against China.
On Sunday, US Defense Secretary Pete Hegseth issued a blunt statement, saying he had “conveyed” to the Labor government that it should increase its military spending to 3.5 percent of gross domestic product (GDP) “as soon as possible.”
Hegseth said he had delivered the message to Australian Deputy Prime Minister Richard Marles at a meeting, held two days earlier, on the margins of the annual Shangri-La Dialogue Indo-Pacific military and strategic forum in Singapore.
It was in line with Hegseth’s aggressive speech to the forum, in which he insisted that all Asian countries must massively increase their military spending to 5 percent of GDP in order to join a US offensive against Beijing.
Before Hegseth on Sunday released the official Pentagon “readout” of his “bilateral meeting with Australia,” Albanese had tried to dodge a media question earlier in the day about meeting Washington’s demand.
Media reports claimed that this meant Albanese had “pushed back” against the Trump administration’s dictate. In fact, Albanese made clear his government’s readiness to increase spending.
He stated vaguely: “What we’ll do is we’ll determine our defence policy, and we’ve invested just across the [four-year budget] forwards, an additional $10 billion in defence.”
Albanese clearly fears the widespread anti-war and anti-Trump sentiment among workers and youth, which allowed his government to win the May 3 election on the back of the collapse of support for the Liberal Party, which was identified with the Trump agenda.
Such spending increases can be implemented only at the cost of basic social services, such as health, education and welfare, and the living conditions of the working class as a whole, triggering working-class opposition.
The Labor government has already committed to reach military spending levels of 2.33 percent of GDP by 2033–34, up from its current level of 2.02 percent. That means allocating $100 billion a year by then, after taking inflation into account. That is nearly double this year’s budget of $58 billion.
But Washington’s 3.5 percent demand “as soon as possible” would raise that to $150 billion a year in the same time frame. That would amount to $50 billion extra a year—more than the federal government’s annual aged care spending, for example.
Hegseth used the Singapore gathering of government and military leaders to ratchet up the decade-long US confrontation with China, which successive administrations, from Obama to Trump, have designated as the chief threat to hegemony that the US secured after World War II.
In his speech on Saturday, Hegseth declared that a war with China, ostensibly over Taiwan, was “potentially imminent.” He insisted that, as well as dramatically boosting their military spending, Asian countries must not try to balance between the military might of the US, and their economic and trade dependence on China. They had to line up with Washington.
His threatening speech, on top of Trump’s tariffs targeting China and countries economically linked to it, sent shock waves through capitals across the Indo-Pacific region. Beijing accused him of turning the region into a “powder keg” and “playing with fire” on “the Taiwan question” in order to pursue US hegemony.
When Marles addressed the conference, he stated his agreement with Hegseth’s bullying demands. He said Hegseth’s confirmation of the US’s “commitment to the Indo-Pacific” was “deeply welcome.”
Marles declared: “The reality is that there is no effective balance of power in this region absent the United States. But we cannot leave this to the US alone. Other countries must contribute to this balance as well, including Australia.”
Sunday’s Pentagon readout of the meeting between Hegseth and Marles made it clear that the demanded boost to Australia’s military spending was part of a wider war agenda by the Trump administration to confront China militarily and economically.
According to the readout, the two men “discussed aligning investment to the security environment in the Indo-Pacific, accelerating US force posture initiatives in Australia, advancing defence industrial base co-operation, and creating supply chain resilience.”
These are code words for making US investment and any relief from Trump’s punitive tariffs depend on further expanding the US military presence throughout Australia, creating a war economy integrated into that of the US and diverting the “supply chain” export of critical minerals and other strategic resources from China to America.
There was only one specific reference, with no detail. According to the readout, the US “welcomed the conclusion of the Precision Strike Missile (PrSM) Memorandum of Understanding on Production, Sustainment, and Follow-On Development—the Department’s first long range fire co-operation on foreign soil.”
In Singapore, Hegseth boasted that the US Army would soon conduct “its first live-fire test of its mid-range capability system in Australia.” This would be “the first time that system is fired west of the International Date Line, the first time it’s been tested on foreign soil. Deployments like this represent a commitment to the region, and there are many more planned.”
Hegseth also said more than 30,000 military personnel from 19 nations would participate in the 11th Talisman Sabre exercise, the largest ever, to be led by Australia and the US in July and August. These extensive war rehearsals will be staged in Australia and, for the first time, in the former Australian colony of Papua New Guinea.
This underscores the Albanese government’s accelerating transformation of the country into a platform for war against China. That includes greater access to ports and air and army bases, the $368 billion acquisition of AUKUS submarines and more frequent visits by US nuclear submarines, together with the rotational presence of 2,500 US marines near Darwin and expansions to the crucial Pine Gap satellite surveillance station in central Australia.
In the Murdoch media’s Australian, Geoff Chambers, the newspaper’s chief political correspondent, suggested that, as a “shrewd political operator,” Albanese had held back a bigger boost to defence spending until after the May 3 election to coincide with a meeting with Trump at the G7 summit in Canada from June 15 to 17.
Behind the backs of the population, war preparations are certainly intensifying. Chambers also reported that the US and Australia had “elevated military exercises and security agency co-operation to a war footing.”
Chambers noted that, after gaining access to US Marine Corps operations in Australia, America’s CBS News last week reported that joint exercises with Australian and Japanese troops were conducted as rehearsals for a war against China.
Brigadier Ben McLennan, commander of the Australian Defence Force 3rd Brigade, told CBS News: “Every time you commit to an exercise like this, it is a rehearsal—and you treat it as your last opportunity to do so before war arrives. A rehearsal for a war the likes of which we haven’t seen since the Second World War.”
With close to 2,500 marines rotating through the Northern Territory, and US submarines, warships and planes visiting often, the US military presence in Australia has already hit its highest levels since the end of World War II.
Provocative exercises are being held frequently. In February, the Royal Australian Navy, US Navy and the British Royal Navy conducted exercises in the South China Sea to “strengthen collaboration at sea” between the AUKUS partners. Last December, Australian, US and Japanese defence personnel ran Exercise Yama Sakura at sites in all three countries, which involved 6,800 troops.
More is to come. Hegseth and Marles on Saturday held trilateral talks in Singapore with Japanese Defense Minister Nakatani Gen to discuss the “severe and complex security environment in the Indo-Pacific and the importance of the Australia-Japan-United States partnership.”
The Japanese government is pushing for Australia to buy $10 billion worth of 11 new Mogami frigates from Mitsubishi Heavy Industries. The Albanese government is due to make a final decision later this year.
Whatever Albanese’s political calculations, the Murdoch outlets and other US-linked voices in the Australian ruling establishment are demanding a far greater and faster military buildup, in line with the Trump administration’s requirements. The government-subsidised Australian Security Policy Institute last week published a “Cost of Defence” report insisting that “immediate action” was needed.
An Australian editorial today declared: “Lifting defence spending a must.” It accused Albanese of having “mulishly rejected” Hegseth’s call to boost military spending to 3.5 percent of GDP. “The PM needs to level with the public about hard choices to be made,” it said.
“These would probably involve paring back the care economy (the National Disability Insurance Scheme will cost $48.5bn this year, set to rise to $63.4bn by 2028–29).”
That confirms the warnings made by the Socialist Equality Party in the May election campaign. While the Albanese government retained office by exploiting the hostility to Trump’s “Make America Great Again” agenda, it is totally committed to the US war path, which means a wholesale assault on all social spending.