What does it mean for a middle-sized regional power to be a friend and ally of the United States in the 21st century? This question is being debated today among U.S. allies with an intensity not seen since the Vietnam War. The wounded hegemon roused to action after September 11 has provoked sympathy, alarm and astonishment, but above all a desire to know whether America's pledge to defeat its new enemies once again represents the last best hope for mankind, or whether it will instead unleash a self-defeating cycle of violence and rippling chaos.

Among America's European and Asian allies a good deal of angst has been communicated to Washington in recent months, much of it organized around U.S. policies toward Ba'athi Iraq and communist North Korea. Accusations of arrogance and unilateralism have been tossed at the Bush Administration; intimations of fecklessness have been tossed back. Amid all this noise it has been easy for Americans to overlook what has been happening in Australia.

When they think about Australia at all, Americans see it as the least of their problems. The two countries have counted their dead in the war on terrorism, first in New York, Washington and Pennsylvania, and then in Bali. Australia has volunteered to fight alongside the United States in Iraq without conditions or complaints in contrast to certain other old American friends. But difficulties are now arising within this fifty year-old alliance, and it is best that they be acknowledged and addressed.

Friends Indeed

America has had few closer allies than Australia. Over the past century the two countries fought together in five wars and began the new century as allies in the war on terrorism, with Australian special forces fighting in Afghanistan. In June 2002 Australian Prime Minister John Howard told the U.S. Congress that "America has no better friend anywhere in the world than Australia." On the fiftieth anniversary of the security alliance (ANZUS) between the nations, Secretary of State Colin Powell described Australia as "our oldest and closest ally in the Pacific region." The relationship is enjoying one of its periodic high tides with a Republican president in the White House and a conservative prime minister in Canberra. The new National Security Strategy pays positive attention to Australia as a model ally, and the two nations are now negotiating a free-trade agreement--a difficult but potentially far-reaching expansion of their ties.

All this notwithstanding, Australians have gotten a mixed message from Washington over the past year. From "down under", it looks as if Colin Powell's effort to construct a broad military coalition to deal with Iraq was contradicted by Defense Secretary Donald Rumsfeld's depiction of a unilateralist America that would not allow any coalition to define or undermine its mission. Of course, the United States has not discarded deterrence for pre-emption in all cases, but the intense public debate in Australia and many other countries focused on pre-emption. As a result, Australia's perception is that under the Bush Administration the United States is a more demanding alliance partner.

For the first time in many years, too, the alliance with America has acquired a sharp domestic focus, largely owing to the Howard Government's early declaration of intention to participate in Iraq. Opinion is now polarizing around competing views of the United States. One view, shaped by tradition, is for expressions of alliance unity and resolution to meet common threats, along with a conviction that Australian influence on the United States is maximized by close partnership. The alternative is for keeping some distance between the allies in this instance, for fear that misjudgments in Washington will harm Australia. This sentiment doubts whether America remains a reliable ally and prudent hegemon.

In any such debate, of course, what America's friends are saying counts most, but even many such friends are more worried than usual. In late 2002, three former Australian prime ministers--Gough Whitlam, Malcomb Fraser and Bob Hawke--as well as several former military chiefs joined to sign a letter opposing their country's participation in any Iraq campaign that is not validated by a specific UN Security Council resolution. This effort was orchestrated by former Labour Prime Minister Hawke, notable for his pro-U.S. views and close relations in office with President George H.W. Bush, and such sentiments are shared widely in Australia's foreign policy community outside of the Howard Government. Even inside this pro-U.S. government, private concerns have been vented about President Bush's inability during 2002 to persuade the Australian public to his cause.

Among America's best Australian friends, too, there is a dawning recognition that a more demanding America poses a challenge. Over the past year the word "unilateral" has meant to discerning observers not that the United States would prefer to act alone, but that it expected its closest friends to embrace its own threat perceptions. Like most other nations, Australia was psychologically unprepared for the 9/11 calamity. Its empathy for America over the attacks on New York and Washington was real enough, but when President Bush said that America was "at war'', there was little real sense that Australia was also at war. When the President declared that Iraq was a threat to the United States, there was no real sense that Iraq was also a threat to Australia.

An omen of this disorientation in Australia was the fact that the ANZUS Treaty was invoked for the first time by an attack on America, not on Australia. Australian architects of the alliance, and most of their Australian successors, assumed that ANZUS had mainly to do with American help for Australia's national security, not the other way around. Naturally enough, when the equation was reversed, new questions arose. What dangers and costs might Australia create for itself by joining U.S.-led military coalitions? Will America play the constructive leadership role in the international system that its junior allies need and expect of such a hegemon? Or will alliance actions undermine Australian security in its particular regional framework?

These questions are vital for Australia. While John Howard was correct to stress shared values between America and Australia, shared values are ultimately not as important in an alliance as shared interests and strategic purpose. Any discussion of the U.S.-Australian alliance must penetrate the haze of mutual congratulations that surrounds it and address this question of shared strategic purpose. When we assess the alliance in that way, the first thing we see is that things have changed from Cold War days--and rather too few observers have marked the ways.

A Matter of Interests

Since 1951, the shared purpose that knit America and Australia together (initially with New Zealand) arose from the common enemy of Asian communism. This was why the ANZUS Treaty was negotiated and sustained. In a deeper sense the treaty has worked Australia's way, since an alliance with the world's superpower is a national asset for a middle power operating outside any regional political bloc. But with the end of the Cold War, and of any broad threat from Asian communism, what are the purposes of the alliance today? Since the ability of the ANZUS partners to re-interpret the alliance to fit new strategic circumstances is the guarantor of its endurance, we should want to know what this re-interpretation sounds like.

From Australia's perspective, such re-interpretation has three basic themes, the first of which arises from the old geopolitics, the second from the new, and the third from a combination of the two.

The first theme concerns China. Is America prepared to accommodate the rise of China and work to integrate it into a constructive Sino-American framework? Since Australia's national destiny is tied forever to East Asia, this is obviously a matter of paramount importance for it.

The second question originates within the new geopolitics: how the United States chooses to pursue its security interest in the long struggle with Islamist terrorism. Does the United States prefer a unilateral, military-dominated approach or one that gives weight to multilateral and political mechanisms as well? How this question is parsed in practice is of enormous importance for all U.S. allies, for it will define the intersecting parameters of utility and trust within America's closest bilateral relationships.

The third question is a subset of the second: How will the alliance be relevant to Australia's challenge from Islamist terrorism within Southeast Asia and, more generally, to the prospect of living with this destabilizing threat? The October 12, 2002 Bali bombing, which killed 88 Australians, was a psychological and strategic turning point for the country. Australia must now realistically see itself as a terrorist target and its region a frontline in the war. This is a new enemy never imagined by the architects of the ANZUS alliance. The decision for Australia is whether to approach this challenge by giving priority to its partnership with the United States or to collaboration with its neighbors--or to engage in the difficult test of finding a sustainable balance between the two.

Managing a Rising China

While America is Australia's most vital state-to-state relationship, its most important region is East Asia--the focus of its trade (56 percent of exports), neighborhood cooperation and security concerns. For several decades the central task of Australian policy has been to integrate its Asian ties with its U.S. alliance, a challenge assisted by the fact that these objectives have been mutually reinforcing most of the time. For example, the joint status of Australia and Japan as U.S. security partners deepens the scope for Australia-Japan collaboration. If the U.S. alliance came to be seen as undermining Australia's role in Asia, on the other hand, then it would count as a serious liability to be weighed against the undoubted benefits of the alliance. Australia, therefore, has a profound interest in the way America manages its relations with China.

Australia values a U.S. forward role that contributes to the regional balance but tolerates the rise of China by seeking to incorporate it into mainstream international economic and security systems. This view is founded in realism, buffered by a bit of justifiable optimism. It recognizes the lack of strategic stability in East Asia, China's role as an anti-status quo power, and the risk inherent in Asia's three unresolved flashpoints: the India-Pakistan dispute, the division of Korea and the Taiwan issue. A strong U.S. role is indispensable to a peaceful regional balance. It is hard to see any downgrading of ANZUS, however, that would not be part of a U.S. regional retreat--a retreat that would also concern Japan and South Korea in the north and, at a minimum, Singapore, Thailand, the Philippines and Australia in the south.

Australia's main worry, however, is not the likelihood of a U.S. retreat but of an ideological overreaction to China's rising power. Australia opposes any American effort to define its Asian purpose as the "containment" of China. This applies either to the emergence of a hardline U.S. unilateralism or any effort to conscript America's Asian alliances into a plan of regional containment. If America's allies in the Asia-Pacific are typecast as part of a China containment strategy, the entire region could become hostage to a deteriorating U.S.-China rivalry--and, from the looks of China's de facto post-communist realities, a needless rivalry at that.

The nightmare scenario for Australia is one in which it would be forced in a crisis to choose between the United States and China. Since Australia would have to side with America, at least nominally, the costs arising from a breach with China would be substantial--particularly if responsibility for any crisis was seen to rest mainly with Washington rather than Beijing. In this situation some Australians would argue that the price of the alliance was no longer worth paying--a fact that underlines the need for each alliance partner to be realistic about what it expects from the other. This is particularly important in relation to China because Australian and American attitudes are considerably more divergent than is generally realized in the United States.

In Australia, unlike in the United States, China policy is more a source of unity than conflict. This is the result of thirty years' worth of bipartisanship on the growth of economic, political and security ties. The future power disparity is such that Australia does not regard China as a rival; rather, Australian governments have sought a relationship with China that transcends the limits imposed by the Beijing-Washington rivalry.

As things stand today, the majority view within Australia is that such transcendence will work for the time being because China, being far weaker than the United States, will defer any crisis. Any near-term testing of this view is likely to center on Taiwan. This is where management of alliance expectations is crucial. There is no disposition in Australia for military commitments in Northeast Asia. Australia's armed forces are not structured for such a role and, except possibly in the unlikely event of crude aggression on the part of China, public opinion would not expect or support it. The political reality that underpins the U.S.-Australian alliance needs to be explicit; America needs to know that Australia will do less than it may expect in Northeast Asia, and Australia needs to accept that it must do more in Southeast Asia. In this sense East Timor and Taiwan offer useful keys to the partners' interpretation of their alliance to each other.

The successful 1999 collaboration over East Timor began with a sharp misunderstanding. Prime Minister Howard was surprised by President Clinton's refusal to contribute U.S. ground troops to the UN force and, for a few days, there was a breakdown between Howard and Clinton. It rapidly evolved into a model of alliance cooperation: Australia as the regional power led the UN force, backed by indispensable U.S. logistical and political support. The overall message is that Australia must assume greater responsibility commensurate with its role as the metropolitan power in the South Pacific and the main economic power in Southeast Asia.

By the same token, the United States should be aware that in any conflict over Taiwan, the Australian contribution would at best be extremely modest and quite probably merely declaratory. Australia has no legal obligations to Taiwan. The "one China'' policy is rarely contested in Australia. There would be little support for a democratic Taiwan moving toward independence. Australia's view is that Taiwan enjoys autonomy and de facto independence as it is and that there is no reason why any Australian should die to convert that into de jure independence. It is difficult to imagine the circumstances, outside of overt Chinese aggression, where any conflict over Taiwan would generate even modest support for Australian involvement. The potential damage to Australia's interests in terms of its China relationship could represent the most serious cost for Australia in the alliance's history. In terms of the current debate, Australia has no vital national interest at stake with Iraq--except as it may ultimately affect WMD proliferation trends. But Australia certainly does have vital interests at stake with China, right here and right now.

Australia's view is that China should meet the region's expectation of a non-military solution, and that the United States and Taiwan should avoid provocation in the short term to win a managed solution in the long term. In the event of a more militant and unqualified pro-Taiwan line emerging in the United States, the chance of a breach between Australia and the United States could not be ruled out.

That the war on terrorism may improve long-term U.S.-China relations, or at least reduce the likelihood that a rivalry will intensify anytime soon, is good news. But the enduring message for the alliance is the need to manage expectations over China to avoid sudden shocks and political disappointments between Washington and Canberra. Now--when the emotional focus in both countries is being directed elsewhere--is an excellent time to talk this out.

The Global War on Terror

It is far from obvious that the war against terrorism unites American and Australian interests to the same extent as have previous wars. The fear among America's allies, that the United States will deliberately privilege pre-emptive military and unilateral means, varies from ally to ally and is often exaggerated. Nonetheless, it is true that American perceptions of the threat it faces are different from those of its allies. To the extent that America tends toward military pre-emption and unilateralism over multilateralism, it creates new problems for old allies.

These differences between unilateral and multilateral approaches, while nothing like the caricatures created in some quarters (and stimulated by some over-dramatic rhetoric by the U.S. Secretary of Defense), do matter. While not disparaging multilateral undertakings in all but the most vital of U.S. interests, Charles Krauthammer favors, as he put it in the Winter 2002/03 issue of The National Interest, "the aggressive and confident application of unipolar power rather than falling back, as we did in the 1990s, on paralyzing multilateralism.'' Fareed Zakaria understands as well as anyone the fragility of the United Nations and the need for U.S. security policy leadership, but he warned in the October 21 issue of The New Yorker that U.S. hegemony needs the legitimacy derived from operating within an international consensus. "Without this cloak of respectability America will face a growing hostility around the world'', he wrote, adding that without such respectability anti-Americanism will become "the global language of political protest--the default ideology of all opposition--unifying the world's discontents and malcontents.''

On balance, most Australians incline to Zakaria's sensibilities rather than to Krauthammer's. Australia's support for the Bush Administration's military actions should not be misread to underestimate Australia's serious interest in the legitimization of such actions. There has been a strong bipartisan view in Australia that any Iraq campaign should be sanctioned by the UN Security Council. Australia's preference in the post-September 11 climate for military action sanctioned by a broad coalition of nations mirrors its concern that the new U.S. emphasis on pre-emption could risk greater global disorder, and that deterrence should not be lightly abandoned.

Australia has strong national interest reasons for such concerns. As a middle power, Australia is interested in seeing that U.S. hegemony is deployed not just on behalf of America itself but for a better global order. This is how any sensible middle power thinks. Australia wants the United States to operate as a constructive global leader that supports Australia's post-World War II diplomatic synthesis between realism and multilateralism. In its realist phase, Australia has prized the U.S. alliance with its military and security dimensions to bolster its own security and political leverage. In its multilateral commitment Australia's interests have consisted in the development of law, treaties, economic agreements and peacekeeping to advance the development of a rules-based international system. This logic derives from Australia's situation as a stable country in an unstable region.

Australia therefore does not want an America so imprisoned by the search for consensus that it is paralyzed from taking military action. But neither does it want an America that is walking away from global institutions rather than laboring to work within them. Indeed, nothing would cause more dismay in Australia than seeing the European Union prevail within such institutions at the cost of those institutions' ultimate viability. If America should ever decide that the global institutions and rules of the post-World War II period have little value for its needs as a hegemon, it would be disastrous for middle powers such as Australia.

In short, Australia prefers an America that values partnerships and coalitions, that utilizes soft as well as hard power, that emphasizes political methods as well as military ones. Such an approach is critical to maintaining a sense of common purpose in relation to ends, means and language. One reason for this is that a certain rise in anti-Americanism is inevitable; great powers, no matter how benign, invariably generate resentment. But Washington must understand that such a development affects not just America but increases the potential price paid by America's allies in siding with the hegemon. This is not an argument against all military action. It is an argument for more attention to the tone of U.S. policy, and for legitimizing military action by law and through coalitions whenever possible.

Such care is particularly important because the American alliance system is overwhelmingly composed of democratic countries with real publics. Australia's pro-U.S. political leaders spent much of 2002 trying to uphold the American position, only to be engulfed by a tide of unilateral and provocative rhetoric from the U.S. administration that had the reverse impact. The U.S. alliance is not immutable in Australia. It needs democratic nourishment and it can be sustained in the long run only by public support that sees military commitments under its banner as being in the national interest and possessing international legitimacy. It is idle to believe that any lurch to an American unilateralism would not erode the domestic political support within Australia for the alliance.

The Southeast Asian Theater

Since the October 2002 attack in Bali, a new factor is affecting Australia's alliance ties--that Australia itself is a prime terrorist target of the collaboration between Al-Qaeda and Southeast Asian groups such as Jemaah Islamiyah. This is a decisive change; it means that Australia now has a security crisis at its very doorstep.

Even the most apolitical Australian knows that Osama bin Laden has singled out Australia by name, and even the moderately thoughtful realize that Australia's status as a target is permanent--a function of geography, the values of its democratic multicultural capitalist society, its identification with the United States and its prime role in the liberation of East Timor. The evidence of Al-Qaeda's penetration of Southeast Asia over the past decade, furthermore, is irrefutable, as is the fact that Malaysia, Indonesia and the Philippines have become the new frontiers of a war in which Australia is invariably implicated. Australians also know that the governments of these countries cannot solve their terrorism problems alone, the result being a strong Australian interest in maximizing its influence and efforts to help them.

The formative template for this new understanding was the Australia-Indonesia decision only days after the Bali bombing to establish a joint investigation and inquest into the atrocity. Clearly, Indonesia is the key as far as Australia is concerned. It is Australia's nearest main neighbor, the world's fourth-most populous state and an overwhelmingly Muslim nation. Amid Indonesia's current systemic crisis--complete with nose-diving economy; several secessionist movements; and rising Islamic radicalism, anti-Americanism and xenophobia--are somewhere between a few hundred and a few thousand Indonesians who were trained in Al-Qaeda's Afghanistan camps.

Since Indonesia's future hangs in the balance, Australia needs a cool head to support its uncertain democracy, its moderate mainstream Islam, and those supportive of a tougher line on terrorism. Australia's regional policy aims to negotiate agreements on counter-terrorism with Southeast Asian nations and deepen links between intelligence agencies and police forces. The wider strategic challenge for Australia, however, is to strike a new balance between its regional security needs and its global commitments to the United States as a senior ally. So the question becomes: What role does the U.S. alliance play in helping Australia to meet this new threat to its security?

It is vital for Australia and desirable for the United States that the alliance between the two countries is seen to have a positive impact on Australia's new Southeast Asian problem. Any sense that the alliance hurts Australian efforts to combat new threats would be highly damaging to it. But it will not be easy for Australia to intensify its counter-terrorism agenda in the region while maintaining open and full military support for the global U.S.-led war on terror. Australia cannot afford the impression to develop in Southeast Asia that it is merely the regional agent for the United States. The Howard Government's worst mistake has been to give currency to this notion. It is not only a liability for Australia in Asia but unacceptable on the homefront. However, such a perception already exists in Southeast Asia, where Australia's influence has been diminished.

Clearly, Australia must operate more as an independent player within the alliance. A new and complex phase of Australia's effort to integrate its U.S. alliance into its regional needs is thus beginning. The immediate risk for Australia is that its role in Iraq will aggravate anti-Australian sentiment among Muslim communities in Southeast Asia and fan hatred among Muslim radicals. This is not a conclusive argument against Australia's participation in Iraq or other U.S.-led coalitions if such participation is justified on its merits, but it does mean that Asian reactions need to be monitored carefully to ensure that regional governments do not retaliate by withdrawing from arrangements with Australia. That would constitute a zero-sum game between Australia's regional needs and its U.S. alliance, and a zero-sum game is exactly what Australia needs to avoid. This will involve, no doubt, a test of American tolerance and Australian innovation.

Australia's approach, overall, to these new strategic tests for the alliance should be obvious. A poorly grasped element of the alliance, for many years now, has been Australia's role as an initiator of policy direction and change. In asymmetrical relations the initiative often lies with the junior partner who has far more at stake, invests greater political capital in the arrangement and enjoys a larger commensurate gain. This tradition is a firm platform on which Australia should now operate as innovator. It means an Australian engagement with the United States that is more, not less, intensive over how to respond to these new challenges.

In the meantime, Americans might profit from reflecting upon what Australia brings to the partnership. It offers a range of benefits: shared military arrangements and an ally that, when the chips are down, is prepared to fight; a country on the rim of East Asia that can assist the U.S. position in the region; an independent partner with common values whose public support can help the United States in political terms and whose private counsel can provide a test of policy. Australia is also an ally prepared to take a leadership position as the metropolitan power within its region--an event rarely replicated in Europe during the last decade. These are assets that a prudent America should value, and if they are valued, they will be sustained by U.S. political capital and a genuine effort to define new points of concord. The alternative is easy to state: it is to watch as a true partnership of peoples is undermined by a lack of understanding and imagination required in changed times.