June 11, 2025 • 11 mins
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Well, there's tension in Canberra and on North Terrace this
morning with news the Pentagon has launched a review of
the Orchest Defense Pact to make sure it's aligned with
Trump's America First agenda. It's thrown the two hundred and
forty billion dollar agreement with Britain and Australia into dart.
So just where do we stand. Michael Schubridge is the
Director of Strategic Analysis Australia. He joins me. Now, Michael,
(00:21):
good morning to you.
Speaker 2 (00:22):
Hey Grahm, how are you well?
Speaker 1 (00:24):
Thanks? So what do you what do you make of this?
Is there reason to be concerned?
Speaker 2 (00:29):
Well? Yes, I think I'm reminded of that Fridge magnet
from the Howard government. Be alert but not alarmed. This
is going to be a pretty serious review by the
Pentagon and then it's going to go up to Donald
Trump's desk and there are both looks. Well will be
important you know from the Pentagon. We know that Elbridge Colby,
(00:53):
who's the undersecree of charge of this, he's an Orchest
skeptic and that's lining up with his view of America First,
Trump's signature policy direction. And it's all about is this
deal in America's interests and some of the big factors
there are America hasn't got enough of these subminds to
(01:13):
meet its own needs and right when we want the
first three is when the US Navy is at its
low point. And even with US ingesting cash into the deal,
are we more of a hindrance than a help as
the US meets its own industrial and production challenges.
Speaker 1 (01:33):
So could the whole ORCHUS agreement be scrapped at the
end of this or adjusted? What are your thoughts?
Speaker 2 (01:40):
Well, Scrapped is probably the more extreme end. Renegotiated I
think is pretty likely, and that sort of gets you
to the Trump side of it. I mean, Donald Trump
has made a point for years now of seeing every
deal that Joe Biden has predecessor did as a bad
(02:00):
deal and either one that should be entirely ended or
negotiation renegotiated, because Trump can do a better deal for
America than Biden ever could. So I think renegotiation looks
very credible.
Speaker 1 (02:16):
Is there anything else Strata can do? I mean, do
we just have to sit back and wait for the
outcome of this review? We have the Prime Minister going
to the G seven summit likely to meet with the President.
Is he likely to bring up orcus.
Speaker 2 (02:30):
Well, if he doesn't, he's wasting valuable time. But I
think Australia can't look like a supplicant here. We have
to be able to say why August is important to
us and why we think us doing this with America
and the UK is good for all of us. And
if we can't make that case, and we can't show
(02:51):
whe're doing the heavy lifting we need to, then we're
in trouble.
Speaker 1 (02:56):
The US has already called on our data to up
our defense spending. Anthony Albanesi said, that's a decision we
will make.
Speaker 2 (03:03):
What are your thoughts, Well, this review says it's going
to look at whether the allies that's the US and
the Australians and the UK in this review are stepping
up with collective contributions to collective defense. And when the
Americans look at our country and our defense capability in spending,
(03:26):
they know that we can't afford the military we plan
along with nuclear submarines for two to two point three
percent of GDP. So the amount of spending is definitely
going to be on the table in this review and
probably in the Trump Albanesi meeting. If they have one.
Speaker 1 (03:44):
It's come to light today that Australia ranks fifteenth in
defense spending. Does that show us up in a bad line?
Speaker 2 (03:52):
Well, I don't think that means we're actually proportionally spending
lessive to our national wealth, because I think we're about
the twelfth or thirteenth largest economy. And you know that
backs up the numbers. America is spending three and a
half percent of its GDP And an America first perspective,
(04:14):
which is Trump's view of the world, is anyone who's
spending lesson is free riding. And it's pretty hard to
say that's not true when we want American crown jewels
in the former nuclear submarine.
Speaker 1 (04:27):
Australia needs ORCUS just for defense of the nation, but
we also needed financially and here in South Eastralia. The
whole program is pretty much based here. So it's not
only defense, is you it's a financial security issue.
Speaker 2 (04:43):
Well, and from an Adelaide point of view, the terrible
history of submarine decision making by various Australian governments over
time must add in to the to the concern. You know,
this is third time lucky, isn't it. We were first
going to do the Japanese submarine program, then we're doing
the French program, and now we're doing the ORCHEST program.
(05:05):
You'd have to think if this program gets canceled and
you're sitting in somewhere like the ASC, you're like the Wiggles,
what's next? Check what's next?
Speaker 1 (05:16):
It is very concerning. But if you can step back
from it and take the economies away from it, is
it realistic to build submarines in Australia. I mean, doesn't
Britain already have a program up and running and we
could have the submarines built there well.
Speaker 2 (05:32):
Unfortunately, I think a big reason for ORCAS is that
the UK needed a cash injection and Australia is providing
that and the UK is struggling to meet its own
submarine needs. In fact, the UK government has just made
their problem worse. They're just announced they're going to go
from seven attack submarines which is the kind we're getting,
(05:55):
to a twelve and build them twice as fast as
ever before. That looks like a very courageous commitment and
it just makes the ORCUST challenge worse. I think there's
a real issue here about even adding in the Australian
financial and technical contribution. Does a third wheel in this
(06:16):
US UK Australia partnership make it harder or easier? And
it could quite easily be decided. Actually the extra Australian
partner makes it harder.
Speaker 1 (06:32):
Setting aside this current review of AUCUS is or have
there been any diplomatic or policy signals from the US
regarding our defense commitment to one another, the alliance that
we've had for many, many years.
Speaker 2 (06:47):
Well, you know, there's been some positive sentiment. Certainly, people
in the US Congress are very positive about Australia, and
that's both Republicans and Democrats and very positive about aucust
The Pentagon Chief Hexas has been positive about Australia as
an ally, but he's also been pretty clear that he
(07:09):
thinks Australia is underdone on defense and needs to lift
its game. And that's led to you know, our Prime
Minister saying somehow it's a sovereign it's a matter of
incredible sovereign pride for US to be underspending on defense.
So that looks weird from Washington. So there have been
signals that yes, we're a valued ally, but we really
(07:31):
need to show we're doing what we need to for
our own defense and that gives us, that makes us
a valuable ally. And if we look underdone, the Americans
are starting to notice.
Speaker 1 (07:43):
So what you're the straight to do if the US
scales back its role in Orcust or becomes less reliable
as a defense partner.
Speaker 2 (07:50):
Well, I think they're fundamental to Australia getting nuclear submarines.
So if they scale it back, I think the Aucust
deal collapses. We should look to renegotiate this deal on
our turn. So there are things about it where we
think it's in our interest to do it differently, and
(08:13):
I also think we need to be a little bit
open minded to well, look, submarines are a military capability.
There are other military capabilities, including effective long range strike,
which is what submarines are pretty good for. And the
Orchest deal delivers military power incredibly slowly. It takes thirty.
Speaker 1 (08:37):
Michael, are you there? I think we've lost you.
Speaker 2 (08:39):
Yep, can you hear me?
Speaker 1 (08:40):
Yes? I just heard you say it takes thirty and
then you cut out.
Speaker 2 (08:44):
It takes thirty years for us to get eight nuclear submarines.
And when we've got eight, that means two are reliably deployable.
Because these things spend most of their life at import
and being maintained. So I think we we need to
not panic about a review and take it as an
opportunity to look at it in a pretty clear eyede
(09:07):
way from our own point of view.
Speaker 1 (09:09):
Donald Trump wrote a book called The Art of the Deal.
He's a deal maker. He puts out ideas that sometimes
are crazy, but this thought behind it. He's initiating a deal.
Is there anything overarching that Australia can offer America and
say as part of the deal, we can do this.
Do we have any chips that we can throw under
the game to make Orcus more attractive?
Speaker 2 (09:32):
Well, where we're a pretty close ally. That's seen in
every conflict with America since federation, so that's a strong car.
We're also giving America a forward operating base in Western
Australia for its own submarines as part of this deal.
That matters. But I think we should show where doing
(09:55):
the heavy lifting we need to do on UCAS and
therefore were more them pulling our weight, and that at
mean doing things we've taken off the table for a
long time. Mike, where's this these post submarine based that
have been and when are we going to start constructing it.
At the moment, the Australian government is going to be
telling the Trump administration, oh, we don't think we've even
(10:16):
got to work out where the site is for that
base for a decade. That doesn't really look like we're
all in, So we could make some changes to show
we want this.
Speaker 1 (10:29):
Now. Michael. Final question, any idea how long this Orchest
review will take?
Speaker 2 (10:35):
Well, the Trump administration has kicked off heaps of reviews
and a lot of these things are sort of ninety
day or six month things. I'd be thinking that's the
kind of time frame because there's a whole urgency about
the way the Trump administration is rolling and I think
both Donald Trump and Pete Exit will be impatient. So
(10:55):
I think it's a shorter rather than longer livem.
Speaker 1 (10:58):
Michael, thanks so much for your inside today. That's Michael Schubridge,
Director of Strategic Analysis Australia, on the Orcus Defile deal,
the fact that it is under review in America at
the moment. Five A Mornings with Graham Goodings
Well, there's tension in Canberra and on North Terrace this
morning with news the Pentagon has launched a review of
the Orchest Defense Pact to make sure it's aligned with
Trump's America First agenda. It's thrown the two hundred and
forty billion dollar agreement with Britain and Australia into dart.
So just where do we stand. Michael Schubridge is the
Director of Strategic Analysis Australia. He joins me. Now, Michael,
(00:21):
good morning to you.
Speaker 2 (00:22):
Hey Grahm, how are you well?
Speaker 1 (00:24):
Thanks? So what do you what do you make of this?
Is there reason to be concerned?
Speaker 2 (00:29):
Well? Yes, I think I'm reminded of that Fridge magnet
from the Howard government. Be alert but not alarmed. This
is going to be a pretty serious review by the
Pentagon and then it's going to go up to Donald
Trump's desk and there are both looks. Well will be
important you know from the Pentagon. We know that Elbridge Colby,
(00:53):
who's the undersecree of charge of this, he's an Orchest
skeptic and that's lining up with his view of America First,
Trump's signature policy direction. And it's all about is this
deal in America's interests and some of the big factors
there are America hasn't got enough of these subminds to
(01:13):
meet its own needs and right when we want the
first three is when the US Navy is at its
low point. And even with US ingesting cash into the deal,
are we more of a hindrance than a help as
the US meets its own industrial and production challenges.
Speaker 1 (01:33):
So could the whole ORCHUS agreement be scrapped at the
end of this or adjusted? What are your thoughts?
Speaker 2 (01:40):
Well, Scrapped is probably the more extreme end. Renegotiated I
think is pretty likely, and that sort of gets you
to the Trump side of it. I mean, Donald Trump
has made a point for years now of seeing every
deal that Joe Biden has predecessor did as a bad
(02:00):
deal and either one that should be entirely ended or
negotiation renegotiated, because Trump can do a better deal for
America than Biden ever could. So I think renegotiation looks
very credible.
Speaker 1 (02:16):
Is there anything else Strata can do? I mean, do
we just have to sit back and wait for the
outcome of this review? We have the Prime Minister going
to the G seven summit likely to meet with the President.
Is he likely to bring up orcus.
Speaker 2 (02:30):
Well, if he doesn't, he's wasting valuable time. But I
think Australia can't look like a supplicant here. We have
to be able to say why August is important to
us and why we think us doing this with America
and the UK is good for all of us. And
if we can't make that case, and we can't show
(02:51):
whe're doing the heavy lifting we need to, then we're
in trouble.
Speaker 1 (02:56):
The US has already called on our data to up
our defense spending. Anthony Albanesi said, that's a decision we
will make.
Speaker 2 (03:03):
What are your thoughts, Well, this review says it's going
to look at whether the allies that's the US and
the Australians and the UK in this review are stepping
up with collective contributions to collective defense. And when the
Americans look at our country and our defense capability in spending,
(03:26):
they know that we can't afford the military we plan
along with nuclear submarines for two to two point three
percent of GDP. So the amount of spending is definitely
going to be on the table in this review and
probably in the Trump Albanesi meeting. If they have one.
Speaker 1 (03:44):
It's come to light today that Australia ranks fifteenth in
defense spending. Does that show us up in a bad line?
Speaker 2 (03:52):
Well, I don't think that means we're actually proportionally spending
lessive to our national wealth, because I think we're about
the twelfth or thirteenth largest economy. And you know that
backs up the numbers. America is spending three and a
half percent of its GDP And an America first perspective,
(04:14):
which is Trump's view of the world, is anyone who's
spending lesson is free riding. And it's pretty hard to
say that's not true when we want American crown jewels
in the former nuclear submarine.
Speaker 1 (04:27):
Australia needs ORCUS just for defense of the nation, but
we also needed financially and here in South Eastralia. The
whole program is pretty much based here. So it's not
only defense, is you it's a financial security issue.
Speaker 2 (04:43):
Well, and from an Adelaide point of view, the terrible
history of submarine decision making by various Australian governments over
time must add in to the to the concern. You know,
this is third time lucky, isn't it. We were first
going to do the Japanese submarine program, then we're doing
the French program, and now we're doing the ORCHEST program.
(05:05):
You'd have to think if this program gets canceled and
you're sitting in somewhere like the ASC, you're like the Wiggles,
what's next? Check what's next?
Speaker 1 (05:16):
It is very concerning. But if you can step back
from it and take the economies away from it, is
it realistic to build submarines in Australia. I mean, doesn't
Britain already have a program up and running and we
could have the submarines built there well.
Speaker 2 (05:32):
Unfortunately, I think a big reason for ORCAS is that
the UK needed a cash injection and Australia is providing
that and the UK is struggling to meet its own
submarine needs. In fact, the UK government has just made
their problem worse. They're just announced they're going to go
from seven attack submarines which is the kind we're getting,
(05:55):
to a twelve and build them twice as fast as
ever before. That looks like a very courageous commitment and
it just makes the ORCUST challenge worse. I think there's
a real issue here about even adding in the Australian
financial and technical contribution. Does a third wheel in this
(06:16):
US UK Australia partnership make it harder or easier? And
it could quite easily be decided. Actually the extra Australian
partner makes it harder.
Speaker 1 (06:32):
Setting aside this current review of AUCUS is or have
there been any diplomatic or policy signals from the US
regarding our defense commitment to one another, the alliance that
we've had for many, many years.
Speaker 2 (06:47):
Well, you know, there's been some positive sentiment. Certainly, people
in the US Congress are very positive about Australia, and
that's both Republicans and Democrats and very positive about aucust
The Pentagon Chief Hexas has been positive about Australia as
an ally, but he's also been pretty clear that he
(07:09):
thinks Australia is underdone on defense and needs to lift
its game. And that's led to you know, our Prime
Minister saying somehow it's a sovereign it's a matter of
incredible sovereign pride for US to be underspending on defense.
So that looks weird from Washington. So there have been
signals that yes, we're a valued ally, but we really
(07:31):
need to show we're doing what we need to for
our own defense and that gives us, that makes us
a valuable ally. And if we look underdone, the Americans
are starting to notice.
Speaker 1 (07:43):
So what you're the straight to do if the US
scales back its role in Orcust or becomes less reliable
as a defense partner.
Speaker 2 (07:50):
Well, I think they're fundamental to Australia getting nuclear submarines.
So if they scale it back, I think the Aucust
deal collapses. We should look to renegotiate this deal on
our turn. So there are things about it where we
think it's in our interest to do it differently, and
(08:13):
I also think we need to be a little bit
open minded to well, look, submarines are a military capability.
There are other military capabilities, including effective long range strike,
which is what submarines are pretty good for. And the
Orchest deal delivers military power incredibly slowly. It takes thirty.
Speaker 1 (08:37):
Michael, are you there? I think we've lost you.
Speaker 2 (08:39):
Yep, can you hear me?
Speaker 1 (08:40):
Yes? I just heard you say it takes thirty and
then you cut out.
Speaker 2 (08:44):
It takes thirty years for us to get eight nuclear submarines.
And when we've got eight, that means two are reliably deployable.
Because these things spend most of their life at import
and being maintained. So I think we we need to
not panic about a review and take it as an
opportunity to look at it in a pretty clear eyede
(09:07):
way from our own point of view.
Speaker 1 (09:09):
Donald Trump wrote a book called The Art of the Deal.
He's a deal maker. He puts out ideas that sometimes
are crazy, but this thought behind it. He's initiating a deal.
Is there anything overarching that Australia can offer America and
say as part of the deal, we can do this.
Do we have any chips that we can throw under
the game to make Orcus more attractive?
Speaker 2 (09:32):
Well, where we're a pretty close ally. That's seen in
every conflict with America since federation, so that's a strong car.
We're also giving America a forward operating base in Western
Australia for its own submarines as part of this deal.
That matters. But I think we should show where doing
(09:55):
the heavy lifting we need to do on UCAS and
therefore were more them pulling our weight, and that at
mean doing things we've taken off the table for a
long time. Mike, where's this these post submarine based that
have been and when are we going to start constructing it.
At the moment, the Australian government is going to be
telling the Trump administration, oh, we don't think we've even
(10:16):
got to work out where the site is for that
base for a decade. That doesn't really look like we're
all in, So we could make some changes to show
we want this.
Speaker 1 (10:29):
Now. Michael. Final question, any idea how long this Orchest
review will take?
Speaker 2 (10:35):
Well, the Trump administration has kicked off heaps of reviews
and a lot of these things are sort of ninety
day or six month things. I'd be thinking that's the
kind of time frame because there's a whole urgency about
the way the Trump administration is rolling and I think
both Donald Trump and Pete Exit will be impatient. So
(10:55):
I think it's a shorter rather than longer livem.
Speaker 1 (10:58):
Michael, thanks so much for your inside today. That's Michael Schubridge,
Director of Strategic Analysis Australia, on the Orcus Defile deal,
the fact that it is under review in America at
the moment. Five A Mornings with Graham Goodings
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