Confronting Foreign Influence in Australia

The continuing saga of self-professed Chinese intelligence operative Wang Liqiang, who sought the protection of the Australian authorities in November 2019, has sent shockwaves around the world. Regardless of the veracity of Wang’s claims about Chinese government intelligence activities, he has brought the heated topic of foreign interference in Australia back to a boil. 

Public debate on foreign interference is not new to Australia. Ever since the Four Corners report Power and Influence in 2017 and Clive Hamilton’s book Silent Invasion in 2018, both looking into Chinese Communist Party influence and interference in Australia, the topic has been debated intensely. Wang’s sweeping claims have just thrust it back into the public spotlight.

When it comes to the public debate on foreign interference in Australia, the only country that gets mentioned regularly is China. Common topics discussed under the foreign influence umbrella include foreign political donations, foreign students in Australia, research collaboration, and foreign investment, especially in critical infrastructure.

What Is Foreign Interference?

In general terms, the goal of foreign influence is to shape the decision-making calculus in another country so it will make decisions favorable to the influencer country. Countries use a variety of tools to influence each other. Foreign interference refers to a subset of these tools that are coercive, covert, deceptive, and clandestine. These foreign interference methods are generally seen as detrimental by democracies, and are contrasted with accepted means of foreign influence, such as public diplomacy.

However, democracies also practice foreign interference. Some now well-known examples occurred during the Cold War, including the U.S. operations in Iran in the 1950s and Nicaragua in the 1980s. There are also more contemporary examples of U.S. interference in the Middle East.

Foreign interference tools are usually used where acceptable forms of influence are not possible or could not achieve the desired outcomes. Countries like the United States do not need to interfere in Australia, because by and large Australian elites are amicable to U.S. geostrategic interests. The same cannot be said of China in Australia. 

For China, there is a general lack of goodwill and trust among the Australian elite toward the Chinese Communist Party (CCP). The low level of China’s soft power in Australia adds pressure for the CCP to adopt other means of driving its interests with respect to Australia.

For Australia, as stated in the 2017 Foreign Policy White Paper, ensuring “that national decision-making and institutions remain free from foreign interference” is one of the most important national interests. Duncan Lewis, the former head of Australia’s domestic intelligence agency, the Australian Security Intelligence Organization (ASIO), characterized the threat in the following way:

Espionage and foreign interference is insidious. Its effects might not present for decades and by that time it’s too late. You wake up one day and find decisions made in our country that are not in the interests of our country.

Challenges of Foreign Political Interference

Transparency and accountability are the bedrock of democracy. Covert and clandestine activities by foreign states or their proxies are a threat to transparency and accountability and thus are also seen as threats to Australia’s democratic political institutions.

For a democracy to function properly, citizens must have confidence in public officials. Voters need to have full knowledge if an electoral candidate has dealings with a foreign power that may affect the performance of their public duties once elected. Outside election seasons, elected officials or other decision-makers must be kept accountable so that there is no conflict of interest.

Disinformation campaigns through traditional media or social media can sway public opinion, sow social discord, pressure policymakers, and even materially influence elections. Australia, as a developed economy and an open country, is susceptible to disinformation, just like other democracies. In December 2018, Australia’s Senate established the Select Committee on Foreign Interference through Social Media to examine the threats posed to Australia’s democracy by foreign interference through social media, and the responses by the Australian government and social media platforms, including Facebook, Twitter, and WeChat. The committee will present its final report before or around May 2022.

Freedom of speech is an essential part of democractic political institutions. However, foreign governments can impede freedom of speech through coercion of individuals or institutions in countries like Australia. For example, in the past China sought to silence dissidents speaking out publicly in Australia by pressuring, or even threatening, their families living in China. Foreign governments can also pressure institutions by threatening to withdraw funding on existing projects. The end result of this type of interference is a detriment to free public discussion.

Foreign governments engage in foreign interference because it is often a cost-effective way to achieve a political end. Kinetic warfare is both expensive and risky. Changing the incentive and calculus of individual decision-makers at the margin can be significantly cheaper.

For an open country like Australia, the big challenge in dealing with foreign interference is to strike a balance between deterring and stopping foreign interference while also preserving individual liberties and social cohesion. There can be a temptation to treat legitimate influence activities or political expression with suspicion and scrutiny. This may inflame existing prejudices within society. We have already seen instances of this in Australia’s heated China debate. 

Criminalizing Foreign Interference

The Australian government response so far has been focused on legislative changes. In 2018, the Australian government passed the National Security Legislation Amendment (Espionage and Foreign Interference) Act, which criminalized the clandestine or deceptive activities of foreign actors that seek to interfere in Australia’s political process or the exercise of Australian democractic rights. The legislation does not specify any specific country.

The legislative change has been operational for 18 months and so far there have been no prosecutions under the new law. In late 2019, the Australian government set up a taskforce specifically focused on arrests and prosecutions for foreign interference activities.

Criminalizing foreign interference is a positive step. However, this approach can only be an effective deterrent if it is clear what constitutes foreign interference. For foreigners who wish to push a political agenda, they need to understand what activities are allowed and what activities are forbidden. For people that may be subject to foreign interference, they need to understand clearly what is illegal under the law. 

Yet so far, there has been a lack of public conversation and an absence of clarity on what constitutes foreign interference and examples of foreign interference activities. This lack of clarity, to a large extent, is due to the amorphous nature of foreign interference. The diversity of sources and forms of foreign interference makes it hard to pin down.

This can lead to two negative consequences: One, foreign interference activities are overlooked and underreported because the people involved did not realize an incidence of foreign interference had occurred; two, there could be spurious accusations of foreign interference if the public mistakes legitimate influence for foreign interference.

The lack of clarity on what constitutes foreign interference has a big effect on the Chinese diaspora communities in Australia. On the one hand, the people on the receiving end of deceptive or coercive conduct may not know what to do. On the other hand, the political actions of individual Chinese-Australians or Chinese nationals in Australia would be scrutinized more closely than other groups for signs of foreign interference. Their political views may be assessed by some in the community in the context of countering foreign interference, which could raise suspicion that may discourage some Chinese-Australians from fully participating in political activities. This can unintentionally impede freedom of speech and exercise of democractic rights.

Foreign Political Donations, Transparency, Academic Freedom

The Australian government has also banned political donations from foreign governments or state-owned enterprises. This is a positive step, but does not go far enough. In fact, the controversial political donations by Huang Xiaomo and Chau Chak Wing, which spurred the reform, are actually not illegal under the new law. Chau was an Australian citizen at the time that he made his donations, and had been for a long time. Moreover, a foreign company can get around the law by donating through an Australian subsidiary. 

More comprehensive political funding reform is necessary. In a small, open democracy like Australia, most big companies in the country have some degree of foreign ownership or foreign interests, including access to foreign markets and financial resources. These big companies seek political influence through political donations. Political donations are a major issue for the health of Australia’s democractic system, as they are in other democracies. Restricting political donations from all sources will reinforce public confidence in Australia’s political system while also addressing the issue of foreign interference. 

The Australian government also established the Foreign Influence Transparency Public Register. The aim is to make foreign influence more public and transparent. Under the scheme, a person or an organization must register if they undertake activities such as lobbying or communications on behalf of a foreign principal for the purpose of political or governmental influence.

As of January 1, 2020 there were 200 registrations with 27 foreign principals listed. The Public Register provides a good picture of which individuals or companies are undertaking lobbying or communications activities on behalf of another country. However, the Public Register only draws attention to legitimate influence activities. It cannot be used to gauge interference activities, which by their nature are usually covert.

On academic freedom, the University Foreign Interference Taskforce, in partnership with universities, produced guidelines to counter foreign interference in the Australian university sector. The guidelines give recommendations for issues such as collaboration, due diligence, and cybersecurity. The development of these guidelines is a good model for meeting the demands of community concerns and working with industry sectors. Similar approaches are needed for other foreign interference issues.

Increased Funding for Security Agencies

Australia has increased funding for security agencies for the purpose of combating foreign interference.

In early 2019, the Australian government announced that it will provide A$34.8 million to establish a Foreign Interference Threat Assessment Center within ASIO and provide funding to support prosecution under the new foreign interference laws.

Then in December, the Australian government announced it will provide A$88 million to establish a new Counter Foreign Interference Taskforce to disrupt and deter foreign interference threats. The taskforce is mainly made up of ASIO and Australian Federal Police (AFP) officers with representatives from the Australian Transaction Reports and Analysis Center (AUSTRAC), the Australian Signals Directorate, the Australian Geospatial Intelligence Organisation, and the Office of National Intelligence. The taskforce will work with the National Counter Foreign Interference Coordinator that sits in the Department of Home Affairs to help streamline decision-making and collaboration between agencies, and strength Australia’s disinformation analysis capabilities. 

Security Vetting

Peter Hartcher, political and international editor of the Sydney Morning Herald, proposed requiring all members of parliament and senators to obtain ASIO security clearance as a way to counter foreign interference threats, mainly from China. Duncan Lewis, the former head of ASIO, said in response that the proposal is unwise: “In a way it kind of goes against the whole essence of the democracy that we live in… I don’t think that vetting by security agencies is a proper way to go forward. It would be, for example, very subject to interference and if it was not, it would be asserted that the intelligence agencies were interfering.”

Notwithstanding the many practical issues the matter of security clearances throws up, such a proposal takes power away from the electorate and puts it in the hands of intelligence officials. One only needs to consider ASIO’s history during the Vietnam War protest years, or McCarthyism in the United States, to understand why the proposal is extremely problematic. 

Indeed, having elected representatives screened by the domestic intelligence agency, an agency under the Executive arm, would be an example of an overreaction to the foreign interference threat.

Solutions

So what is the solution? Legislative changes are not enough to deal with the problem of foreign interference; a broader approach is needed. There are three principles Australia should consider: targeted response, building resilience, and community engagement.

First, Australia needs to target its counter-foreign interference efforts to behaviors and actions with the greatest potential for negative consequences instead of coming up with one-size-fits-all solutions. Most importantly, policy responses must not yield more negative side effects than the problem itself. Limiting immigration from selected countries or screening political candidates are examples of proposed responses that will have major negative externalities that do more harm than good.

Second, Australia needs to build resilience through efforts to reinforce its democractic institutions in the face of undue influence and interference. This includes ensuring trust in Australia’s political and election systems, and educating its people on disinformation.

Finally, Chinese diaspora communities have a big role to play in Australia’s counter-foreign interference efforts. However, current efforts are inadequate, partially due to the lack of understanding and the lack of representation of Chinese-Australians in the intelligence and defense community. More needs to be done to engage the Chinese communities in Australia. 

Media also has a role to play in engaging Chinese diaspora communities. The current media representation of the Chinese diaspora in Australia has been mostly polarizing: portrayal of the diaspora communities as either victims of CCP oppression or CCP sympathizers.

Foreign interference is not an issue that is going away any time soon. The threat will likely evolve. Australia’s response to counter foreign interference also needs to evolve. Importantly, it should strike a balance between deterring foreign interference while preserving individual liberties and social cohesion.