Don’t Count Your Submarines Before They’re Built

September 29, 2021
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On Aug. 20, 1908, two battleship squadrons of the U.S. Navy’s Atlantic Fleet — known as the Great White Fleet — steamed into Sydney Harbor in Australia. More than half a million Australians, an astonishing 12 percent of the country’s entire population, had gathered to greet them. Australia’s welcome so overwhelmed the American sailors that a few days later a crewman was reported to have gone to sleep on a park bench with a sign reading: “Yes, I am delighted with the Australian people. Yes, I think your park is the finest in the world. I am very tired and would like to go to sleep.” The fleet would go on to visit Melbourne and Albany, remaining in Australia until Sept. 18. The visit marked the beginning of the U.S.-Australian defense relationship and helped spur the creation of the Royal Australian Navy.

 

 

So it is somewhat fitting that, more than a century later, U.S. President Joe Biden, U.K. Prime Minister Boris Johnson, and Australian Prime Minister Scott Morrison announced a new trilateral defense arrangement named AUKUS — an acronym of “Australia, United Kingdom, United States” — in mid-September. They declared technology sharing to be the cornerstone of this new relationship. While the initial focus of this technology sharing is the development of nuclear-powered submarines for the Royal Australian Navy, it also encompasses technology sharing and collaboration on artificial intelligence, quantum computing, and more. Because AUKUS focuses on technology sharing, it is different than a traditional arms sale, and this difference has two key implications. First, the deal is a stronger signal of the participants’ long-term concern about China’s rise. Second, and conversely, it will be more difficult to implement the deal in a way that lives up to its claims.

Technology Sharing Signifies More Than an Arms Sale

The AUKUS deal has rightly garnered international attention, in part because it involves nuclear propulsion technology and in part because of the vitriolic French response, but its broader proposed research and technology sharing should gain attention even if nothing nuclear were involved. Successful inter-state agreements to share advanced military technology — via the transfer of the capability to produce advanced weapons — are rare. They are often seen as a subset of arms sales, but this treatment obscures their greater significance.

Modern arms sales agreements almost always include more than simply transferring tanks, planes, etc. These agreements also include provisions for the continued supply of spare parts and, often, maintenance personnel. These follow-on services give the seller continued leverage over the recipient. In the extreme, if relations between the buyer and seller sour, the seller can cut off this support and effectively limit the buyer’s use of their weapons.

The Iranian revolution provides an example. In the 1970s, the United States sold 79 advanced F-14 fighter jets to the Shah’s regime. After the revolution, the United States quit supplying spare parts to Iran. At the start of the Iran-Iraq War in 1980, the Iranians could barely keep a dozen of their new jets flying — though the United States soon began clandestinely supplying them with additional spare parts as part of what would become the Iran-Contra scandal.

Technology sharing is different from arms sales because it means, as with AUKUS, transferring the capability to produce weapons. These transfers involve disclosing intellectual property and manufacturing techniques. This information is almost impossible for the sharing state to claw back if relations with the recipient worsen. As a result, unlike with arms sales — or even alliances — if its relationship with the recipient sours the only way the sharing state can reduce the value of the technology it disclosed is to innovate to speed its obsolescence. This difference also matters because technology sharing can be a much speedier path to building a production capability than either theft or independent development.

Moreover, sharing military technology does not just create the possibility the recipient could turn the technology against the sharer in some hypothetical future — as the Japanese would do in World War II with the naval aviation technology the United Kingdom had provided them in the 1920s. It also creates a risk that the recipient might later compete with the sharer in the international market for the technology. And as the French anger over losing their contract to build submarines because of AUKUS demonstrates, such competition is often fierce even among allies.

Countries Share Technology with Others Facing the Same Threats

Given all the risks, why do countries ever decide to share technology? Usually, countries share their cutting-edge technology when the sharer and recipient face a common threat and the sharer is confident the recipient will remain an ally for the long haul.

Because technology sharing can be so risky, it also serves as a powerful way to message both friends and foes. When a country shares military technology, it makes itself more vulnerable to the recipient. This quality makes technology transfer useful for wooing an uncertain partner or confirming a strengthened relationship. The United Kingdom used technology sharing this way after the fall of France in the summer of 1940 to gain greater support from the United States. Since 1937, the United Kingdom and United States had been fruitlessly haggling over technological exchanges and operational coordination. If anything, the difficult negotiations worsened relations between the two. In the summer of 1940, it was not obvious that the United States would come to the United Kingdom’s aid against Nazi Germany. Then, in September 1940, famed British scientist Henry Tizard led a scientific delegation to the United States. Among other things, the mission gifted the Americans the cavity magnetron, the United Kingdom’s scientific crown jewel. This small device, discovered only months before, enabled powerful and precise radars that were small enough to put on airplanes and ships — today, you likely have one in your microwave oven. Within days, the American attitude changed dramatically, and a scientific collaboration began that formed the foundation on which Anglo-American technical cooperation continues to this day.

With AUKUS, China is the obvious threat that Australia and the United States share, and the deal shows just how concerned they have become. For decades, Australia has attempted to straddle the growing competition between the United States and China. China is Australia’s largest bilateral trading partner, and the United States is Australia’s closest security partner. Australia has needed to balance the tension between its economic relationship with China and its security relationship with the United States. Recently, however, the COVID-19 pandemic has worsened Australia’s relations with China, and China has imposed trade penalties on Australia. With AUKUS, it appears Australia has definitively sided with the United States.

For the United States, AUKUS serves three purposes: it is a strong signal that the United States wants to solidify an even closer relationship with Australia; it serves as an inducement to get greater cooperation from Australia — in a potential conflict with China, the United States will likely need bases in Australia, which will also greatly increase the chance of a Chinese attack; and it holds the potential to make Australia a more capable ally. For Australia, the arrangement serves as a hedge with two distinct benefits. It signals closer alignment with the United States and — consistent with its 2020 defense strategy — it also increases Australia’s capability to defend itself. If the United States stays engaged in the Indo-Pacific, nuclear submarines will enable Australia to be a more capable partner. If over the next several decades the United States takes a more isolationist turn, an Australian capability to build its own nuclear submarines will improve Australia’s ability to defend itself alone.

But Technology-Sharing Agreements Often Fail To Deliver

All of the above assumes that the announced technology sharing eventually occurs, but that may not happen. Technology-sharing announcements frequently amount more to hype than to substance. The United States and India announced the Defense Technology and Trade Initiative, a technology collaboration program, almost 10 years ago, but it has struggled to get traction. Even though U.S. President George W. Bush and U.K. Prime Minister Tony Blair jointly announced that the United States would share the F-35’s source code with the United Kingdom in 2006, years later the Americans have still refused to do so.

The challenge of making technology sharing happen is about more than the risks highlighted above. Actual technology sharing often differs from an announced technology-sharing policy because of the immense leverage government bureaucracies have in this area. Senior policymakers rarely have the technical expertise to identify the key details that their countries must disclose to make the technology transfer a success. In the United States, complex export-control regulations create many opportunities for officials and interests that oppose a transfer to hamper its success. Officials can turn what initially appeared to be the transfer of a production and maintenance capability into something more like an arms sale.

For example, Naval Reactors — the organization that controls the U.S. Navy’s nuclear propulsion program — is notoriously independent and secretive. While Naval Reactors is no longer able to ignore higher U.S. Navy directives with impunity as its founder Adm. Hyman Rickover did, it still jealously guards its enormous power. Its culture of secrecy is so strong that years ago as a new nuclear power trainee I had to mark my notes of a high-school level algebra review as export controlled. This agency, or others within the U.S. or U.K. governments, might create roadblocks to the technology sharing promised by AUKUS.

Additionally, the AUKUS announcement was vague. The countries have not determined whether American or British submarines will serve as the basis for the Australian construction, and the announcement included an 18-month period for the three states to determine the way forward.

Ambiguity exists as to where the three participating states will base different components of the submarine and nuclear propulsion plant supply chain. Australian Prime Minister Morrison announced that the submarines will be built in Adelaide, but U.K. Prime Minister Boris Johnson stated that he expected the new program would bring jobs across the United Kingdom. If the United States and the United Kingdom keep key parts of the nuclear propulsion plant supply chain at home while leaving final assembly of the submarines to Australia, less technology transfer may occur than it now appears. In this scenario, the deal would end up being more like an arms sale than technology sharing. Australia’s lack of any nuclear infrastructure and its nonproliferation commitments may make this approach more likely since both will complicate the process of building new nuclear facilities. That said, precisely because Australia has such limited nuclear experience, even if Royal Australian Navy officers and shipyard workers end up learning only the details of nuclear propulsion necessary to operate and maintain nuclear propulsion plants, the knowledge would still represent an immense leap forward.

Measuring Progress and Ensuring Success

Two markers can help provide early evidence about the extent to which the technology-sharing component of AUKUS will come to fruition. First, does research and development collaboration occur in the other technical areas — like computing and AI — that the agreement covers? While coordination in these areas may be more difficult to observe without public statements by the partners, creating the infrastructure to build and operate nuclear-powered submarines will take time. Meaningful sharing and coordination in less capital-intensive areas may provide an early indication that all parties are committed to technology sharing’s tighter engagement.

Second, once design and production work on the submarines begins, how much of the nuclear technical work will occur in Australia or involve Australians? Direct engagement of each countries’ experts and involvement of Australians directly in the design and production process would be more effective at transferring knowledge. If such involvement is minimal, the deal would still be significant but less so than it appears now.

Finally, the policymakers seeking to make AUKUS technology sharing more than a press release will need to stay closely engaged with the technical negotiations. If they reduce their oversight, the likelihood that bureaucratic incentives and business-as-usual processes will undermine technology-sharing efforts will increase dramatically. Even if they stay engaged, success is not guaranteed.

The AUKUS announcement has rightly garnered significant attention. The agreement’s focus on technology sharing sends a more powerful signal about all three participants’ long-term concern with China’s rise and their commitment to work together than would a regular arms deal. But the deal’s focus on technology sharing also means it will face additional challenges to become a success. The Great White Fleet’s arrival in Australia in 1908 triggered the birth of the Royal Australian Navy and laid the foundation of the U.S.-Australian alliance. Only time will tell whether AUKUS signals a new phase for both.

 

 

Erik Sand is an assistant professor at the U.S. Naval War College and a former U.S. Navy nuclear propulsion officer. He is writing a book about why countries choose to share advanced military technology. These views are his own and do not necessarily represent those of the U.S. Naval War College, Department of the Navy, Department of Defense, or any part of the U.S. government.

Image: U.S. Indo-Pacific Command (Photo by Richard Cordell)