When I was Australia’s ambassador to the United States, I visited General Dynamics Electric Boat in Groton, Connecticut, one of two yards constructing the Virginia-class submarines. A Virginia was the backdrop in San Diego last month for the three AUKUS leaders’ announcement of Australia’s path to acquiring nuclear-powered submarines (SSNs).

Electric Boat plans increase its workforce by some 6,000, doubling the number of shifts. Hundreds of Australians will join them. Their training will be invaluable to the creation of a sovereign workforce to build and sustain our SSN AUKUS fleet and sustain our Virginias as we receive three to five of them in the 2030s.

As I entered USS Missouri’s control room, the captain asked if I recognised anything. ‘Yes,’ I said. ‘I am standing in the control room of a Collins-class submarine.’ He revealed that his last sea post had been as an exchange officer in Australia on a Collins. ‘Best I’ve served on,’ he said (obviously, a certain amount of hyperbole for a guest, but a moment of pride for me).

As ambassador it was my job to request US support for our replacement boat. We’d been looking at a Japanese drive system for the Collins, so I sought assistance from the chair of the Joint Chiefs of Staff, the chief of the US Navy and the US defense secretary. They were, however, not the go-to authorities for submarines. That was Admiral James Caldwell, director of the naval nuclear propulsion program in the US Department of Energy. The first director was Admiral Hyman G. Rickover (1949 to 1982).

I experienced some testiness from the Americans along the lines of, ‘Get on with it’. They emphatically didn’t want us in the nuclear program and liked having allies with a conventional capability. They were particularly enamoured of the Collins, despite criticism in Australia, and found it virtually impossible to detect on exercises. But their overwhelming concern was to limit access to the nuclear technologies in which they enjoyed global superiority. Over Rickover’s screaming objections, they shared that technology with the British 65 years ago, and wanted to spread it no further. The AUKUS arrangement is strongly supported in the US but runs very much against their nature. Technology transfers will require congressional approval and there will be much work for the embassy.

There’s been a lot of discussion about threats to our sovereignty once we acquire the US-made Virginia SSNs. The Americans have made clear that all facets of their deployment will be under our control. In accordance with the nuclear non-proliferation processes thus far endorsed by the head of the International Atomic Energy Agency, the reactors’ fuelling will be handled by the Americans. Any decision to go to war, or not to, will be solely a matter for Australia’s government.

Until Australia receives its SSNs, British and American boats operating from here will be designated Submarine Rotational Forces—West and will have their own lines of authority. That’s been the case with submarines that have made nearly 300 visits to HMAS Stirling since the early 1980s.

The US–Australia alliance is critical to our survival, and ensuring its effectiveness involves intense work on commonality of systems. We acquire the best of our ally’s equipment. The Australian Defence Force’s strike, intercepting, surveillance and transport aircraft are virtually all American, including the F-35 Lightning IIs, Superhornets, Growlers, Wedgetails, P-8 Poseidons, C-17 Globemasters, C-130 Hercules, Chinooks and Black Hawks. Hardly commented on but huge is the acquisition of 200 Tomahawk missiles likely to be deployed from our submarines and destroyers. In addition, we’ll receive the HIMARS missile system. A sovereign missile capability is being developed through the guided weapons and explosive ordnance enterprise. Exposure of threats in our region is much assisted by our joint intelligence-gathering facilities. Our navy’s sensing and weapon systems are largely American. We don’t feel our sovereign decision-making is curtailed by our need to acquire these weapons and spares. If origin equals sovereignty, we lost it long ago. But of course, it doesn’t.

Despite the US government overriding Rickover’s objections, the British didn’t feel obliged to join the allies in Vietnam. Indeed, until that war the Royal Australian Navy flew the Royal Navy’s ensign. The British objected because they didn’t want our ships mistaken as British. They had an active trade with North Vietnam. Without access to the best American equipment ,we would have virtually no affordable defence. The SSNs will be in continuation.

I strongly support the government’s SSN decision. Ironically, if Sweden’s Saab, which now owns the company that designed the Collins, had been allowed to bid for the Collins replacement, it may well have beaten the French and we wouldn’t be having this discussion. We are fortunate that this opportunity has arisen. Courtesy of Rickover, the nuclear boats are very safe. He was almost paranoid about safety and believed that any accident, particularly in port, would end his program. Our sailors and workers will be trained to the highest level, and the boats will likewise be built to that standard.

Conventional boats are quiet and difficult to detect. Nuclear boats are not as quiet, but they are quiet. The conventional boats are deft lurkers, but they have discretion issues as radars and other detection systems improve. Our Collins boats have two to three days submerged before they must ‘snort’, raising a mast to take in air to drive their diesel engines and recharge their batteries. As they do that, they can be detected. Air-independent propulsion could extend their time deeply submerged, but in a conflict that remains a vulnerability.

When a submarine discharges a weapon, it is exposed. SSNs are fast and can depart very quickly. Conventional boats are not so fast, and they are slow to reach their station. Diesel–electric conventional boats must vacate the deployment area to refuel, and an enemy knows where they do it. Nuclear boats, not so. Their deployment time is influenced by crew endurance and food. Speed gives the nuclear boats advantages in open waters and in discretion close to shore.

As retired Rear Admiral David Oliver, who has operated both types of boats, told the Lowy Institute: ‘Nuclear submarines [close in] have such inherent advantages, in that the ocean is so noisy and layered that sounds pursue odd paths.’ He also argues: ‘Nuclear-powered submarines will give Australia invulnerability. There is no nation or system that can prevent a determined attack by a nuclear submarine.’ The Chinese know this, too, and as they attack the AUKUS program, they are building SSNs at pace.

Our nuclear boats will be expensive—up to $368 billion—which will increase the defence budget by 0.15%. The government has said it hopes to make savings towards them. I would argue that lifting defence’s share of GDP from 2% to 2.15% would be fine. In my day it was 2.3% to 2.5%. We can’t make this long-term program the enemy of what must be done now. This is a government of cautious financial management, but it has prioritised national security. Defence spending is massively outweighed by what we spend on social programs. The National Disability Insurance Scheme, for example, will cost at least four or five times that $368 billion over the same 30-year period.

It will probably take a decade to get our first Virginia-class boat and slightly less than two decades for our first British–Australian-designed boat incorporating much American capability. But it’s a major deterrent. The rotation of allied boats will be much sooner, and that helps. Deterrence, not war, is the government’s objective. Its diplomacy is clearly directed towards that. The suggestion that our sovereignty is impinged on by this, when our total program is considered, is untrue. A massive lift in our military effectiveness is assured.

In this special episode, ASPI Executive Director Justin Bassi speaks with Richard Fontaine and Lisa Curtis from the Center for a New American Security and Alessio Patalano from King’s College London about the strategic imperatives and future challenges of AUKUS.

With the optimal pathway for Australia’s acquisition of nuclear-powered submarines now unveiled, there are big plans, big promises and a lot of work to do. Why do we need AUKUS? How do we improve information-sharing while reducing barriers to technology cooperation? How do we integrate our defence industries, which are more accustomed to competing than cooperating? What are the opportunities for additional partners, including the Quad? And how is all this being explained to the public?

To dissect these questions and more, ASPI has been holding a trilateral AUKUS dialogue in Washington DC with the Center for a New American Security and King’s College London’s Centre for Grand Strategy.

It’s been a big day for Australia–UK relations. Sandwiched between the release of the ‘refresh’ of the integrated review in London and the AUKUS submarine announcement in San Diego, a bilateral partnership growing in warmth and strategic significance is evident, and indeed flourishing.

That the two developments take place in the Euro-Atlantic and Indo-Pacific chimes with the British conception of a merging between the two geostrategic areas. The integrated review refresh christens the emergence of an ‘Atlantic–Pacific’ theatre.

That Australia occupies such a significant place in Britain’s refresh is indicative of the new thinking in London. Australia is the second most referenced Indo-Pacific partner in the document behind the US, the UK’s closest and most powerful ally.

It wasn’t always this way. Despite their oft-cited shared history and worldview, Australia and the UK diverged throughout much of the Cold War era as the UK doubled down on containing the Soviet threat. However, it’s now clear that the deteriorating geopolitical environment—characterised by Russia’s war against Ukraine in the Euro-Atlantic and especially China’s increasing assertiveness in the Indo-Pacific—is drawing them back together.

In this sense, Australia is said to be integral to the UK’s ‘new network of “Atlantic–Pacific” partnerships’ that enables and buttresses its ability to ‘shape the international environment’ to uphold an open international order. Shaping the international order is now the central goal of UK foreign policy.

Today’s AUKUS announcements best encapsulate this. British and American nuclear-powered attack submarines (SSNs) will now be forward-deployed to Fleet Base West in Western Australia ‘as early as 2027’—a quick win for AUKUS that will enhance the efforts of both the US and UK in maintaining a stable Indo-Pacific and equipping the Royal Australian Navy with the necessary know-how to operate SSNs. Australia is expected to acquire a minimum of three and maximum of five Virginia-class submarines from the US to undertake patrols until a more permanent arrangement can be implemented.

This more permanent arrangement will involve Australia’s buying into the UK’s program to build the Royal Navy’s next generation of SSNs, which are already being described as ‘SSN AUKUS’. They will be based on the UK design and kitted out with technology from all three nations, notably America’s high-end weapons capabilities. Britain will build the first vessels for the Royal Navy in Cumbria at its Barrow-and-Furness site sometime in the late 2030s. Australian SSN AUKUS boats are projected to be in the water by the early 2040s, with the first being assembled in Adelaide.

This is significant for the UK not least because it will reinvigorate the British defence-industrial base, particularly its naval shipyards in Cumbria. Creating a larger class of SSNs should also enhance economies of scale for both nations. Ben Wallace, the UK defence secretary, has already declared that the number of personnel at the site will increase 10,000 to 17,000, a significant boost to meet the new demand.

The evident strategic (re)convergence between Australia and Britain can also help provide answers to some of the questions still surrounding AUKUS.

With its Indo-Pacific overseas territories, France is the only European partner—albeit behind Britain—with the capacity to meaningfully project force into the Indo-Pacific. This makes it the European Union’s only true Indo-Pacific power, and one that Australia will want to engage with. The extraordinary reaction of France to the initial AUKUS announcement is a well-told story; though Anthony Albanese, Australia’s prime minister, attempted to smooth things over in July last year, relations between the two countries still remain fuzzy.

Again, enter Britain. On 10 March, the UK–France summit was held for the first time in five years, and the two powers discussed how to combine their efforts to ‘ensure permanent presence of like-minded European partners [in the Indo-Pacific]’. France is clearly eager to deepen its involvement in the Indo-Pacific’s security architecture, and the UK—as the European power most embedded in it—is keen to draw France in. No longer so much ‘down under’ as ‘top centre’, Australia will remain critical to France, irrespective of AUKUS, if Paris is to secure its own regional interests. The thaw in French–UK relations can only be good for Australia.

But there are also lessons the UK can learn from Australia. Although the initial AUKUS announcement may have been difficult without the veil of secrecy, Canberra has clearly adjusted its diplomacy and messaging to the Indo-Pacific. Albanese and his cabinet have kept in close contact with regional partners, and he will visit Fiji on his way back from San Diego. If London wants to shape the international order and foster closer relations with so-called middle-ground countries in the developing world, the UK will need to moderate its language and keep an ear to the ground on regional sensitivities.

In a single day, Britain and Australia, together with the US, have put in place the foundations for a partnership that will last at least 50 years. This new centre of geopolitical gravity binds the three together and to the Indo-Pacific region. With resolution and careful diplomacy, they can foster an Indo-Pacific that is ‘open, stable, prosperous and respectful of sovereignty, human rights and international law’.

The rapidly deteriorating strategic environment has led Australia and its allies to realise the imperative for closer collaboration on defence and security issues. The most striking evidence of this is the heralded AUKUS agreement to share sensitive defence technology, including nuclear submarine propulsion, but also covering several other areas. The leaders of the UK, the US and Australia have all been clear about the importance of making this agreement a success. However, at the practical level, a number of administrative barriers remain, and unless they are urgently addressed AUKUS is unlikely to succeed.

In particular, if you ask anyone from the UK or Australia who has tried to collaborate with the US what four letters terrify them the most, the answer will be ‘ITAR’. For the uninitiated, ITAR stands for ‘International Traffic in Arms Regulations’, and controls the export of ‘munitions’ to anywhere outside the US, or indeed to any non-US national. Born out of the cold war, it covers defence materiel as well as related data or information—the lifeblood of today’s digital world.

The scope of ITAR is incredibly broad. ‘Munitions’ is defined broadly to include almost any advanced defence- or security-related technology, and there are no exceptions; specific approval is required for every export to every country. Rules on ‘transfer of data’ cover any verbal discussions or emails from a US person to any foreign (non-US) person. The regulations have extraterritorial impact—the recipient of the technology is prohibited from disclosing any aspect of it to another country, or even to any of its personnel who hold a third-party nationality unless explicitly authorised by the US government.

The US has shown an inclination to strictly enforce the letter of these regulations. Major compliance penalties of up to US$100 million have levied in recent years, including on major defence primes such as Lockheed Martin, Boeing and L-3 Communications. The government has made it clear that it expects all US defence companies to have robust compliance programs, and that all breaches of regulations are treated as a ‘strict liability offence’. There have even been examples of the successor or purchaser of a company being held liable for breaches that occurred before they took control.

From my own personal experience, the practical effect of this is often to stymie collaboration and innovation between allies, while providing no obvious reduction in security risk. My first experience of ITAR came when working on a joint UK–US research project. One of our team went to the US to present our work as part of a symposium and was somewhat shocked when, as soon as he stood up to speak, all the US contractors from a major prime walked out of the room, and then came back in as soon as he finished. It turned out this wasn’t due to some mysterious brand of corporate politics, but because their lawyer had advised them that, due to ITAR, they couldn’t participate in a joint conference with UK personnel. I’m still not sure why someone thought that simply listening to a presentation from a UK national constituted an export of US information to the UK, but it definitely shows how ITAR can create irrational fears that prevent sensible collaboration.

This episode made me understand a bit about ITAR and prepared me for a couple of years later when we wanted to set up a collaboration with a US partner. The first step was a visit to their facility in the US, but there was a catch—the facility was ITAR-controlled. It took eight months to get a ‘technical assistance agreement’, or TAA, approved to cover the visit, but finally we were ready to go. During this time, I had learned the importance of avoiding the extraterritorial reach of ITAR, which meant we had to be able to prove that no ITAR-controlled information received under the TAA was incorporated into anything that we supplied to a third country. I therefore instructed the leader of our delegation to make sure they got written confirmation of everything they had been shown that was ITAR-controlled. When the group returned from the visit full of excitement and enthusiasm, I asked for the list and was shown a blank piece of paper. Apparently, after all the delays and bureaucracy, their export control officer confirmed at the end of the visit that nothing they had seen or heard was covered by ITAR.

I know from talking to colleagues that my own experiences are far from unusual. It’s clear that the broad scope of ITAR, as currently written, coupled with a draconian enforcement approach, is creating both real and perceived barriers to effective collaboration. The one-size-fits-all rules of ITAR don’t work in today’s strategic environment. Regulations to control sharing of information must recognise there are also risks in not sharing information, through lost opportunities. This means the approach needs to be customised based on the country with which information is being shared and the technology domain involved.

The US, Australian and UK governments must find a route to create an open export licence between the three countries that covers all the technology areas contemplated in the AUKUS agreement. This would be a major boost to being able to actually realise the agreement’s strategic intent. Only through effective collaboration can allies achieve more together than any one country can individually. The strategic environment is not going to get any better any time soon, and the time for action is now.

Vice Admiral William Joseph Houston is a thoughtful and experienced United States naval officer, entrusted with command of perhaps the most potent US capability: its submarine fleet.

Houston is also steeped in the history of the US submarine service, and the outsized role it played in defeating Japan in World War II. Following the attack on Pearl Harbor, the only viable weapon immediately available was the US submarine force. In fact, USS Gudgeon commenced the US fleet’s first offensive patrol just four days after the attack of 7 December 1941.

By the time the war had ended, US submarines had sunk more than 30% of Japan’s navy (including eight aircraft carriers) and more than 60% of Japan’s merchant marine fleet.

Not surprising, then, that Houston is fond of describing his submarines as ‘apex predators’ that fear ‘nothing above the sea, nothing on the sea, and nothing under the sea’.

Which is why Australia wants the best possible submarines, too. Nuclear-propelled boats would give Australia the same ‘stealthy, full-spectrum expeditionary platform’ that the US Navy has—minus the nuclear weapons, of course.

But Houston has a problem on his hands: while the number and size of submarines planned for the US Navy continues to grow, the size of the workforce needed to build those submarines has shrunk in real terms.

Events of the past week have highlighted the risk that, regardless of the strongly stated political and military support for AUKUS, members of Congress could begin to take a more ambivalent view if it comes at the expense of US operational readiness.

The leak of a letter that the chairman of the Senate armed services committee, Jack Reed, and then-ranking Republican member James Inhofe wrote to President Joe Biden showed that the senators held concerns that the AUKUS plan to sell or transfer Virginia-class submarines to Australia would undermine the US Navy’s own requirements.

The letter highlights the risk of key US policymakers concluding that nuclear-powered submarines for Australia are a great idea, just not right now. Not while the US is simultaneously planning for war with China.

At the heart of the problem is this simple fact: according to current projections, the US needs to turn out two submarines a year, but only around 1.3 per year are coming out of its shipyards.

The deficit in shipyard capacity is a problem that affects maintenance and refits as well as new boat construction. Last year, Rear Admiral Doug Perry, director of undersea warfare requirements in the US Navy, admitted that of America’s 50 attack submarines, ‘18 were either in maintenance or waiting to go in maintenance’. That figure should be closer to 10.

In the words of senators Reed and Inhofe, ‘what was initially touted as a ‘do no harm’ opportunity to support Australia and the United Kingdom and build long-term competitive advantages for the US and its Pacific allies, may be turning into a zero-sum game for scarce, highly advanced US SSNs’.

Reed and Inhofe will have been briefed in detail by US officials, and presumably those classified briefings led them to conclude that the projected additional demand from the AUKUS program would come at the expense of America’s own military preparedness.

The senators added that they ‘recognise the strategic value of having one of our closest allies operating a world-class navy’. Indeed, Reed subsequently tweeted that he is ‘proud to support AUKUS’, noting that America’s advantage over China is ‘our network of partners and allies’.

Or as one senior US government official privately stated: ‘China hates AUKUS, which means we should love AUKUS—and I love AUKUS!’

Further support arrived in the form of an open bipartisan letter to Biden from nine members of Congress calling for expanding the industrial base, and noting that ‘far from a zero-sum game’, AUKUS could be a ‘rising tide that lifts all boats’.

However, the back-and-forth shows that wider congressional commitment could be put under strain if the program comes to be seen as improving Australian capability while stretching the US to breaking point.

Ultimately, the success of the AUKUS submarines program will be determined not by expressions of political support, but by the ability of an integrated defence industrial base in the US and Australia.

It will take some difficult, even unpalatable decisions: more money, certainly, in the form of government support. But likely also a larger, deeper, better-skilled workforce that will need to start being trained almost immediately, and possibly a workforce that poaches talent overseas from countries that themselves face capacity constraints.

All that plus a fundamental rethink of the way governments and the private sector integrate on long-term advanced technology projects. Add to that the need for a concerted effort to overcome institutional and policy barriers such as the labyrinthine US export controls regime, and the way forward will be anything but easy.

The alternative for Washington, however, is a less capable ally in its primary area of strategic competition. At a time when it is widely accepted by governments in Washington, London and Canberra that the US cannot be expected to carry the burdens of strategic deterrence alone, AUKUS is worth the investment.