Quotes of the Day

In a suburb of one of the world's most isolated cities, Australian Prime Minister Kevin Rudd wants you to know that he feels your pain — to a point. A bedroom community of Perth, Western Australia, Cockburn until recently shared in the buoyant growth rates that turned this part of the southern continent into a giant construction zone. No more. As Australia's great mining boom deflated due to slackening demand from China and the global recession, the region around Cockburn saw unemployment go from 2.1% last October to 7.2% in April. Roughly a year and a half after his victory over longtime conservative Prime Minister John Howard, Rudd dutifully rattles through what his Labor Party will do for this hurting community. But he also regales the audience with tales from the G-20 meeting earlier this year in London, where world leaders debated how to fix the global economy. U.S. President Barack Obama, the Prime Minister confides, borrowed an analogy of Rudd's in his speech, while President Hu Jintao of China chatted with him in Mandarin. As Rudd reveals his foreign exploits, the crowd shifts; attentions wander. The Aboriginal elder who kicked off the event with a traditional welcome ceremony lets his eyelids droop.

With the bland looks of a small-town accountant and an even blander style of oratory, Rudd, 51, doesn't fit the typical mold of an Australian man of action. A former diplomat and veteran technocrat, he often seems more comfortable roaming the international halls of power than pressing the flesh with laid-off workers or drought-stricken farmers in the Outback. Rudd is the consummate globalized citizen, and makes a point of reaching out to those in other nations who share his sense of international community. "He'll put in a full day in the Parliament and then, because of the time difference, call world leaders way into the night," says Michael Fullilove, director of the global-issues program at the Lowy Institute in Sydney and a nonresident senior fellow at the Brookings Institution in Washington. Rudd's late-night conversations, one presumes, turn on his conviction that if his nation of 21 million people is to confront the triple challenge of recession, climate change and a rapidly changing cultural identity, it must in turn recognize a triple reality — that the modern world is interconnected, that each country's challenges are similar and that they can only be tackled by nations acting in unison, not in isolation.

Its geographic remoteness notwithstanding, Australia deserves watching. As both a long and loyal ally of the U.S., and at the same time a nation whose economy increasingly depends on a partnership with China, it has a chance to show the rest of the world the importance of maintaining good relations with both the new century's superpowers. Rudd has positioned himself as the man to pull off that trick.

The Prime Minister's political connection to the U.S. is obvious enough. Like Barack Obama, he's a bit of a geek, a churchgoing centrist liberal who immerses himself in policy detail, chatting fluently on everything from grants for first-time homeowners to the state of broadband connectivity in Australia. But he's familiar with China, too: Rudd speaks fluent Mandarin — the only non-Chinese world leader to boast this linguistic achievement — and in an interview with TIME he rattled through the biographies of some of China's lesser-known Cabinet members. If Rudd can navigate warm and friendly relations with both the U.S. and China, he will turn out to be a politician of more than local significance. And he's going to try. "I'm in the business of making a difference," he told TIME during a rare pause between meetings on a flight from Perth to Melbourne. "There's no point in being here for being here. In the grand tradition of Australians, we believe in having a go."

A Man Apart

Rudd's popularity — in polls, he has an enormous lead over Malcolm Turnbull, the leader of the opposition Liberal Party — is at first sight surprising. After more than 17 years of sustained growth, Australia is flirting with recession; the economy grew just 0.4% in the first three months of 2009. And for a nation that often measures a leader by whether he's the kind of bloke with whom you'd want to have a beer, Rudd comes across as more buttoned-up than many of his predecessors. Talking to TIME, he dropped in a casual reference to Burke (that would be Edmund, the conservative philosopher, not Robert, the doomed Australian explorer). His Twitter feeds — a sample from April 14: "Working hard in sunny Canberra today" — have been mocked as terminally boring.

Yet working a crowd of working-class Australians near Perth, Rudd isn't as stiff as he's sometimes portrayed. In moments of crisis, his emotions resonate. When wildfires, some sparked by arsonists, ravaged drought-ridden Victoria earlier this year, killing more than 170 people, Rudd broke down on camera, momentarily speechless as he blinked back tears. Angrily, he equated arson with "mass murder." And he knows how to combat bureaucratic timidity with the power of grand gestures. Two of his first actions after taking office were making a landmark apology to Aborigines who were essentially stolen as children from their families, and putting Australia's signature on the Kyoto Protocol on global warming, which Howard, like his pal George W. Bush, had declined to do.

Rudd's next initiative is equally expansive. A year ago, he proposed the formation, by 2020, of a new Asia-Pacific Community that would bind the U.S. and Asia together in a regional security forum that would encourage stability in what Rudd says is still a "brittle part of the world." The bloc would build on the Asia-Pacific Economic Cooperation (APEC) birthed and nurtured by his Labor predecessors Bob Hawke and Paul Keating. In 2008, Rudd's proposal sounded like a pipe dream. Today, he argues, the need for such a grouping is all the more important because the global financial crisis underlines how individual countries, even supremely powerful ones, cannot rely on go-it-alone approaches. "I am acutely conscious of what happens when you simply allow things to drift to unrestrained nationalism," Rudd told TIME. "[I want to] avoid long-term strategic drift, avoid the possibility of America drifting away from Asia." And, as an Australian, he believes he has the power of "a creative middle-power diplomacy [that is] friends of all, enemy of none."

Rudd's proposal creates a neat triangle that joins him with Obama and Hu. There is, to be sure, a certain amount of ego involved in his vision. But it also speaks to a general truth about Australian identity. "Australians really do want to exert maximum effort to be taken seriously in the world," says William Tow, an expert on Australia's Asia-Pacific relations at the Australian National University in Canberra. The Lowy Institute's Fullilove puts it another way: "Australians are joiners. We're always thinking about what new international organizations can be established so that we can join them."

The Push — and Pull — of Asia

Raised on a dairy farm in rural Queensland, Rudd might seem an unlikely global citizen. But as a child avoiding work in the cowshed, he would retire to the farthest reaches of the farm with a book on Asian archaeology. Rudd majored in Asian studies in college. Diplomatic postings in Sweden and China followed, and his internationalism captured a changing national mood. For the better part of two centuries, Australia's self-perception was that of a chunk of the West that unaccountably found itself floating in the South Pacific. Today, China is Australia's largest trading partner, with Japan second and four other Asian nations rounding out the top 10.

Australia's complexion, too, is changing — literally. Until the 1970s, an exclusionist White Australia Policy kept out most Asian immigrants. But today, around 8% of Australians are of Asian descent. (If nothing else, Rudd jokes, the changing immigration pattern has catalyzed a culinary revolution in a country where Irish stew was once considered haute cuisine. "At last," says the Prime Minister, "we have some decent food to eat.")

Pad Thai and stir-fried veggies aside, not everyone is pleased with the way Australia has changed. While the reflexive xenophobia of conservative politician Pauline Hanson, who warned in 1996 that Australia was "in danger of being swamped by Asians," has retreated from politics, Asia's presence and influence in Australia still provoke controversy. Some Asian, Middle Eastern and African Australians complain that they are somehow considered less truly Australian than those who came from, say, Italy, Greece or Croatia. An influx of foreign students into Australian universities — many of them Asian — has heightened tensions. In an ugly series of incidents in Victoria in recent months, Indian students have been attacked in so-called "curry bashings." (Indians are the second largest group of foreign students in Australia, after the Chinese.) The attacks caused a storm in India, and when Rudd called Indian Prime Minister Manmohan Singh to congratulate him on his recent re-election, Singh brought up the assaults.

Tensions have also been exacerbated by the economy's increasing dependence on Asian markets. The long economic boom came courtesy of Asian — read Chinese — demand for Australian commodities such as iron ore, coal and bauxite. In large measure, Australians understand the benefit of this regional trade. "The Australian people are enormously practical about the reality of China," says Rudd. "That hundreds of thousands of Australian jobs, directly or indirectly, depend on Chinese trade is something Australians get."

Nevertheless, the specter of a communist country of 1.3 billion people can spook even close economic partners. In the eyes of some Australians, it is one thing to sell what lies underground to China, but rather another to let Chinese companies own Australian resources themselves. Twice this year, Chinese state-owned enterprises have snapped up major Australian mining stakes. But the biggest deal didn't go through. The state-owned Aluminum Corp. of China, better known as Chinalco, was supposed to take a $19.5 billion stake in Australian-British Rio Tinto, which controls, among other mines, vast iron-ore deposits in Australia. The bid sparked a huge controversy in Australia, with the political opposition running TV ads skewering any proposed deal. In June Rio Tinto's shareholders backed out, arguing that the company's recovering stock price allowed them to consider other offers. In the end Australian-British mining giant BHP Billiton stepped into the breach.

The scuppered deal enabled Rudd, whose administration would have had to rule on whether a Chinalco – Rio Tinto tie-up would hurt national security, to sidestep a political grenade. Rudd's political opponents have called him a "Manchurian Candidate" who has allowed China to gobble up Australia's national treasures. The charge is unfair; he's no apologist for the communist rulers in Beijing. (In Taipei, where Rudd studied Mandarin, his home was the wonderfully named Republic of China Anti-Communist Recover the Mainland International Youth Activity Center.) Rudd wrote his university thesis on the trial of leading democracy activist Wei Jingsheng, and in a speech in Mandarin to students at Peking University last year, he infuriated his Chinese government minders by highlighting human-rights abuses in Tibet.

Then there's his government's defense white paper, released in May. The 140-page document outlines Australia's military aims for the next two decades and specifically mentions China's ascendancy as a reason for an arms buildup. In all, $72 billion will be dedicated to bulking up the nation's armed forces, doubling the submarine fleet and adding up to 100 joint-strike fighter jets to its air force.

The Navigator

It makes you wonder: can a nation really welcome being economically yoked to China if it also sees Beijing's ambitions as a threat? In a recent speech on Australian foreign policy, Turnbull questioned whether it was possible to satisfy both of the Pacific's superpowers. "The risk of representing oneself as some kind of trans-Pacific interlocutor," he said, "is that one will be perceived by the Americans as overly sympathetic to China and by the Chinese as a bearer of other people's missions, rather than an advocate of one's own."

It's a fair warning. As any man who wants to enjoy the favors of both a wife and a lover will tell you, it will not be a snap for Australia to stay on good terms with both China and the U.S. The global economy may have joined those two nations at the hip, but it is easy to see how they could be at odds on a host of other issues. Indeed, even as Rudd talks about the inevitable dawn of an Asia-Pacific century with China at its helm, he is careful not to describe the new era as a zero-sum game in which U.S. power is bound to wane. "America has a great history of reinventing itself," he says. "I'm an unapologetic supporter of the United States ... because America is an overwhelming force of good for the world." In an early sign of goodwill, in April Rudd announced that Australia would send an extra 450 soldiers to Afghanistan — where it already had 1,100 troops serving — even as he began fulfilling an election pledge to pull Australian troops from Iraq.

Still, as his defense white paper makes clear, Australia can no longer be confident that it can rely forever on American military protection, as it has since the alliance was forged in some of the most terrible fighting of World War II. The U.S. has many calls on its resources, and Australia is a rich country that can help its allies by helping to look after itself. While in Perth, Rudd visited a navy base where the H.M.A.S. Collins submarine had docked. Descending into the claustrophobic space, Rudd gave a pep talk to seamen who often spend three months at sea in the cramped capsule. As he traveled the world, he said, foreigners, whether American or Canadian or British, always had the most complimentary things to say about the Australian Defence Force. Egos were stroked, but Rudd seemed to be sending another message to the submarine crew: at the dawn of this new century, as a country and a continent unto itself, Australia has to define its security on its own terms.

There's a lesson there for other medium-sized powers. It is surely one that the rich nations of Western Europe, which at times carry themselves as if someone else will always look after their defense, could take more seriously. In the meantime, Rudd will continue with his multilingual diplomacy, trying to convince other world leaders that his pet idea of an Asia-Pacific Community won't just add to the alphabet soup of regional forums that litter the calendar with ineffectual meetings.

On the flight back east from Perth, Rudd glances at the necktie that he has cast aside before landing in Melbourne, where he will deliver another slew of speeches. He rubs his eyes, then launches into a defense of international activism. "You can sit around quietly on the global diplomatic circuit and get nowhere," he says, "or you can ball up a few ideas, some of which have some prospects." It's not a bad blueprint for any nation navigating a place in this globalized world. Makes you wonder whether Australia couldn't export that having-a-go spirit along with its iron ore, coal and gas. The world might be better for it.

• Hannah Beech / Cockburn
• Australia's Prime Minister, Kevin Rudd, is on a mission to convince his fellow citizens that their challenges need global solutions. It isn't just his own people who should listen