There Goes The Neighbourhood. Australia and the Rise of Asia By Michael Wesley New South Sydney, 2011

Infernal Triangle. Conflict in Iraq, Afghanistan and The Levant. Eyewitness reports from the September 11 decade By Paul McGeough Allen & Unwin Sydney, 2011

There Goes The Neighbourhood belongs to that long tradition of inquiries into how Australians have gone wrong and how to fix it. They start with Thomas Bigge's report of 1822 and the roll-call includes Charles Harpur, Daniel Deniehy, Marcus Clarke, P.R.Stephensen, Brian Penton, Donald Horne, Paul Kelly and many more. I had a go myself in a symposium I edited 50 years ago, Australian Civilisation. Michael Wesley brings to the tradition a distinguished academic career in international relations, senior service in the Office of National Assessments, and experience as executive director of the Lowy Institute for International Policy.

His book answers three questions. The first is: Have we gone wrong? Wesley says yes we have. The past 20 years have been the most prosperous years in our history. They gave us a confidence that nationalists of earlier eras dared not dream of.

But the achievement is much less impressive when compared with the current transformation of Asia, especially its giants India and China - an Asia that displays the future of the world in the way America used to. Wesley begins his book by contrasting his departure from Hong Kong with his arrival in Sydney. In the one the train, airport and plane were clean, quick, efficient and punctual. In the other the plane was late, the airport congested, the queues endless, the train slow, dirty and hot.

"It's good to be back in the Third World," he texted his sister ironically. The new Asia is leaving Australia behind.

The second question is: why did we go wrong? Serendipity, he says. Luck. For the first century and more of our history from, say, Napoleon to the Kaiser, we were more or less secure in the British Empire (and gladly paid our dues). When Japan threatened our survival in 1942, the United States saved us. It continued to be our indispensable ally against the threats of communism. When Britain entered the common market, Japan came to the rescue. When the world plunged into the oil crisis of the 1970s, the huge oil fields in the Bass Strait carried us through. More recently we survived the global financial crisis because of China's demands on our mines. It's as if we have, in Wesley's words, "a cosmic panic button" which, if pressed whenever things look ugly, will bring someone or something to our salvation. The Jonahs and doomsayers are always with us but they have always turned out to be wrong. Australians in their complacency have continued to ignore the big bad world outside. We use our prosperity to travel the world but learn little from it. We have become both more cosmopolitan and more insular. As we enter the strange new world of the Asian giants, we find ourselves psychologically and spiritually unprepared.

The third question is: what is to be done? When we lost the protection of the British Empire, we looked to formal alliances and international agencies—everything from the United Nations and ANZUS to SEATO, from ASEAN to APEC, and so and on. Wesley casts a cold eye over most of them. They helped us in many situations—in East Timor, the uranium trade, agricultural exports. But they have become an easy substitute for policy. Worried about regional instability? Try a Pacific islands forum. Boat people? How about a Bali regional process?

After 50 years of this, Wesley writes, there are so many multilateral meetings that our desperate diplomats can't fit them all in. Multilateralism has become obsolete. What should we do instead? At this point, Wesley becomes a little vague. "Australia will need to take the world seriously, study it closely, and choose its actions very carefully." What he means is that we can no longer rely on Washington to help us cope with the great and rising giant, China. We can expect a few big shocks and we will have to absorb two epiphanies—one that most Asian countries are in the same situation as we are vis-a-vis Beijing, and another is that we must learn from them.

In the decades ahead, our security and prosperity will to a very great extent hinge on decisions made by, and our dealings with, South Korea, Vietnam, Thailand, Indonesia, Singapore, Malaysia, and the Philippines. Wesley foresees a new era for our region of continual calibration and recalibration of the "evolving power dynamics" and "diplomatic alignments". If Canberra fails to build influence not only in Washington and Beijing but in Jakarta, Hanoi, Seoul, Tokyo, the 21st century "will be a very unhappy period" for us.

But diplomacy can only go so far ahead of public opinion. It is not only diplomats who must change, but the Australian public and politicians. It's not good enough now for a prime minister to say: "Foreign policy is not my passion."

Wesley remains optimistic. His book may sometimes sound like a variation on The Lucky Country theme, but he is less scornful than Donald Horne of Australian elites. He knows that the transformation of a hard and inhospitable continent into one the most prosperous, free and democratic societies has been far more the achievement of enterprising, ambitious, patriotic and hard-working Australians than of luck. But he also believes that some of the greatest challenges lie ahead. They will be high on the agenda of the Lowy Institute.

The chapters of Paul McGeough's Infernal Triangle are his reports for The Sydney Morning Herald on "the September 11 decade"—from the bombing of Manhattan (which he witnessed) to the Gaza flotilla of June last year (he was aboard). It too is a revisionist critique. But it is not directly concerned with Australian foreign policy. It is basically a critique of American policy and of Australia as a loyal ally.

His "infernal triangle" is formed by Afghanistan (where we should pull out), Iraq (where we should never have gone in) and the Levant (where Israel-Palestine remains in continual crisis). Its tragedy is that it has been split between its reactionary dictators (backed by the US) and the revolutionary terrorists (inspired by Osama bin Laden). McGeough condemns both: he was, he says, run out of Saudi Arabia, and he begins his section on the Levant with a clear-eyed account of the horrifying Matza bombing in Haifa in 2002, which killed 14 Jews relaxing in the restaurant and one Arab. (West Bank Arabs celebrated the bombing: There are no civilians in Israel, the terrorists say, they are all soldiers.)

But despite his attempts at even-handedness, McGeough's sympathy and "understanding" are with Hamas and against Israel. There is no point, he argues, in always reminding us that Israel is the only democracy in the Levant. That does not excuse its policy towards Gaza. There can be no peace until Israel engages with "democratically elected" Hamas.

He also argues, but much less emphatically, that Hamas would do well to acknowledge Israel's right to exist. The one encouraging sign is the Arab spring—bringing the liberal enlightenment to the Arab world. But its hold is tenuous, its future uncertain, and its significance for Israel in doubt. Meanwhile McGeough maintains his scepticism of America, Australia, Israel and the Muslim regimes they support.

He will not convince Australian governments, but he is a useful guide to the policies of Hamas and other alternatives in the infernal triangle.