IT IS PROBABLY just as well that we cannot see into the future; it would make the present even more confusing.

Imagine, for instance, if a visionary futurist had made herself available for interview in August 1988 to respond to comments by an opposition leader who had declared: ‘I am not in favour of going back to a White Australia Policy. I do believe that if it [Asian migration] is, in the eyes of some in the community, too great, it would be in our immediate-term interest and supportive of social cohesion if it were slowed down a little, so that the capacity of the community to absorb were greater.’

The futurist would have had to explain that the opposition leader who lobbed this grenade into the public domain – at a time when the White Australia Policy was rightly discredited and multiculturalism the guiding principle – then seemed unlikely to continue to lead his party, let alone the country. She would have to point out that eight years later he would become prime minister, give comfort to the uneasy, his party would be repeatedly reelected and he would become the country’s second-longest-serving prime minister.

The futurist would also have to say that during this man’s premiership non-European migration would not only continue but reach almost record highs; that he would brag abroad that ‘Chinese’ was the second most common language spoken in his country; that by 2007, when he called his toughest election, Asian-born people would make up nearly a quarter of his own electorate; and that in the same year he would blanch with fury and humiliation when another opposition leader addressed China’s premier in passable Mandarin.

It would have been a complicated interview; the futurist would have had to explain the end of the Cold War, arguments about the clash of civilisations and the end of history, China’s brief dalliance with democratic ideals and its rapid industrialisation, the relative demise of Japanese importance in the region and how the West would be distracted by the reenactment of an ancient clash with Islam and stop watching Asia so closely.

Imagine the response of the producer who took the call from the futurist’s agent offering an interview that could explain why the heated political rhetoric of 1988, which conjured an Asian ogre, might have been a headline-grabbing stunt, a misstatement or a deeply held belief, but any way would be irrelevant in a couple of decades.

Unless the producer owed the agent a very big favour, it is inconceivable that he would have taken up the offer and agreed to such an interview. In the moments it took to open his contacts book the producer would have found a dozen outraged cultural-diversity experts burning with impassioned responses; any number of assertive rednecks happy to pour fuel on the inflammatory remarks and even some Australians of Asian descent who took personal offence.

It would have been a no-contest. News needs conflict. The futurist could sit quietly in her ivory tower and ponder the transitory and ephemeral signs of change before the tectonic plates shifted.

WHETHER JOHN HOWARD was expressing a racist world view and undermining the values of the Liberal Party, as his critics charged, or simply reflecting the views of uneasy Australians, many felt that these few words, which would haunt his career, offered a glimpse into his soul. At the time he belligerently stood his ground and vehemently denied he was racist – such an attitude would be impolite, his biographers noted – but years later attempted to retract the remark.

Howard learned a great political lesson from the torrid encounter and one which he became adept at applying: it is possible to say one thing, keep people distracted and allow something completely different to occur.

After the fury abated, the Labor government reduced the overall level of migration from its then record highs. But it did not give comfort to those made uneasy by the changing ethnic mix and revisit the anachronistic White Australia Policy or jettison multiculturalism. Instead it started to talk more about engagement with the region, to explore how a Western country on the edge of the most populous and rapidly growing part of the world might evolve. Complicated analogies with bats and platypuses were drawn to try to explain Australia’s hybrid future, in Asia but not of it.

When the then prime minister, Bob Hawke, personally intervened in 1989 to make it easier for those involved in the democracy protests in China that erupted in Tiananmen Square to make new lives in Australia, the die was irrevocably cast and over the following two decades Australia changed profoundly. Despite intemperate political outbursts and populist attempts to stir enmity, the country is now more enmeshed with the region than ever. This can be measured: three of our four biggest trading partners are in the region (China recently replaced Japan as the largest); and new settlers from Asian countries now exceed those from Europe.

The 2006 Census provides a telling snapshot. More than seven million people described their ancestry as Australian, another nine million claimed English, Irish or Scottish descent, but fewer than seven hundred thousand declared Chinese ancestry. Although there were more Chinese than British men on the Victorian goldfields in the nineteenth century, policies that limited family migration and access to citizenship, saw the proportions change. Now Chinese settlers comprise the big new group on the block. The historical comparison is striking: in 2006, 90 per cent of those with Chinese ancestry said both parents were born overseas, compared with a fifth of those from Britain and Ireland. Only thirty-two thousand people with Chinese ancestry had both parents born in Australia, compared with nearly six million of those who traced their ancestry to the British Isles. Had the nineteenth century Chinese settlement continued unimpeded, the ethnic mix of Australia could have been quite different.

YET THERE HAS been an important Chinese presence in Australia for two centuries – much more extensive and integrated than the remnant Chinese restaurant in every country town suggests. Indeed John Fitzgerald convincingly shows in his fascinating book Big White Lie (UNSW, 2007) that, contrary to populist fictions, early Chinese settlers were as beguiled by notions of egalitarianism as any other group of nineteenth century immigrants. They shared similar values and myths but, as the White Australian Policy shaped public sentiment, they were treated shamefully – as a species apart, their lives constrained by a plethora of racist regulations – because it was considered inconceivable that they might share similar values.

It is amusing to note that the twenty-first century values statements recently developed by the Chinese and the Australian governments are strikingly similar.

The rich history of exchange was made possible in part by proximity. Chinese settlers in Australia moved back and forth, as Fitzgerald shows, because the distances were not so great – a pattern replicated by Irish settlers in America where the distance was similar. There are Chinese-Australian families that go back five or six generations, who fought in our wars, started great businesses here and in China, were politically influential and yet only recently have begun to assume positions of great public importance.

Fortunately the consequences of the humiliation that Australia dealt Chinese and others from the region who wanted to settle here has not left an insurmountable legacy but there is a lingering memory that can be easily conjured. Politicians with an eye to the future need to be aware of the residual impact of humiliation.

Fitzgerald suggests the impact of the refusal of Australian prime minister Billy Hughes to allow a racial equality clause in the Covenant of the League of Nations in negotiations after World War I reverberated for years. For Hughes such a clause would have jeopardised the White Australia Policy and he did not care that rejecting it humiliated the Japanese. The American delegation came up with a face-saving concession and conceded German territories in China to Japan. This in turn humiliated China and not long afterwards marked the beginning of the Chinese communist movement. Fitzgerald acknowledges ‘it would be drawing a long bow’ to blame Hughes for Mao’s later victory in China but it does illustrate the danger of following narrow nationalist agendas in an interconnected world.

The Chinese community in Australia at the end of the nineteenth century was one of the most modern, technologically savvy and mobile. It is a pattern that is being repeated. Sydney on a hot evening feels like other great cities in the region. Chinatown, once just a couple of blocks defined by kitsch street art, cheap cafes and supermarkets, is now the heart of a precinct that spreads west from Park Street, south from Hyde Park all the way to the newly residential Pyrmont. Chinese cafes now compete with Vietnamese, Thai, Korean, Japanese, Indonesian and Malaysian restaurants bursting with people having a good time.

This physical transformation is not confined to Sydney. Suburbs in every major city have adopted a new livery that projects the diversity of the countries and people in our immediate neighbourhood – it is pragmatic, open and welcoming. From holidays to food, art, technology, shopping, work, entertainment and trade, the ‘Asianisation’ of Australia, once spoken of with fear and trepidation, has become normal and captured the imagination. With little public discussion, while attention was turned inwards or focused on the Middle East and the threat of Islamic extremism, Australians have become comfortable with the neighbourhood.

Michael Wesley describes this as part of the ‘Howard paradox’ in his book of the same title. Now he argues we need to accept it and move on, and at the same time learn more and think harder.

The enormously diverse countries in our neighbourhood are linked by geography and a long and complicated shared history of trade, colonisation, war and culture. They are also home to some of the oldest human civilisations and the epicentre of global power is likely to return to them this century. As Kevin Rudd, the opposition leader who spoke Mandarin to the Chinese Premier, so elegantly demonstrated, the future of civilisation will be shaped in this neighbourhood, and we can participate on our own terms.