When Julia Gillard meet Indonesian President Susilo Bambang Yudhuyono in Bali on the weekend West Papua barely got a mention. Although the text messages inside West Papua went into overdrive with the rumour that the reason Australia and the United States were stationing 2,500 U.S Marines in Darwin was to prepare for military intervention in West Papua.

I told my friends in West Papua it wasn’t true.

But then I got thinking. Actually Australia is doing a lot to help Indonesia loosen their grip on the troubled territory. Not by design of course. But the effect is much the same as if the Government suddenly adopted a radical pro-independence policy.

Confused? Let me explain.

Last month the Indonesian police and military fired live rounds into an unarmed crowd of civilians in West Papua, killing five. The Army and Police then tried to make out that it wasn’t them, that what had taken place was a coup by the Papuan Liberation Army; that it was the Papuans who were doing the shooting. Yudhuyono tried to sell Obama and Gillard a version of that story in Bali on the weekend. That might have washed twenty years ago but in this age of social media and smart phones it is much more difficult to hide the evidence.

Since the killing of five Papuans on October 19, the wounding of scores more and the arrest of six Papuan leaders, international media coverage of West Papua has spiked and Indonesia’s international standing has taken a beating. The Army, Police and President’s denials and attempts at cover-up have not helped the government’s reputation.

The killings have also generated outrage and division within Indonesia. And October 19 was not an isolated incident. A series of shocking acts of torture of Papuans by the Indonesian military have been captured on video and recently released. And when I speak of outrage I am not talking about protests from human rights groups. National legislators from a range of Indonesian political parties have begun to publicly criticise the Indonesian military, police and even the President over the government’s policy, or lack of it, in West Papua. Even the cautious Indonesian Bishop’s Conference urged Indonesian President Susilo Bambang Yudhuyono to hold a third party mediated dialogue without delay.

Indonesian critics recognise that the political crisis in West Papua is spiralling out of control and that the central government and the security forces are making things worse. Indonesian journalist Bramantyo Prijosusilo writing in the Jakarta Globe went as far as saying that the “powerful forces bent on forcing Papuans to separate from Indonesia are none other than the central government, especially its military and police force.”

He has a point. West Papua teeters on the brink of open rebellion. After the shooting on October 19 one student previously uninvolved with politics told me “if the police and military thought they could shoot us dead like animals and we would somehow stop pressing for freedom, they are wrong. We don’t care about the military; we don’t care about the police. We are not afraid anymore.” Days later he was on the streets along with 3,000 other Papuans calling for a referendum.

This is not just about political insurrection. The economy is on the brink as well.

Consider the massive Freeport/Rio Tinto gold and copper mine. Eight thousand mine workers there have been on strike since July. Freeport’s pipeline has been cut in more than 20 places, the company has been unable to deliver on its contracts, the local government in Mimika which depends on revenue from the mine to supply services is cash strapped, and Freeport itself is losing billions.

That could mean Australian jobs are affected. Over 800 Australian companies supply the mine through Cairns and Darwin. The Australian owned company International Purveying Incorporated sends everything from Toyota’s, heavy mining equipment, and frozen beef dinners to Freeport every few days.

How long shareholders and investors will put up with heavy loses and adverse economic risk is any ones guess. But it won’t be forever. And it is not just Freeport / Rio Tinto that is in the firing line. BP, Clive Palmer’s nickel businesses in Raja Ampat, and logging interests are all the target of a torrent of anger from landowners. CEOs like Palmer and Freeport’s Bob Moffet may not ask the Indonesian government to negotiate with Papuans demanding political freedoms but sooner or later shareholders and investors will demand just that.

So how is the Australian government responding to these shifting power dynamics? Well that is the problem. They are not. The government’s position is the same as it has always been: continued support for the Indonesian military / police unhinged from any tangible improvements in human rights such as guarantees of free speech, release of political prisoners or moves towards supporting political dialogue.

No matter what side of the political fence you sit this is not smart policy.

For years Papuans have been telling our leaders that Special Autonomy had failed, that the Freeport mine was a source of conflict, and that the military and police were killing them. Just in case we were not paying attention they described the situation as “slow motion genocide”.

So for those realists out there who think an independent West Papua would be a mistake, here’s some free policy advice: stop funding the armed group splitting Indonesia apart.

Giving a blank cheque to the Indonesian military while there is continued suppression of political freedoms in West Papua is the surest way for Australia to help Indonesia lose a country.

It seems the Australian government might be eager to usher in freedom in West Papua after all.

Jason MacLeod is the newest blogger on This Blog Harms. Jason will be blogging mostly about civil resistance, particularly the use of people power in self-determination struggles in places such as West Papua.