Australia, New Zealand Part Ways on Foreign Policy

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Seen from a distance, the differences between Australia and its smaller neighbor, New Zealand, appear slight, even microscopic - like their two accents, which outsiders often have trouble differentiating.

That was Peter Saunders's assumption, when he first joined the Center for Independent Studies, a libertarian think tank here. But the British sociologist is surprised by how much of his time and attention is spent on Australia's increasingly testy ties with New Zealand.

"Something is happening here that deserves careful attention," he says with a slight frown.

This past year has seen previously unimaginable cracks opening in what was once a watertight …