Is China Trying to Bankrupt US?

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Is China Trying to Bankrupt US?

Does a cash-strapped US face a Cold War redux as China encourages it to ramp up defence spending? Boosting alliances is the way to respond, says Brad Glosserman.

One popular narrative credits the end of the Cold War to a US strategy to bankrupt the Soviet Union. Well aware of the advantage conferred by its superior economic performance, Washington pushed Moscow into a military competition that drained the USSR of its resources. In this narrative, US President Ronald Reagan’s push to create a missile defence system – realistic or not – was the straw that broke the Soviet back.

Are Chinese strategists pursuing a similar approach to the United States? Is Beijing pushing US buttons, forcing it to spend increasingly scarce resources on defence assets and diverting them from other more productive uses? Far-fetched though it may seem – and the reasons to be sceptical are pretty compelling – there is evidence that China is doing just that: ringing American alarm bells, forcing the US to respond, and compounding fiscal dilemmas within the United States. Call it Cold War redux.

China emerged from the 2007-8 global economic crisis with a new sense of its strength and corresponding US weakness when it comes to money and power. The Chinese don’t have the new balance of power right – the United States isn’t as weakened as many assume and China has its own problems – but they are right to note both the centrality of economic strength to international position and a new attitude and atmosphere in the United States. Beijing also senses US overextension and sensitivity to Chinese provocations (broadly defined). There’s a new economic reality for US security planners.

Money is tight. In this era of new austerity, the United States has to make increasingly difficult choices about spending priorities. Both economic rationality and military purpose have to guide procurement. Defence Secretary Robert Gates tried to get in front of this process with a budget that cuts $100 billion in defence spending. He isn’t trying to gut the military as some allege, but instead seeks to strengthen it with a long-term spending plan. His fear is that in the absence of such a proposal, ad hoc decisions (decisions not guided by a long-term strategy) will damage US capabilities.

China is trying to shape that strategy – not just by playing down its potential to threaten the United States but by playing up some of its capabilities. That’s one way to read China’s January 2007 anti-satellite test or the test of the stealth fighter in January of this year just as Gates was visiting China. China is trying to make its capabilities, no matter how nascent or premature, the focus of US planning and forcing the US to respond.

While this theory – that China would highlight its own threat to force a US response – sounds far-fetched, it seems to be working. There’s mounting concern in the defence community over China’s deployment of an aircraft carrier and its anti-access area denial strategy. That’s reasonable: hysteria and dire warnings about a transformation of the regional balance of power are not.

Some Chinese strategists offer an explanation for the tests that have so inflamed US sensitivities that fits this grand design. One expert argues that China is hedging – the tests both maintain Chinese capabilities and signal the United States that it can’t hope to make ‘a technological breakout’ that China will not match. Beijing won’t let the US monopolize high-tech capabilities. The flip side of that logic is that China will do enough to keep the United States on alert, if not hypersensitive to Chinese actions, and that will drive US decision-making.

On the other hand, Henry Kissinger’s recent tome notwithstanding, most observers don’t credit the Chinese with the ability to be that strategic or far sighted, nor do they have a monolithic foreign policy establishment. In this context, the ASAT and fighter provocations could just as easily be explained as being the result of bureaucracies behaving badly, i.e., ministries failing to coordinate.

Most significantly, the success of the Cold War redux strategy – if it exists – depends on the United States surrendering the initiative to China. There’s little evidence that this is happening. But there is no mistaking the attention to Chinese developments and the potential threats they pose to US pre-eminence in the western Pacific, the protection of US and allied interests, and regional stability generally. That is the correct approach – but US decison makers shouldn’t hyperventilate about or overinflate the Chinese threat. As CSIS Pacific Forum President Ralph Cossa has noted, ‘When the Chinese finally deploy an operational aircraft carrier – and there is a big distinction between sea trials and becoming fully operational (measured in years, not months) – the proper US response should be to congratulate Beijing on finally  achieving the status of the Soviet (or Ukrainian) Navy, circa 1984.’

Some historians challenge the Cold War narrative upon which this ‘strategy’ is based, arguing that the Soviet Union collapsed from within with little help from the United States. That doesn't mean that the dangers of US implosion aren’t real, however.

Budget funds are tight. And, significantly, cracks are beginning to appear within the United States. National politics are increasingly polarized and paralyzed as the country debates how to get its economic house in order. A recent Wall Street Journal editorial told readers they have to choose between being a superpower or a welfare state. That is precisely the choice the new Cold Warriors would want us to face. Nothing could be more divisive or more capable of short-circuiting US politics. Nothing would be more detrimental to long-term US interests than to short-change the domestic investments needed to keep the country strong.

In addition, defence procurement has to be smarter and better focused. Force reductions are inevitable (and have been occurring) but they need not undermine US capabilities. Nor will they send the wrong signals to allies and adversaries if they are the result of a deliberate strategy.

Most important, the United States must better leverage its strengths, in particular its relationships with allies, friends and partners.

Alliances and relationships are force multipliers. The more tightly integrated the US and its allies, the more convincing the signal to potential adversaries that the United States is committed to the defence of those partners – in other words, it strengthens our deterrent. And that is the most important element of our security strategy in the Asia Pacific.


Brad Glosserman is executive director of the Pacific Forum CSIS in Honolulu.His opinion articles and commentary have appeared in the Japan Times,South China Morning PostInternational Herald Tribune and Asian Wall Street Journal, among other publications.

This is an edited version of an article that originally appeared at CSIS Pacnet.