8

The Fifth Circle: Modernizing the Military

From the beginning, Xi’s definition of the China Dream has incorporated the military: “The Chinese Dream is to make the country strong. China’s military take their dream of making the military strong as part of the Chinese Dream. Without a strong military, the country can neither be safe nor strong.” Xi sees China’s military strength as the ultimate linchpin of China’s future power in relation to its neighbors, the region, and the world.

Xi also sees himself as a grand strategist. Before coming to power, he was contemptuous of the lack of real war-fighting and war-winning capabilities by the People’s Liberation Army (PLA)—whereas since 2012, he has sought to transform its leadership, structure, and capabilities from, in his view, an antiquated Mao-era people’s army, concerned mainly with the defense of China’s interior and its continental borders, to a high-tech force capable of projecting air and naval power beyond China’s shores. While Deng Xiaoping issued guidance on the modernization of China’s defense as part of the “four modernizations” and shifted the PLA from a force devoted to Maoist guerrilla and human-wave tactics into a more conventional military, Xi has launched a much more fundamental series of reforms. He has also unleashed an anticorruption campaign within the PLA officer corps to professionalize its leadership, restore discipline, and enforce absolute obedience to the party’s political leadership—especially himself as commander in chief. This campaign has removed thousands of senior personnel whose personal loyalty to Xi was judged to be less than absolute.

For its part, the US military has gone from seeing Beijing as a regional strategic adversary in the 1950s and 1960s, to a strategic collaborator against the Soviet Union in the 1970s and 1980s, to becoming an emerging strategic competitor in the early 2000s, and now—once again—an adversary. The formal US assessment of the Chinese military today is that it is already a “peer competitor” in East Asia and a “long-term strategic competitor” around the world. The focus of that military competition with China today is over Taiwan, the South China Sea, the East China Sea, and a growing array of new security threats, including AI, space, and cyberspace.

Although Beijing sees the overall correlation of forces between China and the United States moving steadily in its favor, the Chinese leadership still sees many dangers lying ahead. These include sophisticated American countermeasures developed to meet China’s rapidly evolving military capabilities and the unpredictable variable of American intervention to prevent the forced return of Taiwan to Chinese sovereignty. There is also the problem of America building or reviving alliances and partnerships across the Indo-Pacific (such as the Quadrilateral Security Dialogue or “Quad” with Australia, Japan, and India) and now in Europe in common cause against Beijing.

Xi Jinping’s Dream of a Strong PLA

Xi Jinping’s emphasis on modernizing the People’s Liberation Army is driven in large part by his personality. Xi is a strategic realist who believes that, as important as economic prosperity is, it is military power that ultimately lies at the heart of state power. The lessons of modern Chinese history, most notably China’s repeated defeats at the hands of more advanced Western and Japanese militaries during the country’s Century of Humiliation, have fostered in Xi a deep resolve, shared by the party and the nation more broadly, to never allow this to happen again.

Xi’s attitudes are also shaped by his military service from 1979 to 1982 at the beginning of his professional career and by his father’s time as a senior military commander during the revolutionary war. He has a healthy appreciation of the military traditions of the PLA and, unlike his recent predecessors, has chosen to wear combat fatigues on major ceremonial occasions. His military service, albeit at a junior level, also makes Xi aware of the operational limitations of the PLA, including its complete lack of field experience since China’s border war with Vietnam in 1979, where the PLA fared badly. Even worse for China, the PLA Navy has not experienced any major naval engagement since its founding along with the People’s Republic in 1949.

There is also a resolute determination on Xi’s part that the military remains the ultimate instrument of political control against any internal challenges to the party’s power. This is reflected in the PLA remaining under the direct political control of the party (through the Central Military Commission) rather than through the administrative apparatus of the Chinese state. One of the reasons Xi is so determined to assert absolute control over the military lies in his openly contemptuous remarks on the failure of the Soviet Union’s Communist Party to deploy the Red Army to reassert control amid the anticommunist revolts of 1991 that led to the collapse of the USSR. Xi is determined that no such hesitancy will ever be permitted within the PLA, where every senior PLA commander is made to swear unswerving loyalty to both the party and to Xi himself. Xi has already dismantled several powerful military bureaucracies that he believed were resistant to his overall reform drive, simultaneously consolidating his personal control over the PLA’s command structure and removing any future sources of political resistance to his leadership.

Since its founding, the PLA has been provided with nine sets of formal strategic guidance by the party leadership. The first five were developed prior to 1980 and dealt with how China would counter either an American or Soviet invasion. The four since then—adopted in 1980, 1993, 2004, and 2014—have addressed new contingencies concerned with local wars over Taiwan, China’s maritime claims in the East and South China Seas, and the Korean Peninsula. In all of these, China’s principal potential adversary is the United States. Chinese military contingencies also deal with the country’s long-standing border dispute with India.

For these reasons, Chinese leaders, including Xi, have paid the closest attention possible to the historical evolution of the US Armed Forces and its vast array of state-of-the-art capabilities. China’s military commanders were riveted by the lethality of modern American firepower deployed in the First Gulf War, the Balkans conflict, and the 2003 invasion of Iraq. In particular, they were challenged by the “revolution in military affairs” (or RMA), as real-time strategic and tactical information provided by satellite and electronic sources was integrated with joint air and land forces and weapons systems on the battlefield. Over time, the RMA in the US Armed Forces triggered major reforms in the Communist Party’s formal strategic guidance to the PLA.

China’s military and political leaders have also studied Alfred Thayer Mahan’s classic work on the relationship between sea power and national greatness and cite it frequently, along with historical examples of British and American naval power during the nineteenth and twentieth centuries. In this view, sea power has an axiomatic relationship with global great power status, including the power that subjugated imperial China during the Century of Humiliation. They, therefore, see this as an important strategic lesson for China in the twenty-first century. As a result, China has concluded that the PLA’s maritime power must be expanded, not only to defend China’s shores but also to offer an important means of asserting Chinese power, influence, and prestige into the wider Indo-Pacific region and perhaps, in time, other theaters beyond.

The party’s official guidance documents to the PLA have dealt with four essential questions: With whom will China fight? Where will China fight? What is the character of the war China will fight? And how will China fight? While the answers to these core questions have changed over the course of the decades, of all the external contingencies that the PLA has to deal with, Taiwan remains, by far, the most important of all. Ultimately, the power of the military, together with the strength and reach of the Chinese economy and its unfolding indigenous technological success, is seen by Xi Jinping as the essential means by which Taiwan can ultimately be coerced into a form of national reunification with the mainland.

Xi Jinping’s Approach to Chinese Military Modernization

Xi’s most recent guidelines for the PLA were issued in 2014 (a public version was published as “China’s Military Strategy” in 2015) and was implemented in a massive structural reform program beginning in 2016. The 2015 document, drafted two years into Xi’s first term, is the first to bear his personal, authoritative stamp on the military. There are four major new elements in the strategy: an unequivocal declaration of the importance of what military strategists call informationized warfare (integrating the use of digital data and intelligence with fighting forces) across all military domains; a doubling-down on integrated joint operations (bringing air, land, sea, and other forces together in unified battlefield operations); a new doctrine on the centrality of the navy and the maritime domain in China’s overall strategy; and a new definition of the PLA’s maritime domain of operations as extending beyond China’s “near seas” to a wider area of open seas and even far seas—all as part of what some analysts have described as a move toward a new Chinese military strategy of forward defense.

Informationized Warfare

The 2015 document placed the military’s deployment of information technology platforms at its center. This included long-range, smart, stealthy, unmanned weapons and equipment and the emergence of cyberspace as “the commanding heights in strategic competition.” While previously China had seen informationized warfare as one of the conditions for the successful prosecution of modern warfare, it has now become the fundamental condition for doing so. In an earlier 2013 speech, Xi expressed dissatisfaction that the need for the integration of all functional systems of the PLA (e.g., intelligence, electronic warfare, and logistics) “had not been fundamentally resolved.” To address this, he moved to create new joint service structures at both the central and regional levels and stressed the creation of what both American and Chinese military literature refers to as a “system of systems,” or an information-based joint operational approach.

A New Priority of Sea Power over Land Power

While the expansion and modernization of the PLA Navy (PLAN) had been underway for a decade and a half prior to the 2015 reform, this most recent doctrinal shift is of fundamental importance to the US and its allies. It represents the next step in the evolution of the PLA away from its historical preoccupation with internal security and China’s continental defense to an emerging doctrine of deploying military power beyond China’s shores. Specifically, the new strategy states that “the traditional mentality that land outweighs sea must be abandoned.” Instead, it calls for “highlighting maritime military struggle” and “preparations for maritime military struggle.”

As a logical extension of this new official emphasis on the primacy of sea power, the 2015 document codifies what the strategy refers to as China’s “open seas protection” mission. It extends China’s proposed military reach out to the mid-Pacific in order to better secure its territorial claims in Taiwan, the East China Sea, and the South China Sea through a strategy of antiaccess/area denial (A2/AD) against US forces operating in the western Pacific. It also aims to make China’s emerging global naval and maritime power capable of independently securing its sea line of communication that brings critical trade and resources to China by sea as well as protecting its nationals abroad in times of crisis and cementing the global projection of Chinese national prestige. These are significant changes in Chinese naval doctrine, and although they are not inconsistent with the PLA’s strategic guidance since 1994, they represent a substantial acceleration of China’s intentions to build a navy that is a peer competitor of the United States. China’s second aircraft carrier, and the first to be domestically built (the Shandong), was commissioned in December 2019. A further four carriers are reportedly to be built by 2035—beginning with a larger carrier roughly equivalent to American models, the Type 003, to be launched in 2022. Chinese surface, submarine, and amphibious-lift capabilities also continue to develop at pace. The PLA’s naval forces, weaponry, and organizational sophistication are beginning to rival that of the United States within the western Pacific theater.

Chinese naval forces semiroutinely circumnavigate Taiwan, simulating possible future naval blockades of the island and testing likely Taiwanese and American naval reactions to any such scenario. This has been described by Admiral Lee Hsi-min, Taiwan’s chief of general staff from 2017 to 2019, as “incremental military provocations below the threshold of armed conflict, with the objective of compressing the space in which Taiwan’s military can operate while intimidating its people.” China’s coast guard and large maritime militia (composed of fleets of hundreds of networked, and often armed, fishing vessels) have similarly been enhanced and deployed in order to assert China’s offshore territorial claims.

Beyond China’s mainstream naval forces, China also continued to develop other capabilities to enhance the country’s overall strategic posture. In the South China Sea, East China Sea, and around Taiwan, China routinely engages in what military strategists refer to as gray-zone activities. Under this approach, Beijing seeks to gradually shift strategic circumstances in its favor by deploying assets that are technically nonmilitary (such as its coast guard and maritime militia) to physically press its territorial claims without triggering a full-blown military reaction from the US or its allies. By doing so, China aims to achieve its de jure objectives by de facto means, or what China’s strategic literature describes as “winning without fighting.” That such deployments are frequently in violation of established international law does not seem to bother China. In fact, Beijing has only intensified the practice since 2016, when the dispute resolution panel of the United Nations Convention of the Law of the Sea rejected the legal validity of any of China’s South China Sea claims made under the “nine-dash line.”

Modernization of Air and Ground Forces

As for the PLA Air Force (PLAAF), China produced fifth-generation stealth fighters and is developing long-range bombers, along with airborne early-warning and control aircraft, aerial refueling tankers, and strategic lift capabilities to deal with a full range of contingencies. Meanwhile, under Xi’s reorganization, PLA ground forces appear to have three principal functions: being ready to lead an amphibious assault on Taiwan; dealing with threats in China’s western theater, including along the border with India; and dealing with perceived terrorist threats both from within Xinjiang and from beyond the western border, including from Afghanistan and Pakistan. But in a move reflecting Xi’s appraisal of where future conflicts are likely to erupt and how they will be fought, he has ordered a reduction of the ground forces’ troop numbers by 300,000, leaving the army with a historically low standing force of 850,000 at the same time that the personnel and budget of the navy and air force have increased.

A New PLA Rocket Force

As part of the reorganization of China’s military command structures, Xi also created a new PLA Rocket Force (PLARF) to become a separate force on equal footing with the army, navy, and air force. The PLARF integrates both China’s nuclear and conventional rocket forces. Its conventional capabilities, including China’s latest missiles, have become central to the PLA’s asymmetric A2/AD strategy that aims to hold at bay US naval and air operations out to the second island chain in the Pacific. The rapid expansion of China’s rocket forces, with a full array of medium-range land-attack missiles targeted at Taiwan, anti-ship missiles (including so-called carrier-killers) that can target any approaching US aircraft-carrier battle groups, long-range land-attack missiles (including the so-called Guam-killer), and missiles designed to destroy American satellites in space, are all central to China’s overall A2/AD strategy.

A New Regional Command Structure Focused on Maritime Theaters

Xi also established a PLA Strategic Support Force (PLASSF) to bring together and integrate all of China’s space, cyber, reconnaissance, and electronic warfare capabilities in support of informationatized joint operations across all branches of China’s military services. To reinforce the PLA’s new strategic structure, command, and focus, China’s seven regional military commands, which prioritized defending China’s interior, were collapsed into five active theater commands to emphasize integrated, battle-ready joint operations—of which three are maritime commands along China’s eastern and southern coasts, facing the US, Taiwan, and its allies.

Xi’s Vision for a World-Class Military

Just as Xi Jinping set new benchmarks for 2035 as a midpoint on the way toward achieving the full realization of China’s dream of advanced economy status by 2049, he also initially advanced 2035 as the date for the completion of the modernization of the Chinese military. However, during the finalization of the CCP’s fourteenth five-year plan (covering the period 2021–2025) in the fall of 2020, this date was suddenly brought forward to 2027. There is much speculation as to why Xi did so. It’s conceivable that the main reason is simply that a nearer-term objective could motivate ambitious military commanders to prove their worth by speeding up reforms. It’s also conceivable that Xi, intending to remain in power into the 2030s, wants to be in a position to be able to act militarily to secure Taiwan from as early as the late 2020s should he choose—or at least to have a sufficient military edge against the US by that time to cause Taipei to seek political terms.

A PLA capable of achieving Xi’s Taiwan objectives may be sufficient to satisfy the party’s goal of being a world-class military, first set out in Xi’s address to the Nineteenth Party Congress in 2017. As Taylor Fravel, the acknowledged international authority on PLA doctrinal evolution, has noted, the term world-class has been used relatively widely across China’s other modernization tasks, including universities, scientific research, and China’s ambitions for various sectors of the economy. However, in Chinese strategic literature, a world-class military is specifically defined as one that can compete effectively with any world-class adversary overall, possessing a “strength and deterrent capacity to match them.” Indeed, Chinese Academy of Military Sciences analysts have written that world-class militaries should possess, inter alia, “transregional and transcontinental force delivery capabilities.”

In 2021, China completed construction of a naval base in Djibouti and is seeking to develop additional such bases adjacent to the Indian Ocean, including on the east African coast. Potential locations, where China has already invested in or signed leases for large-scale civilian port infrastructure include Cambodia, Myanmar, Pakistan, and Sri Lanka (where China signed a ninety-nine-year lease on Hambantota in exchange for forgiving large Sri Lankan debts). Chinese naval visits to Indian Ocean ports—including by nuclear submarines—have also been increasing steadily.

At the same time, an extensive Chinese workforce is distributed across Africa and the Middle East, many working on BRI projects and others running their own businesses. This has led the PLA to argue that it needs the capability to deploy with global reach in order to protect Chinese nationals and their assets abroad in the case of natural disasters or major local political unrest—a scenario often vividly portrayed in popular Chinese films, such as Wolf Warrior 2 and Operation Red Sea. As noted above, China also argues that it should be in a position to defend its sea line of communication transiting the India Ocean, particularly given China’s chronic dependence on unimpeded access to the Persian Gulf for its energy needs.

Despite this, the pattern of China’s military operations outside the western Pacific theater do not yet reflect a comprehensive strategy to regularly deploy forces so far abroad. It’s still not clear from China’s naval operations that it intends to become a global, as opposed to just regional, peer competitor with the US military. Nonetheless, China’s naval operations to date do demonstrate a determination to establish a global political and logistical network that could be adapted for such purposes in the future.

The Cyberrealm

In cyberwarfare, the technological advantage still lies overwhelmingly with the attacker rather than the defender. Given the potential rewards it yields for the relatively modest investment made, it is also a remarkably cost-effective form of asymmetric warfare. And it is a form of warfare that flatters long-standing Chinese strategic instincts about “winning without fighting.” Nonetheless, it is also deeply destabilizing and dangerous, presenting real risks to the future integrity and security of critical social and economic infrastructure—from hospitals to transportation and communication systems to power supply. It risks “blinding” military command, communication, control, and intelligence systems in times of tension or crisis, undermining the normally conservative national security decision-making processes of a country under cyberattack. Such countries would likely fear, legitimately or otherwise, that they had been deliberately blinded by an adversary to conceal an imminent military, or even nuclear, attack. Under these circumstances, the case for immediate retaliation could become irresistible.

A further danger is that cyberattackers can often initially hide who they are or where they are based. Rogue actions by state actors, such as Russia or North Korea, or malicious individuals operating from anywhere in the world, have the potential to trigger retaliation, military or otherwise, directed at the wrong target, especially during periods of tension and crisis. Both China and the US are potentially vulnerable in this regard, not just as targets but in terms of being falsely identified as being behind an attack.

Xi Jinping has rapidly accelerated the development of China’s offensive and defensive cyber capabilities. Like AI, cyber is seen as one of a number of new technology platforms that could turbocharge Beijing’s existing military capabilities and enable China to leapfrog the United States. China already sees great strategic advantages by surreptitiously accessing critical US military data and deploying that information to design its offensive weapons systems, including the ability to disable American command, communication, and control systems. However, at the same time, China recognizes its vulnerability to cyberattack—not just in the military and economic domains but also in the civil sphere, where China’s adversaries could obtain and release sensitive political information that might delegitimize and destabilize China’s political leadership. This is part of why China has one of the strictest censorship regimes and tightest internet controls in the world, with severe penalties for such crimes as “spreading rumors” online. (Rumors can encompass real-time citizen reports on anything from industrial accidents to environmental disasters to the story of how the COVID-19 pandemic unfolded in Wuhan.) Given that protecting the CCP’s political position is Xi Jinping’s core priority, along with cementing his leadership, it’s understandable that Xi had himself appointed as head of the Central Leading Group for Cyberspace Affairs in 2014, barely a year into his leadership.

China’s cyberwarfare establishment consists of three agencies that generally target the US, the West, and other significant adversaries. The first, run by the PLA, focuses on military network warfare; the second is run by the Ministry of State Security (China’s external intelligence agency) and focuses on stealing information of all sorts; and the third, run by the Ministry of Public Security, focuses on domestic targets. All three arms are able to deploy non-state agencies to execute their missions, according to independent cybersecurity analysts, sometimes using Chinese public and private corporations as fronts and conduits for data collection and transmission or often simply hiring Chinese cybercriminals to work secretly for the state. Meanwhile, China’s cyber defense operations are centered in the Central Cyberspace Administration Commission (CCAC), which, per Xi, is required to “adhere to the principles of defense, self-defense, and retaliatory strike” in dealing with cyberattacks, including taking the stance that “we will not attack unless we are attacked, but we will surely counterattack if attacked.” This has been reflected in a raft of new Chinese laws aimed at protecting the state from any such attack. These laws effectively compel all data-holding firms operating in China—both foreign and domestic—to surrender their data to the authorities if so requested. Indeed, one of these—the National Intelligence Law—mandates access to data operations held by Chinese firms both inside and outside China, thereby potentially covering data held offshore.

The scope and intensity of China’s recent legal and administrative innovations in the cyber domain is symptomatic of the growing incidence of China-linked cyberattacks abroad. According to a running tally by the Center for Strategic and International Studies in Washington, China is the most frequent source of “significant cyber events” recorded around the world and has been for some time. In most years since at least 2018, the top five national initiators of cyberattacks against state and nonstate targets were, in order: China, Russia, Iran, North Korea, and India. The United States comes in sixth. By contrast, the top targets of cyberattacks were the US, India, South Korea, and China itself. The CSIS report lists, for example, more than fifty-five attacks between 2020 and 2021, on top of twenty major attacks by China on US government and corporate targets over a ten-year period up to 2019 (along with hundreds of other smaller attacks). This included the most spectacular of all: the 2014 attack on the US Office of Personnel Management, accessing confidential personal employment data for millions of US federal employees—including highly sensitive information obtained during security clearance investigations and interviews, potentially usable by China in the identification of American intelligence agents.

Whereas Beijing and Moscow may challenge the objectivity of a report by Washington-based think tanks such as CSIS, its conclusions are not vastly different from the trends identified in other technical papers tracking global cyberactivity by state actors. In 2018, then US deputy attorney general Rod Rosenstein stated that “more than 90 percent of the department’s cases alleging economic espionage over the past seven years involve China.” There has been no reported Chinese response to that claim. US behavior is not exactly saintly on this score, as the CSIS and other reports also indicate. Washington has launched attacks against Chinese targets, although the US government claims that it avoids attacks on civilian or corporate targets, focusing exclusively on conducting normal intelligence gathering on Chinese party, state, and military assets instead. For its part, Beijing regularly denies that it carries out any kind of offensive cyberwarfare and stresses that hacking is illegal under Chinese law—though it has not disputed that it has such extensive capabilities.

The United States has deployed an extensive array of defensive measures to deal with this growing Chinese attack on civilian and military targets, among them its flurry of legislative, regulatory, and institutional initiatives, including the establishment of the Cybersecurity and Infrastructure Security Agency (CISA), the Cybersecurity Enhancement Act of 2014, the continued strengthening of US Cyber Command (CYBERCOM), and the National Cybersecurity and Communications Integration Center (NCCIC).

In an effort to de-escalate growing cyber tensions, in 2015, the Obama administration pressed Xi to limit cyberattacks on private intellectual property, and an agreement was reached. This was temporarily effective: CrowdStrike, an American company monitoring cyberattacks, reported a 90 percent drop in cyberattacks originating from China in the months following the deal. But by early in the Trump administration, previous patterns of activity resumed—and then matched the overall downward spiral of the bilateral relationship from 2017 onward. Indeed, before it published its 2018 National Cyber Strategy, the Trump administration made clear that bilateral cooperative agreements on cyber were no longer part of official US policy. Various other bilateral and multilateral approaches have since been explored to identify and potentially enforce rules of the road in this deeply destabilizing domain. But none have been agreed upon, let alone implemented.

It would be foolish to assume, as with other recent advances in Chinese military-related technologies and capabilities, that China is and always will be dominant in the cyberwarfare domain. The capacity of the United States remains significant. China’s vulnerabilities to a sophisticated and sustained cybercampaign waged against it are particularly high, given its one-party state and its highly centralized political, economic, and military decision-making systems. It remains to be seen whether China’s national vulnerabilities to all-out cyberattack caution China’s recent enthusiasm for cyberwarfare—or whether they, in fact, intensify it further.

Space

Xi has made clear that for China, “becoming an aerospace power has always been the dream we have been striving for.” He also invokes China’s space ambition as a further reason for China to strive for national self-reliance in technical innovation. China is committed to becoming a “major global space player by around 2030” and the “global leader in space equipment and technology by 2045.” This is about more than being the first to land a spacecraft on the dark side of the moon, as the Chinese did in 2019, or landing men on the moon to scope out prospects for construction of a moon base, as China is planning for later in the decade. China has concluded that America’s domination of space has been central to the effective deployment of US military force “beyond the line of sight” in all global theaters and across the full range of strategic scenarios. China has concluded that it must do the same—both to deter and to counter any future US military operations against it. The PLA is acutely aware that satellites represent the eyes and ears of fully integrated military operations for the foreseeable future. As the US Defense Intelligence Agency has recognized publicly, “The PLA views space superiority, the ability to control the information sphere, and denying adversaries the same, as the key components for conducting modern, informationized warfare.”

Following Xi’s directives, China is dedicating significant financial resources to developing a wide array of space capabilities currently possessed by the United States. This includes advanced rocket technologies associated with space launch vehicles for all altitudes; a full range of intelligence, surveillance, and reconnaissance satellite capabilities to monitor and assess relevant weather conditions, enemy signals intelligence, enemy military deployments, and battlefield damage in real time; specialized satellites to provide global coverage for precise positioning, navigation, and timing data; and command-and-control systems for military forces to detect any preparation of ballistic missile activity or provide early warning of any hostile missile launches and coordinate offensive and/or defensive measures in response. All these space missions lie at the nerve center of the modern Chinese military machine.

China is also working on developing its offensive “counterspace” capabilities. These include a combination of ground- and space-based systems (radars, lasers, signals, and optics) to track enemy satellites; electronic systems designed to interfere with the integrity of communications between ground-based transmitters, satellites, and receivers; kinetic energy weapons (usually ground-based antisatellite missiles) aimed at destroying enemy satellites; and directed energy weapons using laser, microwave, or other radio frequency waves, either from the ground or from space, to blind or disable enemy satellites.

While China’s military space program falls under the direct control of the Central Military Commission headed by Xi, the operational deployment of space-based systems for military purposes has been given to the newly established Strategic Support Force (SSF), which, according to the US Defense Intelligence Agency, “integrates cyber, space and electronic warfare capabilities into joint military operations across the entire PLA.” At the same time, the State Administration for Science, Technology and Industry for National Defense (SASTIND) is charged with the allocation of budgets for the entire space program, including research, systems development, and the military acquisition program. Both SSF and SASTIND have received robust budget support from the central government, and although there is limited transparency as to the precise amounts they are given, they are undoubtedly large. Just as important—and maybe more so—is that, in contrast to the US, the Chinese space program is also wired to the center of the country’s political and military leadership, whereas in America this relationship is much more diffuse.

As of 2021, some 3,372 active satellites were orbiting Earth. Of these, 1,897 were American (including at least 300 owned by the US military) compared with 412 Chinese (including at least 80 of which—and likely more—are known to be operated by the PLA). However, China is catching up in the total number of new satellite launches—with 35 in 2020, compared with 40 for the US and 17 for Russia. China’s space-based intelligence, surveillance, and reconnaissance systems are only second in scope and sophistication to the US—with more than 120 separate space assets, half of which are operated by the PLA. This has given China a genuinely global intelligence reach for the first time.

Meanwhile, in the civilian-military domain, China has launched thirty-five satellites that have allowed it to become a major provider of global navigation satellite systems (GNSS) through its BeiDou satellite network—potentially to become a real global rival to GPS, the long-established American system. China is already hoping to extend this feature of the “space silk road” by negotiating contracts with Belt and Road Initiative countries, the Shanghai Cooperation Organization members, and the BRICS countries (Brazil, Russia, India, China, and South Africa) to offer these services to participating states. The fact that BeiDou’s two-way communication system can track the location of ground-based receivers has raised some concerns about privacy. Yet by 2021, Vietnam, Thailand, and Cambodia had signed up, and more countries are likely to do so.

Therefore, by most measures, China is fast closing the gaps in space technology between itself and the US. There are still difficulties, including those China has experienced in developing the reliable, high-altitude, heavy-lift rockets necessary to support China’s manned spacecraft ambitions for the future. But it is catching up faster than any external analyst anticipated a decade ago.

Nuclear Weapons

China has been a nuclear weapons state since 1964. Since then, China has developed and maintained a modest-sized arsenal, spread across land-, sea-, and air-based delivery systems, where its stated objective has been to avoid nuclear blackmail at the hands of Russia (during the Sino-Soviet split) and, now, the United States. Beijing has defined its nuclear doctrine as one of “minimum deterrence.” This is anchored in a declaratory policy of no first use, underpinned by a sufficiently hardened nuclear force capable of surviving an initial strike from an adversary and then being able to launch a credible retaliatory strike. This doctrine has enabled the bulk of China’s military modernization efforts to be concentrated to date on its conventional capabilities, as most recently reflected in Xi Jinping’s 2015 Military Strategy discussed earlier.

However, given the recent structural deterioration of the US-China relationship, there are indications that China is in the process of reexamining its previous nuclear assumptions. In doing so, Chinese military leaders have examined a number of questions. First, to what extent has the long-standing stability of Chinese and American nuclear doctrine been challenged by new technological developments in areas such as ballistic missile defense, hypersonic missiles, and various forms of algorithmically driven warfare, as well as the type of offensive cyber and space capabilities referred to previously? Second, to what extent will the nuclear efforts of third countries—such as Russia, North Korea, and Iran—impact the future of US-China nuclear doctrine? And third, perhaps most critically, to what extent do US and Chinese nuclear capabilities, operational doctrine, and declaratory policy reduce the real risk of conventional conflict? Or are they beginning to have the reverse effect: that the nuclear factor is seen as so irrelevant to the risk of conventional conflict over Taiwan, the South China Sea, and the East China Sea that this perceived “minimal risk” of nuclear escalation actually serves to exacerbate the risk of conventional conflict? These are all critical considerations for the future. Too often in the US-China debate, they are pushed to one side because they are too complex, too unknowable, or too remote. I would argue the risk of nuclear escalation between the US and China must be considered afresh.

Beijing, for one, seems to have landed on some unsettling answers. While it was estimated in 2020 that China has a nuclear arsenal of some 290 warheads spread across a full nuclear triad of some ninety ICBMs, six nuclear submarines, and strategic bombers, China appears to have embarked on a major nuclear expansion. In 2021, satellite imagery revealed that China began construction of more than two hundred new missile silos in its northern deserts. Some of these silos are likely to be empty decoys. But even if only some of them are filled, this would represent a large increase in China’s active nuclear arsenal. Additionally, in August 2021, China reportedly tested a nuclear-capable hypersonic glide vehicle that successfully circled the earth in space before maneuvering to its target. The test of the vehicle, which would have the capability of evading US missile defenses, reportedly astounded US intelligence officials with the speed of China’s modernization. “We have no idea how they did this,” one told the Financial Times. Combined with this are persistent and growing indications that China’s leadership is considering switching from a strategy of no first use or second strike (only launching nuclear weapons after surviving a nuclear attack) to a strategy of launch on warning (launching as soon as a likely attack is detected). All this suggests that Xi and China’s military leadership feel that a far more hostile external environment and, in particular, the prospect of prolonged struggle with the United States have necessitated a significant buildup in its strategic nuclear deterrence capabilities.

In recent years, China also sharpened its existing capabilities with improved range, accuracy, and survivability, including developing new road-mobile missiles and deploying other advanced ballistic missiles, such as the DF-41, with multiple warheads designed to better evade missile defenses. China is also scheduled to deploy a new generation of Type 096 strategic nuclear submarines in the 2020s, which will carry a new J-3 missile with a nine-thousand-kilometer range. Still, these capabilities remain dwarfed by those of the United States. By contrast, the US currently has some six thousand nuclear warheads spread across some four hundred ICBM installations, a fleet of fourteen ballistic missile submarines, and sixty-six strategic bombers with nuclear-launch capabilities. Each of these legs of the US strategic triad is also the subject of rolling modernization and replacement programs. Therefore, even if Chinese military planners have shifted their strategy, it will take quite some time before the nuclear balance could be brought closer to equilibrium.

US nuclear doctrine also differs considerably from that of China and is usually expressed in terms of four pillars: first, to deter any conventional or nuclear attack on the United States; second, to do the same on behalf of US allies over whom the American “nuclear umbrella” is extended, obviating their need to develop their own nuclear capabilities; third, to prevail against an adversary in the event of deterrence failing; and fourth, to hedge against any future developments in military technology, conventional or nuclear, that might threaten US national security. These pillars were reaffirmed in the most recent 2018 US Nuclear Posture Review (NPR). Importantly, the NPR explicitly named both China and Russia as threatening the US nuclear posture and the future effectiveness of US deterrence. The NPR also rejected a no-first-use doctrine in order to maintain strategic ambiguity in the eyes of American adversaries about the circumstances in which Washington would consider a nuclear response. As the NPR noted, “Our tailored strategy for China is designed to prevent Beijing from mistakenly concluding that it could secure an advantage through the limited use of its theater nuclear capabilities or that any use of nuclear weapons, however limited, is acceptable.… The United States is prepared to respond decisively to Chinese nonnuclear or nuclear aggression. US exercises in the Asia-Pacific region, among other objectives, demonstrate this preparedness, as will increasing the range of graduated nuclear response options available to the president.” In other words, the US has made clear that any use of conventional, tactical, or theater-level nuclear attacks in East Asia could potentially trigger a menu of nuclear options in response. It is, of course, a separate question as to whether Chinese political and military leaders regard such statements as credible. PLA commanders, for example, have regularly questioned whether US counterparts really believe that a future American president would sacrifice San Francisco to nuclear attack as the price of defending Taipei. Nevertheless, this represents a large—and potentially fatal—leap of faith on the part of the PLA concerning American strategic intentions.

The US deployment of Terminal High Altitude Area Defense (THAAD) systems in South Korea in 2016 to counter the growing nuclear and ballistic missile threat from North Korea highlighted how the installation of space-based monitoring systems can endanger nuclear deterrence. From the perspective of the Chinese military, THAAD—which is designed to shoot down ballistic missiles descending from space in their terminal phase by drawing both land-based radar and satellite-based early warning, tracking, and targeting systems—is particularly problematic. THAAD would cause trouble for the PLA in situations where it aimed to deploy missiles in future Taiwan-related contingencies, including against US carriers and bases, in the event of military conflict. These concerns extend to the deployment of other American sea-based technologies (e.g., the Aegis Ballistic Missile Defense System), which, in China’s view, would have a similar effect. Unsurprisingly, China protested against the THAAD deployment in South Korea, having concluded that its installation would undermine the integrity of China’s second-strike nuclear capability that has long been central to China’s overall deterrence strategy against the US. China has also been deeply concerned by the significance of the United States’ conventional prompt global strike plan, which seeks to develop a new capability to take out any target anywhere on the globe within an hour of a command being given. This presents another threat to China’s second-strike nuclear capability and, therefore, the integrity of its entire doctrine of minimal deterrence. Such developments may have played a role in China’s decision to expand its nuclear arsenal.

These developments have also resulted in a range of other Chinese countermeasures. China’s decision to deploy a new hypersonic missile (the DF-ZF), designed to evade any ballistic missile defense system with its extreme speed and maneuverability, adds a further dimension to an unfolding US-China nuclear arms race. Persistent concerns have also spurred China’s development of its ballistic missile defense systems. This, in turn, will have a further escalatory effect on US calculations on the adequacy of its arsenal, each side constantly seeking to secure temporary advantage over the other.

Despite the possibility of a new nuclear arms race, China continues to spurn US invitations to engage in either bilateral nuclear arms control negotiations or trilateral negotiations with Russia. It appears that China, fearing the vulnerability of its relatively small force, may have concluded that its only option for the future is to radically increase the size and sophistication of its arsenal. Overt nuclear competition between Beijing and Washington, once almost exclusively the preserve of the US-Russia relationship, may become the new norm.

The Overall US-China Military Balance

So where does this leave the regional balance of power as of 2021? As various studies have emphasized in recent years, the military balance cannot be calculated purely on the basis of some mechanical, quantitative comparison of the Chinese and American order of battle—that is, the crude numbers of troops, ships, submarines, planes, rockets, and so on. Rather, the list of difficult-to-measure factors is a long one, including

• the relative sophistication and survivability of military platforms, systems, and weapons;

• the effectiveness of battlefield experience and training;

• the robustness of command, control, communications, and intelligence systems for integrating and sustaining effective joint operations;

• the sustainability of military budgets over time;

• the continuing political will in Washington, Beijing, and relevant allied capitals to support and sustain the deployment of military forces in given strategic situations;

• the capacity to harness the nonmilitary dimensions of overall state power (e.g., diplomatic, economic, financial, and technological resources, together with the ability to shape global public opinion) in the prosecution of a military campaign;

• the impact of nuclear deterrence on the scope, intensity, and duration of any conventional conflict; and

• most critically, the application of all these variables, both quantitative and qualitative, by individual leaders to individual crises in different locations as they arise.

For example, the answer to the military balance equation will differ depending on whether we are applying it to particular scenarios in the Taiwan Strait, the South China Sea, the East China Sea, or the Korean Peninsula, let alone in potential operational theaters in the Indian Ocean or even further afield, where China’s power projection capabilities beyond the western Pacific become increasingly stretched.

Nonetheless, a number of clear trends are becoming apparent. First, the capabilities gap is narrowing in virtually all categories and more rapidly in some categories (e.g., cyber) than US military strategists had anticipated. Second, in desktop military war games conducted by Washington, Beijing, and Tokyo across a range of Taiwan scenarios, the United States has reportedly lost repeatedly (according to some reports, this includes on as many as nineteen successive occasions—and, in some cases, even when fighting with a range of its strongest regional allies). Third, where Japan and the United States respond together to military crises in the East China Sea close to Japan, however, war-gaming produces more favorable results, reflecting the supreme importance of geography. Fourth, the same does not, however, apply in the South China Sea, where China is largely pushing on an open door. This partially explains why Beijing has been more cautious in prosecuting its territorial claims in the East China Sea around the Senkaku / Diaoyu Dao Islands than in the Spratly and the Paracel island groups in the South China Sea. In the South China Sea, the US has no specific treaty obligations at stake beyond the Philippines. Consistent with this, the US did not respond militarily to China’s program of island reclamation in the South China Sea over 2014 and 2015. This caused Beijing to become increasingly confident of its overall military position in the theater. Fifth, China’s overall net military advantage over the US, however, dissipates the greater the geographical distance from China’s shores. This will change over time, as China’s long-range strike, blue-water navy, force protection, and sustainment capabilities improve, but it appears in no hurry to significantly scatter its resources until it becomes absolutely confident of its strategic position closer to home—most particularly regarding Taiwan. Finally, Washington should be aware that the Chinese state’s capacity to marshal the full resources of the Chinese economy in any given conflict is greater than the United States’, given the radically different nature of the two countries’ political and economic systems.

All that said, Xi continues to face many problems with his military modernization program, not least how to pay for it. The Stockholm International Peace Research Institute estimates that the Chinese defense budget grew approximately 233 percent from 2008 to 2020—from $108 billion to $252 billion. As of 2020, it represented close to 10 percent of the total Chinese government budget. Xi will be aware of the headwinds confronting China’s political-economic model, including a potential decline in China’s future private-sector-driven growth rates and the implications this will have for future Chinese budgets. Xi is also aware that the underfunding of China’s domestic policy needs increasingly demanded by the public, particularly in health, aged care, and retirement income to support a rapidly aging population, risk making substantial military outlays a risky political proposition.

Furthermore, Xi has awoken the American bear from its long strategic hibernation. Since 2017, the US defense budget once again grew at an average of more than 5 percent per year, following a post–Iraq War slump. While Biden’s first annual defense budget request totaled $715 billion—an increase of only 1.6 percent—the budget deliberately shifted significant spending to focus on systems designed to deter China. This included more than $5 billion designated for a newly created Pacific Deterrence Initiative, an effort to develop and deploy advanced long-range strike weapons to the region (in a version of China’s A2/AD strategy, which has proven so problematic for American naval planners). Japan and Australia, as two of America’s three principal allies in East Asia, have also both signaled that they intend to significantly increase their military budgets. Indeed, I signaled the same back when we prepared the 2009 Australian defense white paper, including doubling the Australian submarine fleet and increasing the surface fleet by one-third. As Beijing has become aware, it may not have been the best idea to be so loud and proud about China’s growing military prowess. Indeed, since 2018, there has been a dramatic decline in public references to Xi’s world-class military in Chinese state media. This seems to parallel the decision to remove all reference to China’s 2025 high- technology strategy for fear of generating further international reaction.

In the end, theoretical war gaming aside, it remains unclear whether Xi’s military reform and expansion program will work in delivering a PLA capable of “fighting and winning wars.” As of 2020, the PLA was still in a process of major internal upheaval; any near-term regional crisis would, therefore, have to be dealt with by a military apparatus still in the throes of a profound institutional transition. Military reform is also deeply politically sensitive in China itself. The demobilization of three hundred thousand soldiers has resulted in a large number of public protests by veterans unhappy with the financial terms of their forced retirement. Meanwhile, other senior commanders have been purged, detained, or imprisoned for a combination of corruption and disloyalty—whether real or confected. This has included several once-powerful generals, leaving gaps in experience and potentially dangerous levels of resentment in the force. Sacked military commanders are also a powerful source of potential dissent across the Chinese political system. And on top of all this, Xi has waged a relentless campaign to reconsolidate the party’s authority over the PLA, including his decision to bring China’s formidable paramilitary apparatus (the People’s Armed Police) under direct party control, removing it from the supervision of the state council altogether.

While there is unlikely to be any fundamental objections to these changes from his politburo colleagues, there will be professional and political disquiet if more political and military power is concentrated in Xi’s hands. It contributes further to Xi’s existing reputation within the Chinese political system of being the “chairman of everything.” There is a danger this adds to any political “antibodies” already accumulating within the party. But so far, Xi has demonstrated himself to be a master at eliminating potential opponents—and doing so well before any of them could effectively organize and move against him.

Despite these not inconsiderable difficulties, as noted previously, Xi Jinping sees the overall regional balance of military power moving steadily in China’s direction. Xi would take some pride in the fact that the United States Department of Defense formally refers to China as “a peer competitor.” This was not the case before 2018. Based on its analytical models, China believes the “objective” balance of forces is moving in its favor over time. This is reinforced by its internal calculus of the overall “correlation of forces” between the US and China, incorporating its models for calculating each country’s comprehensive national power, which takes into account the full range of military and nonmilitary capabilities in a carefully constructed international league table. Until 2009, China published these tables. Now it doesn’t. This reflects the same sort of internal political sensibilities that prompted China to reduce its official public media reporting of anything that smacks of China’s growing capabilities, grand ambitions, or public triumphalism. However, on the underlying reality of Chinese military power, China’s internal calculus finds a steady shift in the regional balance in its favor.

Senior Chinese military leaders, however, are aware that, despite the closing of the capability gap between China and the US and its closest allies, they still face formidable adversaries in the US and Japan in particular. I attended a well-lubricated dinner with a number of Chinese two- and three-star generals at the National Defence University after I became a senior fellow at the Harvard Kennedy School following my second term as prime minister in Australia. I was at the university to deliver a public lecture on US-China relations in the presence of the notoriously hard-line General Liu Yafei, the university president. It was a torrid session, one of a number I attended with the Chinese military over recent years. But over dinner and much maotai later that evening, the conversation turned to concrete military scenarios. Relations with Japan at that time had hit rock bottom over Tokyo’s “nationalization” of the disputed islands of Senkaku / Diaoyu Dao, and naval and air assets from both countries were becoming increasingly engaged. I remember vividly the high degree of military caution from my Chinese colleagues on what it would be like to actually fight a major engagement in the East China Sea against the Japanese alone—quite apart from whether the Japanese were also joined by US naval and air assets. The Chinese military are acutely conscious of their lack of direct field experience. They are not lacking in courage. Far from it. But their level of professional prudence was striking.

For Xi Jinping, the political loyalty and the effective modernization of all branches of the Chinese military are central parts of his overall strategy. The PLA is directly relevant to his future hold on power. It is fundamental to securing and maintaining national unity, most acutely in relation to Taiwan. But it is undeniably a major drain on the budget: effectively funding it over the long term makes it imperative that China’s future economic development model is a success, or else China will face even harsher budgetary choices than it does now. But as we will see in the chapters that follow on Beijing’s growing role in the region and the world, China’s military power is becoming as fundamental to China’s international policy ambitions as its economic power has been for a considerable time already.