Heritage Foundation Leadership for America

The National People's Congress of the People's Republic of China (PRC) announced on March 4, 2007, that it would increase the country's military budget by 17.8 percent in 2007 to a total of $45 bil­lion—by far the largest acknowledged amount that China has ever spent on its military.1 The Chinese government went out of its way to reassure the world that this spending hike was normal and need not worry anyone. "China is committed to taking a path of peaceful development and it pursues a defensive mil­itary posture," a spokesman said.2

As the Chinese aphorism goes, "listen to what they say, but observe what they do," and what Beijing is saying is quite different from what it is doing.

The resources that Beijing devotes to its armed forces put China in the top stratum of global military powers. With China's 2006 gross domestic product (GDP) in excess of $2.5 trillion (about $10 trillion in purchasing power parity terms) and its military spending estimated by the Central Intelligence Agency at 4.3 percent of GDP,3 China's military spend­ing is more accurately pegged at about $430 billion than at $45 billion.

While China's declared military budget primarily includes personnel costs (and a 17.8 percent military pay hike is reasonable), the declared budget is only a small part of overall Chinese military spending. The exact methodology that U.S. intelligence agencies use to estimate the military's share of China's GDP is clas­sified, but it reportedly accounts foreign arms pur­chases, subsidies to military industries, China's space program (which is under the absolute com­mand of the Central Military Commission), the 660,000-man People's Armed Police, provincial militias, and reserve forces—all of which are excluded from official military budget figures.4[1][2][3][4]

Defense spending in some sectors that are not counted in the defense budget appears to be in­creasing at a much faster rate than the official military budget. For example, China's National Defense in 2006 (China's 2006 Defense White Paper) noted that:

In 2005, the output value, added value and gross revenue of the entire spectrum of defense-related science, technology and industry in­creased by 24.3 percent, 20.7 percent and 21.6 percent, respectively, over the previous year.[5]

The Chinese military budget does not include the bulk of the defense-related science, technology, and industry sectors or overseas military procurement or provincial spending on militias and reserves.

Despite the Chinese Communist Party leader­ship's espousal of China's "peaceful rise," the facts tell a different story. The unprecedented peacetime expansion of China's military capabilities can no longer be viewed as though some benign force ani­mates it. China's military expansion is already suffi­ciently transparent that one can discern Beijing's intention to challenge the United States in the West­ern Pacific and establish itself as the predominant military power in the region—in the name of anti-hegemony and to promote a "multipolar interna­tional system."

China's Rise as a Military Power

Chinese leaders are not seized by self-doubt about the direction of their regime. The declared strategy of the Chinese leadership has been to turn its economic growth into military power by means of the "four modernizations" (agricultural, indus­trial, science and technology, and military) and the "prosperous nation, strong military" (fu guo, qiang bing) model.

Ironically, after the 1991 collapse of the Soviet Union—China's only existential threat—China in­creased military spending, while the United States and virtually all of its allies immediately set about reaping a "peace dividend," with U.S. defense ex­penditures dropping over 10 percent from $298 billion in fiscal year (FY) 1992 to $268 billion in FY 1997.[6] During the same period, Chinese defense spending sustained annual double-digit increases. This pace of Chinese military spending increases has continued to this day. The Pentagon estimates total Chinese defense-related expenditures in 2005 at between $70 billion and $105 billion, which places China third in nominal dollar defense spend­ing after the United States and Russia.[7]

American intelligence analysts in both Republi­can and Democratic Administrations have been sur­prised in recent years at the breathtaking pace and scope of China's military development.[8] A 2006 Department of Defense report on China's military power notes that the transformation of the People's Liberation Army (PLA) has included new doctrines, reform of military institutions and systems, improved exercise and training standards, and the acquisition of new foreign and domestic weapons systems. China's military expansion has already altered regional military balances. The long-term trends in China's military have the potential to pose credible threats to modern militaries.[9]

Nuclear Forces. The most ominous of China's military advances has been in the PLA's strategic rocket forces, the 2nd Artillery, which includes nuclear and conventional ballistic missile com­mands and anti-satellite units. In the mid-1990s, the 2nd Artillery embarked on a modernization program designed to improve the reliability, surviv­ability, response times, and accuracy of its ballistic missiles to state-of-the-art standards. Since 1996, it has more than doubled—and in some years has tri­pled—the annual production of solid-fuel short-range ballistic missiles (SRBMs).[10]

China has also deployed at least 40 interconti­nental ballistic missiles (ICBMs) targeted at the United States. The road-mobile DF-21 medium-range ballistic missile (MRBM) has been operational since 1996, and the 2nd Artillery is now introduc­ing road-mobile ICBMs, including the DF-31.[11] The DF-31A, which has a range of 10,000 kilome­ters, is expected to become operational by 2008. Given the known rapid growth in SRBM produc­tion, production of MRBMs, intermediate-range ballistic missiles (IRBMs), and ICBMs has likely increased at the same rate. Thus, by 2006, DF-31 output could easily have reached 10–20 new mis­siles per year.

China's current Xia-class ballistic missile subma­rine is already loaded with Julang-1 (JL-1) solid-fuel missiles, and a longer-range JL variant subma­rine-launched ballistic missile with a range of 8,000 km will be deployed on China's new Jin-class (Type-094) nuclear ballistic missile submarine in three years.[12]

In addition, the PLA will have "several new con­ventional and nuclear variants of MRBMs and IRBMs for regional contingencies and to augment its long-range missile forces."[13]

Logically, the strategic aim of this rapid expan­sion of China's nuclear force, particularly the deployment of DF-31s and DF-31As and a durable submarine-based nuclear capability, is to reduce China's nuclear vulnerability substantially and develop a robust nuclear deterrent focused on the United States.

While Beijing purports to have a nuclear "no first use" (NFU) policy, some U.S. experts believe that the Chinese leadership reserves the right to use nuclear weapons in a first strike against Taiwan or Taiwan's defenders. The unmistakable implication is that U.S. forces defending Taiwan would be tar­gets.[14] This position was explicated on the record by a senior Chinese strategist in 2005.[15] There are indications that the PLA is contemplating the use of a high-altitude nuclear detonation to generate a powerful electromagnetic pulse that would fry microcircuitry in U.S. weapons systems during a conflict.[16] Rather than trying to reduce instability in such a strategic environment, internal PLA military writings treat NFU as a constraint on nuclear oper­ations and reflect considerable resistance to NFU in the PLA.[17]

Hence, China's NFU declaration appears to be intended primarily for propaganda advantage and possibly to encourage complaisance in American decision-making. At least one study shows that Chi­nese nuclear doctrine seems to make little distinc­tion between conventional ballistic missiles and nuclear-armed ballistic missiles with respect to how they are deployed and used.[18]

Another serious facet of China's nuclear doctrine is that the Central Military Commission deploys nuclear and conventional warheads on the same classes of ballistic missiles and co-locates them near each other in 2nd Artillery units. This doctrine is apparently designed to shorten the escalation fuse in an effort to further complicate U.S. and Japanese responses during a crisis.[19]

Moreover, this modernized and sophisticated nuclear force is clearly well in excess of any mere Taiwan contingency. It involves new power projec­tion capabilities that give Beijing two advantages: "area denial" strength, which is achieved by placing forward-deployed U.S. forces in Japan, Korea, and Guam at risk, and coercive diplomacy instruments to resolve other territorial disputes, such as in the East China Sea with Japan and the South China Sea with other Association of Southeast Asian Nations (ASEAN) countries. Indeed, China's new nuclear weapons systems present grave implications for U.S. power projection in the Western Pacific, the security of U.S. allies and friends in democratic Asia, and regional military balances in general.

Nuclear Proliferation. The United States also needs to pay far more attention to China's tacit direct and indirect support for nuclear weapons programs in Pakistan, Iran, and North Korea. Stra­tegic planners in Washington need to consider whether or not China calculates that a nuclear strike launched by Iran on the United States or by North Korea on the United States or Japan might actually be in China's ultimate interests. The September 11, 2001, attacks on the United States weakened the United States, distracted U.S. policymakers from Asia, and diverted foreign investment flows from the U.S. to China for several years thereafter. A sce­nario in which Iran or North Korea inflicts major damage on the United States or its allies with a nuclear device could be an underlying motivation for China to give rogue states diplomatic support against U.S. and European pressures to abandon their nuclear programs.

As China refines its missile guidance capabilities, forward-deployed U.S. forces in the Western Pacific will become vulnerable to Chinese missiles. For example, U.S. carrier battle groups could face the­ater ballistic missiles with maneuverable reentry vehicles (MaRVs) capable of hitting moving ships at sea.[20] The hyperspeeds of these MaRVs make them virtually impossible to defeat with current missile defense technology.

Chinese advances in land attack cruise missiles and theater ballistic missiles will also place U.S. forces in Japan, Korea, and Guam within their range.[21]

Anti-Satellite Weapons.Given the American military's highly advertised reliance on space sys­tems, an equally unsettling development is the 2nd Artillery's experimentation with various anti-satel­lite (ASAT) systems—capabilities that are targeted exclusively at U.S. space assets. On January 12, 2007 (Beijing time), a Chinese DF-21 missile lifted a kinetic kill vehicle (KKV) into an intercept track for a Chinese weather satellite in polar orbit.[22] The missile warhead then fired the KKV at the satellite (perhaps guided by ground-based targeting laser) and successfully destroyed it. U.S. space trackers have monitored but did not publicize at least two previous ASAT tests in July 2005 and February 2006. In the February test, the KKV was maneu­vered into close range of the target satellite but sud­denly veered away.[23]

Given the grievous risks to low-orbit satellites presented by a debris cloud from the January test, why the U.S. did not confront the Chinese following the earlier tests is a mystery.[24] No doubt some Administration officials did not want to antagonize China's space efforts.

In April 2006, shortly before Chinese President Hu Jintao's official visit to Washington, China's Dep­uty Space Agency Administrator Luo Ge evidently found a receptive audience in the White House for his proposals for joint U.S.–China space coopera­tion. Mr. Luo requested that the U.S. agree to Chi­nese participation in the International Space Station (ISS), including making modifications on the orbit­ing station that would allow Chinese spacecraft to dock, and President Hu and President George W. Bush did discuss Chinese participation in the ISS and cooperation on a future lunar landing effort— an initiative that might explain some of the U.S. hes­itation.[25] Some observers speculate that U.S. offi­cials were holding out the prospect of space cooperation to persuade China to accept space launch rules of the road. In fact, China's People's Daily touted U.S. interest in manned lunar mission cooperation with China, an obvious propaganda ploy, but the PLA rejected Washington's rules-of-the-road initiatives.[26]

Some enthusiastic support for U.S.–China space cooperation persisted in the White House until August 2006, when the PLA attempted to blind (or illuminate) a U.S. reconnaissance satellite, but that support was resisted by the Pentagon and NASA and by Undersecretary of State Robert Joseph.[27] By the end of September, NASA Administrator Michael D. Griffin was expressing deep frustration that the PLA had blocked any reciprocal access to Chinese space launch facilities or engineering centers. With­out transparency in China's programs, especially given China's refusal to coordinate launch informa­tion and space debris data, cooperation remained impossible.[28] While senior U.S. military command­ers debated on China's ASAT intentions even into October 2006, all but the most ardent apologists admitted that China simply was not prepared for serious international cooperation in space.[29]

The Propaganda Department of the Chinese Communist Party approved a September 28, 2006, commentary in Beijing's Huanqiu Shibao that declared: "The United States' exaggeration of China's counter-satellite technology is only an attempt to seek an excuse to justify its development of space weapons."[30] In retrospect, however, whatever the United States was doing regarding China's counter-satellite technology, it was not exaggerating it. The January 12, 2007, ASAT test irrefutably confirmed that China was interested solely in scoring propa­ganda points and not in space cooperation, as China did not seem to feel any obligation to give interna­tional notification that it intended to fill a polar orbit 530 miles up with thousands of particles of space debris, each with the potential to damage or destroy space craft orbiting at or below that altitude.[31]

The following week, the State Department filed a démarche with the Chinese government protesting the ASAT test but received no response. A week later, the Pentagon briefed journalists on the test. It was the first time the Department of Defense had reported on China's KKV–ASAT program, although the Defense Department had described other Chi­nese ASAT efforts in its annual China military power reports.[32] Subsequently, the Chinese foreign minis­try, while not publicly admitting that an ASAT weapon test had taken place, dryly observed that Beijing has shown a "responsible attitude" by offer­ing "explanations" to the U.S. and Japan and insisted that Beijing has all along "upheld the peace­ful use of outer space."[33] "China opposes the weap­onization of space and any arms race," the foreign ministry added, pledging reassuringly that "The test is not targeted at any country and will not threaten any country."[34] Judging from the clueless reaction of China's foreign ministry to the angry démarches and complaints from several nations with space pro­grams, few outside the PLA chain of command or the Communist Party Politburo were informed of the tests ahead of time or were briefed afterward.[35]

This does not mean that Beijing's foreign minis­try does not have a vital role in China's ASAT pro­gram. Chinese diplomats have the important mission of getting the United States to adhere to a Chinese draft statement, "Preventing an Arms Race in Outer Space" (PAROS), that Beijing has circulated in the United Nations. Although U.S. negotiators have tried to engage Chinese counterparts on Beijing's thoughts on verification of a PAROS regime, the Chinese have uniformly insisted that they will consider verification issues only after the U.S. has first signed a PAROS agreement.[36] How­ever, this point seems lost on most of America's allies. China and Russia managed to isolate the United States 160–1 on the PAROS statement in the last meeting of the U.N. First Committee. Israel abstained, while Japan, Britain, and Australia voted for it. The United States needs to be wary of the disastrous potential for Beijing's public relations campaign on the PAROS statement to drive a wedge between the U.S. and its allies.[37]

In this, the Chinese have learned much from Soviet arms control negotiators, who realized by the 1980s that they did not have to rely on verification when dealing with the United States. Once the U.S. signed an arms control agreement, it was self-enforced by America's democratic processes. More­over, as evidenced by the Soviets' construction of the Krasnoyarsk anti-ballistic missile (ABM) battle-man­agement radar in direct contravention of the ABM Treaty, the Soviets could openly cheat, deny inspec­tions, and confound verification without fear that the U.S. would abrogate the treaty. China appears similarly intent on violating any PAROS agreement by forming covert ASAT units in the 2nd Artillery.[38]

Since the January 12 test, U.S. media reports from the Pentagon have reflected alarm among U.S. space strategists over several other Chinese space weapon initiatives including ground-based lasers and radio frequency weapons.[39] They are particularly con­cerned about the launching of small Chinese satel­lites into orbits very close to key U.S. intelligence, reconnaissance, and communications spacecraft. Such parasitic microsatellites are presumed to be time bombs that could blind and cripple American military operations and financial communications. "These things aren't being sent up there to be space rocks," one military source said.[40] All these pro­grams bespeak an anti-satellite development pro­gram that is very broad and sophisticated.[41]

While official U.S. government speculation that China's political leaders may not have known of the ASAT tests[42] is not credible, it is certainly PLA prac­tice to withhold information from civilian depart­ments. The PLA's refusal to inform health authorities about the 2003 SARS epidemic in military hospitals across China is a clear example of this. It is possible that the PLA believed that the January 12 ASAT test would go unnoticed, although for 18 months before the test the Pentagon had extended a standing invi­tation to China's 2nd Artillery commanders to visit U.S. Strategic Command to discuss the dangers of space debris and how the U.S. tracks it.[43] Few doubt that the PLA is fully aware of U.S. Strategic Command's and Air Force Space Command's space tracking capabilities and fully appreciates that the U.S. would detect the debris cloud immediately after a successful ASAT test. While low-level officials in China's foreign ministry have admitted that they knew nothing of the ASAT tests, most observers agree that the civilian party and government lead­ers, at least at the Politburo level, are extensively briefed on important military advances.[44]

Naval Forces. China is now the world's largest commercial shipbuilder, and its naval ship produc­tion has slipstreamed behind the civilian sector.[45] President Hu's speech to the PLA Navy on Decem­ber 27, 2006, indicated clearly—if not explicitly— that China is preparing to confront the United States at sea and under the sea.[46] China's navy is also upgrading its naval aviation and power projec­tion capacities. China's naval modernization, Hu reported, "has made great strides, comprehensive combat capabilities have strengthened visibly, and we have achieved new heights and made new con­tributions to the various missions which the Party and the people have bestowed."

A few days later, China's Defense White Paper declared: "The Navy aims at gradual extension of the strategic depth for offshore defensive operations and enhancing its capabilities in integrated mari­time operations and nuclear counterattacks."[47] China has already assembled a modern submarine fleet of 29 advanced diesel-electric submarines, including 12 super-quiet Russian-made Kilo-class subs[48] and 14 Chinese-made Song-class and Yuan-class boats. At least 10 more conventional and nuclear submarines are under construction in Chi­nese shipyards, with another five new nuclear bal­listic missile and attack subs on the drawing boards.

China's surface fleet is undergoing a similar mod­ernization, and the PLA Navy (PLAN) is refitting the former Soviet aircraft carrier Varyag for sea duty—at the very least as a training platform for naval pilots.

Submarine Force. Chinese submarines slip out into open seas from underwater tunnels and are vir­tually undetectable. In 2004, U.S. intelligence offi­cials admitted that development of the Yuan-class submarines was concealed from American satellites because they were constructed in an underground dry dock in south-central China.[49] The PLAN's Song submarines are stealthy diesel-electrics equipped with long-range wake-homing torpedoes designed to sink aircraft carriers.

In September 2006, Rear Admiral Ding Yiping, China's top submarine officer and PLAN Vice Chief of Staff, sent a Song submarine on a mission to hunt an American carrier. On October 27 (October 26, Washington time), the submarine surfaced in waters off Okinawa within torpedo range of the U.S.S. Kitty Hawk, where it was seen in the Kitty Hawk's wake by an F-18 pilot on landing approach. It then submerged and disappeared, defeating all U.S. anti-submarine warfare (ASW) efforts to detect it.[50] The carrier battle group's ASW systems did not detect the sub because it had apparently waited— submerged, stationary, and silent—for at least one day as the task force approached the area. Beijing's state-controlled media reported that Admiral Ding had personally commanded the entire operation, perhaps even skippering the submarine himself, and predicted that the success of his mission would lead to a promotion.[51]

In March 2007, a Chinese newspaper described the jubilant homecoming ceremony for a submarine at "a certain naval port in southern China":

[O]n this day marked by a soft breeze and daz­zling sun, amid deep gentle currents, a new type of Chinese Naval vessel courses steadily into harbor's bay after the flawless completion of its special test. On the pier are two columns of naval officers and soldiers lined up in full dress uniform to salute the victorious return of the ship. The dockside is filled with fresh flow­ers and the sound of applause.[52]

This article describes an extravagant welcom­ing home for a vessel returning from sea trials, but it never identifies the type of ship or the nature of the experimental propulsion system that it was testing. However, myriad hints suggest that the ship was a submarine steaming with "air indepen­dent propulsion," a conclusion evidently shared by other analysts.[53] And although unverifiable, it may also be, given the circumstances, the very same submarine encountered by the Kitty Hawk.

The official Chinese press noted the PLA high command's confidence in Admiral Ding—ample evidence of their pleasure at the success the mission against the Kitty Hawk. The Chinese foreign minis­try's protest that the vessel had not stalked the Kitty Hawk is likely the literal truth, indicating that the submarine simply waited submerged until the U.S. battle group sailed over it.[54] The ease with which the submarine maneuvered undetected into Japa­nese waters and evaded U.S. and Japan Self Defense Force submarine sensors suggests that China's large submarine fleet engages in far more sea patrols than the U.S. has any hope of tracking.[55] Like the Janu­ary ASAT test, this incident was a clear message to the United States that China is the rising power in the Pacific.

China's submarine fleet is now considered the PLAN's most "potent strength."[56] Since 1995, the PLAN has commissioned about 31 new submarines, including two nuclear-powered submarines based on advanced Russian technology.[57] Eight subma­rines were commissioned in 2005, and seven were commissioned in 2006, including new Song-class boats and a Yuan-class boat heavily inspired by Rus­sia's Amur-class sub with its anechoic tile coatings and quiet seven-bladed skewed propeller.[58] The reported incorporation of "air-independent propul­sion" systems that permit submarines to operate underwater for up to 30 days would make the Song and Yuan submarines virtually undetectable to existing U.S. surveillance networks.[59]

In addition, China has three new nuclear-pow­ered submarine design and construction programs. The Type-093 Shang-class nuclear attack boat and the Type-094 Jin-class nuclear ballistic missile sub­marine programs are underway. Two Shang subma­rines are deployed, and three are under construction, and five Jin-class ballistic missile sub­marines are reportedly under construction. Five Type-095 submarines, a larger version of the Shang/ Jin hull, are also under development.[60] Together with its procurement program for improved Rus­sian-made Kilo-class submarines, China has at least six new submarine programs under way simulta­neously—a submarine development campaign that is unprecedented in peacetime. China will have at least 34 advanced submarines deployed in the Pacific by 2010—some analysts expect as many as 50 to 60—assuming that those under construction will be completed within three years. China will cer­tainly have over 60 advanced submarines by 2020.[61]

Meanwhile, the United States has three sub­marines under construction today, is downsizing submarine shipyards, and is laying off expert techni­cians needed for submarine construction. Under current construction and decommissioning sched­ules, the U.S. Navy's total submarine force will drop to 48 boats in 2020, 17 percent below the Pentagon's own stated requirement of 58—a level that cannot provide more than 60 percent of the U.S. Navy's existing submarine mission requirements. By 2027, the U.S. Navy will have less than 40 submarines.[62]

Surface Combatants. The PLAN is also lavishing financial resources on its surface fleet. It received the second of its two Russian-made Sovremennyy II guided missile destroyers in September 2006, fitted with advanced anti-ship cruise missiles and sophis­ticated wide-area air defense systems, a qualitative improvement over even China's two advanced-tech­nology Sovremennyy ships acquired in 2000.[63]

In 2005, the PLAN launched its newest ships: Luzhou-class (Type 051C) guided missile destroyers equipped with Russian SA-N-20 air defense systems and a Tombstone phased-array radar that doubles the range of current PLA Navy air defense weapons. The Luzhou destroyer complements ongoing devel­opments of the Luyang I (Type 052B) guided missile destroyers (similar to the Sovremennyy) and Luyang II (Type 052C) guided missile destroyer. The Luyang I is equipped with the Russian SA-N-7B Grizzly air defense missiles and YJ-83 anti-ship cruise missiles. The Luyang II is also fitted with Chinese-produced HHQ-9 air defense missiles.[64] The PLAN's deploy­ment of eight new classes of Chinese-built destroy­ers and frigates since 1994 and the launching of 13 new frigates since 1998 are, as one congressional analyst notes, "an undertaking with few parallels by any country in recent decades."[65]

China's naval buildup has two other intriguing aspects: aircraft carriers and amphibious assault ships, both designed for region-wide projection of soft and hard power. These would not be particu­larly useful in a Taiwan Strait scenario, given the fairly short distances between Taiwan and the Chi­nese coast. Rather, they appear intended to project China's military force out into the East Asian and Pacific region in crises or confrontations in which they would not be challenged by hostile submarines.

The Varyag. For over a year, the PLAN has been more or less open about China's eventual deploy­ment of an aircraft carrier battle group. Except for the carrier, China has all the elements of a carrier battle group in place, according to Lieutenant Gen­eral Wang Zhiyuan of the PLA General Armaments Department.[66] China will finish constructing its first aircraft carrier by 2010, according to an unnamed lieutenant general (probably General Wang again),[67] but its first operational carrier will likely be the Varyag, the former Soviet carrier bought from Ukraine.

China's once-secret naval aviation program appears to be underway at full steam. At its center is the massive 67,000-ton former Ukrainian aircraft carrier, which the Chinese government extracted from the Black Sea in 2001 after considerable costs in both treasure and political capital with Turkey.[68] In March 2002, the Varyag finally completed its 15,200-mile journey to its new home port of Dalian, where it was immediately placed under heavy security at the PLAN dry docks.[69]

China has reportedly negotiated a contract for 48 Sukhoi-33 jet fighters, the carrier-based version of the Su-27, and is now preparing the Varyag's flight deck for flight operations.[70] Reports in the PRC media indicate that China will also configure its new Jian-10 fighter for carrier operations.[71]

The PLAN Air Force (PLANAF) schedule appar­ently envisions developing a carrier air wing by the time China launches its own aircraft carrier,[72] despite official Beijing's continuing protestations that while "China already is capable of building an aircraft carrier, a final decision on construction has not yet been made."[73]

Amphibious Landing Vessels. A carrier force is only half of the naval power projection formula. The ability to land a significant ground force on a distant shore is the other half. In 2003–2005, China built three new classes of landing craft, including 19 amphibious ships and 10 amphibious landing craft.[74] On December 20, 2006, China launched the PLAN's largest combat amphibious assault ship, an indigenously designed amphibious landing dock (LPD) identified as the Type 071, which is similar to but a little bigger than the U.S. Whidbey Island-class LPD.[75] Designed in the 10th five-year plan (2001–2005), the ship was built in about six months in the second half of 2006 and appears to be the first of four LPDs. The Type 071 appears to be designed to land 500–800 troops and 25–50 armored vehicles and supplies using 15 landing craft or several large hovercraft. It will carry at least two Changhe Z-8 helicopters, each capable of transporting 30 soldiers inland beyond the beachhead.

The prospect of being able to assemble a signifi­cant show of military and naval force during some future instances of anti-Chinese upheavals in Southeast Asia or the Pacific islands rather than chartering evacuation flights is no doubt attractive in the Politburo. One or two instances of Chinese military intervention in regional Asia–Pacific unrest, with an aircraft carrier and a few LPDs carrying a brigade or more of PLA special forces troops, would establish China as the preeminent Asian power and demonstrate its readiness to defend Chinese émi­grés in any country in Asia. As President Hu exhorted the PLAN in December 2006, "China is a great maritime nation; in the defense of national sovereignty and security, and protecting our nation's maritime rights, the navy's role is important and its mission is glorious."[76]

Air Forces. Although the modernization of the PLA Air Force has taken a backseat to nuclear, space, and naval development, the PLAAF is a much more modern fighting force in 2007 than it was in 1997. It now boasts about 450 advanced fighter aircraft, including about 300 Russian-designed fourth-generation Su-27 Flankers and Chinese Jian-11s and 76 Su-30MKK fighter-bomb­ers, which display substantial ground attack capa­bilities and are armed with Russia's most advanced air-to-air missiles.[77]

In January 2007, the PLAAF unveiled its new Jian-10 multirole fighter jet, which is based on the Israeli Lavi airframe, itself an evolutionary offshoot of the F-16. As of March 2007, the PLAAF had reportedly deployed 60 Jian-10s, with the total pro­duction run estimated at around 250.[78] Although its forward-wing canards are a novelty among Chi­nese-designed fighters, the Jian-10's most remark­able characteristic is its midair refueling module.[79] The PLAAF has been practicing in-flight refueling since at least 2005 with both Su-27 and older Jian-8 fighters.[80] Following Peace Mission 2005, a joint Chinese–Russian military exercise on China's Shan­dong peninsula, China contracted for six to 10 Illy­ushin-78s configured as aerial refueling platforms and 30 Illyushin-76 cargo aircraft configured for paratroop drops.[81]

The increasing size of China's fourth-generation fighter fleet,[82] which is heavily armed with the lat­est Russian and Chinese air-to-air missiles and equipped with fire control systems and refueling modules, gives the PLAAF a technological and numerical edge in the Taiwan Strait. The Pentagon estimates that China has deployed more than 700 fighters in the Taiwan Strait theater.[83]

On the other side of the strait, Taiwan has roughly 320 fourth-generation fighters: 56 Mirage-2000-5s, 146 F-16s, and 128 Taiwanese-designed Ching-kuo fighters. Furthermore, Taiwan has only 120 AIM-120 missiles for its 146 F-16s—less than one per F-16. One U.S. official privately com­mented, "if they want to bring down a second Chi­nese Su-27, they have to crash into it."[84] Of course, this assumes that the PLA's Su-27 fighters or its SA-10, SA-20, or Russian S-300PMU2 missiles do not shoot them down first.[85]

The goal of the PLAAF's buildup is quite transpar­ent. According to the 2006 Defense White Paper, the PLAAF "aims at speeding up its transition from ter­ritorial air defense to both offensive and defensive operations, and increasing its capabilities in the areas of air strike, air and missile defense, early warning and reconnaissance, and strategic projection."[86]

Ground Forces. China's standing army of 1.64 million men is the largest in the world and is now undergoing a comprehensive modernization. Hop­ing to persuade the outside world that downsizing the PLA's ground forces is a key component of China's military modernization, Beijing's 2006 Defense White Paper makes much of the demobili­zation of over 200,000 PLA troops between 2003 and 2005, reducing the regular army from 1.84 mil­lion men to 1.64 million.[87] However, the demobili­zation's main effect appears to have been to move the downsized troops out of PLA roles and to reas­sign them to provincial militias and reserve units or to change their status to non–active-duty contract personnel (feixianyi renyuan and wenzhi renyuan), whose salaries are not part of the published national military budget.[88]

However, China is not neglecting its ground forces in favor of nuclear, naval, and air services. The sole thrust of ground troop reductions is to construct a more effective fighting force.[89]

While PLA ground force modernization includes important organizational, training, doctrinal, and logistical reforms, it would be of little use without significant equipment upgrades. For example, the PLA's workhorse Type 96 main battle tank is gradu­ally being replaced by the Type 98, which arguably outclasses its U.S. counterpart, the M-1A2 Abrams.[90] The PLA is also being outfitted with the Type-63A, a new amphibious light tank described as "the most heavily armed amphibious tank in the world." PLA Amphibious Army and PLAN Marine units have received 400 to 600 Type-63As.[91]

The equipment modernization also includes new Russian and Chinese helicopters, unmanned aerial vehicles, self-propelled guns, mobile surface-to-air missiles and launchers, multiple rocker launchers, small all-terrain vehicles for special operations forces, and a panoply of new small arms. In addition, the PLA is developing a new class of amphibious assault hovercraft, which appears designed to carry 60 to 75 tons of cargo or one main battle tank.[92]

Cyberwarfare Forces. Perhaps the most promi­nent buzzword in China's 2006 Defense White Paper is "informationization" (xinxihua). The PLA ground forces organized their first cyberwarfare units (zixunhua budui) in early 2003.[93] They have since become a highly active element in China's ground force organization, no doubt building on the expertise developed in the late 1990s by China's police and state security services, which are well equipped and well trained in using the Internet and cell phone networks to monitor, identify, locate, and censor cyberdissidents. New PLA doctrine indicates that computer network operations (CNO) are now seen as a force multiplier in any confrontation[94] with the United States and other potential adversar­ies, including Taiwan, Japan, South Korea,[95] and even the United Kingdom.

Since then, PLA cyber units seem to have been active and to have become highly sophisticated. They apparently are the only PLA units that regularly attack enemy targets in the course of their duties.

On November 1, 2004, according to Time mag­azine, PLA cyberwarfare troops "sat down at com­puters in southern China and set off once again on their daily hunt for U.S. secrets." Pentagon com­puter security sleuths had monitored their opera­tions since 2003, when the unit began their attacks on U.S. government networks, part of an informa­tion operation that U.S. investigators have code­named Titan Rain. Using a simple but elegantly modified scanner program, Titan Rain hackers identified network vulnerabilities in scores of Pen­tagon systems, including critically important com­puters at the U.S. Army Information Systems Engineering Command at Fort Huachuca, Arizona; the Defense Information Systems Agency in Arling­ton, Virginia; the Naval Ocean Systems Center in San Diego, California; and the Army Space and Strategic Defense Command in Huntsville, Ala­bama.[96] The attacks were traced to a network in China's Guangdong province, and according to one expert, the software and hacking techniques iden­tified it as a professional military operation. The hackers "were in and out with no keystroke errors and left no fingerprints, and created a backdoor in less than 30 minutes. How can this be done by any­one other than a military organization?"[97]

Throughout December 2005, British Parliament offices in London were surreptitiously penetrated, also from computers using the Guangdong ISP net­work. Britain's National Infrastructure Security Coordination Center investigators told reporters, "These were not normal hackers…. The degree of sophistication was extremely high. They were very clever programmers." The Chinese hackers searched files in offices of the British government dealing with human rights issues—"a very odd tar­get," noted one U.K. security official,[98] unless the hackers had been tasked by the Chinese govern­ment. The attacks on British parliamentary offices were well funded and well organized. The hackers used highly sophisticated software and had authori­zation to develop Web sites in China to which infor­mation was directed by e-mails. A British network security expert observed, "it costs money to be able to mount an operation of this complexity."[99]

The U.K. attacks involved Trojan e-mails specifi­cally targeted on unique victims. "One email was tar­geted at one company in aviation. It was a Microsoft Word document that had a Math/cad component. If you did not have math/cad on your computer it would not open," said one expert. "The point was to find documents that had been written in that partic­ular program and then send them back."[100] PLA cyber penetrations of Japanese organizations used Microsoft zero-day vulnerabilities.[101]

The PLA cyberwarfare units almost certainly dis­covered these software and hardware vulnerabilities in key global operating systems and business pro­grams when they gained full access to Microsoft source codes via the Chinese State Planning Com­mission (SPC). The SPC signed a memorandum with Microsoft in June 2002 in which Chinese gov­ernment access to source codes was a condition of Microsoft's future investments in China.[102]

One British academic has pointed out:

Hacking in China carries the death penalty…. You also have to sign on with the police if you want to use the internet. And then there is the Great Firewall of China, which lets very little through—and lets [the Chinese government] know exactly what is happening.[103]

Consequently, there is little doubt that these cyberattacks were part of a deliberate Chinese gov­ernment-sanctioned campaign.

While the Pentagon managed to shore up its cyber defenses after the 2004 attacks, other U.S. government agencies remained lackadaisical.[104] In 2006, at least four separate U.S. government com­puter networks were covertly attacked by Chinese cyber forces. Sometime in the spring of 2006, com­puters at the U.S. Department of State were shut down when it was discovered that Chinese hackers had installed software backdoors in the depart­ment's unclassified networks and were siphoning sensitive data from computers in offices dealing with China and North Korea.[105] Under congres­sional pressure, the State Department discontinued purchases of computers from Lenovo, a Chinese firm that acquired IBM's personal computer division in 2005.[106]

In July 2006, overseas hackers operating from Chinese Internet servers penetrated computers in the Bureau of Industry and Security (BIS), the office in the U.S. Department of Commerce that manages export licensing of military-use products and infor­mation. "Through established security procedures, BIS discovered a targeted effort to gain access to BIS user accounts," according to a Commerce Depart­ment spokesman. Commerce officials admitted pri­vately that Chinese hackers had implanted covert "rootkit" programs in the computers to mask their presence and to obtain privileged access to the com­puter system. When the damage was assessed, the agency's information security officers determined that they could not salvage the workstations and instead spent several million dollars building an entirely new system with clean hardware and clean software.[107]

In mid-November, computer security officials determined that Chinese hackers had penetrated the computer network at the Naval War College in Rhode Island. Retired Air Force Major General Richard Goetze, a professor at the Naval War Col­lege, said the Chinese took down the entire Naval War College computer network, an operation that prompted the U.S. Strategic Command to raise the security alert level for the Pentagon's 12,000 com­puter networks and 5 million computers. One report hinted that the Chinese cyberwarriors may have been targeting the college's Strategic Studies Group, which had begun developing concepts for waging cyberwarfare.[108]

At about the same time, in November–December 2006, the computers at the National Defense Uni­versity in Washington, D.C., were also attacked. The NDU attack was not publicized, but it was well-known among academic circles that NDU's e-mail accounts had been shut down for weeks while the penetrated systems were replaced.

No one should be comforted by the fact that some Chinese cyberattacks have been identified. While PLA cyberwarfare units devoutly wish to avoid detection, they also seek to give a false sense of security that all network penetrations can be detected. One expert told a conference of federal information managers early this year that "The Chi­nese are in half of your agencies' systems."[109] U.S. Defense Department sources say privately that the level of Chinese cyberattacks obliges them to avoid Chinese-origin hardware and software in all classi­fied systems and as many unclassified systems as is fiscally possible. Moreover, the already serious threat of Chinese cyber penetration of U.S. defense networks will only be magnified as the Pentagon loses more and more of its domestic sources of trusted and classified microchips.

A report published in February 2005 warns that "a significant migration of critical microelectronics manufacturing from the United States to other for­eign countries has [occurred] and will continue to occur." The strategic significance of this phenome­non cannot be overstated because this technology is the foundation of America's ability to maintain a technological advantage in the military, govern­ment, commercial, and industrial sectors. Indeed, microelectronics supplies for defense, national infrastructure, and intelligence applications are now in peril.[110]

This is a critical national security issue because America's defense-critical electronics demand trusted and classified microchips. The "confidence that classi­fied or mission critical information contained in chip designs is not compromised, reliability is not de­graded, or unintended design elements were not in­serted in chips as a result of design or fabrication in conditions open to adversary agents" simply does not exist in commercial off-the-shelf (COTS) microchips manufactured overseas. As the February 2005 report explained, that "trust cannot be added to integrated circuits after fabrication; electrical testing and reverse engineering cannot be relied upon to detect undesired alterations in military integrated circuits."[111]

Increasingly, China is the source of COTS micro­chips, and Chinese foundries and design shops have had direct network access to foundries in other countries, particularly Taiwan—a fact that has be­come a source of alarm for Taiwan's intelligence agencies.[112] Chinese government pressure is now inducing Intel to propose construction of a $2.5 bil­lion semiconductor wafer fabrication plant in Dalian, China,[113] despite the fact "that manufacturing costs in China are only ten percent lower than in the United States while manufacturing costs in Taiwan are seven percent lower—almost all…accounted for by labor costs." These data, according to the Semi­conductor Industry Association, "[do] not support the hypothesis that…the current migration to China is due to lower construction and operating costs…. [Chinese] Government policies are driving this."[114]

The U.S. government is very reticent about the vulnerabilities of its databases to Chinese penetra­tion, but an example of how widespread Chinese cyberattacks have become surfaced in spring 2006, when a certain foreign "coast guard agency" discovered a covert program imbedded in its net­work that systematically searched for shipping schedules and then forwarded them to an e-mail address in China.[115] There is every likelihood that Chinese PLA cyberwarfare units have already pen­etrated the Pentagon's unclassified NIPRNET (Unclassified but Sensitive Internet Protocol Router Network) and have designed software to disable it in time of conflict or confrontation.[116] PLA cyberwarfare units' access to source codes for America's ubiquitous office software means that they have a skeleton key to any networked gov­ernment, military, business, or private computer in America.

Geostrategic Implications of China's Military Expansion

One might accept that China is simply a great nation that requires a great navy, but what does Beijing's leadership intend for such a large and increasingly well-equipped ground force? The obvious answer lies in the 2006 Defense White Paper, which declares that the PLA's mission is "defending against violation of China's territorial sea and air space, and borders; opposing and con­taining the separatist forces for ‘Taiwan indepen­dence' and their activities."[117]

Aside from assembling an invasion force to "lib­erate" Taiwan, China has other borders and territo­rial seas to defend. China's landmass is vast, and its population is the world's largest. China shares land borders with 14 nations, but none of them is in a position to challenge China on land. Even Russia, with a population of 6 million east of the Ural Mountains, is no match for the 120 million Chinese who live in Manchuria alone. Indeed, many Rus­sians believe that, economically at least, China has already taken over the Russian Far East.[118]

China's still unrequited claims on Asian main­land irredenta include the recent assertion that "the whole of what [India] calls the state of Arunachal Pradesh is Chinese territory and Tawang (district) is only one place in it and we are claiming all of that."[119] New Delhi downplayed the remarks pub­licly, but Indian officials are concerned that Beijing will continue to press its claims on the Tawang dis­trict, where the sixth Dalai Lama was born, as a way to tighten its hold on Tibet. Beijing has similar ter­ritorial concerns with Bhutan. Moreover, Kazakh­stan and Mongolia would surely pay more heed to China's desires if they were backed up by a modern PLA, China's army already seems strong enough to intercede in the event of a North Korean collapse to prevent unification of the peninsula,[120] and a sig­nificant Chinese amphibious infantry force would have a similar effect on the nations of Southeast Asia and the Pacific.

The geopolitical impact in Eurasia of an over­whelmingly massive Chinese army would be one of intense intimidation throughout the region, and Beijing no doubt wants to keep its neighbors calm, at least until it can develop a modernized navy and air force that would discourage U.S. intervention.

Thus, while China's strategic, space, and naval modernization is doubtless targeted at the United States and Japan, and as its expanding fighter fleet anticipates a Taiwan Strait contingency, China's ground force modernization looks beyond possibly invading and occupying Taiwan to establishing Chinese military predominance on the Eurasian landmass.

What the Administration and Congress Should Do

The perception in Asia is that the top levels of the Bush Administration have no strategic vision for Asia in general and are not concerned about China's spreading influence in particular and that whatever concern exists at working levels of the national security bureaucracy is eclipsed by Middle East concerns.[121]

This perception should inform the Administra­tion's and Congress's management of the gathering security challenge posed by China's emergence as a rival superpower in the 21st century. Any effective American response will require a new partnership with democratic Asia and an attitude change in Washington.

Three strategic goals are essential elements of an effective U.S. policy toward China:

• The United States must have a vision for the Asia–Pacific Region that is based on the follow­ing principles: (1) The U.S. definitely has a posi­tion on differences between despotism and freedom; (2) the U.S. has a stake in the survival and success of Asian democracy; and (3) the U.S. will ensure that Asia's democracies are not coerced into acceding to Chinese demands or subservient relationships with China.
• As the preeminent global maritime power, the United States cannot permit the rise of a new hostile naval power on mainland Asia to com­promise America's "Island Asia" lifelines to the Pacific.
• As a matter of national security, the United States must maintain its military technologi­cal supremacy, not just in traditional battle spaces, but also in outer space and cyberspace.

With these goals in mind, an effective set of pol­icies that are structured to manage China's expand­ing strategic footprint in Asia must include the following elements:

• Coherence and consistency in the interagency and intra-agency implementation of policies. Each Cabinet department and agency should have an office devoted to China issues, initia­tives, and coordination. In national security agencies, each bureau should have a China officer who is responsible for monitoring China-related issues on a full-time basis and briefing the bureau's principals and the East Asia/Pacific Bureau on them.
• A heightened policy commitment to protect­ing defense-critical technologies, equipment, software, and intellectual property.
• A revitalized presence in the Asia–Pacific and South Asia regions. The United States must not only be committed to maintaining stability and balance in the region, but must also be seen as having such a commitment. This requires that top American officials engage key Asian group­ings and fora, including the ASEAN heads of state, ASEAN ministerials, the ASEAN Regional Forum, and the Asia–Pacific Economic Coopera­tion (APEC) forum. On an ongoing basis, the U.S. should seek to preserve and strengthen U.S. security alliances in East Asia by expanding bi­lateral and multilateral strategic consultations and joint military exercises with treaty allies and other U.S. partners.
• A renewed commitment to Asian allies and friends. Sun Tzu advised that a most effective way of defeating an enemy is to "divide him from his allies,"[122] and this is assuredly a top Chinese strategic goal in Asia. Washington should there­fore be wary of Beijing's stratagems to drive wedges between the U.S. and its partners. The U.S. should resolutely support Japan against China's territorial pretensions in the East China Sea and vigorously protest Beijing's missile, air, and naval buildup against Taipei. China's suc­cessful U.N. campaign for a PAROS regime is driving a wedge between the U.S. and allies on space policy. The U.S. needs to explain to its friends and allies that it views space as a matter of the highest national security priority.
• Reengagement with the Atlantic Commu­nity—the European Union and NATO allies— in a robust consultation and dialogue on shared strategic interests and basic values of human dignity and freedom. Most NATO allies recognize that the proposed EU arms sales to China would significantly harm Amer­ican and Japanese security interests in Asia, but only the prospect of terminating or severely curtailing defense industrial cooperation per­suaded others to maintain the EU arms embargo on China. European leaders were gen­uinely surprised at Washington's reaction in 2004–2005 to anticipated EU–China weapons systems cooperation because the United States had simply not engaged Europe in a dialogue on China and Asia.
• Encouragement of India as a participant in Eurasian geopolitical dynamics. The U.S. should encourage India's continued involve­ment in the East Asian Summit, India's security consultations with Japan and Australia, and a deepening engagement of New Delhi in a stra­tegic dialogue.
• Managing the emerging Chinese military super­power will require:
• A U.S. naval and air presence sufficient to maintain strategic supremacy in Asia. For example, the U.S. needs to expand its submarine fleet by building at least two boats per year, start­ing now. Given the high costs of nuclear subma­rines, the U.S. Navy may need to consider conventional submarine platforms for short mis­sions from forward bases, especially for anti-sub­marine warfare operations.
• Expansion of forward bases and facilities in the Pacific, particularly Guam, and the allot­ment of resources needed for secure and uncom­promised military construction.
• Strengthened Japanese anti-submarine and anti-mine warfare capabilities in addition to its ballistic missile defense efforts. Japan will be the most reliable ally in the Western Pacific and must have the confidence to stand with the United States as Chinese power grows. The geopolitical situation may also require making a next-gener­ation fighter, Aegis ships, ballistic missile defense, and other equipment available to Japan and Australia as the United States finds its own resources strained in the region.
• Expanded subsurface and ballistic missile– related sensors throughout the Western Pacific and littoral East Asia.

Conclusion

The Asian perception that the United States is a Pacific power in decline may prove prescient, even though America's leaders may not see themselves presiding over America's retreat. However, China is clearly emerging as the preeminent power in the Asia–Pacific region.

America could engage and strengthen the cur­rent robust trans-Pacific alignment, knitting the democracies of the Americas with their counter­parts along the Western Pacific Rim, or a disengaged America could allow a Sino-centric axis to crystal­lize as ASEAN, Taiwan, Korea, and eventually Japan, Australia, and South and Central Asia band­wagon with China. The latter would make Leninist-mercantilist China the rule-maker in Asia, not just for transnational trade and financial structures, but also for a new Asian security architecture and a new ideology of authoritarian state-mercantilism that defends repressive "development models based on national conditions."

Over the next few years, the choices made in Washington, both in the White House and on Cap­itol Hill, will be a bellwether to the capitals of dem­ocratic Asia for their own geopolitical decisions. How Washington manages the emerging Chinese superpower will determine not only the direction of Asian democracy, but the prospects for global free­dom in the 21st century.

John J. Tkacik, Jr., is Senior Research Fellow in China, Taiwan, and Mongolia Policy in the Asian Stud­ies Center at The Heritage Foundation.