Danger Zone: The Coming Conflict with China

by Hal Brands

Objective economic analysis is being replaced by government propaganda. And technocrats are being replaced by political hacks: Xi’s government has whittled away the relative autonomy that the country’s central bank once enjoyed.86

Many Chinese citizens know that their government’s economic story doesn’t add up, and they are voting with their feet. The rich are moving their money and children out of the country en masse. In any given year, 30–60 percent of Chinese millionaires and billionaires say they are leaving China or have plans to do so.87

China’s internal security budget doubled between 2008 and 2014—surpassing military spending in 2010—and has grown a third faster than overall government spending ever since.91 Half of China’s major cities have been put under grid-style management, a system in which every block is patrolled by a team of security officers and surveilled 24 hours a day by cameras.92 Now the government is rolling out a social credit registry that uses speech- and facial-recognition technologies to monitor each of China’s citizens constantly and punish them instantly.

Building an Orwellian police state is hardly the hallmark of a vibrant economic superpower.

But we are saying that the conventional wisdom about China’s ascendance is flawed. Where others see rapid Chinese growth, we see massive debt and Soviet-level inefficiency. Where others see gleaming infrastructure, we see ghost cities and bridges to nowhere. Where others see the world’s largest population, we see a looming demographic catastrophe.

Any one of the trends we highlighted in this chapter—surging debt, declining productivity, rapid aging, foreign protectionism, environmental degradation—could derail China’s economy. Collectively, they all but guarantee that China will suffer a severe and sustained economic slowdown. And that slump will shake China’s system to the core just as another threat—strategic encirclement—starts to bite.

On the night of June 15–16, 2020, the Galwan River valley, an isolated area along the disputed Himalayan border between India and China, became a high-altitude field of horrors. A

hand-to-hand battle in near-blackout conditions took the lives of dozens of Indian and Chinese soldiers. For Beijing, the bloodbath represented a minor tactical victory and a larger strategic defeat.

upward. In 2017, there was a prolonged military standoff after the PLA began building a strategically located road in territory claimed by Bhutan, which India views as a friendly buffer state. Even more brazenly, China surreptitiously constructed, on land globally recognized as Bhutanese, entire villages with an accompanying PLA presence. In 2019, there was a marked increase in Chinese violations of the de facto border with India.1

The fireworks began in May, with Chinese forces briefly occupying swaths of Indian-claimed territory. When Indian forces pushed back, the resulting scrapes were initially conducted according to the familiar rituals. But after dark on June 15, the skirmishing turned deadly. Chinese soldiers attacked an Indian patrol using primitive but brutal weapons, such as sticks studded with rusty nails.

PLA personnel even tried to crush Indian soldiers by pushing boulders down on top of them.2 A pitched battle ensued, lasting six hours and involving up to 600 troops.

Viewed narrowly, the episode was a victory for China. It showed how easily the PLA could grab chunks of territory claimed by India and how hard it was for New Delhi to respond without touching off a larger war against a stronger power. Nonetheless, China lost more than it gained.

Narendra Modi’s nationalist government had more recently worried that Beijing was using BRI projects in Sri Lanka and Pakistan to pressure India from all sides. After Galwan, the backlash was sharp.

To limit digital dependence on a rival, the Indian government banned dozens of Chinese mobile applications, including TikTok and WeChat, and barred Huawei and ZTE from its 5G network trials. Most important, India’s long, slow move toward America accelerated.

The year after June 2020 saw a flurry of diplomacy around the Quad, a U.S.-Australia-India-Japan partnership that looks a lot like an anti-China alliance of Indo-Pacific democracies. In

At a virtual Quad summit, Modi and his counterparts effectively announced that they would frustrate China’s geopolitical ambitions—by cooperating to preserve a free and open Indo-Pacific—even as they never publicly mentioned China by name.4 In the summer of 2021, India moved tens of thousands of additional troops to the border, while also studying how it might help Washington choke off China’s maritime supply lines in a war.5 U.S. officials began publicly referring to India as a keystone of their counter-China strategy.6

For a generation after the Cold War, China escaped the fate that has befallen so many aspiring Eurasian hegemons—the emergence of a countervailing coalition committed to checking its power. That achievement is now in the past.

overreach, Beijing has made an enemy of the superpower that did so much to assist its rise. It has provoked fear and resistance from countries near and far. The strategic holiday that China enjoyed for decades is over.

Strategic encirclement is a rude awakening for Xi’s China, but it has a familiar feel for those steeped in history. If the past few centuries teach us anything, it is that nations with fish and friends as neighbors have the best chance of claiming global power without provoking global resistance. Those ringed by rivals must constantly fear that expansion will result in their own isolation and defeat.

United States didn’t always enjoy “free security” thanks to its geographic isolation: It spent its first century battling European empires and Native Americans for control of the North American continent.8 Yet the fact that this contest was an away game for America’s great-power rivals, which had to defend holdings thousands of miles from their capitals, gave Washington the decisive advantage.

America could build an ocean-going navy rather than heavily fortifying its frontiers. It could enter the world wars of the twentieth century late and allow countries in Europe and Asia to bear the brunt of the fighting and dying. And because the United States was so far away from Europe and Asia, the countries of those regions were less likely to fear being conquered by America than to try to enlist it as an ally against predators closer to home.

Mao explained his pivot to America as a way of using the “far barbarians” to keep the “near barbarians” in check.10

How America used its power also mattered tremendously. A country founded in liberal political principles created a comparatively liberal geopolitical system.

China is cursed by comparison. The Eurasian landmass is a big but crowded space; it is home not to one major power but many. A country that dominates Eurasia would pose a mortal threat to the sovereignty, even survival, of countries located in its shadow, which means that the rise of one powerful nation cannot fail to stimulate a reaction from others.

Napoleon’s France conquered much of Europe but fell victim to a combination of rivals led by Great Britain. In the twentieth century, Germany was destroyed (twice) when its European enemies made common cause with the United States. During the Cold War, the Soviet Union was thwarted by a ring of rivals from Northeast Asia to Western Europe, all backed by Washington.

Perhaps the most astonishing aspect of China’s rise was how long it took the world to start pushing back.

One reason for this complacency was greed. In the early 1990s, an engagement policy seemed logical because China was a minor military threat and a massive money-making opportunity.

China was simply too good to pass up as a consumer market and a low-wage production platform. So Western multinational companies and financiers pressed their governments to integrate China further into global supply chains.

Those governments happily obliged, arguing—when they talked about the CCP’s grotesque human rights violations at all—that a more economically open China would eventually become more politically open.

That assurance related to a second reason China’s holiday continued—the overweening Western confidence, even hubris, of the post–Cold War era. Aggressively containing China seemed almost gratuitous at a time when America was so dominant. Given

Given that the American-led global economy was making China wealthier, surely Beijing would come to see the value in supporting that system.

Bush called China a “strategic competitor” and promised to take a hard line once in office.19 But it mostly didn’t happen, thanks to a third factor—distraction. The 9/11 attacks diverted U.S. attention for a decade, while making Washington more dependent on Chinese diplomatic support in the war on terror. The Obama administration then sought to recoup lost ground with its “pivot to Asia,” only to be whipsawed by the rise of ISIS and another multiyear war in the Middle East.

Give credit where credit is due: Chinese strategy encouraged American procrastination. Deng’s hide-and-bide policy eased fears of a “China threat.”

China’s surge of maritime coercion in Asia made it hard to believe that Beijing was reconciling itself to the existing order in the western Pacific.

After roughly twenty years, China’s military buildup had reached an alarming level. Respected think-tanks reported that the Pentagon was losing its edge in the Taiwan Strait and other hot spots.24

These weren’t the only wake-up calls. Tech gurus such as former Google CEO Eric Schmidt warned that Washington could lose the race for supremacy in artificial intelligence (AI).26

In his best-selling book, The Hundred Year Marathon, Pillsbury argued that America had been duped by CCP hawks who were well embarked on a quest for global dominance.28

It’s true that engagement failed to tame or transform the CCP. But China had failed, too, by scoring such a catastrophic success. The country’s rise had, finally, destroyed the welcoming global environment that had allowed it to rise in the first place.

Finally, China is racing to set international technical standards for next-generation technology such as advanced microchips, the internet of things, cloud computing, big data, 5G, intelligent health care, and AI.

The CCP also has a plan, China Standards 2035, dedicated to dictating international technical standards. As of 2021, Beijing led four of the fifteen science- and technology-related agencies of the United Nations (compared to one led by the United States) and submitted more standard-setting proposals to international bodies than any other country.

The boldness here is remarkable: If this modern-day imperialism succeeds, China will rule over a new “sinosphere,” in which global networks of trade and innovation once dominated by the West will cluster around Beijing. This scenario keeps many American strategists up at night. But another scenario that could be just as troubling is if Beijing’s efforts succeed only partially, leaving China strong enough to scare and pressure many countries, but not strong enough to feel secure about its long-term prospects.

Given the obstacles China faces in breaking free of Lenin’s trap, the CCP is hedging its bets by honing other tools of influence, including powerful ideological weapons.

As late as 1989, there were twice as many autocratic governments as democracies. Twenty years later, however, democracies outnumbered autocracies 100 to 78, and the share of the world’s population living under autocracy had fallen by half.

From a U.S. perspective, democracy’s global advance was one of the most hopeful developments of the postwar era. From the perspective of China’s leaders, it was a clear sign that the liberal world order was rigged against their form of government and needed to be changed before it destroyed their regime.

According to Beijing’s narrative, the problem started at the beginning of the postwar period, when the United States exploited its dominant position to inject radical ...

later decades, America helped foster democratic institutions in numerous countries, including some of China’s neighbors: Japan, South Korea, and Taiwan. The expanding global posse of democracies subsequently used military force, economic sanctions, and an array of media and human rights organizations to undermine dozens of autocracies—not just tin-pot dictators, but also the Soviet Union and nearly China itself in 1989.

Although PRC leaders long chafed at this ideological pressure, it was bearable so long as China enjoyed a booming economy and a stable periphery.

China’s citizens were willing to forgo political rights when their bank accounts and their country’s international status were swelling, but it’s an open question whether they would do so under harsher conditions.

What he did not say, but knew very well, was that rapid growth and engagement with the West could also change the Chinese people, raising their expectations in ways that the regime might one day struggle to satisfy. China’s rulers also have long understood what political scientists have proven empirically: Autocracies often fall in waves, as revolutionary activity in one country inspires popular uprisings in others.

The lesson is that revolution anywhere can be a threat to autocracy everywhere—even to regimes that seemed stable weeks or even days before.47