Danger Zone: The Coming Conflict with China

by Hal Brands

First, the CCP has the eternal ambition of every autocratic regime—to maintain its iron grip on power.

Second, the CCP wants to make China whole again by regaining territories lost in earlier eras of internal upheaval and foreign aggression.

“We cannot lose even one inch of the territory left behind by our ancestors,” Xi told U.S. secretary of defense James Mattis in 2018, generously adding, “What is other people’s we do not want at all.”11

The CCP’s third objective is to create “Asia for Asians,” a regional sphere of influence in which China is supreme because outside actors, especially America, are pushed to the margins.

The CCP envisions, rather, using a mix of attraction and coercion to ensure that the economies of maritime Asia are oriented toward Beijing rather than Washington, that smaller powers are properly deferential to the CCP, and that America no longer has the alliances, regional military presence, or influence necessary to create problems for China in its own front yard.

Beijing wants more than regional hegemony, however, and the fourth objective of its strategy focuses on achieving global power and, eventually, global primacy.

Beijing now accounts for more than half of Asia’s military spending; it wields the world’s largest ballistic missile force, navy by number of ships, and integrated air defense system.28 Chinese forces are preparing for “short, sharp wars” against America and its regional allies; they are racing to complete reforms that would allow the CCP to conquer Taiwan.

You don’t have to infer anything to believe this. Xi has said it outright.

The tools of BRI thus include everything from state-owned enterprises to China’s growing navy. The fundamental ambition appears to be making the world’s largest landmass a platform for the projection of Chinese power.

Chinese strategy is “grand” in every sense of the word. It marries the geopolitical insights of Alfred Thayer Mahan, who argued that great powers must build ocean-going navies and rule the waves, with those of Halford Mackinder, who popularized the idea that the Eurasian “heartland” could become an unassailable geopolitical fortress if controlled by a single actor.45 That strategy envisions preeminence within China’s regional surroundings as a springboard to global influence; it wields a vast array of tools to achieve a vast array of military, economic, diplomatic, and ideological ends.

The CCP’s grand strategy imperils America’s long-declared interest in preventing any hostile power from controlling East Asia and the western Pacific. That strategy is activating America’s equally long-standing fear that a rival that gains preeminence on the Eurasian landmass could challenge the United States worldwide.

Why is Beijing so set on fundamentally revising the system, even if doing so leads to a dangerous rivalry with the United States?

it was always improbable that China would happily settle into America’s world, because doing so would have required accepting arrangements—such as U.S. protection of Taiwan and U.S. military alliances arrayed along China’s maritime periphery—that no great power would tolerate forever.

China has historically lived in a rough neighborhood.4 It occupies a uniquely vulnerable chunk of territory at the nexus of Eurasia and the Pacific that enmeshes it in five complex subregions: Northeast Asia, Southeast Asia, South Asia, Central Asia, and Oceania. The upside of this central location is influence; China is, almost by default, a major player in world politics. The downside is omnidirectional exposure to foreign instability and pressure.

Yet Soviet hostility proved to be a valuable asset for China, because it made possible Mao’s opening to America.

First, it turned the United States from a mortal enemy into a quasi-ally.

Second, the opening to America fast-tracked China’s integration with the wider world.

Third, rapprochement allowed a breakout from economic purgatory.

For much of the past forty years, China was lucky: It was nearly self-sufficient in food, water, and most raw materials. Cheap access to these inputs, plus low labor costs and lax environmental standards, helped make China an industrial powerhouse. Its firms could outcompete foreign manufacturers and dominate industries such as cement and steel. And the fact that China had a relatively pristine environment and untapped resources at just the right moment—the start of the reform and opening period—made the vital difference.

more willing to start wars, if for no other reason than to throw surplus men into a meatgrinder.

This might not be so bad if Xi was an enlightened economic reformer. But he consistently prioritizes political control over economic efficiency. For example, private firms generate most of China’s wealth, yet under Xi, politically connected state-owned enterprises have received 80 percent of the loans and subsidies doled out by Chinese banks.49 State zombie firms have been propped up while private firms have been starved of capital and forced to bribe party members for protection.

Western intelligence agencies predicted that China would overtake the United States as the world’s leading economy. These fears exacerbated growing concerns about China’s rise as a trade juggernaut: According to one study, China’s entry into the WTO cost the United States 2.4 million jobs as multinational corporations shifted labor-intensive manufacturing activities to China.55 Beijing was now a potent economic rival, which made it a target of anger as America and other countries entered harder times.

The era of hyperglobalization that facilitated China’s rise is coming to an end. And it couldn’t be happening at a worse time.

A growth rate of 6 percent would still be spectacular, but only if it were true. Rigorous studies based on objectively observable data—such as electricity use, construction, tax revenues, and railway freight—show that China’s true growth rate is roughly half the official figure and China’s economy is 20 percent smaller than reported.

Take semiconductors, which are arguably the linchpins of computers and therefore of the modern economy. China has spent tens of billions of dollars trying to become a leader in this area. Yet it still depends on imports of high-end semiconductors and semiconductor manufacturing equipment from America and its allies, a vulnerability that the U.S. government is now using to squeeze Chinese firms such as Huawei and ZTE.78 China’s national champion, Semiconductor Manufacturing International Corporation, still relies on subsidies for 40 percent of its revenue (versus 3 percent for U.S. firms) and produces chips that lag those of foreign competitors by half a decade, which might as well be a century in the battle for computer shoppers.

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.

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.

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. This was what the countries of Western Europe did in dragging the United States into NATO in the 1940s. It was what China itself did in the 1970s: Mao explained his pivot to America as a way of using the “far barbarians” to keep the “near barbarians” in check.10 By dint of not being located in the Old World, the United States found itself invited to exercise vast influence there. How America used its power also mattered tremendously.

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.

China’s neighbors include seven of the world’s fifteen most populous countries, four countries armed with nuclear weapons, five countries that have waged wars against China in the past eighty years, and ten that still claim parts of Chinese territory.

Secretary of State Mike Pompeo called for a global alliance of democracies to keep China in its “proper place.”31 This was the most dramatic change in U.S.-China relations since Nixon visited Beijing, and it wasn’t just talk. A significant bump in defense spending allowed the Pentagon to initiate its largest naval and missile expansion in a generation. Trump hit China with America’s most sustained and aggressive use of punitive tariffs since World War II. Washington layered on the tightest investment and technological restrictions since the Cold War, seeking to cripple Huawei and turn the world away from Chinese 5G providers. The U.S. Congress created the International Development Finance Corporation, a $60 billion answer to BRI, while the FBI was unleashed to go after China’s pervasive espionage and influence campaigns. The bureau, director Christopher Wray announced, was “opening a new China-related counterintelligence case about every 10 hours.”32 CIA director Gina Haspel steered that agency away from a generation-long preoccupation with counterterrorism to focus on the problems presented by big, threatening states.33 The U.S. national security bureaucracy was training its unrivaled capabilities squarely on China.

In 2020, after watching China swallow Hong Kong, Taiwan’s government approved a 10 percent hike in military spending and a bold new defense strategy.43 Under this plan, Taiwan would acquire huge arsenals of mobile missile launchers, armed drones, and mines; prepare its army to surge tens of thousands of troops to any beach in an hour; back those regular forces with a million-strong reserve force trained to fight guerrilla-style in Taiwan’s cities, mountains, and jungles;

Countries from Japan to Australia to the United Kingdom have sent naval patrols and otherwise opposed China’s dominance of a sea through which one-third of the world’s shipping passes. And American allies in the region are signing defense cooperation agreements that bring them closer to each other at the same time that they draw closer to the United States.

If China and Russia have traditionally struggled to tame their historical rivalry for long, for now their anti-U.S., anti-democracy agendas are binding them together.70

Just as Germany and Japan—two ambivalent, distrustful partners with fundamentally different long-term visions for the world—profited from the chaos and pressure each other’s advances created in the run-up to World War II, China and Russia benefit from the fact that America cannot fully concentrate on either of its great-power rivals. Sino-Russian ties could get even tighter in the coming years. If Russia faces prolonged isolation thanks to its assault on Ukraine, it will become more dependent, economically and strategically, on China. If Beijing experiences a more energetic form of containment at the hands of Washington and its allies, then calm, productive relations with Russia will become all the more valuable. It is no longer absurd to imagine a scenario in which America’s parallel great-power rivalries, against China and Russia, merge into a single contest against a more coherent autocratic axis spanning a large part of Eurasia.

COVID-19 may have created a “short tactical window” for China, but that window “is not big enough to solve the strategic dilemma it will face in the future.”79 Yuan Nansheng, a former diplomat and CCP stalwart, likewise argued—by way of the historical analogies that offer a safer means of criticism—that “having enemies on all sides” is a recipe for disaster.80 America’s “multilateral club strategy,” agreed Yan Xuetong in July 2021, was “isolating China” and causing severe difficulties for its economic development and diplomatic relations.

Put simply, it is hard to see how a country with so many metastasizing cancers, and so many wary rivals, can forever outrun all the resistance its behavior has begun to provoke. That may seem like good news, from an American perspective. But it’s not entirely reassuring. As China’s problems really take hold in the coming years, the future will come to look darker and darker for Beijing. The twin specters of economic decay and geopolitical encirclement will stalk CCP officials remorselessly. And that’s when we should get really worried. What happens when a country that wants the world concludes that it might not be able to get it peacefully? The answer, history suggests, is nothing good.

The conventional wisdom among political scientists holds that great powers are either rising or falling; that rising powers push forward whereas declining powers fall back; and that the greatest tensions and most devastating wars occur when a rising challenger surpasses an established superpower—what scholars call a “power transition.” The reality is more complicated.

In other words, the reason China’s trajectory is so alarming is not that it will inexorably overtake America. It is that some of history’s deadliest wars were started by revisionist powers whose future no longer looked so bright.

Power transition theory holds that war is likely when a rising country threatens to overtake an established country. As the challenger grows stronger, it destabilizes the existing system. It provokes tests of strength with the reigning power.

There’s a clue here for understanding what drives great powers to desperation. A country whose relative wealth and power are growing, whose position is improving, will surely enlarge its geopolitical horizons. But it should also want to delay a climactic confrontation—to avoid prematurely bringing down the wrath of the reigning hegemon. Such a country should presumably conduct itself as China did for two decades after the Cold War, by hiding its capabilities and biding its time.

Lenin defined imperialism as a capitalist country’s attempt to secure new markets and resources abroad when its home economy becomes oversaturated with production capacity.12 Unless the country finds new markets, Lenin theorized, it would suffer economic stagnation. Growth would cease, jobs would vanish, and domestic unrest would spike.

Its economy is glutted with excess capacity generated by decades of subprime lending. The main markets where it used to dump its products—North America, Europe, and Japan—are increasingly unwilling to absorb an endless flood of Chinese goods. Since 2008, China has responded to these trends with a two-step plan. First, lend more than a trillion dollars to foreigners so they buy enough Chinese goods and services to keep CCP Inc. in business.13 Second, use the proceeds to become a technological powerhouse by pumping investment into R&D, buying and stealing foreign technology, and using subsidies and trade barriers to protect Chinese

China’s latest five-year plan, made public in March 2021, mandates 7 percent annual increases in R&D spending, a rate of growth faster than what is planned for the military budget. China’s banks have set aside tens of billions of dollars to lend to more than 1,000 Chinese firms in strategic industries, including artificial intelligence, quantum computing, semiconductors, advanced robotics, and synthetic biology.27 The objective is for China to produce 70 percent of key components in strategic industries by the end of the decade.

China is well on its way to dominating global networks. It is the world’s largest provider of telecommunications technology. It has already become a landing point or supplier for 12 percent of the world’s submarine cables, which carry 95 percent of international data. Huawei claims to have cloud computing contracts with 140 countries; another Chinese company, Hengtong Group, has installed 15 percent of the world’s fiber optics.35 China’s BeiDou satellite network has been adopted by dozens of countries and provides greater coverage over 165 of the world’s capital cities than does the U.S. Global Positioning System (GPS).

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.37 In most of these industries, there will be only one set of global standards, and the country that sets them will likely rule the market because its products will already meet the required specifications. The Chinese recognize this advantage and have a saying: third-tier companies make products, second-tier companies make technology, top-tier companies set standards.

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. That question is especially pressing with regard to China’s millennials, who have known nothing but upward economic and international mobility. When that cohort was being born in the 1980s, Deng Xiaoping warned that opening the “window” to breathe the “fresh air” of Western commerce would also allow in “flies” in the form of seductive ideas and corrupting influences.

Boldness isn’t the same thing as insanity. The fact that China’s power has plateaued doesn’t mean that it will lash out violently in all directions. It does mean that China will become more coercive and aggressive, particularly in areas where it thinks risk-taking now will create a better long-term reality. If China grabs Taiwan, then the First Island Chain is broken, and Beijing’s strategic geography improves enormously.

America needs a long-term strategy for dealing with an assertive, authoritarian China for a generation or more. But it also needs a shorter-term strategy for navigating a period of high tension during the current decade.

Prioritize ruthlessly; thwart near-term breakthroughs that can have devastating long-term effects. Be strategically deliberate and tactically agile; don’t make the perfect the enemy of the good. Firm up the defense by playing some offense; take prudent risks but not unduly provocative ones. Think of danger-zone strategy as something that helps you win in the future by avoiding disaster in the here and now. These insights from an earlier era are again becoming very relevant. The United States can’t simply go back to the Cold War playbook for every policy: Run away from anyone who tries to tell you that the answer to a bellicose China is a “new Marshall Plan” or an “Asian NATO.” But America will need a strategy that reflects the larger lessons of one Cold War if it hopes to make it through another today.

many of the principles that helped America survive the early Cold War can help it thrive in a new danger-zone scenario today. First, prioritize ruthlessly. A danger-zone strategy must deny China any easy escape from its economic and strategic problems by thwarting near-term successes that could radically change the balance of power.