Danger Zone: The Coming Conflict with China

by Hal Brands

Don’t get us wrong: We’re not saying that China is on the brink of economic collapse or that it lacks the money or muscle to pose major problems for the world. 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. Where others see an ocean of Chinese exports, we see vulnerable supply lines and a dearth of domestic consumption. And where others see an enlightened leadership confidently carrying out a master plan for economic supremacy, we see a decadent elite that views China a lot like we do, which is why it is building the most advanced internal security machine the world has ever seen. 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.