China wants to rule Asia. China is just trying to build a reasonable military sized to its economy, population and interests. China is the “rising power” of the globe and will eclipse America in 20 or 30 years. Take your pick of any of those futures and you’ll find yourself with plenty of company.
In an upcoming article, “Demystifying China’s Defense Spending: Less Mysterious in the Aggregate,” in the China Quarterly, a Naval War College professor and a Princeton doctoral candidate offer a detailed analysis of Chinese military spending trends and what it may all mean.
The authors are Adam Liff and Andrew S. Erickson. Erickson teaches at the Naval War College and at Harvard. Liff is a doctoral candidate at Princeton University.
Following are excerpts [click on PDF link on top left of page for full article]:
How much have the Chinese really spent building up their military?
“First, throughout much of the post-1978 ‘reform and opening up’ period, rampant inflation has mitigated the real-world impact of nominally large budget increases (see Table 1). Calculations of China’s defense budget at constant prices (which account for the effect of inflation) show that in many years the effective growth rate of China’s defense spending is much lower than the widely cited current price (‘nominal’) figures suggest.”
“…with each passing year China’s military forces receive – on average – a declining percentage of the government’s largesse. In other words, China’s investment in its military development, while increasing at a rapid clip, has been outpaced by the government’s overall spending, and does not come close to dominating national priorities – in stark contrast to that of, say, the former Soviet Union.”
Why Chinese defense spending has increased:
“The growth in spending over the past two decades is driven primarily by a desire to modernize and professionalize the PLA after decades of neglect and military backwardness. Throughout much of the post-1978 reform era the real-world effects of China’s nominal defence spending have been mitigated heavily by rampant inflation. Even during recent periods of relatively low inflation, rapid defence budget increases have been roughly consistent with overall GDP growth and outpaced by the growth in total state financial expenditures.”
Can China keep that up?
“Defence spending growth over the past two decades has led to significantly improved military capabilities, the most significant of which are designed primarily to address contingencies in the Near Seas and their immediate approaches as opposed to further afield. Recent defence spending increases are sustainable, at least in the near-term, and could be augmented considerably and directed to support selected overseas contingencies. However, in the medium- to long-term, worsening economic and demographic pressures may impel China’s leaders to shift budget resources elsewhere and thereby limit further military spending growth.”