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Can China afford a war?

Updated: Oct 31, 2022

For the past few days, China has constantly been threatening to take military action if Nancy Pelosi, Speaker of the United States House of Representatives visits Taiwan. If China does what it says, it will turn this into a military confrontation between the US and China. But can China afford a war?

Pelosi's visit to Taiwan isn't something new, US officials and diplomats have been visiting Taiwan for a long time. In fact, during the initial days of the Russian invasion of Ukraine, Mike Pompeo, the former Secretary of State of the United States under the Trump administration, visited Taiwan. China didn't make a fuss then, but why now? The answer is Pelosi holds more power than Mike Pompeo and is a much high-ranking official than Pompeo. Pelosi's visit to Taiwan may signal a possible shift in the US's stance on the One China policy. Pelosi is third in line for the presidency according to the US constitution. Hence, China doesn't want such a high-ranking US official to land in Taiwan.

Also, Xi Jinping is facing elections later this year in the CCP for his next tenure, and any humiliation on the global stage would harm his image within the CCP. China at this point is far too big to tolerate humiliation. But that doesn't mean they would go to war. Also, Pelosi's visit to Taiwan had to be a more subtle one, but reports indicate a possible leak from the White House because of which all the drama has taken place. Reports of Pelosi's possible visit to Taiwan had emerged about a week before the official trip to South East Asia began, this was a major mistake on the US side.

The US is maintaining a strategic ambiguity concerning its foreign policy towards Taiwan. And, I think that's definitely what the US should be doing. A few months back, Biden said the US would go to 'war' with China if China invades Taiwan. But the white house was quick to retract the statement downplaying the President's statement, stating that there has been no change in the foreign policy and would recognize the One China policy. Noting how quick Biden was in responding to the question by the reporter on whether the US would get militarily involved, I think that Biden was prepared for the question or he had been instructed to answer YES. To instantly answer 'YES' and then to retract the statement by White House officials in a later press briefing was probably a show put up by the White House. This was probably done to maintain the ambiguity on the matter. Ambiguity but a more aggressive ambiguity....

So why is ambiguity important on the subject? If there is a possible war between China and Taiwan in the coming years, this ambiguity would serve the US interests in the region. What would be the possible difference between strategic clarity and strategic ambiguity on the matter? To understand the answer to this question we have to understand that China is going to invade Taiwan. If not today, maybe tomorrow. For the CCP it is not about land and resources, but it's about a successful democracy functioning just outside the country. The CCP today enjoys huge support among its citizens because the CCP has done well in developing the country. It has pulled out about 800 million people from poverty in the last twenty years, something that any other democracies around China haven't been able to do so. China uses the examples of these unsuccessful democracies as a way to justify the rule of the CCP. Because of this, the CCP enjoys huge support among its citizens. The Chinese accept CCP's rule in return for economic development and glory to the Chinese civilization. The 2049 plan is just another demand that the Chinese citizens want to be fulfilled. The Chinese believe that they have been humiliated by foreign powers, which they call 'the Century of Humiliation', and the CPP promises to bring back the long lost glory by 2049. But now the country is already a developed country, and there isn't much to achieve for the CCP. When a country becomes a developed country its citizens tend to focus on other things; till now the Chinese citizens were onto building the nation, but now they have time to think and peek outside of China and technology gives them access to it. Traveling around the world gives them more knowledge on topics like democracies. China may censor the internet, but it's nowhere near the iron curtain of the cold war times. The Soviet Union hadn't allowed companies like McDonald's or any other company which could be a symbol of capitalism to step into the Russian markets for a very long time. Therefore, the Russian citizens were unaware of what capitalistic societies looked or work like. When the first McDonald opened its first store in the soviet union, the citizens of the soviet union were surprised to experience the kind behavior of the staff at the store. Before, the citizens of the Soviet Union got their food in ration stores after waiting in queues for hours together. But in the new McDonald's store, customers were treated as kings and queens. It reflects the "Customer first" idea which puts the customer at the center of the organization, and this was a symbol of capitalism. People were bewildered and amused to see the kind behavior of the staff. On the first day, about 38000 customers waited in line for hours to try out the new restaurant, breaking all records at the time. Today China controls the minds of the people to some extent but Chinese people can still view what is happening outside the world. They travel outside the country more frequently as the median income of Chinese households has risen. Today the CCP lacks the proper cause to maintain the same mandate over the people. And Taiwan adds to its woes. They can't let a democracy near their border function successfully. Also, there is a law that requires China to invade Taiwan "if Taiwan tries to assert independence or if the possibilities of a peaceful reunification are exhausted". In simple words it means China "will" invade Taiwan someday, and it believes that Taiwan is a part of China

So, when China invades Taiwan, Strategic ambiguity would give the US some time to decide whether to get involved in the conflict or to stay out of it. But more than that the strategic ambiguity would give the US more time to prepare and gather resources if they have to retaliate against any Chinese invasion. On the contrary, if there is strategic clarity on the matter that the US would definitely defend Taiwan, then China would take out US military bases in the region first before actually invading Taiwan. And this first strike could become something like a Pearl Harbor incident and the US might suffer an initial setback in the war. Today the US doesn't have many military establishments in southeast Asia like in Europe. So if China takes out the few US military bases present in the region surprising them and overwhelming them as the Japanese did in world war II in Pearl Harbor, it would be impossible for the US to defeat China. But as a result of strategic ambiguity on the issue, China is very less likely to attack US bases in Japan, South Korea, the Philippines, and other countries. Instead, they would think the other way and try not to engage the US, Japan, and other US allies in its confrontation with Taiwan.

But can China afford a war? The answer according to me is no. The sanctions levied on Russia after the invasion are more than enough to discourage China from participating in a war. The sanctions on the Russian economy have rendered the 600 billion dollar Russian central bank reserves useless today. The US and its allies have seized the majority of the accounts which held the reserves. If such sanctions are placed on China, Chinese money in offshore bank accounts would be seized, and the forex reserves held in bank accounts outside the country might become worthless. America has tried to demonstrate to the Chinese the possible consequences of an invasion by sanctioning Russia. And China is much more intertwined with the World economy than Russia. If the same sanctions levied on Russia are levied on China it might have thrice the impact it had on the Russian economy. Russia has gas, but China doesn't have anything that can't be replaced. Oil and gas reserves can't be produced, so Russia can flex its power by threatening to restrict the export of gas to European countries, but China can't do it. The world would soon find an alternative to China if it tries to do something like that. About 50% of the Chinese economy is dependent on international trade, and sanctions on the economy would be a major blow to the economy. Yeah, sanctions will have some effects on the American economy too, but only about 20% of the American GDP comes from international trade. So China has more to lose in a financial war. Coming to the Conventional aspect of the war, the ability to create resources required for war and to make war happen is astronomically high for the US. Japan made the same mistake in WWII, thinking that a huge blow to the Americans in Pearl Harbor would be hard to recover from, and could put the US in the backseat for years. But the United States built back its navy and was back to the playground with a larger fleet within months, and do note that the production capability of the US economy today is much much higher than those of the 1930s and 1940s. Even if China gives a huge blow in the initial days of the war, the US would come back with a larger force within weeks. And if China goes to war with the US, it is just like pulling the entire world into the war. To back the US there would be Japan, the Philippines, South Korea, Indonesia, Australia, the UK, France, Germany, 30 other NATO countries, probably even India too, and many others. Also if the US wishes to they can just block the Malacca Strait and cut off oil and gas supplies to China to a huge extent. China lacks the geographical advantage that the US has. The US is thousands of miles away from China, and it can keep fuelling war for a long time, and it might take a long time for China to even reach close to the mainland US. With over 800 military bases around the world, the US can intervene anywhere in the world with 15 mins of notice. And with 800 military bases in the event of a war, China will face the heat from every direction(except the north because Russia is not a US ally). China is no match to this supreme army that can bring in war resources from all parts of the world. A war with China wouldn't just be on the eastern front, but NATO in Europe and US bases in the middle east will try to push from the northwest. India being an ally of the US might also join the combined efforts to push from the south. But yes, the geopolitical stature of the US in the south china region isn't as strong as that in the Europe region. The US would need to form an Asian NATO, which is essential at this point in time. An Asian NATO would further enhance the power of the US in the region. So, to answer the question, no, China can't afford a war today. The Chinese economy is too vulnerable and the PLA isn't a formidable power that can defeat the US. Nonetheless, China knows that they are at the peak of military power, and economical power. China as we speak is facing a demographic problem. The Chinese population is growing older, and the Chinese economy might share the same fate as that of the Japanese. There was a time when Americans thought that the Japanese economy would surpass that of the US (in the 1990s) but that never happened. The Japanese economy stagnated ever since the 2000s, and the demographic problem has a role to play. By 2100 China's population would be somewhere near 500 million down from 1.4 billion people. Because of all this, the Chinese leadership might think that this is the right time to invade and grab all that they can when they are a formidable power rather than regret not doing so later. So, there is a possibility that China might invade and try to conquer new territories this decade. Yes, China can't afford a war, but it doesn't mean it won't wage a war. Under the previous CCP regime under Hu Jintao, the policy was to "hide power, and show it only when necessary", but now under Xi Jinping it is all about power projection and inducing fear in adversaries. China has always played the long game. China never spoke out against the US or tried to contradict the US until the 2010s. Therefore, China managed to stay under the radar for much of the time during its rise. So, China might try to overlook this and forget the incident, in order to achieve a bigger goal of global supremacy by 2049(the 100th year anniversary of the founding of the People's Republic of China). But at the same time, they might make impulsive decisions to go to war. It is hard to tell whether China would go to war, though it is very unlikely. Hitler deciding to invade the Soviet Union is often considered the biggest mistake of the twentieth Century, now if China decides to invade Taiwan it could be the biggest mistake any leader has made in the twenty-first century. The Us doesn't need to go to war to subdue the Chinese. As Sun Tzu aptly said in his book The Art of War, "The Supreme Art of War is to Subdue the Enemy without Fighting", the US can win the war without firing a single shot just by levying hard-hitting sanctions and uniting the world against China. War or no War, the CCP has to be stopped.

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