The Chinese Military Is a Paper Dragon

By Kyle Mizokami
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It’s important to view China’s arms spending in historical context. A quarter-century ago, Beijing’s military was big and low-tech. In 1989, the PLA had 3.9 million people on its payroll—many of them leg infantry lacking vehicles and sophisticated weaponry. The army’s main tank was a version of the Soviet T-55, a design dating to the early 1950s.

The air force and navy were capable only of coastal defense. China had a single nuclear missile submarine, which was rumored to have caught fire and sunk in port.

China was a poor country. Its GDP was $451 billion. By comparison, the USA’s GDP in 1989 was $8.84 trillion. That year, Beijing spent $18.33 billion on defense. By comparison, the same year Japan spent $46.5 billion and tiny New Zealand, $1.8 billion.

China’s 1989 defense budget amounted to spending $4,615 per soldier. At the same time, the United States appropriated $246,000 per individual service member.

In the late ’80s, China’s military doctrine still emphasized “People’s War,” a defensive strategy for drawing an enemy deep into the Chinese interior and then destroying him with conventional and guerrilla warfare. It was based on China’s wartime experiences … and was totally inadequate.

In 1991, Beijing watched in shock and horror as a U.S.-led coalition easily smashed Saddam Hussein’s Iraqi army and ejected it from Kuwait. An air campaign lasting several weeks and a ground offensive just 100 hours in duration destroyed a numerically superior Iraqi force.

Suddenly, China’s large, impoverished military looked like a liability.

Beijing had a lot of work to do reforming its armed forces. That required money. The good news for China was that, thanks to a booming economy, it actually didn’t have to devote a larger share of national output to defense in order to invest more in competent troops and modern weaponry.

One way to look at defense spending is as a percentage of GDP. China’s major neighbors, with the exception of Japan, allocate more to their militaries as a percentage of their respective GDPs. India allocates 2.5 percent, South Korea 2.8 percent and Russia 4.1 percent. The United States, with the best-equipped military on the planet, spends 3.8 percent of its GDP on defense.

The paradox of China’s military budget is that spending has risen even as defense’s share of the economy has dropped. As a percentage of the economy, China’s arms spending has actually fallen by a little more than 20 percent. Beijing spent 2.6 percent of GDP on defense in 1989. Between 2002 and 2010, it appropriated an average of 2.1 percent. In 2013, China’s military budget accounted for just two percent of GDP.

The PLA’s slice of the economic pie has gotten smaller. It’s just that the pie itself is much, much bigger than it was 25 years ago.

Public Security

By some calculations, in 2013 China spent more on “public security”—Internet censorship, law enforcement and the paramilitary People’s Armed Police—than it did on external defense. China’s internal security budget for 2014 is a secret, leading to speculation that once again, the Chinese Communist Party is spending more to defend itself from its own people than from other countries.

The Party knows what it’s doing. Many Chinese are unhappy living under a totalitarian regime. Environmental damage, labor abusescorruption and land grabs can—and do—quickly escalate into riots.

On top of that, China must contend with low-level unrest in the far western province of Xinjiang—where ethnic Uighurs resent colonization by the rest of China—and in Tibet.

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Kyle Mizokami
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