5 Common Myths about China's Power
China’s transformation from an isolated, developing country into an economic juggernaut and emerging global actor is perhaps the most important power shift for twenty-first-century international politics. Its economy is now second largest in the world, while its military budget has ballooned from $20 billion in 1989 to $215 billion in 2015—an amount larger than the military budgets of Russia, Germany and the United Kingdom combined.
Fear surrounding the consequences of China’s rise has engendered the spread of misinformation and hyperbole, much of which dominates public discussion of China in the United States. Several persistent “myths” about China overshadow its many problems, including its deeply ingrained corruption, slowing economic growth and aging population.
These myths create an image of China as a dangerous usurper destined to displace the United States as the dominant global power. Breaking down the myths about Chinese power is critical to understanding China’s rise, its potential role in the international community and the evolving nature of U.S.-China relations.
Myth #1: China is a global military superpower.
Two decades of meteoric economic growth has enabled China’s leadership to embark on a multi-faced modernization of the People’s Liberation Army. From 1995 to 2015 China’s defense budget maintained, on average, double-digit growth. Stockholm International Peace Research Institute estimates China’s 2015 defense budget at $214 billion, second in the world only to the United States. China’s military spending constitutes 48 percent of the total spending of all the nations in Asia and Oceania combined.
Although increased spending has greatly enhanced China’s military capabilities, the nature of these enhancements reveals the limited reach of China’s military prowess. Superpowers must project power globally, but China’s capabilities remain bounded to East Asia. Its controversial island-building projects—and the airstrips and radar towers on those features—amplify Chinese power in the South China Sea, but are vulnerable to attack and offer diminishing returns for operations beyond the Nine-Dash Line. Similarly, China’s emerging anti-access/area denial capabilities and antiship technology could be used to counter the United States in a regional conflict, but are less effective beyond China’s immediate neighborhood.
Should the political will exist, China may eventually develop superpower capabilities. China’s first aircraft carrier, the Liaoning, was commissioned in 2012—but as a refitted Soviet carrier, it remains technologically limited. However, China has already begun the difficult process of developing an aircraft carrier built entirely with Chinese designs and technology. Indigenous defense development coupled with an expanding research and development/science and technology base offers Beijing a means to reduce China’s technology gap with the United States. Furthermore, while China currently lacks the basing agreements that enable the U.S. military to operate worldwide, it publicly announced construction on its first overseas “support facility” in Djibouti in February 2016.
There are other hurdles that China cannot overcome with money alone. China has not fought a war since 1979. Its military remains untested, and its officers lack combat experience comparable to their counterparts in the U.S. military. The recent reorganization of the PLA may exacerbate these issues in the short term as command hierarchies, especially with regard to command and control, are realigned. Considering these limitations, it could be decades before China possesses the capabilities to project military power on a global scale.
Myth #2: China's holdings of over $1 trillion in U.S. debt give it leverage over America.
The fear that China’s ownership of American debt affords it leverage over the U.S. economy is misplaced and overblown. The purchasing of sovereign debt by foreign countries is a normal transaction that helps maintain openness in the global economy.
States hold debt for a variety of reasons. Foreign sovereign debt frequently comprises a portion of states’ foreign exchange reserves, which enable states to pay for foreign goods and investment abroad. Central banks also purchase sovereign debt to maintain exchange rates, to forestall economic instability and as a low-risk store of value. China buys U.S. debt for these same reasons.