CHINA IS no longer simply a rising power. It is now a maritime power that competes for influence with United States from the Korean Peninsula, through mainland Southeast Asia and to the Strait of Malacca. China challenges U.S. alliances and the U.S. Navy’s dominance of East Asian waters.

China’s navy has made significant gains in closing the gap in U.S.-China maritime capabilities. These gains have accelerated the power transition in East Asia, enabling China to advance its interests in East Asia and challenge U.S. security and defense strategy. These developments have undermined regional stability, raised the risk of U.S.-China hostilities and transformed the regional balance of power.

China’s challenge to U.S. security in East Asia is clear. But the United States is currently unable to compete with China and maintain the regional security order. The economic, political and institutional changes necessary to contend with China’s growing naval power are daunting. Unfortunately, the United States has yet to confront this challenge.

FOLLOWING THE end of World War II and the onset of the Korean War, the United States established air, naval and ground force bases in South Korea, Japan and the Philippines. In the 2000s, it expanded its naval presence in Singapore and Malaysian port facilities. Into the early twenty-first century, America dominated the seas of East Asia.

U.S. maritime superiority contributed to regional peace and prosperity. It provided the stability that enabled the region to focus on economic cooperation rather than on security conflicts. China benefited from this strategic order. Since the late 1970s, it prioritized economic growth over military modernization. Nonetheless, China’s acceptance of this U.S.-based strategic order reflected its naval weakness, rather than its understanding of Chinese security interests. Chinese economic prosperity and security depended on American good intentions.

China has long criticized America’s East Asian alliances as remnants of “Cold War thinking.” But this was not simply an ideological objection to U.S. policy. Rather, American alliances enabled the United States to encircle China’s coastal waters with military bases in South Korea, Japan and the Philippines. Its strategic partnership with Singapore allowed the United States to treat Singapore as a de facto naval base. These facilities have enabled the United States to carry out extensive and close-in surveillance of China’s coastal air and naval facilities and its naval operations and to challenge Chinese coastal security.

China never accepted U.S. maritime dominance. Now that it possesses a large and modern navy, China’s leaders are determined to advance China’s security in East Asia, necessarily challenging U.S. alliances and security interests.

For much of the post–Cold War era, China remained focused on developing ground-force superiority along its periphery. Russian military resurgence in Northeast Asia remained a possibility, and the border conflict with India was a persistent security concern.

In the past five years, however, China has developed greater confidence in its border security. Most important, the Russian threat has diminished. As China has modernized its economy, its infrastructure and its military, it has benefited from the persistent decline of Russia’s population, economy and infrastructure in the Far East; its inability to reform its economy; and its preoccupation with U.S. military presence in Europe and the Middle East. Chinese observers now dismiss the possibility that Russia could challenge Chinese security or “balance” against China.

Elsewhere around its border, China enjoys unchallenged superiority. India has yet to develop the technology or the economic resources to challenge Chinese security. It lacks the naval power to monitor its coastal waters, much less challenge China in East Asia. It continues to import its most modern naval ships, and the large GDP and technology gaps between the China and India expand every year. Relative to China, India is a declining power. Along the rest of its border, China dominates its smaller neighbors. Vietnam, despite its traditional hostility toward China, must contend with the large and modern Chinese army just across its border, while its army has stagnated since the end of its occupation of Cambodia in 1991.

China’s mainland strategic environment looks much like America’s strategic environment in North America; it possesses the secure borders necessary to become a naval power.

As China focused on border security, its naval modernization program proceeded at glacial pace. It developed successive generations of naval ships, but it produced only a few prototypes within each generation. It focused on the development of the advanced technology and training necessary to construct a modern navy. But just when China developed confidence over its territorial borders, its navy developed the technology and skills necessary to build and operate a capable maritime force. Thus, within the past decade, China began to reallocate its defense spending to begin serial production of naval ships.

From 2010 to 2017, the number of Chinese naval ships increased from approximately 210 to 320. In 2016 alone, the Chinese navy commissioned eighteen ships. At three hundred ships, the Chinese navy is already larger than the U.S. Navy, and before long it may operate four hundred ships. It commissions nearly three submarines each year, meaning that in two years China will have over seventy submarines. The Chinese navy is also deploying significant numbers of cruisers, destroyers, frigates and corvettes, all equipped with long-range antiship cruise missiles. Between 2013 and 2016, China commissioned over thirty modern corvettes. At current shipbuilding rates, in fewer than fifteen years China could have 430 surface ships and a hundred submarines.

As the size of China’s fleet has increased, its navy has decommissioned its older ships. In 2010, fewer than 50 percent of Chinese ships were “modern”; in 2017, over 70 percent of the fleet is modern. China’s diesel submarines are increasingly quiet, and challenge U.S. antisubmarine capabilities in the South China Sea. Similarly, China’s ship-launched and air-launched cruise missiles possess significant range and stealth, and rely on increasingly sophisticated targeting technologies.

Complimenting China’s naval capabilities are its conventional medium- and intermediate-range ballistic missiles that target maritime facilities throughout East Asia. U.S. strategic facilities in South Korea, Japan, the Philippines, Singapore, Malaysia and Guam are now vulnerable to Chinese ballistic missiles. U.S. missile-defense systems cannot defend against the large quantity of ballistic missiles that China can target and significantly degrade U.S. naval facilities throughout the region.

AS CHINA has increased the size and quality of its navy, the United States has not stood still. On the contrary, in many respects it has been going backwards.

The current size of the active U.S. fleet is approximately 282 ships. The number of its attack submarines has declined since 2010, to fifty-one ships in 2017. The current Navy budget calls for the steady expansion of the fleet. Nonetheless, the Congressional Budget Office estimates that if the Navy continues its average annual budget over the prior thirty years, and maintains its construction schedules for aircraft carriers and ballistic-missile submarines, in twelve years the size of the active naval fleet will decline to 237 ships. In six years, when the Chinese navy will possess over seventy attack submarines, the U.S. submarine fleet will decline to forty-eight ships. In eleven years the number of U.S. attack submarines will decline to forty-one ships. Current Navy plans call for an increase to sixty-six submarines in thirty years.

The U.S. Navy is acutely aware that China’s naval shipbuilding and modernization challenge U.S. maritime superiority and operational capabilities in East Asia. In 2015, it developed a plan to increase the size of the active fleet to 308 ships by 2022. In 2017, the Trump administration advocated for a 355-ship navy. These goals are neither realistic nor adequate to meet the challenge of the Chinese navy.

To reach 308 ships, the Navy would have to spend 36 percent more than its average shipbuilding budget over the past thirty years, and receive a one-third increase to its current budget. If funding continued at the past thirty years’ average, then in another thirty years the Navy could purchase seventy-five ships fewer than it plans. To reach 355 ships, the Navy would need a budget 60 percent greater than the average budget over the past thirty years and a two-thirds increase in its present budget. It is not clear where the United States will find the funds to support a 308-ship navy, much less a 355-ship navy.

Given current budget and political constraints, in November Thomas Dee, the acting under secretary of the Navy, observed that the Navy could eventually reach 355 ships—but at best in the 2050s, and only with a significant infusion of funds. He ruefully observed that “you can’t always get what you want.”

Reallocation of the federal budget to support ship construction is not likely. Mandatory spending constitutes 60 percent of overall federal spending, but Congress has shown no interest in reducing mandatory funding for social programs. On the contrary, in recent years Congress has increased spending on Medicare, Medicaid, transportation and veterans’ benefits, and it will not consider reduced funding for Social Security benefits. On the other hand, the Pentagon already receives over 55 percent of the discretionary budget, and the remainder of discretionary spending is spread over eleven sectors, including education, additional funding for veterans, Medicare and health benefits, and infrastructure.