This is the eighth part of a series of posts where I examine what would happen if the PRC invaded Taiwan. For deep background, check out my book on Chinese military history, Walls of Men.
I’ve taken a break from this topic, but a recent video by China Observer made want to revisit it. The video claims that China is experiencing severe budgetary problems and that this is even reaching into the Peoples’ Liberation Army, which – if true – is pretty significant. The PLA is not a national army but a servant of the Chinese Communist Party and it is the thing that keep the party in power. That is to say, when you are asking the security forces who sustain your regime to economize, things have to be really bad.
Buildup vs Drawdown
People of a certain age will recall what the end of the Cold War meant for the US military: a massive drawdown and reorganization. In theory, that should have meant that the smaller force would be properly manned and funded, but that is not what actually happened. I enlisted in Army National Guard in 1999, and by that time readiness was abysmal. Even going through Basic Training was a challenge, with worn-out gear, malfunctioning rifles and even training ammunition in short supply. I recall one day we went to the range and just sat in the shelter for hours while our sergeants tried to scrounge up some ammo.
All that changed after the 9/11 attacks, and the contrast was striking. Everything got revamped, even down to the combat boots. In fact, not a single item from the 2000-era uniform and equipment was in service just a few years later.
That was a very expensive undertaking, but the cash spigot was open and the services competed against each other to find new and inventive ways to burn cash.
According to the video, China has been increasing its defense spending every single year for decades. The rate of the increase is falling, but still around 6-7%, which is a pretty heavy buildup, certainly enough to cover food and uniform items, yet the video shows official propaganda demonstrating very petty and small-scale reductions. The examples they give are treating briefcases as a hand-receipt item, to be issued before a conference and then returned. To reduce food waste, troops are eating with their hands out of buckets. Supposedly old uniforms are also being reused or reconditioned. What does it mean?
The Case for the Buildup
It is entirely possible that the PLA has all the resources it needs for normal operations but that as they prepare to invade Taiwan, they now want to shift funds from ancillary items (like briefcases) to additional ammunition. Similarly, the same channel has documented a year of storms and flooding, which likely has inflicted severe crop damage. Having the military tighten down on food waste not only spares the budget, but reduces that amount of food China would have to import.
To put it another way, if these trivial areas are being cut down with a 6% budget increase, something we can’t see must be getting all that extra funding, and that could be supplies and munitions for the invasion.
The Case for the Drawdown
As Napoleon once observed, an army marches on its stomach. Throughout history, one of the most reliable ways to raise morale (and therefore fighting spirit) is to ensure first-rate rations are available to the troops. Conversely, hunger is the most dangerous enemy most armies ever face. Making troops eat out of buckets is demeaning, no matter how it is portrayed. Yes, I suppose the PLA is built around the mythical guerillas living on handfuls of cold rice during the revolution, but times have changed. One cannot expect a modern, advanced military to live like peasants stealing food to survive. It’s very strange.
While it is possible that the saved funds and the annual increase is going to munitions, it is far more likely that it is be used to cover soaring fuel prices. The Peoples’ Liberation Army Navy runs on petroleum – there are no nuclear-powered ships. Those aircraft carriers are likely very thirsty, and it probably costs a fortune to have them sail back and forth around Taiwan. Similarly, the naval presence and provocation in the South China Sea isn’t free. China’s two main suppliers of oil – Venezuela and Iran, – are either shut down or under American management. A key component of China’s economy was the use of “gray zone” tankers to import oil and below-market prices. Having to pay full retail is absolutely going to have an effect on the bottom line.
Funny Numbers
When China first opened itself up to the West, there was an effort to update its institutions for a modern economy. A big part of that was increasing transparency around the economy and other national statistics. Foreigners were not going to invest if they were unsure where things stood or what might happen next. Even after the Tiananmen Massacre, the CCP was still willing to tolerate dissenting views on topic like building the Three Gorges Dam.
In recent years, that transparency has been severely diminished. Xi Jinping clearly has decided that it is easier to cover up failure than address the cause, even to the point of telling blatant lies about natural disasters. Even with clear video evidence that a great many people in Chinese-controlled Tibet were killed by the unexpected flooding, the state media still persists in claiming an absurdly low number of victims.
The same applies to the economy. While China has some elements of the free market, the government still sets GDP growth targets and despite all the natural disasters, the oil shock and the continuing collapse of both manufacturing and housing, China still managed to hit its 4% growth target. What are the odds?
Because of this improbability, independent analysts are now offering their own estimates, which put growth at zero, maybe negative. If the economy is shrinking, that means less revenue, which means more borrowing, and this is what we are seeing. This brings us back to the case for the drawdown. If one questions official economic data, should one not also question published expenditures in the budget?
All The Other Stuff
At this point, it’s useful to consider that these developments are not operating in a vacuum. China’s ailing financial health just add even more complexity to the invasion. If there is indeed a problem with the food supply, the collapse of shipping as a result of an invasion would catastrophic. There are already reports that roving gangs of senior citizens are swarming into fields and stealing crops, disrupting the harvest in the process. I’m trying to imagine how bad things would have to be for Americans to swarm into cornfields with baskets like that.
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