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Time Horizons and Great Power Competition

By GG001213 – Own work, CC0,

I came across a couple of different reports last week, and it made sense to put them together.  The first is a report doing some serious digging into the real size of the Chinese economy, which largely remains a mystery.  The second was an older report detailing research into the size of the Japanese economy in the interwar period.

There is no question at this point that the relative sizes of the U.S. and Chinese economy today are much closer than those of Japan and the U.S. in the interwar period. And long story short, underselling the size of the Chinese defense budget and overselling the size of the Chinese economy does tend to obscure the magnitude of China’s defense buildup. Nevertheless, even if we make strong assumptions about the size of the errors in both directions, China’s defense buildup still does not look very much like Japan’s of the interwar period; indeed, despite the growth in its military capabilities, it does not look like China is trying to compete militarily with the United States.

If I had the chance to do it over again I’d caveat that last bit with “in terms of overall capability.” But in the interwar period Japan was generally spending 5% of its GDP on defense against 1% for the United States, while today China is spending 2% against 4% for the US. We’re in a much different competitive environment.

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