China's Military, Take 3.

• Author: Gill, Bates

LET US BEGIN BY thanking Ambassador James Lilley and Carl Ford for driving home an important point in their article, "China's Military: A Second Opinion" (Fall 1999): any conflict over Taiwan would be of the utmost seriousness regardless of what one thinks of the conventional military balance in the region. No one who read our article ("China's Hollow Military", Summer 1999) should be led to believe otherwise. The potential for enormous losses in Taiwan and southeastern coastal China; the lasting geopolitical harm resulting from the embitterment and ostracization of the world's most populous state after such a war; and the slight but real risk of nuclear escalation are all extremely worrisome, even if the People's Republic of China (PRC) were to prove unsuccessful in invading or blockading Taiwan.

Lilley and Ford are also right to emphasize that China has been trying to improve its problem-plagued military. And they are surely correct that PRC forces need not equal the capabilities of the U.S. military to pose a significant risk to American interests in East Asia. We made these points too, but it is worthwhile to have them reinforced. On a number of other points, however, Lilley and Ford plainly misrepresent our argument. On others, they overstate China's military prowess, or commit precisely the error we warned against: equating Beijing's aspirations with its actual capabilities.

BEGINNING with budgetary matters, Lilley and Ford imply that we understate China's true level of defense spending. But, while they note that most Western estimates put the PRC's annual expenditures between $28 billion and $50 billion, we had put the range between $35 billion and $65 billion. The authors make a great deal of China's revenues from arms sales and the possibility that these could help the PRC modernize its military capability "off-budget." But recent analysis by the Congressional Research Service puts the gross revenues of such sales at no more than a few hundred million dollars per year. Moreover, independent research in books edited by Ambassador Lilley himself shows that little, if any, of the net profit from these sales is reinvested in PLA modernization.

Our essay went on to note that China's defense expenditures, while fairly impressive in aggregate, translate into a low level of spending per troop. China has provided particularly few resources in areas that soldiers know to be critical in warfighting--such as logistics, maintenance and...