War with China?

I have already offered my views of Robert Kagan’s Wall Street Journal op-ed about a coming conflict with China. In it Kagan argued that America’s enemies had underestimated its resilience and its industrial capacity in two world wars. He added that if China makes the same mistake America will rise from its deliria and become a fearsome fighting machine.

To which Niall Ferguson responds by suggesting that America is not a sleeping giant, but a “comatose geriatric.” He counsels against complacency:

The idea that, in the event of a surprise attack in Taiwan, the United States would dust down the World War II playbook is no doubt comforting to some. But another word that suggests itself is “complacent.” “Today,” wrote Kagan, “the US and its allies and partners (which includes most of Europe, Japan, India, South Korea, Australia and others) produce over 50% of the world’s wealth, while China and Russia together produce a little over 20%.” But if we know one thing about power today, it is surely that it’s not equivalent to GDP. If it were, the war in Ukraine would by now have been won by Russia, which had a pre-war GDP nine times larger.

But then, Ferguson quotes a Rand Corporation analysis. You might consider it an antidote to complacency:

The United States displays some of the characteristics of a once dominant power that has passed its competitive prime: by some important measures, it is complacent, highly bureaucratized, and seeking short-term gains and rents rather than long-term productive breakthroughs. It is socially and politically divided, cognizant of the need for reforms yet unwilling or unable to make them, and suffering a loss of faith in the shared national project that once animated it.

China clearly benefits from a potent national will and ambition, both domestically and internationally, and a unified national identity among much of the population. It has an active state that is pouring resources into human capital, research and development, high technology, and infrastructure.

In the 20th century the United States was unrivaled in its industrial capacity. That has ceased to be true in the past 20 years. As recently as 2004, US manufacturing value-added was two-and-a-half times larger than China’s. But China overtook the US by this measure in 2010. In 2021 Chinese manufacturing value-added was nearly double that of the US. And it’s worth pondering which of the two superpowers has more dual-use manufacturing capacity. Not many dishwasher factories can quickly switch to making precision missiles.

As for industrial production, things do not look much better. Ferguson writes:

In a major regional conflict … the US use of munitions would likely exceed the current stockpiles of the US Department of Defense (DoD), leading to a problem of ‘empty bins.’” In short, “the US defense industrial base — including the munitions industrial base — is not currently equipped to support a protracted conventional war.” It is the reverse of consoling that the situation is even worse for America’s principal European allies.

He continues to expose the deterioration of our military-industrial complex:

... the Russian invasion of Ukraine has laid bare the comparable deterioration of our once mighty military-industrial complex.

Here are some startling examples:

• “The quantities of Javelins transferred to Ukraine through late August 2022 represented seven years of production at fiscal year (FY) 2022 rates before recent reprogramming actions.” (CSIS)

• “As of January 2023, the US military has provided Ukraine with up to 1,074,000 rounds of 155 mm ammunition, significantly shrinking the availability of 155 mm rounds in storage.” (CSIS)

• “Ukraine … [is] firing more than 5,000 artillery rounds every day — equal to a smaller European country’s orders in an entire year in peacetime. (Financial Times)

• “As of January 20, 38 HIMARS [high mobility artillery rocket systems] have been sent to Ukraine. Each system costs around $6.8m. … At the start of last year, Lockheed Martin was producing at a rate of 48 HIMARS a year, and is now up to a rate of 60. But getting to its target rate of 90 will take another 18 to 24 months.”

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The US defense “primes” — the big five defense contractors — are struggling to keep up with Ukraine’s military needs in a relatively small war against a Russian invasion force that has performed dismally in close to a year of conflict. And bear in mind that Russia’s manufacturing value-added is one-tenth that of the United States.

And, let’s not ignore the fact that government bureaucrats and regulations have made it prohibitively expensive to build much of anything:

According to a report by the Government Accountability Office (GAO) last year, the cost of building the new 12-vessel Columbia class of nuclear-armed submarines has risen by $3.4 billion to a projected $112 billion. It is now $132 billion, and there are doubts that the new subs will be available for deployment in 2031. The GAO identified delays in 17 major programs, including the DDG-1000 destroyer, the MQ-4C Triton surveillance drone, the CH-53K cargo helicopter and the MH-139A Gray Wolf helicopter designed to patrol nuclear missile silos.

You can console yourself with the thought that less manufacturing means a cleaner planet. We are unprepared for war but we are fighting the good fight against the weather:

In our time, by contrast, we have been shrinking our military-industrial base. In 2013 the Environmental Protection Agency shut down the 121-year-old Doe Run lead smelting plant in Herculaneum, MO — the last primary lead smelting plant in the country. And that’s just lead. According to a 2021 report from the Department of Energy, “of the 35 mineral commodities identified as critical … the United States lacks domestic production of 14 and is more than 50% import-reliant for 31.” No doubt great from an ESG perspective. But what about the WWIII perspective?