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While 2024 started with a bang (no pun intended), what can only be described as a year of global transition is well and truly upon us, with all signs pointing to further conflict – this time, much closer to home.
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Over the more than 5,000 years of its history, China has been characterised by cycles of boom and bust which correspond with its prominence on the global stage.
China’s modern history, at least since the success of Mao’s revolution and the formation of the People’s Republic of China in 1949, is no different, with various policies of collectivisation, mainly the Cultural Revolution and Great Leap Forward both resulting in mass famine, economic stagnation, and decline.
By the time the 1970s rolled around, the now-deceased Mao’s dream of a socialist utopia was crumbling, providing the perfect opportunity for the Western world to engage the ancient power, paving the way for it to emerge as one of the world’s truly great economic and industrial powers.
Characterised as the period of “Boluan Fanzheng” or “Eliminating Chaos and Returning to Normal” by Mao’s pragmatic and reform-minded successor, Deng Xiaoping, in an attempt to “correct the mistakes of Cultural Revolution”.
This opening up and liberalisation of the Chinese economy, paving the way for the true beginning of the globalised economy, was rapidly embraced by both sides of the Communist East and Capitalist West.
Seemingly unassailable in its economic and industrial ascendency, China’s economic miracle avoided the Asian Financial Crisis and steadily positioned the nation to become the “factory of the world”, resulting in the hollowing out of many national industrial bases in favour of cheaper, “just in time” supply chains.
This shift also saw a major shift in the global flow of trade, particularly for industrial inputs, energy, and of course, perishables, to keep the vast Chinese economy and population operating like a well-oiled machine.
At the same time, China’s leadership has extensively invested in the People’s Liberation Army and its subordinate commands, transforming it into what has rapidly become one of the world’s leading military powers, with the ambition of rebuilding the ancient glory of the Middle Kingdom.
All of this has ultimately combined to bring China, particularly the China of Xi Jinping, into direct confrontation with the post-Second World War order, with a number of emerging economic, political, and strategic flashpoints that could boil over into open and truly humanity-ending conflict.
Yet, preparing for a potential conflict leaves clues for analysts, like any good detective to follow and unfortunately, all signs point to something concerning.
Highlighting this is associate professor of political science at Tufts University, Michael Beckley, and professor of global affairs at the Johns Hopkins School of Advanced International Studies, Hal Brands, for Foreign Policy in a piece titled, How Primed for War Is China? Risk signals for a conflict are flashing red.
The pair begin by setting the scene, stating, “Notwithstanding the recent flurry of high-level diplomacy between Washington and Beijing, the warning signs are certainly there. Under Chinese President Xi Jinping, Beijing is amassing ships, planes, and missiles as part of the largest military build-up by any country in decades.
“Notwithstanding some recent efforts to lure back skittish foreign investment, China is stockpiling fuel and food and trying to reduce the vulnerability of its economy to sanctions – steps one might take as conflict nears. Xi has said China must prepare for ‘worst-case and extreme scenarios’ and be ready to withstand ‘high winds, choppy waters, and even dangerous storms.’ All of this comes as Beijing has become increasingly coercive (and occasionally violent) in dealings with its neighbors, including the Philippines, Japan, and India – and as it periodically advertises its ability to batter, blockade, and perhaps invade Taiwan,” Beckley and Brands explained.
The status quo isn’t guaranteed
Importantly for both Beckley and Brands, the long-held (and in my opinion, misheld) belief that China won’t seek to overturn the global order that has benefited it so strongly since Deng’s wave of economic liberalisation and reform in the 1970s is just the latest fallacy the West has deluded itself into believing.
Much like Francis Fukuyama’s “End of History” hypothesis, postulated in the early-1990s to explain the post-Cold War world, the belief that as China became wealthier, liberal and more global, its people and by extension its government would equally liberalise and become more democratic.
Equally, the “Golden Arches” theory, which can best be explained by the belief that no two nations with a McDonald’s have gone or will go to war with one another has effectively characterised the Western view of the rising superpower like a sick game of sleight of hand.
Demonstrating this, Beckley and Brands explained, “What links these arguments is a belief in the basic continuity of Chinese conduct: the idea that a country that hasn’t launched a disastrous war in more than four decades is unlikely to do so now.
“We believe this confidence is dangerously misplaced. A country’s behaviour is profoundly shaped by its circumstances, no less than its strategic tradition, and China’s circumstances are changing in explosive ways,” the pair explained.
However, before China makes its move, there are a number of factors or preconditions that have to be met that would effectively serve as triggers for the superpower to take a more aggressive route to achieve its various objectives.
Stressing this, Beckley and Brands stated, “Political scientists and historians have identified a range of factors that make great powers more or less inclined to fight. When one considers four such factors, it becomes clear that many of the conditions that once enabled a peaceful rise may now be encouraging a violent descent.”
The four preconditions and the ambition of one man
It is critical to identify these four preconditions if we are to understand the broader implications of the key indicators that reveal Beijing’s accelerating push to confront the post-Second World War order.
Beginning with the first such factor, Beijing’s ongoing and numerous territorial disputes with its various neighbours, ranging from India in the Himalayas, to Vietnam, the Philippines, Indonesia, and Japan in the South China Sea, and of course, the pesky question of that “breakaway province”, Taiwan.
Beckley and Brands explained the implications of Beijing’s territorial disputes, saying, “First, the territorial disputes and other issues China is contesting are becoming less susceptible to compromise or peaceful resolution than they once were, making foreign policy a zero-sum game.”
The impact of said territorial disputes equally lead into the second factor, that is the shifting balance of tactical and strategic military power in the Indo-Pacific, largely as a result of the increasing decline of the United States and its willingness to maintain the global order it built and maintained at great material and human costs since the end of the Second World War.
“Second, the military balance in Asia is shifting in ways that could make Beijing perilously optimistic about the outcome of war,” the pair explained.
Going further, Beijing’s unprecedented and meteoric explosion of economic and industrial capacity since the 1970s has given it the capacity to outbuild the once great industrial powers of the Western world, especially while they continue to pursue self-destructive policies across the domains of regulation surrounding employment, energy, and taxation.
Beckley and Brands detailed this, stating, “Third, as China’s short-term military prospects improve, its long-term strategic and economic outlook is darkening – a combination that has often made revisionist powers more violent in the past.”
Fourth and finally is the consolidation of Xi Jinping’s unquestioning personal power and prestige within the country and particularly over the civilian and military levers of power, leaving him the undisputed ruler of the emerging superpower.
“Fourth, Xi has turned China into a personalist dictatorship of the sort especially prone to disastrous miscalculations and costly wars,” the pair explained.
All of these combine to paint a particularly stormy forecast, despite Beijing’s protestations and commitments to maintaining its “peaceful rise” as a responsible regional and global stakeholder, and fly in the face of historical precedent.
Beckley and Brands highlighted this, saying, “It wouldn’t be the first time a seemingly peaceful rising power broke bad. Prior to 1914, Germany hadn’t fought a major war for more than 40 years.
“In the 1920s, Japan looked to many foreign observers like a responsible stakeholder as it signed treaties pledging to limit its navy, share power in Asia, and respect China’s territorial integrity. In the early 2000s, Russian President Vladimir Putin mused about joining NATO and linking Russia closer to the West. That each of these nations nonetheless launched barbaric wars of conquest underscores a basic truth: Things change. The same country can behave differently, perhaps radically so, depending on the circumstances.”
Each of these factors are ultimately defined by the ambitions and desires of its leadership, particularly in an autocratic nation like the People’s Republic of China, which ultimately rest with one man: Xi Jinping.
For Beckley and Brands, this is as critical as all the other individual factors, which is why the military build-up championed by Xi is so telling, “Today’s China is done hiding and biding. Instead, it is churning out warships and missiles faster than any country since World War II. Chinese planes and warships simulate attacks on Taiwanese and US targets. Asian sea lanes are dotted with Chinese military outposts and brimming with Chinese coast guard and fishing vessels that brazenly shove neighbors out of areas claimed by Beijing. Meanwhile, China is abetting Russia’s brutalisation of Ukraine and massing forces on the Sino-Indian border.”
Going further, the pair explained Beijing’s growing confidence, stating, “One reason China has become more combative is because it can. China’s inflation-adjusted military budget expanded tenfold between 1990 and 2020 ... it is no longer clear that the Pentagon could immediately respond to, let alone defeat, a Chinese assault on Taiwan. Historically, the United States has fallen back on its manufacturing prowess to outproduce adversaries in protracted wars.
“But now that China is the workshop of the world, Beijing might believe – correctly or not – that the military balance would shift further in its favour the longer a war continues,” they explained.
Rounding out this analysis, the pair detailed the influence of Xi over China’s current and future direction, stating, “Since coming to power in 2012, Xi has appointed himself chairman for life, inserted his governing philosophy into the constitution, and purged thousands of potential rivals.
“He has taken uncompromising positions on China’s vast territorial claims. ‘We cannot lose even one inch of the territory left behind by our ancestors,’ he warned US Defense Secretary James Mattis in 2018. Xi has attached his legitimacy to making China a superpower: State media now declares that under Mao, China stood up; under Deng, China grew rich; and under Xi, China will become mighty. In recent years, Xi has given internal speeches instructing the Chinese military to be ready for war and the Chinese people to prepare for ’extreme scenarios’.”
Broader implications for the region and what to watch for in the final countdown
It goes without saying that all of this combines to form a rather bleak outlook, particularly where matters that could be described as central to the legitimacy of contemporary China, and Xi Jinping for that matter, are at stake.
Think Taiwan, China’s global ambitions exercised through multilateral organisations like BRICS, Shanghai Cooperation Organisations, and programs like the Belt and Road Initiative that seek to build a new Silk Road, with Beijing firmly entrenched at the centre.
While we’re not quite at zero hour, we are getting close and there are some important developments for analysts to monitor as tensions across the Taiwan Strait in particular continue to evolve and deteriorate, particularly as Beijing steps up its “exercises” in and around the water and airspace of Taiwan.
Gerard DiPippo, senior economics fellow at the US-based Centre for Strategic and International Studies (CSIS), identified a number of key factors that could precipitate potential Chinese actions against Taiwan, or more broadly other tactical and strategic priorities in the Indo-Pacific, including:
- Imposition of stronger cross-border capital controls, including in response to apparent capital flight from elites.
- A freeze on foreign financial assets within China.
- Rapid liquidation and repatriation of Chinese assets held abroad, including sales of US bonds (concerningly for Australia, this could include “privately held” real estate assets).
- A surge in stockpiling emergency supplies, such as medicine or key technology inputs.
- A suspension of key exports, such as critical minerals, refined petroleum products, or food.
- Measures to reduce demand or ration key goods, especially imports like oil and gas.
- Restrictions on outward travel for Chinese elites or high-priority workers.
Adding further complexity for China watchers, DiPippo added, “China’s short-term economic actions might not offer conclusive or specific warnings about Beijing’s military intentions. Economic indicators would need to be paired with other signs, such as PLA movements or domestic propaganda, to determine Beijing’s military intentions.”
This is particularly relevant when considering similar recent hostile actions, namely Russia’s most recent invasion of Ukraine in February 2022 and the preceding build-ups between the 2014 invasion of the Donbass, again explained by DiPippo, who said, “Moscow’s financial measures after the 2014 sanctions were designed to harden Russia’s financial system to potential sanctions (“fortress Russia”), including by accumulating international reserves, diversifying away from US dollar assets, and increasing fiscal savings through conservative budgeting. The Russian government attempted to reduce dependencies on foreign hardware and software. In 2018, Moscow announced a program to achieve self-sufficiency in domestic agriculture.”
However, it is important to understand that such measures, if implemented by Beijing, could be seen as largely defensive in nature, in a similar nature to those actions taken by Russia, which DiPippo explained as, “Russia’s attempts at financial hardening and economic self-sufficiency were treated as defensive.”
Final thoughts
Importantly, in this era of renewed competition between autarchy and democracy, this is a conversation that needs to be had in the open with the Australian people, as ultimately, they will be called upon to help implement it, to consent to the direction, and to defend it should diplomacy fail.
Dr Ross Babbage of US think tank Center for Strategic and Budgetary Assessments said, “I think what we’ve got to show what’s the vision for Australia, you know, what can we achieve and what you know if we go on the trajectory we are on at the moment. I’ll tell you what, you know, a lot of people, a lot more people in a decade’s time are likely to be either in really dumb jobs or maybe not have jobs at all, and in the society be a lot weaker and will be a lot less prosperous.
“So what we want to say is, look, there’s plenty of scope for doing more and smarter things, encouraging investment to do that, and then there will be some very, very interesting additional jobs and opportunities, a lot of high tech, and so on, I can tell you that, you know, talking to foreign investors, they’re quite keen on principle to work here, and do a lot more here and provide a lot more good jobs for Australians,” he explained.
This requires a greater degree of transparency and a culture of collaboration between the nation’s strategic policymakers and elected officials and the constituents they represent and serve – equally, this approach will need to entice the Australian public to once again invest in and believe in the future direction of the nation.
In the second part of this short series, we will take a look at the corresponding yet equally scathing commentary in recent days highlighting the growing strategic and military decline of Australia despite the rhetoric of recent months.
Get involved with the discussion and let us know your thoughts on Australia’s future role and position in the Indo-Pacific region and what you would like to see from Australia’s political leaders in terms of partisan and bipartisan agenda setting in the comments section below, or get in touch at
Stephen Kuper
Steve has an extensive career across government, defence industry and advocacy, having previously worked for cabinet ministers at both Federal and State levels.
