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Unpacking the Pentagon's 2022 China Military Power Report – DOD Officials Speak at American Enterprise Institute

MACKENZIE EAGLEN, SENIOR FELLOW, AEI: Good morning. Welcome to the American Enterprise Institute. I'm Mackenzie Eaglen, senior fellow here, looking at defense budgets and strategy and the intersection where they meet up. It's a pleasure to welcome all of you today to talk with our friends from the Pentagon in their first public event since releasing this year's China Military Power Report, but we will get to that in a moment. Just a few notes of administrative matters, we will take questions online as well as from our audience in-house. So, thanks for coming out. If you're joining us online, look at the screen and you'll see a prompt for how to submit questions via email and Twitter I believe. Before we welcome, again, our friends from DOD, I just want to briefly also welcome my colleague Zack Cooper, who's going to introduce them, and he's a senior fellow here. Zack and I work together. He's a man of many think tanks and hats as well as government service NSC and at the Defense Department as well. He's also a professor and, Zack, the list is, kind of, long, so I'm going to stop talking there. We don't like to crowd out our special guests of honor. Thanks for being here.

ZACK COOPER, SENIOR FELLOW, AEI: Well, it's really fantastic to be here alongside two really leading experts on China in the Indo-Pacific more broadly. I think all of you know them, so I'll just do very quick bios. Dr. Ely Ratner is the assistant secretary of defense for Indo-Pacific security affairs. He's had many previously important jobs, including as deputy national security adviser to then–Vice President Joe Biden. He's been a Senate staffer. He's also worked at a variety of think tanks, which is clearly the most important of your previous positions, including the Council on Foreign Relations, and RAND, and CNS. Dr. Michael Chase is the deputy assistant secretary of defense for China. He also, before becoming deputy assistant secretary of defense, has a long track record in both the think tank community and teaching at the Naval War College, spent a number of years at RAND, writing long tomes about China just like this one that we'll be talking about a little bit. So, we're really delighted to have you here and thanks for taking the time.

MS. EAGLEN: Yes, thank you both. So, we just want to offer a scene setter, a moment for you both to just talk about the report, give our audience an overview. I'm sure everyone stayed up all night reading and underlining, but for those who didn't, please just maybe, Dr. Ratner, if you could just give us a quick overview. Tell us what jumps out at you and what you want us to think about.

DR. ELY RATNER, ASSISTANT SECRETARY OF DEFENSE FOR INDO-PACIFIC SECURITY AFFAIRS: OK, great. Well, thanks, Mackenzie and Zack. It's great to be here at AEI. This institution has been a leader on defense policy, Asia policy, huge amounts of China expertise, two of them here today but many, many others. So, really, really glad to be here. This is an important institution for US policy and strategy. So, the China Military Power Report for those who aren't as familiar, as mandated by Congress, it's more than 20 years old, and it's an important document. As someone who has been in and out of government, this is in my view and not just saying this as a DOD representative here today, it is the most authoritative, unclassified articulation of PRC capability and strategy. And it was a good idea for Congress to do this, and we continue supporting it. It allows these kind of conversations that we're having today. It allows the American public, members of Congress to understand better the China challenge, and it facilitates the conversations we want to be having with our allies and partners about why we need to be working together in the face of this. So, I think that's really what the report is. In terms of the content and what's new this year, you know, the administration has been saying since the very beginning of the Biden administration, we released a document called the Interim National Security Strategic Guidance. It was, sort of, an early national security strategy in which China was articulated as the only country with both the capability and the will to challenge the international order reform, revise the international order to comport with its authoritarian preferences in ways that are very much undermine core US interests and values. And this report demonstrates the ways that is happening through the military instrument that we see China developing not only the capability but actually starting to use the military instrument in a way that we haven't seen previously in a more assertive and coercive way in a way that often runs counter to US interest. And frankly this is why Secretary Austin and the department have articulated the PRC as the department's pacing challenge, and we can talk a little bit more about that if you're interested. But the report documents this growing assertiveness, this growing coercion as it relates to the East China Sea, as it relates to the South China Sea, on the line of actual control against India and of course against Taiwan. And we're also seeing it through the PLA's operational behavior through their increasingly aggressive, assertive, unsafe air intercepts, which is something we also ought to discuss in a little bit more details today. It's something important that the department has been communicating both publicly and privately. So, in the region we are seeing this more assertive and capable PLA, but we're also seeing a more global PLA, one that is pursuing installations around the world, very ambitious aspirations to be projecting power, sustaining power overseas. So, it's both the regional piece and the global piece that's highlighted in the report. But let me turn over to Mike here for some additional insights.

DR. MICHAEL CHASE, DEPUTY ASSISTANT SECRETARY OF DEFENSE FOR CHINA: Sure, thank you very much for having us over and also thanks to the team that worked on the report, which is, you know, a pretty labor-intensive undertaking every year but, you know, again, one that we are proud to be a part of because, as you just heard, this is really sort of the US government's premiere, unclassified, authoritative assessment of Chinese military modernization and not just the capabilities the PLA is developing but the ways in which they are employing them including more coercively. And so just a few of the other highlights I would note in the report, you know, we cover the improvements of the PLA's conventional capabilities that they continue to pursue, their navy, their air force, their conventional missile force, what they're doing in space, and cyber, and electronic warfare. And we also talk about the capabilities that they're developing for strategic deterrents, their strategic weapons programs. And so very importantly, you know, we are charting the modernization, the diversification, and the expansion of the PRC's nuclear forces in this report, and they are developing a nuclear triad. It is no longer just the land-based rocket force. They've added a sea-based leg to their nuclear force and also reintroduce the nuclear deterrents and strike mission for their air force. And we cover in the report projections for the expansion of their nuclear missile force. Many of you, I'm sure have seen the images of the silo fields that the PLA rocket force is building, and we provide in the report an estimate of about 400 nuclear weapons in China's inventory today, and we project out to 2035 when we expect that they'll want to have about 1,500 nuclear weapons. So, this is a really big change in terms of what they see as their requirements for their nuclear deterrence capabilities. We also track areas such as what they're doing in their space and counterspace capabilities and highlight the range of different types of anti-satellite capabilities they're working on to include both ground-based and on-orbit capabilities. And then, you know, we highlight some of the challenges that we face also because of their reluctance to discuss some of what they're doing there and the challenges that presents to strategic stability, just among many of the areas that we cover in the report.

MS. EAGLEN: That's great. It really is exhaustive, detailed, and comprehensive. It's an impressive product. So, thank you for working so hard on that. I'm going to bring up the speaker's visit to Taiwan not to talk about whether she should have gone but to talk about if that particular event and the multiple-day live fire, you know, joint, I don't know, forcible entry or whatever, however you want to characterize what it was they were practicing. I saw capabilities that could be applied to quarantine, not just an invasion, which makes me a little nervous, but did you see any new capability and intent, in that real-world event, that wasn't or either reinforce what's in the report or wasn't in there yet? And of course, I don't want to get into too many details because this crowd already knows it but, you know, there were missiles fired within Japan's EEZ for the first time that that had happened. Other missile targets were the closest ever to Taiwan's main island during the event, 22 warplanes crossing the median line, a hundred fighters and bombers deployed near Taiwan, 10 warships patrolling, the Eastern Theater Command for China, they carried out aerial patrols and several rounds of simulated attacks against vessels. So, after that, the Navy 7th Fleet commander said that—he said there's a term in Mandarin— I don't want to butcher the term—but it's called nibbling like a silkworm. They just, kind of, continue to push the boundaries and see what they get away with. So, tell me, you know, new, not new to you, just new to us, or reinforces what's in the report.

DR. RATNER: Well, maybe I'll say what's not new about that, which is what we've seen is a pattern—you know, Zack has been documenting this well over the last decade, but a pattern of behavior whereby Beijing uses these kinds of events as opportunities to take steps forward of assertiveness and aggression that were very much already on the shelf and very much consistent with a trajectory of behavior. And I think this goes in the category of things that we've seen over the years where they're using essentially an excuse of a geopolitical event to do something that they were planning to do all along. So, I don't think this was new in that regard. I mean, certainly the degree of coercion and assertiveness is new. I think what's important about it and what's important for this audience to understand is that what we are communicating as a government from a political, military perspective and through our operations as well is that we're going to continue to fly, sail, and operate in a way that is consistent with international law, that is responsible, that is peaceful regardless of this behavior. And I think that's what's really important. And in the wake of this activity, we have continued to do that with Taiwan Strait transits, other types of freedom of navigation operations in the South China Sea. And one of the things that, again, we have communicated to Beijing, the secretary of defense has communicated is that if this kind of military coercion is meant to deter the United States from acting in accordance with international law, that's not going to work.

MS. EAGLEN: Before I turn it over to Zack, just push you a little bit on, sort of, the timeline. You know, all of Washington agrees this is the decade of maximum concern. I guess you could say that's, like, sort of, the baseline consensus. And then it's only a question of—you know, I've heard certain military leaders, for example in recent weeks, start talking about, you know, well 2027 is a unique date. And you talk about that in the report for a variety of military modernization and other reasons by Beijing but, you know, for example, some service chiefs have said, "But, you know, I got to be ready tonight for the potential something—any act of war, which, you know, again, quarantine may or may not be an invasion. There's always tension between the services and the civilian leadership. Is there a gap there between how you guys see the moment of—you know of, is there more time? Do the defense civilians think we have more time than we do to prepare or are you sympathetic to the uniform side that's saying, you know, it could happen any moment?

DR. RATNER: So, I don't think there's a gap. I think there is consensus within the department about the urgency of maintaining and reinforcing deterrence. So, I think what we are trying to do and what our goals are here vis-à-vis the deterrence question is to ensure, as Admiral Davidson used to say, that when Beijing looks at this problem, today is not the day. So, we understand and the report makes clear that Xi Jinping and the PLA are trying to develop capabilities whereby it would potentially make it easier for them in a way to seize the island of Taiwan or to use military aggression. I think our goal is to ensure that that is never easy for them to do rapidly or cost-free. And so I think what we are doing is taking actions now to reinforce deterrence. And I don't think there's a gap here. We have obviously regular contact with the leaders at INDOPACOM among the services within OSD and the joint staff. And I think we're all focused on the deterrence problem. It's a today problem. It's a tomorrow problem. It's a 2027 problem. It's a 2035 problem. It's a 2040 problem. And I think we are getting after the different elements of deterrence that we think are important for each of those wickets. But, Mike, I know you've been thinking a lot about this.

DR. CHASE: Yeah, no. I agree. I mean, this is part of what makes, you know, the PRC, the pacing challenge is that there are challenges that we could face in the very near term, you know, out over the next five years and beyond. And, you know, we know that the, as we talk about in the report, you know, Xi Jinping has set goals for the PLA to accomplish in 2027 and 2035, and all the way out to 2049. And we have to be prepared to deal with the challenges that presents, you know, throughout this entire time period.

MS. EAGLEN: OK, thanks.

MR. COOPER: Yeah, I just want to pick up on that last point because I think the timeline debate is one that's getting a lot of airtime in Washington. And so it's really important to be clear about it. And one of the things that I really liked about the report is it's very clear about at least the capabilities that Beijing is trying to create between now and 2027 and, as you said, 2035 and 2049. So, let me characterize this and let you guys tell me if this is accurate. For 2027, in particular, because that's been—the debate in Washington is really pretty focused on that five-year timeline for some reason. The report characterized this as an effort to build integrated mechanization, informatization, and intelligentization. And it's really about capability building, not intent, from how I read the report. Is that an accurate assessment?

DR. CHASE: Yeah, I think we view all three of those markers—2027, 2035, and 2049— as milestones for capability development when Xi Jinping has told the PLA they need to reach a, you know, particular level of capability. So, 2027 is, as you described, it's the 100th anniversary of the PLA. It's, sort of, the nearest term of the three-step, you know, sort of process that he's asked them to carry out. When we get to 2035, they're supposed to basically complete the modernization of the PLA. And then looking out further to 2049, which is also their milestone for national rejuvenation, that's when the PLA is supposed to become a world-class military. That's second to none. All right, so all three of those we view as capabilities development milestones.

DR. RATNER: I mean, I can answer your question part, which is, is it the belief of the department? And this gets, I think, to, sort of, the urgency question that Xi Jinping's ready to push a button on 2027 to say go no matter what, and our answer to that is no, that we think that there is a clear path, one on which we are on now, to continue to deter PLA aggression. And that has to do with our own capabilities, it has to do with our concepts, it has to do with our posture and updating that all in a way that makes aggression against Taiwan too costly for a leader in Beijing that's still thinking about China's—his goal of China's rejuvenation, thinking about the PRC economy, thinking about China's role in the region, etc. So, I think we are—and Secretary Austin spoke to this out at Reagan, I think with a degree of confidence, about where we are now on that question. And that may be a little, Mackenzie, about what you're hearing when you hear leaders say, "We don't think PLA invasion of Taiwan is imminent," because that would be a really bad idea for Beijing. I think that's where that assessment comes from, and we want to keep it that way. And I think that the urgency that you're seeing, clearly the United States has been primarily focused on other threats for the last two decades. That has changed, in part started changing, during the Obama administration, and got accelerated under the Trump administration, and really crystallized under this administration. And the United States is very focused now. The Department of Defense is very focused. It hasn't been that long that we have been focused, and I think we're seeing great strides inside the department along each one of those vectors on the capabilities development, on the concepts development, and posture and otherwise that are going to reinforce stability and deterrence in the region. I think we're on the path to do that. So, I hear people talking about 2027. The PLA has its goals. We have a vote in that as well, and I think we're pretty focused on this effort.

MR. COOPER: That's such an important point. I want to, sort of, build on that by asking. So, you know, the department hasn't really come out and given one big statement about all of the things that we're doing to try and stabilize the cross-strait military balance. And I think there are probably a lot of good reasons for that. One is you don't necessarily want to reveal everything, but you do have to reveal something. So, I want to ask if you can talk a little bit about some of what's going on to stabilize the deterrence situation, especially in the crossstrait dynamic. Obviously, you know, last week, we saw the B-21 rollout, which is going to be part of the capability side. I know it's hard to talk about some of the posture changes, and it's hard, you know, for people outside government to understand operational concepts and how those are shifting. But can you walk us through some of the kinds of changes that you and others in the department are pushing?

DR. RATNER: Yeah, maybe I'll start with the posture piece, and then Mike can pick up on some of the other elements because this is an area where—look, you open any think tank report on US strategy in the region, and it is no secret that the US forward presence in the region has historically remained predominantly in Northeast Asia, predominantly at major operating bases, and smart folks like yourselves have been writing, "Hey, we really need a more mobile, resilient, lethal, diversified posture in the region." We agree. You know, that takes a lot of work. It takes a lot of diplomacy. It takes what Secretary Austin describes as hard government work. It doesn't just take making, you know, big speeches and writing big strategies. It takes years of diplomacy. You're talking about having to engage partners on their territory questions related to their sovereignty. This is not something that you flip overnight. And that said, I think it is fair to say that, in my view, 2023 is likely to stand as the most transformative year in US force posture in the region in a generation. And I think in the way that it took the Obama administration a couple years, if you look back on the last period when there was, sort of, fundamental change, right, that occurred in 2011, 2012, that was after a couple years of really hard work that the Department of Defense put in, Secretary Clinton, Kurt Campbell, and others to put the kinds of pieces we put in place in the Philippines, in Darwin, LCS in Singapore, which all came together. And we've been getting after that over the last couple years, and I'm hopeful that we're going to start seeing the fruit of those efforts bearing quite soon. We've seen obviously this week the AUSMIN talks between the United States and Australia. Not a lot of details released publicly but a lot of work being done. And an announcement made that the United States will be increasing the US presence in Australia across all domains—land, air, and naval—looking at logistics and sustainment issues out of Northern Australia, in particular, for folks who have been looking at that, hugely important. When the vice president was in the Philippines, she announced what secretary of defense had already said publicly as well, that we're working with the Philippines not only to continue building out existing EDCA sites but to start looking at new EDCA sites. I'm hoping we'll have more to say on that in the future. That's fundamentally important. Of course, we're in the midst of finalizing the pathway for a conventionally armed, nuclear powered Australian submarine, which may have some posture implications as well. And those announcements will be coming out before the end of March. And there will be others as well, and I think, as a package, we are going to be making good on a strategic commitment that people have been looking for a long time to think about, "OK, how's the United States going to be revising its forward presence in the region that is going to be, as I said, more lethal, more mobile, more resilient and exactly reinforcing that kind of deterrence that we were talking about that make some of these rapid low-cost invasions nearly impossible if you have the right forces in presence in place?" So, I know there's been a lot of sort of waiting with bated breath for some of these announcements. Hopefully, they're going to be coming early next year, but my team's very committed, the department's very committed, the secretary's very committed to getting this done. And I think folks are going to be quite satisfied with the results that are going to be rolling out throughout 2023. So, more to follow on that, but we've seen some of it already with Australia, with the Philippines in a number of important pieces that will be falling into place.

MS. EAGLEN: Well, we invite you to come back any time to talk about the most transformative year for force posture in a generation next term and in terms of the region. I welcome it. I applaud you for all the behind-the-scenes work. I take your point. It takes a long time, and it's a lot of people toiling away. And the rest of us only find out when we find out. So, I'm excited to learn more.

DR. RATNER: But let me give Mike a chance. It's not just the posture piece. I want to make sure—

DR. CHASE: I would add to that that we're also strengthening our space and cyber and electronic warfare capabilities. We're working closely to collaborate more closely with allies and partners in those areas as well. So, there are a lot of things that are not as visible but are also really important in terms of how we are working to develop our capabilities and our concepts and to make sure that we are, again, taking a—you know, we've got this really important asymmetric advantage in terms of our alliances and partnerships. And so building on that to strengthen deterrence is also an important component of what we're doing. And then I would just add that, you know, obviously, Taiwan has a really important role to play here as well. And so the work that we're doing to help support their transition to a more asymmetric set of defense capabilities and to pursue their institutional reforms, you know, to work on training and so on also plays a really important role in the overall picture.

MS. EAGLEN: Thank you for that pivot, which reminded me that I wanted to ask about friends in the legislative branch. You know, we see increasing alignment between the Department and Congress on the urgency and on the consensus about what needs to be done, and what it might cost, and what slashing bureaucracy for everything from FMF to FMS to replenishing stockpiles of munitions, for example, that we're providing to Ukraine. So, if you were kings for a day, what could Congress do that would be most helpful for you next year?

DR. RATNER: Well, maybe just quickly start with what Congress is already doing, to say just thank you to the authorizers who've put in a lot of work to get to where we are today, and hopefully we'll be in the near future as the NDAA marches forward. The department welcomes the additional resources and authorities therein and would really love to see the appropriations to match that authorization. So, we'll be looking for that going forward. And you mentioned, sort of, alignment between the Hill and the department. I think what this also represents is growing alignment between Republicans and Democrats around this issue. And for all the rancor in Washington that we all like to talk about, we see the NDAA, in particular, the Taiwan provisions therein, it's a really, really important bipartisan symbol that parties are still willing to work together. I think Taiwan's obviously watching that carefully. Beijing watches that carefully. The world watches that carefully. So I would say maybe the answer and then turn to Mike again for additional thoughts. I think what I will be looking for from Capitol Hill to continue that bipartisan spirit around this issue. I know there are always going to be differences, but for Republicans and Democrats to be able to come together, particularly with a divided Congress around this issue, will be incredibly important, and Beijing would love to see nothing more than this issue get politicized and start pulling us apart. So, I think maintaining that unity is priority number one for '23.

DR. CHASE: Yeah, no, I mean, absolutely. I mean, there's strong bipartisan support for Taiwan across administrations. You know, we fully expect that that will continue. And, you know, again, I think that sends, you know, a pretty clear message to Beijing. And I think the more that they engage in intimidating and coercive behavior, just the greater the sense of urgency that everyone has about trying to make sure we're doing everything possible to help Taiwan, you know, kind of, with the transition that they need to complete so that they'll strengthen their deterrence and defense capabilities and become increasingly resilient.

MS. EAGLEN: OK, fair. So, I want to just give you an opportunity both to talk about, you mentioned, the global nature of this competition and the work that you're doing. And I agree with you. In the report, you talk about expanding overseas logistics and basing infrastructures for the PLA to project power, which is really, kind of, an American thing, and I don't think we like it when others can do that. So, I was struck because I was at a different panel earlier in the week, and former US Army Commander General Ben Hodges, he was talking about, you know, the logistical challenges for supporting Ukraine and bolstering NATO deterrence in Eastern Europe. And he talked about needing to change ports where we offload troops, and equipment, and all kinds of stuff three different times because Beijing has increasingly—you know, private/state-owned companies—companies that are potentially state-owned keep gobbling up legally and allowed to do it different ports and, you know, whether that's controlling how the containers come off the ships or they're just a stakeholder in the company of ownership. And so we're now on our third port in the region, so we don't give away certain, I don't know, intelligence and capabilities. You know, is this something that we should be worried about everywhere? And then can you talk about the global nature of this and then just, kind of, how do you confront a problem that's everywhere all the time?

DR. RATNER: Mike, on you.

DR. CHASE: Sure. I mean, it's increasingly clear that the PRC has global ambitions for the PLA. I mean, this was something that, you know, earlier in my career in think tank and Naval War College days, we used to have a lot of debates about whether their military ambitions were basically confined to the Indo-Pacific region or if they were global. And I think we've seen that, you know, it's become increasingly clear that they're global. And, you know, it's been developing for a long time. It was maybe 15 years ago or longer I think we saw PRC leadership reach the conclusion that they had global economic and security interests and that they needed to develop global military power to advance those interests. And so we've seen the development of some of the capabilities like their aircraft carriers, their large transport aircraft, the cruisers that they've developed for the PLA Navy that are obviously intended to expand the reach of their military power. And then beginning with the establishment of their first overseas base in Djibouti, you know, we now see the pursuit of a global network of logistics and support facilities and bases to help them build that out and become a global military power. And so they have interest, as we document in the report, and locations in the Indo-Pacific region but also beyond to include Africa and the Middle East. And so we're now in a relatively early stage of their development of that set of global capabilities, but they appear to be very determined to pursue it and putting the resources behind it. And we see them pursuing basing or other forms of overseas facilities in a number of different countries as we outlined in the report.

DR. RATNER: And I would say one of the interesting elements about this issue, obviously the global nature of it means that it's touching countries beyond the Indo-Pacific who are generally at the front end of worrying about PLA military aggression, military coercion. I think one of the couple elements of this problem, particularly as it relates to the military installation piece, the PLA has not been particularly transparent about this not to the world, much less not even to the target countries that they're looking to do this in. We've seen this pattern where even when they're looking to establish military installations, they're producing let's say not completely comprehensive plans to the partners about what their intentions are. And so there's an educational aspect that needs to happen to countries around the world about what they're likely signing up for. I think there's an educational aspect to our allies and partners around the world about some of these issues because there's a way in which this problem is coming home much more quickly for countries around the wars and not just the United States but others, Mackenzie, for the reasons you mentioned that are different from the natural force projection capabilities emanating from the mainland and some of the security challenges in East Asia, which maybe still remain geostrategically distant from some of these countries. But the global installations question matters a lot to them.

MS. EAGLEN: Thank you.

MR. COOPER: I think we'll just do one more question from us before we open it up for the discussion. We'd be remiss if we didn't ask you the nuclear question. As we all pour over the report for changes in numbers of launchers and missiles, one of the key numbers that's changed the most in recent years is the numbers of nuclear warheads and the types of nuclear capabilities as you already mentioned, Mike. I remember two years ago we did the rollout here of the Military Power Report, and the number was in the low 200s for estimated deployable nuclear weapons. Now we're talking about something in the low 400s. So, you know, basically a doubling almost in two years, which is pretty, pretty substantial and rapid and real departure from the approach that Beijing had taken for quite a long time. And it's obviously not just the warhead numbers, you know, as the report talks about, it's the triad, right? And so we're seeing a massive modernization program across all elements. Can you talk a little bit both about, you know, what you're seeing from the Chinese on that side? And also if it is affecting how you think about our responses and our preparation, how do you think about that challenge?

DR. RATNER: Well, Mike's really one of the leading experts in the world on PLA nuclear weapons, so let me turn it over to Mike.

DR. CHASE: Sure.

DR. RATNER: I mean, I have some comments at the end but Mike's the—

DR. CHASE: Yeah, so, I mean, again, I think historically the PRC was comfortable with a very relatively small nuclear force, and we've obviously seen that change over the past couple of years. You know, under Xi Jinping, they have embarked on a pretty rapid not only modernization and diversification but also expansion in terms of the numbers of nuclear warheads that they have and that we project that they're going to deploy over the next, sort of, five to 15 years. Last year's China Military Power Report, we talked about 700 weapons by 2027. And now this year we're projecting 1,500 for 2035. We also see other important changes, movement in the direction of a launch on warning posture and a higher level of readiness at least for some units of the PLA rocket force. And so I think, you know, while the PRC states that their nuclear policy remains unchanged, they're creating a much more diverse set of capabilities that will put other options on the table, and they haven't been transparent about the intent behind the, sort of, change in trajectory that's leading them to these much larger numbers. And so we would certainly welcome greater transparency on that, but they have been very reluctant to engage in discussions about strategic stability or strategic risk reduction issues. And so, you know, that presents some challenges in and of itself. And of course, in terms of what the department is doing, we are also modernizing our own capabilities on the nuclear front as was outlined in the Nuclear Posture Review, and we continue to try to engage with the PLA to keep the channels of communication open to try to make sure that, even as we have an intensifying competition, that it doesn't veer into confrontation or conflict unnecessarily. But there we have some challenges as well. They've been, as I mentioned, already reluctant to, kind of, talk about some of the crisis communications and strategic risk reduction types of issues. And they also have a long track record that they've continued of canceling some of the exchanges that we've planned as a political signaling mechanism as we saw after Speaker Pelosi's visit to Taiwan this summer, and so that layers another set of challenges on top of this.

DR. RATNER: And maybe just building on this last point, which I think is really important because I can speak for the region being out, engaging with partners day-to-day. They understand the growing intensity of the US-China competition, the military competition. They're seeing what's happening. Even our closest partners want us to be at least communicating with the PLA in a way that will prevent miscalculation and other forms of inadvertent conflict. So, the region is looking to Washington and Beijing to manage this competition more responsibly. And I want there just to be no doubt that the Department of Defense, Secretary Austin, Chairman Milley, Admiral Aquilino, and the Pentagon leadership have an outstretched hand to say, "Let's have a conversation here." We've seen some openness to that. Obviously, the president met with Xi Jinping on the margin of the G20. Secretary Austin just saw Minister Wei out in Cambodia on the margins of the ADMM-Plus. But on the whole, the PLA is not yet willing or serious about trying to manage this competition in a way that we would expect a responsible or aspiring major power to do so, and we think that's a huge problem, and we're going to continue to be open to those discussions, but they're not happening yet at the way we want, not to mention what the region wants to see as well.

MS. EAGLEN: It's a little frightening. Great, we're going to open it up for questions both here in the audience as well as online. I'm just going to gently stay in this lane for just a moment because we have lots of questions about their nuclear modernization, so I'll combine two. The first is from our boss, Dr. Kori Schake. She sends her thanks for being here and regrets that she's not here in person. Obviously, it's a striking modernization effort, and your point Secretary Chase about, you know, there's a lack of transparency about why they're doing it, I guess I won't ask you to speculate. We'll leave that for another day. But she's wondering if you're thinking about the risks of China teaming up with other nuclear-armed adversaries to us. And then the question from Tony Capaccio, he wants to know if you assess that China currently now fields a viable nuclear triad.

DR. CHASE: OK. Yeah, so I think on the second question, you know, as we outlined in the report, they've got, sort of, a nascent nuclear triad. The land-based rocket force was historically, sort of, the cornerstone of their nuclear deterrent for a long time was really the entirety of it. They've now added ballistic missile submarines that conduct deterrence patrols, and the PLA Air Force as of a couple of years ago, you know, publicly confirmed that they were back in the nuclear deterrence and strike business as well. So, we characterized that as, sort of, a nascent nuclear triad that they continue to develop. On the first question, yes, certainly the modernization and the expansion that the PLA is undertaking inevitably create new challenges that we have to address. And, again, that's something that our colleagues in the department, who are focused on the functional side on nuclear issues, have talked about it at some length.

MS. EAGLEN: Thank you. OK, I'm looking out here to all of you to see if there are any questions. OK, we'll start over here.

Q: Good morning, J. P. Hogan. I'm remembering when Obama became president, there were stories that I think China was asking them to be less socialist because it was interfering with their moves towards some capitalism. I'm wondering, under Biden's posture, is labeling China of imperialism, of expansionism, of communism, that it should be a threat, imminent or existential, to Americans' religious liberty, or is he seeing it as building a capacity maybe to be a global police force?

DR. RATNER: Sorry, I don't totally understand the question.

MR. COOPER: Can I reframe it just a little bit? I mean, so there's a lot of discussion in the national security strategy, right, about the competition between democracy and autocracy, right? And I think, you know, this sort of goes to the basic theme, which is, you know, how do we frame the competition, right? We were just talking about the challenges of trying to manage a competition, right, and do so responsibly, but it is a competition. And as the president has said, you know, we're in it to win it. So, I guess one way of reframing that would be, how do you think about framing this competition in the right way, you know, in ways that both help us build the coalition of countries that are like-minded but do so in a responsible way?

DR. RATNER: So, maybe one answer to this question, and if you want to build on it, we can do that. I mean, as Zack said, the president has talked about the competition between democracy and authoritarianism and the importance of demonstrating the effectiveness of our system at home and the effectiveness of our coalition of democracies abroad. So, that is an element of the Biden administration's foreign policy. I think as it relates to the Indo-Pacific and the China challenge, what we are trying to do is what has been articulated as a free and open Indo-Pacific phrase that was generated in Tokyo, adopted by the Trump administration, and there's been continuity in that regard in the Biden administration as well. And that articulates not a question of the domestic governance system but rather the rules, norms, and institutions that we want to see prevailing in the IndoPacific in which all countries are welcome to be part of. It is not divisive. And I think one of the interesting things for those who enjoy reading government speeches, I would strongly, to answer that question, urge you to go back and take a look at the speech that Secretary Austin gave at last year's or this year's, sorry, Shangri-La Dialogue where what he talked about was this vision of a free and open Indo-Pacific, but it not being America's vision, that it's a shared vision for the region. And if you look at the way the ASEANs talk about the region they want, the Japanese, the Indians, the Australians, even the Europeans, when they articulate the kind of order that they're interested in seeing in the Indo-Pacific, it is about one that is open economically, which the sea lanes are open, which disputes are resolved peacefully in which actors are working in accordance with international law. And the concern that we have is that what we are seeing not only by what the PRC is saying but what it is doing is it is not aspiring toward that vision. It is not aspiring toward a vision where countries are able to operate freely in accordance with international law. And we see that on a regular basis because it is using its military engaging in reckless dangerous intercepts of US and allied aircraft who are operating in international airspace at times, enforcing UN Security Council resolutions, vis-à-vis North Korea. So, that to me tells you everything you need to know about the kind of region that the PRC is envisioning. And then we see other forms of military coercion. So, I think, when we voice our concerns about some of this behavior, it's not in a tactical sense but rather it's about this question of this type of region that the world is aspiring toward in one in which we think the region shares and, again, talking about it not as an American vision but as a shared vision. And I think fundamentally that's what this competition is about.

MS. EAGLEN: That's a fired-up Secretary Ratner. I love it. David Martin from CBS, you're next. Wait for the mic, David.

Q: You've twice mentioned the aggressive intercepts. Be more specific. I mean, how many have there been and if the 2001 incident in which EP-3 was forced down as, sort of, your baseline? How dangerous are these? And is it only a matter of time before another plane gets forced down?

DR. RATNER: Well, we hope it's not only a matter of time, but this is really dangerous behavior that I would liken to driving with road rage in a school zone, all right? That's what we're talking about here. We have PLA aircraft coming within tens of feet of US and allied aircraft. We have them releasing flares and chaff. We have them doing dangerous maneuvers around aircraft. And to exactly this point, it is attempting a crisis that could have geopolitical and geo-economic implications. And frankly, again, it could not be more important to underscore that these are operations that are being conducted in accordance with international law, in international airspace that are being done in a very responsible manner. And the response that we are getting from the PLA is that they don't accept that activity. And I think that's a real concern. It is something that the secretary has been conveying privately his concerns to the PLA leadership but also when he was in Cambodia just a few weeks ago and had a chance to address all of the ASEAN defense ministers and defense ministers plus, so the plus countries as well. This was an issue he raised. I think it is a real issue. It's real dangerous. And if it continues, then it does raise the risk of this kind of accident or incident, and that's something that we all have an interest in preventing. So, it is fundamentally important that the PLA curb this behavior, and it's something that we have seen only increasing over time. And it's one that we're going to keep talking about.

DR. CHASE: Yeah. Sorry, go ahead. Sorry.

Q: Was there any tipping point in which suddenly they started doing this by a more frequent bases? And if so, was there any event you think that triggered it?

DR. RATNER: It is a pattern of behavior that has been growing in particular over the last year and a half or so. So, it's a relatively new phenomenon. We've seen it in the air domain. Again, I think the other important response is not only that this is dangerous, but what I said earlier, and this is not just a talking point. It is true that the United States is going to continue to fly and sail and operate peacefully and responsibly wherever international law allows. And we have continued to do this despite that kind of behavior. So, if Beijing's intent here is, "Hey, we're going to somehow intimidate the United States out of operating according to international law," that hasn't worked. It's not going to work, but this is, again, very reckless behavior.

DR. CHASE: Yeah, I was just going to add that it also underscores, you know, how disappointing it is that the PLA has canceled some of the dialogues and mechanisms that are meant to allow us to ensure that we have, kind of, shared expectations about safe and professional encounters between our air and maritime forces when they're operating in proximity. So, among the several exchanges that the PLA canceled earlier this summer, they canceled the MMCA, which is kind of our operator-to-operator level dialogue about air and maritime safety in which both sides have the opportunity to raise cases of behavior that they consider unsafe, unprofessional, or otherwise problematic. And so that's a venue where we would normally be able to raise these incidents in great, you know, detail and also where the PLA, if they feel as though we've done something that doesn't live up to the standards of operating safely and professionally, would have their own opportunity to raise their objections as well. But they canceled it, right? So, these are the kinds of things that, you know, when Secretary Austin spoke with General Wei at ADMMPlus, you know, he highlighted the importance of getting these dialogues back on track. So, we obviously want to see a change in behavior there where they don't engage in unsafe and unprofessional behavior that risks a collision like what happened in 2001, either with us or with one of our allies or partners. But we also want to ensure that the PLA will kind of do again what the region and the world expect, which is to try to manage this competition responsibly. And that, you know, requires engaging in direct dialogue on these issues, not, you know, canceling it when they're displeased about something else.

DR. RATNER: Yeah, and I think it'll be important. You know, in the months ahead, we've seen, in the wake of the party Congress, clearly, Xi Jinping reentering the international stage after a long COVID period of not traveling at least in Saudi Arabia or at least just was. He's been doing a number of international engagements, saying a lot of pleasantries about China's approach to the region, to the world. I think the problem is we continue to see a say-do gap between talking about stability and whatnot and then the military behavior. And we think it's important that we focus on not only what the PRC is saying but also what it's doing.

MS. EAGLEN: Thank you. All right, before we go, we have so many in the room. Let me just ask one last one from online and then the rest of you guys get [inaudible] AEI Today. You referenced it earlier the great work by Congress, particularly in the Defense Authorization bill which was made public yesterday. You know, they have a historic security assistance package for Taiwan in that bill, $2 billion a year over five years for Foreign Military Financing, $1 billion a year in drawdown authority, and of course, as we all know, the authorizers sort of set the stage and then we need the appropriators to follow through. So, are you working with and talking to them behind the scenes on making sure these things become a reality?

DR. RATNER: I think we're doing everything we can to ensure that those authorizations, if they come to pass, will be met by appropriations and look to our good friends and influential think tanks to reinforce those voices. But absolutely we're engaged with Congress on these issues.

MS. EAGLEN: OK, great. Thank you. So, we'll go here in the room. Right here and then we'll come over here.

Q: Thank you. Just following up on the NDAA, there's going to be $10 billion for Taiwan in grant in the next five years and bearing in mind the challenge from China the panel just mentioned and also its goal for 2027, 2035, and even 2049, and also what's going on in Ukraine. I'm just wondering what kind of priorities the DOD plans to set for this grant to Taiwan. And secondly, if I may, if the next house speaker plans to visit Taiwan, would you advise against it given the response that we saw coming out of China? Thank you.

DR. RATNER: Let me maybe just take the second question first to say we recognize that these are decisions for members of Congress and for the Taiwan. So, I would look to them to answer the question of whether or not that something like that would be worthwhile. I think what I'll say for our part is, as a department, when we think through what are the kind of activities or engagements that we think are important for us to do, that we put a premium on things that are going to be from a defense department perspective, reinforcing deterrence and reinforcing Taiwan's resilience. So, that's the lens through which we look through our own activities, but we have made crystal clear, including to Beijing over and over, that we see Congress as a coequal branch of government, and we'll continue to have that position.

MS. EAGLEN: Good. OK, we'll try and go rapidly. Start here and then we'll get to in the back before we conclude, and let them get back to the building on time.

Q: Yeah, thanks very much. It's Karl Polzer. I just wanted to get your thoughts and maybe another reason to have dialogue with China as the nuclear deterrence game in game theory goes from a two-country game to a three and maybe more. We've had mutual assured destruction. If you blow us up, we'll blow you up. Pretty simple unless there's misunderstanding or irrational behavior. But now you have a third country. So, if country A attacks country B and country B retaliates, there's country C in a good position to take over, do more in Africa. So, that's pretty complicated, especially given these algorithms have to happen in an hour. So, you know, once an event happens, they have to be pre-coded. But anyhow, I'll stop there but that's my question.

MS. EAGLEN: How do you think about the chessboard of problems?

DR. CHASE: I think it underscores the importance of being able to have open channels of communication with the PLA, which again, you know, from our level all the way up to Secretary Austin and Chairman Milley, we've made very clear to the PLA something that we would prioritize. But it also requires them to be willing to engage in those discussions, whether it's on crisis communications or strategic risk reduction. And so far we haven't seen willingness on their part to, you know, engage in those discussions in the way that we would like. And, you know, it would be most important to help address some of the issues that you raised of avoiding any kind of, you know, miscalculation or, sort of, a misjudgment. And so we'll continue to try to work on that.

Q: Thanks so much. [inaudible] from Marubeni Corporation. So, I have two very quick questions. The first one is, do you have any concern or thought on the new Chinese member of the Central Military Commission as their new vice-chairman who was the commander of the Eastern Theater and a new member who has been sanctioned by the US government? And my second question is, as you may know, the Japanese government is discussing about the new counterstrike capability. So, what kind of the communication or coordination we should have between the US and the Japanese government to operate this new capability? Thank you.

DR. CHASE: Yeah. I'll take the question about the CMC. So, we do include in the report information about PLA leadership, and of course coming out of the party Congress, we watch very closely both what they articulated in terms of their vision for their defense modernization. Xi Jinping talked about strengthening what he referred to as their strategic deterrence system, which gets to some of the nuclear and space issues that I mentioned earlier. And then of course, also we saw a new CMC membership. And I think that, you know, you can look at the membership of the CMC and see that they continue to emphasize the advanced high tech weapons capabilities, developing the PLA's operational proficiency. You can see also that they continue to attach a lot of importance to political work and to anticorruption or discipline inspection as they refer to it in their system. So, certainly you can learn quite a bit from the composition of their military leadership. They do have a new CMC member who is under US sanctions and we'll manage that in accordance with our own legal and policy frameworks.

DR. RATNER: And just on the Japan question, I would say we are obviously engaged in ongoing and regular and deep conversations with partners in Tokyo about the future of the alliance about Japan's roles and missions therein and the associated capabilities with those roles and missions. We're obviously watching very carefully as Japan is updating and revising its own budget and strategic documents. I think we're very encouraged by what we're seeing so far and looking forward to seeing the results of what will ultimately be a sovereign decision for Japan, but one that I think will have great benefit to the alliance overall.

MS. EAGLEN: Thank you. We have time for one more.

Q: Well, thank you all for this panel. My name is Antonin Scalia. I work at Palantir Technologies. I'm curious how you all are thinking about this idea of cognitive domain operations both how does the PLA understand this, what do they mean by this, and then how is the US government thinking about what our response should be to cognitive domain operations?

DR. CHASE: So, it's one of the operational concepts that we have highlighted in various editions of the China Military Power Report, the kind of overall approach that they're taking and they refer to as multi-domain precision warfare, which we talk about in there some as well. But the cognitive domain warfare part of it is something we've seen them emphasize in their professional military literature in recent years. It has elements of psychological warfare, of cyber operations. There's a variety of different kind of components of political warfare. I think it illustrates how central the competition in the information domain is in the kind of broader military context. And so that's something that we'll continue to address along with our allies and partners who I think largely share our assessment and our concerns on that front.

MS. EAGLEN: Dr. Ratner, I want to give you the opportunity to close out with any final thoughts, anything we didn't touch on Ukraine, North Korea, or just anything you want to foot stomp on your way out the door.

DR. RATNER: Well, I'm tempted to ask you, Mackenzie, a whole bunch of questions, including what should Congress be doing to support our efforts in the Indo-Pacific? I know you've got a lot of great answers to that and are doing terrific work on this. So, I look forward to all you're doing here at AEI. I guess I would just say that the administration is making a commitment to the Indo-Pacific. This is something that is in our strategy documents, but I think what we've seen over the last several months and since the beginning of the administration is a real commitment to that, we obviously had the President out in the region and the vice president and secretary of state spending a lot of time there. We're getting the secretary of defense out there quite a bit. And I think we're trying to, as we're doing that, providing the sort of manifestation of what people have talked about, the rebalance, the priority theater, and what does that look like in terms of capabilities, posture, concepts, and otherwise, if there's sort of one thing out of the National Defense Strategy, that I think is really important is the identification of the PRC as the pacing challenge, as the priority, recognizing the acute threat from Russia and obviously the Ukraine issue is on the front of everybody's car these days. But while that is all happening, I think the department is making good through strategy and importantly through budget and all the work being done in the department, that the PRC really is the pacing challenge and the focus. And that's for all the reasons that we talked about here today and are in the report.

MS. EAGLEN: Well, I want to thank you on behalf of Zack, and Kori and myself and your team for all the hard work that you did, not just to write the report but to make progress on these terrific announcements coming next year. I'm going to be listening, watching, and talking with you about them. Please join me in thanking our friends from the Pentagon.