On Communist China’s Military Budget

November 2, 2021 Updated: November 2, 2021


China seems to spend less on military spending, compared to the United States. But Beijing manipulates the numbers to make China appear more peaceful, and its behavior suggests that Washington should still be concerned.

The Heritage Foundation held an online forum last week discussing the budget of the Chinese regime. This is important because military budgets are crucial pieces of information for domestic audiences—such as how much they are spending on the military, compared to “investment” in social programs and economic development. It is even more important for foreign audiences, as the defense budget is a benchmark that is used by other countries to assess their own spending and readiness. But communist China uses several methods to cook the books, which can skew proper analysis.

It’s incredibly popular in some analytical circles to dismiss possible Chinese threats based on finances alone. These circles are usually from the virulent anti-war and anti-military crowd, who argue that the Chinese regime is just the victim of numerous assaults and destabilizing American behavior. They point to events like the American involvement in the Korean War, but also include the supposedly too high American military spending and freedom of navigation patrols in the South China Sea.

According to data released by the Stockholm International Peace Research Institute (SIPRI), U.S. military spending is larger than the following 11 countries combined: China, India, Russia, the United Kingdom, Saudi Arabia, Germany, France, Japan, South Korea, Italy, and Australia.

The United States spent $778 billion in national defense in 2020, SIPRI reported. But this does not mean the threats are any less real, or that America is causing them. In fact, because the Chinese regime deliberately manipulates the reported spending numbers and continues its aggression in the South China Sea, the data from SIPRI distorts the true nature of the threats that America faces.

In March, Beijing announced a 6.8 percent growth in its defense budget and will spend 1.35 trillion yuan (about $208 billion) on its military for 2022. The growth in China’s military spending has been larger than the country’s economic growth, and focuses on newer and advanced technologies like shipping killing cruise missiles, advanced frigates, and home built aircraft carriers. But this is just the announced growth. The Rand Corporation suggests that the numbers are typically much higher than Beijing reports.

Sinologist June Teufel Dryer estimates that communist Chinese spending is much higher, based on several factors. She points to complaints of provincial leaders feeding and housing soldiers to argue that the regime doesn’t report many of their personnel costs such as housing and food. Dryer argues that the cost of China’s nuclear weapons program, which is rather large, and the cost of its weapons acquisition programs are not included, either. Finally, she points out that the cost of living and wages on the mainland are so much lower than the United States. Thus, looking at the regime’s relatively low expenditures belies the large number of soldiers it has. The low range of China’s reconfigured budget is 30 to 40 percent higher than reported. The high range would estimate its budget to be as much as 10 times higher on the upper range of estimates. The median for most analysts suggests a military budget three to four times Beijing’s disclosed amount.

Critics of American military involvement point to data that show that the U.S. military industrial complex and massive outspending of opponents make it very hard to justify reversing sequestration, or even the need for a military that strong. But even taking Beijing’s $208 billion defense budget, and then multiplying that number by the consensus of 40 percent, still suggests a dangerous threat. And considering the low cost of living, that money can sustain a much larger military than the United States.

Clearly then, just using military spending as a measuring tool, communist spending is not as innocent as many suggest. While this is useful to provide analysis, the danger from potential aggression isn’t simply a math problem. If spending money was the only factor that mattered, our military would be filled with accountants and led by mathematicians. How that military is used, and how well the money is spent, matters just as much as the amount of money spent.

That behavior, combined with its disguised spending, suggests an even bigger threat from the Chinese regime. The regime has illegally built-up islands and placed advanced weapon systems and infrastructure to support ships and aircraft. It currently pursues a strategy that seeks to overwhelm American defenses with lower cost swarms of missiles. So the greater purchasing power of its budget, as the Heritage Foundation suggests, becomes even more concerning. Finally, the Chinese regime has fought preemptive offensive wars with every one of their neighbors in the last 60 years. Thus, its budget, strategy, and current behavior all suggest a growing threat that underlies simple infographics about spending.

In short, in both military spending and behavior, the Chinese regime is rather aggressive. It deliberately manipulates the perception of its military spending in order to appear more peaceful than it is, and undermines the correct perception of its aggression. The United States does spend a good deal on its military, but in some ways it only appears that way due to Beijing’s manipulation of its data. Regardless of the perception, America needs a strong military with adequate funding to properly prevent aggression and help promote peace. Assessing and responding to threats is far more important than complaining about spending.

Views expressed in this article are the opinions of the author and do not necessarily reflect the views of The Epoch Times.

Morgan Deane
Morgan Deane is a former U.S. Marine, a military historian, and a freelance author. He studied military history at Kings College London and Norwich University. Morgan works as a professor of military history at the American Public University. He is a prolific author whose writings include "Decisive Battles in Chinese History," "Dragon’s Claws with Feet of Clay: A Primer on Modern Chinese Strategy," and the forthcoming, "Beyond Sunzi: Classical Chinese Debates on War and Government." His military analysis has been published in Real Clear Defense and Strategy Bridge, among other publications.