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Originally Posted by ShadoWarrior

Taiwan is worth trillions of dollars. Add up the liquidation values (not the much higher market values) of all the industrial and commercial companies on the island, plus the value of the land itself, plus the value of the (destined to be slave) labor force. It's a lot. Compared to that the US debt that China holds is essentially trivial.

I’m going to suggest, dear compatriots, that a degree of nuance is called for in our blanket statements. I’m as guilty as the next man as snapping off sound bites—especially when Legbreaker and I are in a disagreement. Nonetheless, I think it’s worthwhile to have a more in-depth look at some of the ideas put forth here.

Regarding US debt owned by China, I’m not sure we can use the term “trivial” meaningfully when China holds in excess of $500 billion in US debt. Granted, it’s somewhat less than 5% of the GDP. Five percent is a big number in fiscal terms. Watch what happens when the Dow Jones drops 5%. When unemployment jumps by 5%, well… In any event, “trivial” is a trivializing term to describe a sum of money greater than the GNP of most members of the UN, greater than the GSP of most US states, and greater than the cost of the war in Iraq. The largest public works project in the history of the US (the Big Dig) experienced cost overruns somewhat in excess of 300% and will cost more than $20 billion by the time it has been paid off. For the price of China’s ownership of US debt, another twenty-four major US cities could have comparable projects completed. Thus while we may claim that a half-trillion may be an acceptable loss in a given context, I don’t believe the term “trivial” applies.

On the matter of context, however, we aren’t speaking of the value of a half-trillion to the US. We’re speaking of China. It’s hard to gauge what $500 billion is worth to China, given that the GNP is between $3 and $4.5 depending on whose analysis one believes. However, if we go with the figure that minimizes the impact of losing a half-trillion in US debt, then the money the PRC stands to lose through US default is equal to one-ninth of the economy, or slightly more than 10%. That’s a big hit. The Politburo is hard to read, since they aren’t elected officials. They may deem a 10% body blow right off the bat a good trade for the value of Taiwan. They also might worry about the effects of such massive losses to Chinese banks on the economy in the short term and, more importantly, about the loss of confidence domestically and potential unrest. China already has plenty of problems. Still, it’s hard to look into the minds of the senior leadership of the PRC without a lot more detailed information.

We might say that Taiwan is worth the prize because Taiwan is worth ever so much more than $500 billion in US debt. The equation quickly becomes very complex, though. One doesn’t simply liquidate Taiwan and convert the place into cash. Taiwan has value because it produces things and because people will pay for Taiwanese goods, services, and real estate. One very likely outcome of a PRC takeover of China is a real or virtual blockade of China’s foreign trade followed by freezing or seizure of China’s foreign assets. Having captured Taiwan, Beijing may discover that the principal customers of Taiwanese goods aren’t buying anymore. Worse, the principal customers of goods from the mainland aren’t buying anymore. The flow of investment currency from the West dries up. Chinese assets held overseas no longer can be converted into cash. The bad news just goes on and on. Billions of dollars of lost business daily adds up quickly.

Here’s where the submarines of the US Navy come in. Following the fall of Taiwan, the United States declares a total naval blockade of the PRC. Of course, the PLAN will do its best to break the blockade. US subs need not venture into Chinese coastal waters to sink every vessel worth sinking moving in and out of Chinese ports. Once the blockade takes on blue water aspects, the USN will be on its own turf, so to speak. China won’t be destroyed by a blockade, but she’ll experience great pain. To say that this pain would place enormous stress on the state security apparatus that keeps the decision-makers safe and sound would be a grotesque understatement.

From an economic standpoint, the short-term costs of an invasion of Taiwan are simply stupendous. It’s possible that the Politburo, being unelected, might decide to go ahead and do the thing anyway for other reasons. However, Beijing has made decisions over the past thirty years that demonstrate a priority for China’s economic growth and security. Win or lose an invasion of Taiwan, China would be trading that growth and security for the prospect of absorbing an island representing a small fraction of China’s population and productive capacity. While it’s possible that a wave of mindless nationalism could sweep over the Chinese senior leadership, it would not be in keeping with the patterns of behavior we’ve seen over the past three decades.

Originally Posted by 95th Rifleman

A note on casualties.

War weariness is the killer factor in any conflict involving a democratic nation. If the conflict goes hot, China can sustain more casualties than America ever could. Vietnam proved that the key to defeating America is to kill enough soldiers, quickly enough to force the American people to make the US government back down.

Vietnam proved that there is a formula for public support that includes factors like the number of casualties. Other factors include the length of the conflict, the public’s support for the goals of the conflict, the public’s perception of casualties, and so on. The US military has made great efforts to control the role of the media in this equation, with the backing of successive administrations. Is a soldier really dead if no one but his family and friends know about it? From the standpoint of national leadership, the answer (sadly) is no.

Then there’s the draft. In Vietnam, the threat of draft was pervasive; whether you were a potential draftee or a family member of a potential draftee, the draft affected just about everybody in one way or another. Not so with the modern system. The W. Bush administration learned its lesson well. Whereas the Vietnam era administrations believed calling up the National Guard and Reserves would inspire popular resentment, the 2001-2009 administration correctly surmised that the public reaction to having reservists called up would be far less pronounced than it was for the Vietnam-era draft. After all, only volunteers are going.

The public mood regarding Afghanistan reflects the idea that the Taliban was involved in 9-11. People who wanted us out of Iraq support ongoing operations in Afghanistan. The W. Bush administration shrewdly tried to connect Iraq to the threat of terror attacks to inspire the same level of support. The point here is that the public perception of why we’re there has to be factored into the equation.

Of course, sheer numbers are important. This is one reason the management of the wars has been so wretchedly ineffective. Winning means fighting, but fighting effectively means using the infantry effectively, which in turn means accepting a higher casualty rate than not using the infantry effectively. We’ve traded victory in the median term for keeping casualties low over an extended period.

Of course, comparing Vietnam, Iraq, and Afghanistan to an invasion of Taiwan is comparing very unlike things. A high intensity conflict on Taiwan will reach is denouement before US public opinion becomes meaningful, unless nuclear weapons are used. China might be able to accept more casualties than the US, but she’s going to take more casualties. The question is where the breaking point for each nation is and who gets there first. Let’s not forget that the PLA is now made up of men born under the one-child policy. An invasion of Taiwan along the lines described will be fought on the ground by the PLA and the Taiwanese Army. Chinese soldiers, Communist and otherwise, will do the overwhelming majority of the fighting and dying. In the air and at sea, the US has a bigger role to play. However, the loss of life in air and naval operations is significantly lower than during major ground operations.

Originally Posted by RN7

Well I would assume the Chinese would fail in any attempt to take Taiwan because they don't have the logistical capability to succesfully invade Taiwan, and their airforce and navy is not up to taking on the Americans.

I honestly don’t know how true this is at this point in history. However, it seems to me that the PLAAF would be operating from its own bases against US forces off the coast. Under these conditions, numbers surely count for something. As for logistics, a nation with the resources of China surely could find a way to transport materiel to Taiwan once the sea lanes were made safe—if the sea lanes could be made safe enough.


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