Since the mid-1990s, much has been written about the potentially disruptive impact of China if it emerges as a peer competitor challenging the United States. Not enough attention has been paid, however, to a more immediate danger—that the United States and a weaker China will find themselves locked in a crisis that could escalate to open military conflict. The long-term prospect for a new great power rivalry ultimately rests on uncertain forecasts about big shifts in national capabilities and debatable claims about the motivations of the two countries. By contrast, the danger of crisis instability involving these two nuclear-armed states is a tangible near-term concern. An analysis that examines the current state of U.S.-China relations and compares it with key aspects of U.S.-Soviet relations during the Cold War indicates that a serious Sino-American crisis may be more likely and more dangerous than expected. The capabilities each side possesses, and specific features of the most likely scenarios for U.S.-China crises, suggest reasons to worry that escalation pressures will exist and that they will be highest early in a crisis, compressing the time frame for diplomacy to avert military conflict.

Despite their disagreements, proponents of deep engagement and offshore balancing share an optimistic but unrealistic assessment of U.S. military power. In particular, both sides in the debate over U.S. grand strategy underestimate the potential consequences of China's military modernization. China's antiaccess/area denial strategy and conventional precision-strike capabilities are already undermining the United States’ ability to prevent local conflicts, protect longtime allies, and preserve freedom of the commons in East Asia. Whether the United States intends to uphold the status quo when threats emerge or adopt a wait-and-see approach to regional conflicts, it will need to adapt its military for power projection operations in much less permissive environments than it has become accustomed to during the unipolar era. These adaptations include developing air and undersea platforms that can survive inside denial zones, forward bases that are better able to withstand attacks, and satellite and cyberspace networks that are less vulnerable to disruption.

Since oil began fueling the global economy, governments have employed policies of “energy mercantilism” to secure access to this key input. Critics of these policies claim they are unnecessary because oil can be acquired on global markets. Countries such as China that engage in energy mercantilism are thus neither enhancing their energy security nor threatening others' access to oil. These critics, however, misunderstand the logic of energy mercantilism, which is rooted in the economics and business literatures on supply chain management. Firms and states are correct to worry about access to critical supplies under four conditions: imperfect contracting, supplier collusion, geographic concentration, and high risk of conflict. All of these conditions plague the oil industry. Likewise, the energy mercantilist policies that critics deride are analogous to the strategies that firms adopt to protect their supply chains. China's steps to ensure access to oil have enhanced its energy security and reduced U.S. coercive options toward Beijing. More broadly, the unfolding competition over energy access highlights the lingering power of mercantilism, even in this age of economic globalization and the apparent triumph of market liberalism.

In the post–Cold War period, scholars have considered the Asia Pacific to be ripe for military competition and conflict. Developments over the past decade have deepened these expectations. Across the region, rising military spending and efforts of various states to bolster their military capabilities appear to have created an increasingly volatile climate, along with potentially vicious cycles of mutual arming and rearming. In this context, claims that China's rapid economic growth and surging military spending are fomenting destabilizing arms races and security dilemmas are widespread. Such claims make for catchy headlines, yet they are rarely subject to rigorous empirical tests. Whether patterns of military competition in the Asia Pacific are in fact attributable to a security dilemma–based logic has important implications for international relations theory and foreign policy. The answer has direct consequences for how leaders can maximize the likelihood that peace and stability will prevail in this economically and strategically vital region. A systematic empirical test derived from influential theoretical scholarship on the security dilemma concept assesses the drivers of bilateral and multilateral frictions and military competition under way in the Asia Pacific. Security dilemma–driven competition appears to be an important contributor, yet the outcome is not structurally determined. Although this military competition could grow significantly in the near future, there are a number of available measures that could help to ameliorate or manage some of its worst aspects.

Recent developments in Chinese politics and defense policy indicate that China will soon embark on an ambitious maritime policy that will include construction of a power-projection navy centered on an aircraft carrier. But just as nationalism and the pursuit of status encouraged past land powers to seek great power maritime capabilities, widespread nationalism, growing social instability, and the leadership's concern for its political legitimacy drive China's naval ambition. China's maritime power, however, will be limited by the constraints experienced by all land powers: enduring challenges to Chinese territorial security and a corresponding commitment to a large ground force capability will constrain China's naval capabilities and its potential challenge to U.S. maritime security. Nonetheless, China's naval nationalism will challenge U.S.-China cooperation. It will likely elicit increased U.S. naval spending and deployments, as well as politicization of China policy in the United States, challenging the United States to develop policy to manage U.S.-China naval competition to allow for continued political cooperation.

How strenuously, and at what risk, should the United States resist China's efforts to dominate the South China Sea? An identification of three options along a continuum—from increased resistance to China's assertive policies on one end to a partial South China Sea retrenchment on the other, with current U.S. policy in the middle—captures the choices facing the United States. An analysis of China's claims and behavior in the South China Sea and of the threat that China poses to U.S. interests concludes that the United States' best option is to maintain its current level of resistance to China's efforts to dominate the South China Sea. China has been cautious in pursuing its goals, which makes the risks of current policy acceptable. Because U.S. security interests are quite limited, a significantly firmer policy, which would generate an increased risk of a high-intensity war with China, is unwarranted. If future China's actions indicate its determination has significantly increased, the United State should, reluctantly, end its military resistance to Chinese pursuit of peacetime control of the South China Sea and adopt a policy of partial South China Sea retrenchment.

Why has the People's Republic of China (PRC) courted international opprobrium, alarmed its neighbors, and risked military conflict in pursuit of its claims over vast areas of the South China Sea? Answering this question depends on recognizing long-term patterns of continuity and change in the PRC's policy. A new typology of “assertive” state behaviors in maritime and territorial disputes, and original time-series events data covering the period from 1970 to 2015, shows that the key policy change—China's rapid administrative buildup and introduction of regular coercive behaviors—occurred in 2007, between two and five years earlier than most analysis has supposed. This finding disconfirms three common explanations for Beijing's assertive turn in maritime Asia: the Global Financial Crisis, domestic legitimacy issues, and the ascendancy of Xi Jinping. Focused qualitative case studies of four breakpoints identified in the data indicate that PRC policy shifts in 1973, 1987, and 1992 were largely opportunistic responses to favorable geopolitical circumstances. In contrast, the policy change observed from 2007 was a lagged effect of decisions taken in the 1990s to build specific capabilities designed to realize strategic objectives that emerged in the 1970s.

The military implications of Chinese control of Taiwan are understudied. Chinese control of Taiwan would likely improve the military balance in China's favor because of reunification's positive impact on Chinese submarine warfare and ocean surveillance capabilities. Basing Chinese submarine warfare assets on Taiwan would increase the vulnerability of U.S. surface forces to attack during a crisis, reduce the attrition rate of Chinese submarines during a war, and likely increase the number of submarine attack opportunities against U.S. surface combatants. Furthermore, placing hydrophone arrays off Taiwan's coasts for ocean surveillance would forge a critical missing link in China's kill chain for long-range attacks. This outcome could push the United States toward anti-satellite warfare that it might otherwise avoid, or it could force the U.S. Navy into narrower parts of the Philippine Sea. Finally, over the long term, if China were to develop a large fleet of truly quiet nuclear attack submarines and ballistic missile submarines, basing them on Taiwan would provide it with additional advantages. Specifically, such basing would enable China to both threaten Northeast Asian sea lanes of communication and strengthen its sea-based nuclear deterrent in ways that it is otherwise unlikely to be able to do. These findings have important implications for U.S. operational planning, policy, and grand strategy.

Many analysts argue that China will soon dominate East Asia militarily. In reality, China is far from achieving this goal and will remain so for the foreseeable future. China's maritime neighbors have developed antiaccess/area-denial (A2/AD) capabilities that can deny China sea and air control throughout most of its near seas, and China cannot afford the power-projection capabilities it would need to overcome these A2/AD forces. This regional balance of power enables the United States to preserve the territorial status quo in East Asia at moderate cost and risk to U.S. military forces.

Many analysts worry that improvements in Chinese missile, sensor, guidance, and other technologies will enable China to deny the U.S. military access to parts of the Western Pacific that the United States has long controlled. Although these “antiaccess, area denial” (A2/AD) capabilities are real, they are a geographically limited long-term threat. As both the United States and China deploy A2/AD capabilities, a new era will emerge in which the U.S. military no longer enjoys today's command of the global commons, but is still able to deny China military hegemony in the Western Pacific. In this new era, the United States will possess a sphere of influence around allied landmasses; China will maintain a sphere of influence over its own mainland; and a contested battlespace will cover much of the South and East China Seas wherein neither power enjoys wartime freedom of surface or air movement. This in turn suggests that the Chinese A2/AD threat to U.S. allies is real but more limited than often supposed. With astute U.S. choices, most U.S. allies in this new system will be imperfectly, but substantially, secure.

Unipolarity is arguably the most popular concept used to analyze the U.S. global position that emerged in 1991, but the concept is totally inadequate for assessing how that position has changed in the years since. A new framework that avoids unipolarity's conceptual pitfalls and provides a systematic approach to measuring how the distribution of capabilities is changing in twenty-first-century global politics demonstrates that the United States will long remain the only state with the capability to be a superpower. In addition, China is in a class by itself, one that the unipolarity concept cannot explain. To assess the speed with which China's rise might transform this into something other than a one-superpower system, analogies from past power transitions are misleading. Unlike past rising powers, China is at a much lower technological level than the leading state, and the gap separating Chinese and U.S. military capabilities is much larger than it was in the past. In addition, the very nature of power has changed: the greatly enhanced difficulty of converting economic capacity into military capacity makes the transition from a great power to a superpower much harder now than it was in the past. Still, China's rise is real and change is afoot.

Whether China will abandon its long-standing nuclear strategy of assured retaliation for a first-use posture will be a critical factor in future U.S.-China strategic stability. In the past decade, advances in U.S. strategic capabilities, especially missile defenses and enhanced long-range conventional strike capacity, could undermine China's nuclear retaliatory capability, which is based on a relatively small force and second-strike posture. An exhaustive review of Chinese writings on military affairs indicates, however, that China is unlikely to abandon its current nuclear strategy of assured retaliation. Instead, China will modestly expand its arsenal, increase the sophistication of its forces, and allow limited ambiguity regarding its pledge not to use nuclear weapons first. This limited ambiguity allows China to use the threat of nuclear retaliation to deter a conventional attack on its nuclear arsenal, without significantly increasing the size of its nuclear forces and triggering a costly arms race. Nevertheless, China's effort to maintain its strategy of assured retaliation while avoiding an arms race could backfire. Those efforts increase the risk that nuclear weapons could be used in a crisis between the United States and China, even though China views this possibility as much less likely than the United States does.

Nonnuclear weapons are increasingly able to threaten dual-use command, control, communication, and intelligence assets that are spaced based or distant from probable theaters of conflict. This form of “entanglement” between nuclear and nonnuclear capabilities creates the potential for Chinese or Russian nonnuclear strikes against the United States or U.S. strikes against either China or Russia to spark inadvertent nuclear escalation. Escalation pressures could be generated through crisis instability or through one of two newly identified mechanisms: “misinterpreted warning” or the “damage-limitation window.” The vulnerability of dual-use U.S. early-warning assets provides a concrete demonstration of the risks. These risks would be serious for two reasons. First, in a conventional conflict against the United States, China or Russia would have strong incentives to launch kinetic strikes on U.S. early-warning assets. Second, even limited strikes could undermine the United States' ability to monitor nuclear attacks by the adversary. Moreover, cyber interference with dual-use early-warning assets would create the additional danger of the target's misinterpreting cyber espionage as a destructive attack. Today, the only feasible starting point for efforts to reduce the escalation risks created by entanglement would be unilateral measures—in particular, organizational reform to ensure that those risks received adequate consideration in war planning, acquisition decisions, and crisis decisionmaking. Over the longer term, unilateral measures might pave the way for more challenging cooperative measures, such as agreed restrictions on threatening behavior.