We’re looking at that big bow wave and wondering how the heck we’re going to pay for it, and probably thanking our stars we won’t be here to have to answer the question.
The most dangerous concern is [the use] of military force against Taiwan… My opinion is this problem is much closer to us than most think.
The 2020s do not look good.
This weekend I read two large reports that look at the present and future of the U.S. military’s force structure. Together they present a disturbing picture of the decade to come. Both of these reports are squarely focused on the United States military and a constellation of problems it will soon face. Neither is written by an expert in Asian military affairs; both write with shared assumptions about the nature of “great power competition” with China, but neither report is about China. Neither attempts to contrast their predictions for the United States with likely developments across the Pacific. But it is precisely those developments that make the trends traced in Mark Cancian’s U.S. Military Forces in FY 2021: The Last Year of Growth? and Mackenzie Eaglen and Hallie Coyne’s The 2020s Tri-Service Modernization Crunch so alarming. In particular, the trends described in these reports should have alarm bells going off in Taipei. Taiwan—and any country that might be called on to defend it—is entering a dangerous decade.
Defense planning talk can lead eyes to glaze over. Little surprise! Debates over this topic quickly get bogged down with acronyms, accounting terms, and references to opaque production and planning cycles. One helpful way for ordinary citizens get a handle on these issues—at least, for ordinary citizens of my generation—is to think of defense planning as bit similar to a real time strategy (RTS) computer game, like Warcraft or Age of Empires. Games of that sort force the player to decide how they will spend constrained resources. Do you spend your gold or vesper gas (or whatever else it is the game uses in lieu of money) on the production of new fighting units, the development of new technologies that will improve your kingdom, or on increasing the scale of resource extraction? That is the usual tradeoff present in most RTS games, though some games will add in additional wrinkles. Gamers know that the right balance between these three is key: if they choose poorly at the beginning of a gaming session, they will be dealing with the consequences of their bad investment for the rest of their game.
Though far larger in scale, the senior officers and civilian leaders in charge of the Pentagon’s purse strings are not that different from Starcraft e-sports stars. Like the RTS gamer, these leaders must plan over time in a world of constrained resources. Tradeoffs are inevitable.
Defense planners find themselves trying to balance three competing priorities. The first of these is the development of new technologies and fighting platforms. To fight with the technology of the future, one must pay for its development now. In defense planning lingo, this is usually called “modernization.” You might think of this as the ‘research tree’ found in most RTS games.
The next category is the procurement of new platforms that have already been developed. Sometimes these purchases mean an absolute increase in the number of platforms fielded; other times it simply means buying new vehicles or ships to replace those that are retiring from service. This is spending on “force structure” — the idea is that your military force is properly structured to accomplish the strategic goals laid out for it. Again, there is an easy analogue here with the RTS gamer, who must carefully choose which units will be the most valuable additions to their army based off of the type of enemy they are fighting.
The next item does not have such an easy analogue in most RTS games (though you do see a similar mechanism featured in many turn-based strategy games). This category includes the costs of maintenance, training, and operations. Maintenance includes regular repairs needed to fix the wear-and-tear of normal use, but also technological upgrades—say, installing a new weapons system or radar array on an aircraft that has been in service for many years. It also includes the cost of training exercises and other measures (such as fueling, inspections, deployment, etc.) that keep these platforms and the military units they are attached to “ready” to join the fight. Thus in peacetime this category is often described with the word “readiness.” However, combat operations are also usually included as part of this category when budgets are being drawn up. Depending on the tempo and intensity of the war in question, combat operations might swallow up this entire section of the budget (and much more besides). Defense planning documents often call this the “operations and maintenance” section of the budget.
There are other factors that might determine how money is spent— for example, the desire to have a resilient industrial base or please a Senator—but the vast majority of spending decisions are an attempt to try and balance out the competing demands of modernization, force structure, and readiness. A military branch that spends all of its money on modernization will have superior technology in the long term but nothing to fight with in the here-and-now. A military optimized for force structure, on the other hand, risks mortgaging the long term away for the sake of near-term gains. But even those near-term gains might not be near enough: because new platforms are expensive and slow to construct, a military too focused on optimizing force structure might find itself blindsided and unprepared if it has not spent an equal amount of money on maintaining readiness and upgrading old legacy platforms while new ones are being built. Finally, a force that spends all of its money on the maintenance and operations of the minute will be ready for a fight today, but will struggle to compete with advancing adversaries in the future, and may be overwhelmed by the rising costs of operations as technology and platforms begin to age.
I apologize to experienced nat-sec hands for this introductory, simplified overview, but this issue is important—important enough that Americans outside the defense industry need to understand it. That small backgrounder should be enough context for these two reports to make sense.
Mark Cancian’s report is the more sober of the two; he does not argue a case so much as identify current trends and explain the sort of tradeoffs facing each of the U.S. military’s main branches. Eaglan’s report is just as well sourced as Cancian’s, but more argumentative. She and her research assistant believe a crisis is around the corner. They want you to believe it too. Eaglen is also more willing to endorse specific solutions to the crises she sees. However, the two reports’ findings are complementary and I will quote liberally from both of them below.
Let us start with Eaglen. She describes the basic problem quite dramatically:
Fleets of ships, aircraft, vehicles, and other equipment are reaching the end of their service lives, hitting the edge of their upgrade limits, and losing combat relevance. As great-power competition accelerates, the United States is offering a free and open window of opportunity and advantage to its adversaries. Unless policymakers take concrete steps now, defense leaders will continue America’s sleepwalk into strategic insolvency and its consequences. The aptly named “Terrible 20s” have arrived. The intention of this report is not to propose ideal or preferred defense investments. Rather, it aims to deliver an unvarnished overview of the existing modernization bill before the Pentagon today, forcing an overdue confrontation with reality…. In 2016, popular military blogger and Navy Cmdr. CDR Salamander (ret.) coined the phrase “Terrible 20s” to describe the modernization challenges before the US military this coming decade. He offered an ominous overview of the next 10 years as “that horrible mix of debt bombs, recapitalizing our SSBN [ballistic missile submarines] fleet, and the need to replace and modernize legacy aircraft, ships, and the concepts that designed them.” It is a bracing and accurate summary of the following analysis.
She also includes a fun graphic to illustrate the problem:
|Figure 2, The 2020s Tri-Service Modernization Crunch (2021)|
How did this happen? It started with a Clinton era decision to focus on upgrading legacy platforms instead of developing or purchasing new ones:
By the end of the Bill Clinton administration, the Pentagon had laid out a strategy to update and replace the Reagan-era fleets. This plan hinged on justifying end strength reductions across the services with the increases in combat power delivered by new and improved military technologies.
When explaining this reasoning for the American Enterprise Institute in 2007, Robert Work used the example of advancements made to the shipboard vertical launch systems (VLS) In 1989, 108 large surface combatants carried 1,525 VLS cells, with an aggregate magazine capacity of 7,133 battle-force missiles. By 2004, the Large Surface Combatant (LSC) fleet shrunk to 71, but it carried 6,923 VLS, with a fleet magazine capacity of 7,539 battle-force missiles. More revolutions in satellite-guided weapons, unmanned aerial vehicles, missile defense systems, and improved targeting and radar technology are also cited as demonstrable examples of key new battlefield technologies from the Clinton years, even as modernization spending on procurement and R&D plummeted from its peak in FY85 to a new low a decade later. 
During the Bush years, force structure was focused on winning the war at hand, and modernization was once again put off:
In the 2000s, Pentagon leaders focused understandably on the wars but did so while planning too optimistically in realizing ambitious technology transformations that would take decades to materialize. As a result, not enough investment was made in the conventional platforms required to maintain a ready force and strong conventional deterrent through the 2020s. In fact, rosy assumptions about revolutions in military affairs and the promises of technology solutions tomorrow became a justification to drastically slash those same aging fleets and inventories of ships, aircraft, and vehicles the troops use every day to sail, fly, and drive to accomplish their missions. Now the military is facing a decade of staggering modernization cost.
Then came Robert Gates’ fight against “Next War-itis” and the sequester years:
Politically vulnerable because of outside pressures, new programs stood no chance and were killed en masse by the new administration. President Obama felt liberal pressure to curtail the military-industrial complex and defense spending, while Gates took personal offense at a military bureaucracy still focused on preparing for conventional conflict instead of pouring its full energy into the ongoing counterinsurgencies and counterterror operations in Iraq and Afghanistan. The bureaucracy scaled down its plans below its own requirements and sought to shield programs from permanent death by keeping their pilot flames lit. These choices created a second round of cancellations near the turn of the decade that dwarfed the Rumsfeld cluster….
In 2011, following the hollow buildup of the 2000s, Congress and the president’s failure to agree on entitlement and other reforms resulted in the BCA. Two years later, the BCA led to the sequestration of 2013, which swung a budgetary axe mostly on discretionary funding, half of which sustains the US military. The Pentagon responded largely by canceling dozens of pro-grams permanently and delaying almost everything else except for present-day needs. Leaders calculated they could accept risk in the mid to long term, as long as large swaths of troops were still engaged in ongoing conflicts and another large part stood ready to fight on a moment’s notice.
Thus for three decades America traded out modernization and longer-term force structure procurement for the sake of maintaining readiness and battlefield operations. The long wars forced some of this trade off on the services (cue Eaglen: “Today, the US military is in the middle of a future that was mortgaged to pay for the wars of yesterday”), but political foolishness played just as large a part. The thing to emphasize here are the long term consequences of poor decision making by national elites. As procurement and development programs run so long, mistakes made in 2003 or 2013 reverberate decades later. Today we the enter the 2020s with a military built during the 1980s.
But as Cancian makes clear, the temptation to further defer force structure procurement and modernization lingers with us:
From the service perspective, the key tension for force structure will be between the desire to cut size to invest in modernization and the need to maintain day-to-day deployments for crisis response, ongoing operations, and allied and partner engagement. If the forces get too small, then the operational tempo required to maintain these deployments will stress personnel. This would hurt sustainability of the all-volunteer force, particularly if the economy recovers and recruiting and retention get more challenging as a result of competition for labor. The Biden administration, like every administration before it, will pledge to support service members, so it will need to heed complaints about stress….
The Biden administration will be particularly conflicted here because of its often-stated desire to reassert U.S. global leadership. The United States cannot be a global leader if it pulls its forces back from global deployments. Some strategists have argued that a “virtual” or intermittent presence from the United States can substitute for forward stationing or continuous rotations. However, critics point out that virtual presence is actual absence. Knowing that a carrier is in Norfolk does not have the same impact as seeing 90,000 tons sail into one’s harbor.
Deferring modernization and procurement like this carries a financial cost. Eaglen explains why:
As a result of failing to undertake necessary modernization, the military instead pays for aging platforms to stay in the force. In fact, the problem mirrors our broader national challenge with net interest. Just as a quarter or more of debt growth over the next decade will be net interest on the debt itself, the military has begun to pay more to keep old equipment running, which makes it increasingly difficult to invest in new platforms. It’s a vicious cycle, often called an “acquisition death spiral. 
The fiscal consequences of this can be seen in the percentage of current expenditures that go towards maintenance and upgrades of legacy systems:
Why these costs are so severe makes more sense when you see just how old many of our principle military platforms really are. For one example, here is Cancian’s tally of the Air Force fleets:
Some fleets are in relatively good shape: the transport fleet (21 years, on average) because of acquiring C-17s and C-130s, the special operations fleet (12 years) because of its high priority, and the UAVs/RPVs (6 years) because of large wartime purchases. Other fleets are old: fighter/attack (29 years old), bomber (42 years), tanker (49 years), helicopter (32 years), and trainers (32 years). All the older fleets (except for some specialty aircraft) have programs in place for modernization, but the programs have been delayed, are expensive, and may take years to implement fully. 
But now this system of pushing platforms just one more decade past their due date has reached its limits. Many of the old legacy systems simply cannot be rolled through one more decade of use. Even if they could, the money spent on drawing out the life of a legacy system would be better spent on modernization and force structure changes. This is the logic behind the US Marine Corps’ decision to get rid of their tank battalions, for example. Theirs is a purposeful attempt to shed platforms that the service does not think will be useful in a conflict with China. But other draw-downs are simply the product of poor planning.
Consider the Navy’s hopes to drastically increase the number of nuclear attack submarines they can put to water:
Cancian explains what you see:
Attack submarines (SSNs) receive strong support from strategists because their firepower and covertness are useful in great power conflicts. Thus, they are likely to receive strong support in the next administration, whether that is a Trump or Biden administration. However, submarines are expensive (about $3.3 billion each in the current version), so increasing production is difficult…
Numbers dip in the late-2020s and early-2030s, bottoming at 42 boats as Los Angeles-class boats built during the 1980s retire. Secretary Esper said that the new plan intends to extend the service life of additional older submarines, but the Navy tends to retire old ships early in order to buy new ships…
The obvious solution is to build more submarines, but having two submarine construction programs operating simultaneously puts pressure on both the shipbuilding account and the submarine industrial base. The FY 2020 Navy 30-year shipbuilding plan showed a capacity for three total submarines per year, attack (SSN) or ballistic missile (SSBN) submarines, although the Navy did not always fund to the total capacity. Esper called for building three Virginia-class submarines per year in addition to SSBNs as soon as possible, but the industrial base will need a lot of funding and lead time to get to that level of production….The Navy cannot build enough new submarines quickly enough to significantly mitigate the trough. What it can do is accelerate the rate at which it gets to its target level. 
If you are familiar with the war games and simulations American military officers run to game out Taiwan contingencies, Cancian’s info-graphic should disturb you. Attack submarines are widely viewed as a crucial component of the American conventional deterrent in any potential cross-straits dust up. Stealthy and submersible, nuclear submarines are one of the few platforms we expect to reliably pierce the A2/AD death zone that will project out thousands of kilometers from the Chinese coast. Yet their numbers are set to fall through most of the 2020s. Worst of all, there is very little we can do about it. The time to have averted this crisis was back in 2015.
Another set of platforms American strategists anticipate U.S. forces will rely on to pierce the A2/AD bubble are our stealth bomber fleets. Here is what Cancian has to say about that:
Since no new aircraft are being produced, the bomber force continues to age (currently 43 years on average), though various upgrade programs keep the aircraft flying and operationally relevant, for example, new engines for the B-52s and a new defensive system for the B-2s. The Air Force would like to divest some of the B-1s early but has run into congressional opposition. The B-21 Raider program continues in development, with budget demands seeming to stabilize: $2.9 billion in FY 2020 and $2.8 billion in FY 2021 and remaining at that level through FY 2025. Because the B-21 has a mid-2020s fielding date (“Initial Operating Capability”), the legacy B-52s, B-1s, and B-2s will comprise the bomber force for many years to come. Details are uncertain, however, because the B-21 remains a classified program. 
Here the pattern repeats. Eventually the B-21 will go online and be purchased in large numbers. But purchases in small numbers will not happen until the mid-2020s at earliest, and the fleet will, as with the submarines, require time to slowly grow in size. Until then we can only expect the stealth bomber fleet to degrade as the the existing systems age and the Air Force tries to remove the oldest platforms to save on cost.
All of this is assumes that the money can be found for the post-2030 expansion of the bomber and submarine fleets. Yet part of the reason we got into this mess in the first place is because we spent the last decade pitching plans like these, which project growth in force structure—but only in the far away future. Representative Mike Gallagher rightly complained about this sort of thing back in 2019:
Yet, the Navy’s FY20 shipbuilding budget represents an overall decrease of1.5 percent from the previous year. While the Navy submitted a 30-Year Ship-building Plan along with its budget that reached 355 ships for the first time in more than two decades, much of this growth happens in the outyears—the Pentagon’s version of “the check is in the mail.” Despite reaching 355 ships roughly 20 years faster than the FY19 shipbuilding plan, the new document only adds one additional ship over its first five years compared to last year’s plan. 
But even if the money can be found the problem I am highlighting here will not go away. Consider the US Marine Corp’s transformation from a “tip of the spear” ready-force able to deploy anywhere in the world to a long-range artillery force to be stationed on the islands of the West Pacific. This transformation does not require any extra money from Congress. What it does require is time. The USMC have called their plan “Force Design 2030.” Perhaps their force design really is the perfect ticket for deterring the PLAN—but if so, it will not be complete for another decade.
Similar things could be said about the US Army’s attempt to obtain more long range munitions, the Navy’s plans to remake the surface fleet as a more distributed force centered on lighter tonnage ships, or the surplus of unmanned submersibles and aircraft that are supposed to sustain the Navy and Air Force’s lethal edge through mid-century. In each case, the modernization of the future force is gained by slimming down the current one. This is necessary, but it comes with a catch: that future force doesn’t fully arrive until the 2030s.
Can we wait that long? I am not sure we can. When Captain James Fanell (ret.), intelligence analyst with the U.S. Navy, labeled the 2020s as the “Decade of Concern” based on his projections of the PLA Navy’s growing capabilities, he was treated as something of a pariah. But now that Admiral Philip Davidson, INDOPACOM’s outgoing commander, just declared that he believes the PLA will be capable of assaulting Taiwan within six years, Fannell’s judgment seems prescient. The 2020s will see both the growth of Chinese military power to new heights and a temporary nadir in American capacity to intervene in any conflict in China’s near abroad.
The “temporary” part of that equation is important. Historians of the First World War and the Pacific War trace the origins of those conflicts to pessimistic assessments of the changing balance of power. The belligerency of imperial Japan and Wilhelmine Germany rested on a belief that their position vis a vis their enemies could only decline with time. Any statesman who believes that a temporary military advantage over an enemy will soon erode will have a strong incentive to fight it out before erosion has begun.
And that is the problem. Commander Salamander’s “Terrible ‘20s” and Captain Fanell’s “Decade of Concern” are the same decade. In the mid 2020s the United States will be struggling to pay the Pentagon’s “modernization crunch.” The Navy, Marine Corps, and Air Force will be midway through a transition to a new, counter-China force structure. The number of attack submarines and stealth bombers that the United States can put in the field will be at an absolute low.
It is at this moment we project the PLA will be capable of executing a cross straits invasion.
This does not make conflict inevitable. But if the Chinese have concluded that military means are the only way to bring about Taiwan’s integration into the People’s Republic of China, Beijing’s leaders will soon face powerful pressure to escalate towards war. Waiting until the 2030s or 2040s to sabre rattle is to wait for the U.S. military’s counter-China modernization and procurement programs to run their course. There will be a terrific temptation to “resolve” the problem before these programs have been implemented.
If you are Taiwanese the implications of all of this should be obvious. The clock is ticking. The terrible ‘20s have begun.
 Mackenzie Eaglen and Hallie Coyn, The 2020s Tri-Service Modernization Crunch (Washington DC: American Enterprise Institute for Public Policy Research, 2021), 1, 3.
 ibid., 7.
 ibid., 5
 ibid., 18, 22.
 ibid., 22.
 Mark Cancian, U.S. Military Forces in FY 2021: The Last Year of Growth?, CSIS Defense Outlook (Washington DC: Center for Strategic and International Studies, 2021), xi
 Eaglen and Coyn, Tri-Service Modernization Crunch, 15.
 Cancian, U.S. Military Forces, 80.
 ibid., 53-54.
 ibid., 85
 Mike Gallagher, “State of (Deterrence by) Denial,” Washington Quarterly 32, no. 2 (Summer 2019), 35.
 The most mature statement of this position is found in James Fanell, “Now Hear This—The Clock Is Ticking in China: The Decade of Concern Has Begun,” Proceedings, October 2017; for Fannell’s most recent assessment of the PLA Navy’s growth and development, see James Fanell, “China’s Global Navy—Today’s Challenge for the United States and the U.S. Navy,” Naval War College Review 73, no. 4 (2020): article 4.
 Malory Shelbourne, “Davidson: China Could Try to Take Control of Taiwan In ‘Next Six Years,’” USNI, March 9, 202.
 See David Stevenson, Cataclysm: The First World War As Political Tragedy (New York: Basic Books, 2005), ch. 1; David Herrmann, The Arming of Europe and the Making of the First World War (Princeton: Princeton University Press, 1997); Michael Barnhart, Japan Prepares for Total War: The Search For Economic Security, 1919-1941 (Ithica: Cornell University Press, 1991).