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The last time there was a Taiwan crisis, China’s low-tech military was badly outmatched by U.S. forces. Not now. – CNBC

Three French-made Mirage 2000 fighter jets taxi on a runway in front of a hangar at the Hsinchu Air Base on August 5, 2022. China conducted its largest-ever military exercises encircling Taiwan despite condemnation by the United States, Japan and the European Union.

Sam Yeh | AFP | Getty Images

The last time tensions soared between Beijing and Washington over Taiwan, the U.S. Navy sent warships through the Taiwan Strait and there was nothing China could do about it.

Those days are gone.

China’s military has undergone a transformation since the mid-1990s when a crisis erupted over Taiwan’s president visiting the U.S., prompting an angry reaction from Beijing.

“It’s a very different situation now,” said Michele Flournoy, a former undersecretary of defense for policy in the Obama administration. “It’s a much more contested and much more lethal environment for our forces.”

Chinese President Xi Jinping, unlike his predecessors, now has serious military power at his disposal, including ship-killing missiles, a massive navy and an increasingly capable air force. That new military might is changing the strategic calculus for the U.S. and Taiwan, raising the potential risks of a conflict or miscalculation, former officials and experts say.

During the 1995-96 crisis, in an echo of current tensions, China staged live-fire military drills, issued stern warnings to Taipei and launched missiles into waters near Taiwan.

But the U.S. military responded with the largest show of force since the Vietnam War, sending an array of warships to the area, including two aircraft carrier groups. The carrier Nimitz and other battleships sailed through the narrow waterway that separates China and Taiwan, driving home the idea of America’s military dominance.

“Beijing should know the strongest military power in the western Pacific is the United States,” said the then-defense secretary, William Perry. 

The Chinese People’s Liberation Army (PLA) back then was a low-tech, slow-moving force that was no match for the U.S. military, with a lackluster navy and air force that could not venture too far from China’s coastline, former and current U.S. officials said.

“They realized they were vulnerable, that the Americans could sail aircraft carriers right up in their face, and there was nothing they could do about it,” said Matthew Kroenig, who served as an intelligence and defense official in the Bush, Obama and Trump administrations.

The Chinese, taken aback by the U.S. military’s high-tech display in the first Gulf War, “went to school on the American way of war” and launched a concerted effort to invest in their military and — above all — to bolster their position in the Taiwan Strait, Kroenig said.

Beijing drew a number of lessons from the 1995-96 crisis, concluding it needed satellite surveillance and other intelligence to spot adversaries over the horizon, and a “blue water” navy and air force able to sail and fly across the western Pacific, according to David Finkelstein, director of China and Indo-Pacific security affairs at CNA, an independent research institute.

“The PLA Navy has made remarkable progress since 1995 and 1996. It’s actually mind-staggering how quickly the PLA Navy has built itself up. And of course in ’95-96, the PLA Air Force almost never flew over water,” said Finkelstein, a retired U.S. Army officer.

Gen. Mark Milley, chairman of the Joint Chiefs of Staff, has described China’s dramatic rise as a military power as a strategic earthquake.

“We’re witnessing, in my view, we’re witnessing one of the largest shifts in global geostrategic power that the world has witnessed,” Milley said last year.

The Chinese military now is “very formidable especially in and around home waters, particularly in the vicinity of Taiwan,” said James Stavridis, a retired four-star admiral and former commander of NATO. 

China’s navy now has more ships than the U.S., he said. Although U.S. naval ships are larger and more advanced, with more experienced crews and commanders, “quantity has a quality all its own,” said Stavridis, an NBC News analyst.

China is currently building amphibious vessels and helicopters to be able to stage a possible full-scale invasion of Taiwan, experts say, though whether the PLA is capable of such a feat remains a matter of debate.

During the 1995-96 crisis, China lost communication with one of its missiles, and came away determined to wean itself off global positioning systems linked to the U.S., said Matthew Funaiole, a China expert at the Center for Strategic and International Studies think tank. “It got them thinking that ‘we can’t rely on technology from other countries,'” he said.

Officials in the U.S. and Taiwan now have to take into account a much more lethal and agile Chinese military that can deny America the ability to deploy warships or aircraft with impunity, and even to operate safely from bases in the region, Funaiole and other experts said.

“The game has changed in terms of how stacked the deck is for the U.S. It’s much more of an even game. Whatever the U.S. does, China has options,” Funaiole said.

Outraged by House Speaker Nancy Pelosi’s visit to Taiwan this week, China has launched large-scale, live-fire military exercises, including ballistic missile launches, that have surpassed the drills carried out in the 1995-96 standoff. The exercises are located in waters surrounding Taiwan to the north, east and south, with some of the drills within about 10 miles of Taiwan’s coast. China once lacked the capability to conduct a major exercise in waters east of Taiwan, experts said.

China on Thursday fired at least 11 ballistic missiles near Taiwan, with one flying over the island, according to officials in Taipei. Japan said five missiles landed in its economic exclusion zone, near an island south of Okinawa.

This time, the U.S. government has made no announcements about warships moving through the Taiwan Strait. “Biden could try to do that, but China could put them on the bottom of the strait. That’s something they couldn’t do in 1995,” Kroenig said.

The White House said Thursday that the USS Ronald Reagan aircraft carrier would remain in the region as China carries out its exercises around Taiwan to “monitor the situation.” But National Security Council spokesperson John Kirby said that a previously scheduled ICBM test had been postponed to avoid any misunderstanding.

Despite the tough rhetoric between the two powers and the mounting tensions, China is not looking to start a war over Pelosi’s visit and is seeking to stage a show of force, not an invasion of Taiwan, former U.S. officials and experts said. 

For the moment, Chinese President Xi is focused on shoring up his country’s sluggish economy and securing an unprecedented third term at the next Communist Party congress later this year. But China’s newfound military might prompt overconfidence in Beijing’s decision-making or lead to a cycle of escalation in which each side feels compelled to respond to show resolve, former officials said.

There is a risk that Xi could underestimate U.S.’s resolve, and that he believes there is a window of opportunity to seize or blockade Taiwan in the next few years before American investments in new weapons alter the military balance, said Flournoy, now chair of the Center for a New American Security think tank.

“I worry about China miscalculating because the narrative in Beijing continues to be one of U.S. decline, that the U.S. is turning inward,” Flournoy said. “That’s very dangerous, if you underestimate your potential adversary.”

To prevent such an outcome, Flournoy argues both Taiwan and the U.S. need to bolster their military forces to deter Beijing and raise the potential cost of any possible invasion or intervention against Taiwan.

Finkelstein said he worries about an “action-reaction” chain of events that could lead to a conflict no one wants, and that the risk of miscalculation in Beijing, Taipei and Washington is “going sky-high.”

To keep a lid on the tensions, the U.S. and China need to pursue an intense dialogue to lower the temperature, he said. “We need to be talking to each other constantly.”

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