U.S.-China Economic and Security Review Commission, "Hearing: China’s Emergent Military Aerospace and Commercial Aviation Capabilities." May 20, 2010

May 20, 2010
Room 562 Dirksen Senate Office Building
First Street and Constitution Avenue, NE
Washington, DC 20510

Hearing Co-Chairs: Commissioners Daniel A. Blumenthal and Peter Videnieks

DEAR SENATOR INOUYE AND SPEAKER PELOSI:

We are pleased to transmit the record of our May 20, 2010 public hearing on “China’s Emergent Military Aerospace and Commercial Aviation Capabilities.” The Floyd D. Spence National Defense Authorization Act (amended by Pub. L. No. 109¬108, section 635(a)) provides the basis for this hearing.

During the hearing, the Commission received testimony from Congressman Roscoe G. Bartlett (R¬MD). Congressman Bartlett  provided his perspective on what China’s efforts to modernize its aviation capabilities means for regional and global security. Representatives from the Executive Branch and expert witnesses described to the Commission recent developments in China’s military aerospace capabilities. According to then¬Deputy Under Secretary of the Air Force for International Affairs Bruce S. Lemkin, although the Chinese Air Force still lagged behind the U.S. Air Force, China has greatly improved its long¬range air
defense, electronic warfare, computer network attack efforts and offensive strike capabilities. Wayne Ulman, China issue manager at the U.S. Air Force’s National Air and Space Intelligence Center, detailed the “dramatic changes [that] have occurred in the areas of mission, personnel, training, and equipment” in China’s Air Force. Mark Stokes, executive director of the Project 2049 Institute, told the Commission how China relies upon its expanding conventional ballistic and cruise missile arsenal to close the gap between the Chinese military and more advanced militaries. Roger Cliff, senior political scientist at the RAND Corporation, felt that because of these modernization efforts, the Chinese Air Force could present a “substantial obstacle to the United States” in the event of a conflict between the two militaries. Focusing on how China’s growing missile arsenal could affect the U.S. military, Jeff Hagen, senior engineer at the RAND Corporation, described to the Commission how RAND research demonstrated that the Chinese military, relying predominantly on conventional missile strikes, could potentially disable most U.S. Air Force bases in the region. Rebecca A. Grant, director of the Mitchell Institute for Airpower Studies, opined that China’s highly capable air defense systems and numerically superior fighters would pose serious problems to U.S. military aircraft in the region.

Panelists also described the current developments and future trends of China’s aviation industrial base. Peder Andersen, international trade analyst for aerospace at the U.S. International Trade Commission, described how Beijing has prioritized the development of an indigenous civil aircraft industry and reorganized its aviation manufacturing industry to support this goal. Agreeing with Mr. Andersen, Tai Ming Cheung, associate adjunct professor at the School of International Relations and Pacific Studies, University of California, San Diego, told the Commission that China is “pursuing an ambitious strategy to build an internationally competitive, innovative, and comprehensive aviation design and manufacturing base within the next one to two decades.” Focusing on recent developments, Richard D. Fisher, Jr., senior fellow at the International Assessment and Strategy  Center, explained the  interconnectedness between China’s civil and military aviation industrial bases.

The Commission also heard about the implications of a growing Chinese aviation industrial base for the United States. Addressing the current state of U.S. aerospace industry, Deputy Assistant Secretary of Commerce for Manufacturing and Services Mary H. Saunders told the Commission that while China is an increasingly important consumer of aerospace products and services, U.S. aerospace manufacturers face several obstacles in the market. In particular, she highlighted such challenges as the relationship between civil and military aviation production in China, the direction of Chinese aerospace industrial policy, and the extent of unfair Chinese subsidies to the aerospace sector. Expert witnesses disagreed, however, on the specifics of how the U.S. industrial base would be affected. Owen E. Herrnstadt, director of trade and globalization at the International Association of Machinists and Aerospace Workers, felt that the U.S. industrial base would permanently suffer since U.S. companies were increasingly outsourcing aerospace jobs and know how to China. Disagreeing with Mr. Herrnstadt, Daniel K. Elwell, vice president for the Aerospace Industries Association, argued that the growth in China’s demand for civil aircraft over the next 20 years would be enough to split opportunities between both China and the United States.

Thank you for your consideration of this summary of the Commission’s hearing. We note that the prepared statements submitted  by the witnesses are now available on the Commission’s website at www.uscc.gov. The full transcript of the hearing will be available shortly.

Members of the Commission are also available to provide more detailed briefings.  We hope these materials will be helpful to the Congress as it continues its assessment of U.S.¬China relations and their impact on U.S. security. Per statutory mandate, the Commission will examine in greater depth these and other issues in its Annual Report that will be submitted to Congress in November 2010. Should you have any questions, please feel free to have your staff contact Jonathan Weston, the Commission's Congressional Liaison, at (202) 624¬1487.

Sincerely yours,
Daniel M. Slane
Chairman

Carolyn Bartholomew
Vice Chairman

Commissioners’ Opening Remarks
Opening statement of Commissioner Daniel A. Blumenthal
Opening statement of Commissioner Peter Videnieks

Congressional Perspectives
Congressman Roscoe Bartlett (R-MD)
Congressman Phil Gingrey, M.D. (R-GA)

Panel II: Administration Perspectives
Mr. Bruce S. Lemkin, Deputy Under Secretary of the Air Force for International Affairs, U.S. Air Force, Washington, DC
Ms. Mary H. Saunders, Deputy Assistant Secretary of Commerce for Manufacturing and Services, U.S. Department of Commerce, Washington, DC

Panel III: Developments in China’s Military Aerospace Capabilities
Dr. Roger Cliff, Senior Political Scientist, The RAND Corporation, Arlington, VA
Mr. Mark Stokes, Executive Director, Project 2049 Institute, Arlington, VA
Mr. Wayne Ulman, China Issue Manager, National Air and Space Intelligence Center, Dayton, OH

Panel IV: China’s Aviation Industrial Complex
Mr. Peder Andersen, International Trade Analyst for Aerospace, U.S. International Trade Commission, Washington, DC
Dr. Tai Ming Cheung, Scientist, Institute on Global Conflict and Cooperation, Associate Adjunct Professor, School of International Relations and Pacific Studies, UC San Diego, CA
Mr. Richard D. Fisher, Jr., Senior Fellow, Asian Military Affairs, International Assessment and Strategy Center, Washington, DC

Panel V: Civil Implications for the United States
Mr. Owen E. Herrnstadt, Director of Trade and Globalization, International Association of Machinists and Aerospace Workers, Upper Marlboro, MD
Mr. Daniel K. Elwell, Vice President for Civil Aviation, Aerospace Industries Association, Arlington, VA

Panel VI: Military Implications for the United States
Dr. Rebecca Grant, Director, The Mitchell Institute for Airpower Studies, Washington, D.C.
Mr. Jeff Hagen, Senior Engineer, The RAND Corporation, Arlington, VA