Last April, China's ships surrounded Scarborough Shoal in the South China Sea. By July, the Chinese had erected a barrier to the reef's entrance, denying access to all but their own vessels. The swift action was taken despite mutual promises by Beijing and Manila to leave the area, which up until then had been controlled by the Philippines. Chinese state media gloated over the deception.
After gobbling up Scarborough, Chinese vessels and aircraft stepped up their intrusion into Japanese territorial waters and airspace around the Senkaku Islands in the East China Sea, in an effort to wrest them from Tokyo. In a display of massive force, eight Chinese ships entered the waters around the uninhabited outcroppings on the 23rd of this month. On Friday, China's Foreign Ministry said the islands were a "core interest," meaning that Beijing will not stop until it has taken control of them. Some analysts think China will try to land forces on the Senkakus soon.
Beijing's aggression on the seas is being matched by its aggression on land. During the night of April 15, a Chinese platoon-strength force advanced 10 kilometers south of the Line of Actual Control, the de facto border between China and India in the Himalayas, and established a tented camp in the Daulat Beg Oldi sector of eastern Ladakh. In recent days, Chinese troops advanced another 10 kilometers into India, one more bold attempt to take ground from a neighboring country.
China is a belligerent state that seeks to seize territory from an arc of nations: from India in the south, to South Korea in the north. At the same time, we are hearing war talk from the Chinese capital—from civilians, such as new leader Xi Jinping, to China's senior military officers. Washington has yet to understand the fundamental challenge China's militant nationalism poses to America and to the international community.
At one time, it seemed that Beijing, for its own reasons, wanted to work with the U.S. Washington, in turn responded to Chinese overtures. Since Nixon's trip to Beijing in 1972, the U.S. "engaged" the Chinese to bring them into the international community. The concept was that our generous policies would avoid the devastation that Germany and Japan precipitated last century. The American approach proved durable, despite tumultuous change over the course of four decades, precisely because it was consistent with our conception of our global role as the ultimate guarantor of peace and stability. The policy of engagement of China was enlightened, far-sighted, and generous.
It was also a mistake. Beijing prospered because of America's engagement, and while the Chinese required help, they seemed to accept the world as it was. Now, however, they believe they no longer need others and are therefore trying to change the world for the worse. China is not only claiming territories of others but also trying to close off international waters and airspace; proliferating nuclear weapons technology to Iran; supplying equipment to North Korea's ballistic missile program; supporting rogue elements around the globe; launching cyberattacks on free societies; undermining human rights norms, and engaging in predatory trade tactics that helped tip the global economy over the edge in 2008.
Beijing has gone on a bender. Soon after President Obama's troubled summit in the Chinese capital in November 2009, China dropped all pretense and started openly to challenge the American-led international system. Chinese diplomats, officials, and officers spent less time explaining, persuading, and cajoling and more time complaining, pressuring, and threatening. In early 2010 China's flag officers and senior colonels made a point of publicly talking about fighting a war -- a "hand-to-hand fight with the U.S." as one put it -- in the near future. China, as Robert Sutter of George Washington University points out, is the only major power actively planning to kill Americans, and, judging from public comments, China's senior officers are relishing the prospect of doing so.
It is not hard to understand how China became a militant state. First, Chinese leaders became arrogant, evidently believing they were leading the world's next great power. They saw economic turmoil elsewhere and told us through their media that the United States and the rest of the West were in terminal decline.
Second, the ruling Communist Party was going through a tumultuous leadership transition that, despite appearances, is still not completed. As the so-called Fourth Generation, led by Hu Jintao, gave way to the Fifth, under the command of Xi Jinping, feuding civilians sought support for their personal political ambitions from the flag officers of the People's Liberation Army. Consequently, the generals and admirals effectively became arbiters in the Party's increasingly rough game of politics. And in a time of political transition, almost no civilian leader was in a position -- or willing to take a risk -- to tell the top brass what to do. As a result, the military gained substantial influence, perhaps becoming the most powerful faction in the Communist Party.
The result of discord among civilians has been a partial remilitarization of politics and policy in the Chinese capital. Senior officers are now acting independently of civilian officials, are openly criticizing them, and are making pronouncements on areas once considered the exclusive province of diplomats.
The implications of these internal changes are, obviously, large: China's flag officers want to use their new-found power. "China's military spending is growing so fast that it has overtaken strategy," said Huang Jing of Singapore's Lee Kwan Yew School of Public Policy. "The young officers are taking control of strategy and it is like young officers in Japan in the 1930s. They are thinking what they can do, not what they should do."
To make matters worse, this leadership transition was occurring while the Chinese economy stumbled. GDP growth rates, beginning in the middle of 2011, began to falter. In recent quarters, they have not been in the high single digits, as Beijing's National Bureau of Statistics claims. Electricity production figures, manufacturing surveys, price indexes, and corporate results, among other indicators, point to an economy growing at about 3%. Moreover, the economy is beginning to choke on debt incurred to build "ghost cities" and produce unsellable inventory.
Why is China's slowdown important? The Communist Party for three decades based its legitimacy primarily on the continual delivery of prosperity; without prosperity, the only remaining basis for legitimacy is nationalism. Nationalism in turn is causing leaders to increase friction with China's neighbors and the U.S.
There is a third factor, which could define this decade, also contributing to Chinese's troubling trajectory. Our engagement of China has, unfortunately, reinforced the worst tendencies in Beijing by inadvertently creating a set of perverse incentives. With the best of intentions, we rewarded irresponsible conduct in the hope the Chinese would change. No matter how they continued in their ways, we failed to hold them to account. In these circumstances, as we kept providing incentives for unacceptable behavior, Beijing predictably became less cooperative and more assertive.
Worse, the less and less the Chinese exhibited desire to engage us, the more and more we felt the need to engage them. It is evident from Beijing's recent actions that the old approach toward China is not working. If we do not begin to change our policies, our indulgence may end up creating the very thing we have desperately sought to avoid: an incurably aggressive Chinese state.
Ronald Reagan opposed the Soviet Union because he told us the form of its government mattered: that it prevented Moscow from evolving to better policies and serving as a reliable partner. We need to understand that the form of China's one-party state matters too.
The risk of getting China wrong, as we are now doing, is that an aggressive regime can undermine the institutions of free societies and take down the multilateral framework built after the Second World War. The Chinese have learned all the wrong lessons in recent years, but we have yet to adjust our approach. We have, with the best of intentions, created the conditions for the rise of a militantly hostile state.
Gordon G. Chang is the author of The Coming Collapse of China and a columnist at Forbes.com. Follow him on Twitter @GordonGChang.