Tyler Cowen has a blog post about non-negligible chances for a major conflict in Asia as a result of China’s new geopolitical power here. Graham Allison has a similar take in his op ed piece from today’s FT, behind their firewall.
The really big questions are:
Is this risk being priced adequately into markets? Cowen thinks no.
Is such a conflict inevitable as the geopolitical power balance changes? Allison thinks no.
Influenced by these concerns are questions about what the future US Navy will look like. There seem to be two camps. One, the Area-Denialists, see the Super-carrier going the way of the battleship, as new Chinese anti-ship ballistic missile capabilities come on line. The other, let’s call them the Mahanists, see maintaining and modernizing the carrier fleet (11 of them!) as critical to maintaining world trade stability.
The new Ford class super-carriers cost $9B a piece.