Taiwan, Trade, and Sea Power: The Economic Catastrophe We Can’t Ignore

210728-N-FO714-1033 TAIWAN STRAIT (July 28, 2021) The Arleigh Burke-class guided-missile destroyer USS Benfold (DDG 65) transits the Taiwan Strait while conducting routine underway operations. Benfold is forward-deployed to the U.S. 7th Fleet area of operations in support of a free and open Indo-Pacific. (U.S. Navy photo by Mass Communication Specialist 1st Class Deanna C. Gonzales)

Introduction

In a recent Senate Armed Services Committee hearing, Senator Tom Cotton posed a sobering question to Admiral Samuel Paparo, commander of U.S. Indo-Pacific Command: What would happen to the global economy if China attacked or invaded Taiwan?

The answer, echoed by both military and civilian experts, is nothing short of catastrophic.

Investor Ken Griffin warned that a rupture over Taiwan could send the world into “great depression circumstances.” Ian Easton of the Naval War College has long warned of China’s ability to disrupt global trade and exploit vulnerabilities in the Indo-Pacific. The U.S. Navy and our allies cannot afford to treat these concerns as hypothetical.

Why Taiwan Matters to the Global Economy

Taiwan is not only a leading global manufacturer of semiconductors—it is also a key node in international shipping. Roughly one-third of the world’s trade passes through the South China Sea. Any disruption caused by Chinese military action—especially a blockade or invasion of Taiwan—would choke critical sea lanes and sever the supply chains that power everything from cars to smartphones to critical defense systems.

What Ken Griffin Got Right

In January 2024, Griffin put it bluntly:

“If there were a rupture around Taiwan, it would be catastrophic to both the Chinese and to the American economy.”

Griffin wasn’t talking about market jitters—he was warning about supply chain collapse, capital flight, manufacturing shutdowns, and global financial panic. These effects wouldn’t just hit Wall Street—they would impact farmers, truckers, teachers, and service members alike.

Sea Power Is Economic Poweruh

This is why Americans for a Stronger Navy continues to sound the alarm. The U.S. Navy isn’t just a military force—it’s a shield for global commerce. Sea power ensures stability in the Indo-Pacific and protects the economic lifelines that Americans depend on.

Today’s tools of deterrence extend beyond warships. Ships, drones, AI—they all play a critical role in keeping trade flowing and conflict at bay. Without continued investment in these technologies and the people who operate them, our economy and our alliances remain vulnerable.

Blockade drills and military posturing by China are not symbolic—they are preparation. And we must respond with strategic clarity, industrial readiness, and unwavering public support for naval strength.

Conclusion: Americans Deserve to Know

This isn’t just a military issue—it’s an economic one. The American people deserve to understand what’s at stake, and what it means to be unprepared.

If we fail to invest in our fleet, fortify our alliances, and educate the public, we risk more than just ships—we risk our prosperity.

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Arming for Peace: Why America Must Act Now to Strengthen the Navy and Defend Freedom

A Review of Heritage Foundation Report BG3902 by Americans for a Stronger Navy

Introduction

The Heritage Foundation’s latest report, “Arming for Peace: Expanding the Defense Industrial Base and Arming Taiwan Faster” (BG3902), echoes what Americans for a Stronger Navy has been sounding the alarm on: The threats facing the United States are real, escalating, and dangerously close to overwhelming our current naval capabilities. As Brent Sadler writes, the time for talk has passed. Action is overdue. If we don’t mobilize now, America risks losing the ability to deter war and defend freedom in the Indo-Pacific and beyond.

As Sadler states: “As Americans go about their daily lives unmolested, the world is accelerating in its change—much of it perilous to U.S. national survival.” He warns that “on the back of a decades-long sustained military build-up, China’s military is increasingly confident and willing to directly challenge the U.S.”

His call to action is clear: “The U.S. must restore ebbing national deterrence and prevent a war in Asia—while not ceding its democratic way of life and prosperity for the next generations.”

Key Findings That Should Wake America Up

China is preparing for war. Admiral Davidson’s 2021 warning that China could strike Taiwan by 2027 has not only proven prescient, it’s now backed by an unprecedented military buildup. China has conducted massive joint-force invasion rehearsals and increased provocations around Taiwan. As Brent Sadler put it, “Aggressive maneuvers around Taiwan right now are not exercises, as they call them. They are rehearsals.”

That warning was underscored this week when the Chinese military launched large-scale joint drills around Taiwan, including its Shandong aircraft carrier battle group. According to China’s own Eastern Theater Command, these drills are a “severe warning and forceful containment against Taiwan independence.” With missile forces, air strikes, and blockade rehearsals now unfolding, many in Taiwan — and around the world — are rightfully concerned. Sadler’s insights about China’s evolving risk tolerance add important context to these real-time developments.

Further validating the urgency, the U.S. Naval War College’s China Maritime Report No. 14 found that Chinese analysts themselves believe the PLA has narrowed the gap with the U.S. military, especially in its immediate region. “There is consensus in China that the PLA has narrowed the gap in overall military capabilities with the United States over the last two decades,” the report notes.

Russia and China are approaching U.S. shores. Testimony from U.S. Northern Command chief Gen. Gregory Guillot before Congress confirmed that joint Russian-Chinese military patrols have entered the U.S. Air Defense Identification Zone near Alaska — levels not seen since before the Ukraine war began. One coordinated flight last July saw Russian TU-95 and Chinese H-6 bombers test U.S. response time. This should serve as a wake-up call: our adversaries are not just projecting power near Taiwan, they’re probing U.S. airspace and waters closer to home. As Politico reported, Chinese “dual-use” vessels under scientific pretenses are mapping the Arctic for future military operations.

U.S. deterrence is fading. Years of underinvestment in shipbuilding and naval readiness have created dangerous gaps. Delays in weapons deliveries, inadequate port infrastructure, and a depleted missile defense stockpile are symptoms of a nation unprepared for a prolonged maritime conflict. As Sadler warns, “Failing to act… could result in the most destructive and consequential war the U.S. has ever had to fight.”

The Navy is stretched thin. The U.S. Navy has sustained an aggressive forward presence, but at great cost. Ship wear, sailor fatigue, and insufficient repair capacity are taking their toll. The grounding of the USNS Big Horn disrupted combat ops in the Red Sea, highlighting our logistical fragility. Sadler notes, “This comes at a cost in added wear on the ships and sailors reliant on a logistics infrastructure of ports, support ships, and dry docks too few to assure contested forward naval operations.”

The world is on fire. From Ukraine to the Red Sea to the Arctic, our adversaries are watching and testing U.S. resolve. China, Russia, Iran, and North Korea now operate more boldly, confident in America’s disunity and domestic distraction.

Taiwan is not a distant concern. More than 80,000 Americans live, work, or travel there. A war over Taiwan would drag us into conflict, devastate global supply chains, and send shockwaves through the U.S. economy. As Sadler puts it plainly, “Taiwan is where over 80,000 Americans live, work, or travel on any given day.”

China’s geographic advantage cannot be ignored. According to the CMSI report, Chinese military capabilities are particularly potent within the First Island Chain, which includes Taiwan. “Chinese capabilities may…contest U.S. supremacy in scenarios close to home,” the report warns. That’s where deterrence matters most—and where readiness is most urgently needed.

Why Americans Should Care

This is not just a Navy problem. It’s an American problem. Delays in defense production, weak infrastructure, and an uninformed public are national vulnerabilities. If Americans fail to understand what is at stake, we will fail to hold our leaders accountable. And if we fail to act, we will be forced to react under far worse circumstances.

A strong Navy protects freedom of navigation, global trade, energy security, and the American way of life. Without it, our adversaries will decide what happens in the Taiwan Strait, the Red Sea, the South China Sea — and now, even the Arctic.

What the Navy Needs Now

A modern Naval Act. We need a 21st-century version of the pre-WWII Naval Act to rapidly rebuild shipyards, expand production, and modernize our fleet. Sadler calls this “a promising first step to regain the ability to sustain a wartime economy in a prolonged war with China.”

Real investment in maritime infrastructure. Ports, dry docks, and logistics support are vital national security assets that must be revitalized now.

Faster arms deliveries to Taiwan. The delays in Harpoon, Javelin, and Stinger deliveries must be resolved. Taiwan’s ability to defend itself is our first line of deterrence. Sadler emphasizes that “how the new Administration responds and accelerates the arming of Taiwan will be key in sustaining the military balance and peace in the near term.”

A unified national strategy. We must operate differently — with diplomatic, economic, and military efforts aligned. Naval statecraft must be at the heart of this new Cold War strategy. Sadler emphasizes, “Naval statecraft is the recommended way forward; that is, a maritime strategic framework for using American power.”

The CMSI report reminds us that training, human capital, and logistics remain U.S. advantages. While China may be catching up in hardware, “Chinese training still lags. The gap in the software [human resources and development] is even bigger,” the report notes. But these gaps can close — unless we act now to protect and reinforce our edge.

An Engaged and Educated Public

At Americans for a Stronger Navy, we believe in peace through strength. But strength requires public awareness, buy-in, and civic action. That’s why we launched the Americans for a Stronger Navy Educational Series — to help Americans understand the stakes, the history, and the path forward.

We invite every reader to check out and sign up for the Educational Series on StrongerNavy.org. Learn what makes our Navy vital to our security and prosperity. Share it with others. Talk about it. Get involved.

Conclusion

We are not powerless. But we must not be silent. The Heritage Foundation, the U.S. Naval War College, and recent military testimony to Congress all point to the same reality: America is in the early stages of a long contest with near-peer adversaries, and we must prepare now.

It’s time for Americans to wake up, stand up, and demand a Navy that is ready not just for today’s threats, but tomorrow’s challenges.

America needs a stronger Navy. And the Navy needs a stronger America behind it.

Global Risks to Undersea Infrastructure and the Growing Need for Defense

All Hands on Deck by StrongerNavy.org

Undersea cables are the unseen arteries of modern communication, carrying 99% of the world’s internet and telecommunications traffic. Yet, as geopolitical tensions rise, these vital systems are becoming frequent targets of sabotage and hybrid warfare. Incidents from the Baltic Sea to the Taiwan Strait highlight both their strategic importance and vulnerabilities.

The Stakes: Why Undersea Cables Matter

  • Global Communication: These cables carry 99% of international data, enabling everything from financial transactions to government communications.
  • Economic Lifeline: Damaging these cables can disrupt trillions of dollars in daily transactions, impacting economies and businesses globally.
  • Military and Security Concerns: Undersea cables are vital for military communication, making them high-value targets in hybrid warfare strategies.

Recent Incidents and Their Implications
Baltic Sea

  • October 2023: The Hong Kong-registered containership Newnew Polar Bear dragged its anchor across the seabed, damaging the Balticconnector natural gas pipeline and data cables in the Gulf of Finland. The ship fled toward Russia, evading investigation.
  • December 2024: A power cable between Finland and Estonia was severed, and suspicion fell on a Russian “shadow fleet” tanker, the Eagle S. Finnish authorities found specialized surveillance equipment on board, allegedly used to monitor naval activity.

Taiwan Strait

  • February 2023: Two undersea cables connecting Taiwan to the Matsu Islands were severed by a Chinese fishing boat and cargo vessel, leaving the island without internet for weeks.
  • January 2025: The freighter Shunxin-39 severed a cable off Taiwan’s northern coast. Although the ship escaped investigation, Taiwan suspects deliberate sabotage. Herming Chiueh, Deputy Head of Taiwan’s Digital Ministry, said the cable-cutting was likely intentional: “You need to accidentally [drop your] anchor on the cable, and then you need to accidentally turn on your engine with the anchor down, and even [if] you realize your anchor is down, you need to keep the engine moving until you cut the cable.”

Red Sea

  • Houthi rebels were suspected of damaging cables belonging to four major telecom networks, though the group denied involvement.

The Strategic Significance of Undersea Infrastructure

  • Economic Importance: These cables carry trillions of dollars in financial transactions daily. Disruptions can cripple economies, hinder communication, and destabilize global markets.
  • Military Implications: Reliable undersea communications are vital for military operations and coordination. Sabotage could cripple responses during crises, delaying information flow and strategic decisions.
  • Geopolitical Pressures: Russia and China employ unorthodox tactics to assert dominance and destabilize their adversaries.

U.S. Navy and Allied Responses

  • Enhanced Patrols: NATO and allied nations are increasing naval presence in the Baltic and other regions to monitor suspicious activity.
  • Technological Investments: AI-driven systems and underwater sensors are being deployed to detect and deter sabotage.
  • Policy and Collaboration: Strengthened international legal frameworks and collaborative efforts among allies are essential for defending undersea infrastructure.

The Way Forward

  • Mitigating Risks: Building redundant systems, deploying advanced monitoring technologies, and fostering public-private partnerships are key steps to reduce vulnerabilities.
  • A Call for Action: Safeguarding undersea cables requires prioritization at the highest levels of government and international collaboration to counter hybrid threats.

Undersea cables, often taken for granted, are critical to the global economy, security, and military operations. The recent spate of incidents underscores the need for vigilance, innovation, and collaboration. For the U.S. and its allies, safeguarding these invisible lifelines is not just a technical challenge—it’s a strategic imperative.

Why Taiwan Matters for America and Its Navy

Taiwan – Wikipedia

Introduction

Taiwan is a small island nation off the coast of China, with a population of about 23 million people and a land area of about 14,000 square miles. It is also one of the most important and contentious issues in global security, especially for the United States and its Navy.

Taiwan’s History and Status

Taiwan has a complex and contested history with China, which claims Taiwan as part of its territory and vows to reunify with it by force if necessary. Taiwan, on the other hand, has developed its own identity and democracy, and seeks to maintain its autonomy and sovereignty. The United States has been Taiwan’s main ally and protector since 1979, when it established the Taiwan Relations Act, which commits the United States to provide Taiwan with arms sales and assistance, and to help Taiwan defend itself against any threats or attacks.

However, the United States has also maintained a policy of strategic ambiguity on Taiwan, which means that it neither promises nor rules out military intervention in case of a Chinese attack. This policy is intended to deter both China and Taiwan from taking any provocative or unilateral actions that could destabilize the status quo and trigger a war. However, this policy also creates uncertainty and confusion for both sides, as well as for the United States itself.

Taiwan as a Tipping Point

In his recent speech at the Global Security Forum ’23, Professor James Holmes, a professor of strategy at the Naval War College and a nonresident fellow at the University of Georgia School of Public and International Affairs, addressed the question of whether Taiwan will be a tipping point in global security. He defined a tipping point as a change of state that involves cause and effect and time. He used the metaphor of a boiling point to illustrate his definition, and he explained how human beings can regulate changes of state by adjusting the heat or pressure in a system.

He then applied his definition and metaphor to the case of Taiwan, which he considered to be a potential flashpoint between the United States and China. He argued that Taiwan is not yet at a tipping point, but it could be if certain conditions are met. He identified three conditions that could trigger a tipping point:

(1) China decides to use force to reunify with Taiwan;

(2) the United States decides to intervene militarily to defend Taiwan; and

(3) Taiwan decides to declare formal independence from China.

He analyzed each of these conditions and evaluated their likelihood and consequences. He concluded that none of them are very likely or desirable, but they are not impossible or unthinkable either. He warned that miscalculation, misperception, or miscommunication could lead to an escalation or a crisis that could push Taiwan over the tipping point. He also cautioned that domestic politics, public opinion, and media influence could affect the decision-making process of the actors involved.

How to Prevent or Manage Tipping Point

He then offered some recommendations on how to prevent or manage a tipping point in Taiwan. He suggested that the United States should maintain its strategic ambiguity on Taiwan, which means that it should neither promise nor rule out military intervention in case of a Chinese attack. He also advised that the United States should strengthen its deterrence and diplomacy vis-à-vis China, which means that it should bolster its military presence and capabilities in the region, as well as engage in dialogue and cooperation with China on areas of common interest. He also proposed that the United States should support Taiwan’s security and democracy, which means that it should provide arms sales and assistance to Taiwan, as well as encourage its participation in international organizations and forums.

Why Taiwan Matters For America’s Interests and Values

Why should Americans care about Taiwan? Because Taiwan matters for America’s interests and values, as well as for its Navy’s missions and objectives. Taiwan is an important economic partner and trading partner for the United States, with bilateral trade worth over $100 billion in 2020. Taiwan is also an important democratic ally and friend for the United States, sharing common ideals and principles such as freedom, human rights, and rule of law. Taiwan is also an important strategic partner and asset for the United States, helping to balance China’s power and influence in Asia-Pacific.

Why Taiwan Matters for America’s Navy

Taiwan is also crucial for America’s Navy, which has been operating in the western Pacific for over 70 years. The Navy’s role is to protect U.S. interests and allies in the region, as well as to ensure freedom of navigation and access to the global commons. The Navy’s presence is also meant to deter China from using force or coercion against its neighbors, especially Taiwan. The Navy’s capabilities are also essential for responding to any contingency or crisis involving Taiwan, whether it is humanitarian assistance or military intervention.

Taiwan is not only an island nation; it is also an idea worth defending. It represents what America stands for: democracy, liberty, and peace. It also represents what America needs: a strong Navy that can protect its interest and values around the world.

Conclusion

We are the Americans for a Stronger Navy and we advocate for Peace Through Strength. We believe that a strong navy is the best guarantee of peace and security in the maritime domain.

We believe that a strong Navy is the best deterrent against aggression and coercion by our adversaries. We also believe that a strong Navy is the best instrument of diplomacy and cooperation with our allies and partners.

We stand with our sailors and their families during this difficult time. We support them with our words and deeds. We thank them for their dedication and sacrifice. We hope that they will receive their due respect and reward soon.

We are the Americans for a Stronger Navy, and we say: “Don’t give up the ship!”

Source: 19FortyFive.com