An annual report released Tuesday by the U.S.-China Economic and Security Review Commission (USCC), a bipartisan congressional body, delivered one of Washington’s starkest evaluations to date of America’s eroding position in the Indo-Pacific as China accelerates its military expansion.
The report highlights massive state investment in China’s defense-industrial base, which has allowed Beijing to grow its armed forces at a pace “far more accelerated than previously anticipated.” The commission now estimates that China possesses roughly 600 nuclear warheads—more than double the 300 believed to be in its arsenal just five years ago.
In a notable shift in tone, the USCC abandoned its long-standing characterization of China as a “rising peer competitor,” instead describing Beijing as a near-peer power capable of inflicting severe damage on U.S. forces in the region.
The report also cites unnamed officials from key U.S. allies—including Australia, South Korea, Japan, and the Philippines—who told the commission their governments no longer believe the United States could win a rapid war with China should Beijing launch an attack on Taiwan. Instead, these officials now assess that China would likely win outright or, at minimum, impose catastrophic costs on Washington.
The USCC’s own analysis does not contradict that view. By 2027, the report states, China is expected to field sufficient conventional and nuclear capabilities to conduct a cross-strait assault and either win quickly or drag the U.S. into a long, grinding conflict that Washington “cannot win or sustain” given projected losses.
Tuesday’s findings follow months of warnings from U.S. think-tanks—many urging the Trump Administration to pursue a more restrained and de-escalatory posture toward Beijing, arguing the U.S. remains unable to mobilize at the scale and speed China now can.
The report further concludes that the U.S. no longer holds escalatory dominance in the Western Pacific, with China able to strike U.S. carrier groups at long ranges. It warns:
“The era of unquestioned U.S. military primacy in Asia is over. Deterrence is still possible, but the margin is razor-thin and shrinking every year. If the United States does not dramatically change course — industrial base, force posture, alliances, economic resilience — it risks losing the military balance in the Western Pacific within this decade.”
China, which commissioned its third aircraft carrier earlier this month, is on track to field nearly 500 naval vessels by 2030, compared to a U.S. fleet of fewer than 300 ships and a far lower annual shipbuilding capacity.