I’m Not Lovin’ It: Via Big Mac Index, CCP Defense Spending May Exceed America’s
By Matthew Hipple
November 02, 2023
In June, Senator Sullivan (R-AL) discussed an unclassified intelligence estimate on the House Floor suggesting the Chinese defense budget is roughly $700 billion, over three times China’s official 2023 military budget of $224.8 billion (¥1.55 trillion). Applying the Economist’s Big Mac Index, which compresses the loose protein slurry of economic factors down to the single variable of the McDonald’s Big Mac, the Chinese military budget comes to $1.07 trillion in comparative value: $253 billion more in value than the U.S. defense budget.
To be clear, the Big Mac Index does not suggest $1.07 trillion in CCP military spending; it describes received value. Though a nominal budget of 4% China’s GDP may seem unbelievable, let alone a PPP valuation of $1.07 trillion, the results suggest fair valuation. While the U.S. Navy fights to maintain a fleet smaller than requirements, the PLAN raised the world’s largest fleet backed by a shipbuilding capacity 2000% America’s. Additionally, the PLAN fields over 80,000 sea mines of increasing quality and various methods of deployment while American minelaying and mine countermeasure projects struggle. While American air forces face material readiness and recruitment troubles, the PLAF pushes its boundaries and the PLA Rocket Force (PLARF) fields the largest and most diverse missile force in the world – alongside 3200+ acres of reclaimed seabed bases patrolled by maritime militias. While American ground force sealift capacity struggles, China weaponizes their world class civilian maritime industry. China may be short on reliable friends and field systems of debatably lesser quality - but their 20 year military realignment shows value-for-money.
https://www.realcleardefense.com/articles/2023/11/02/im_not_lovin_it_via_big_mac_index_ccp_defense_spending_may_exceed_americas_990091.html
