WHILE AMERICA SLEEPS – AT 8:42 A.M. ET:   Chuck Hagel, strategist, announced deep cuts in American defense last week.  China has given its reply.  From Bloomberg:

China’s central government will boost defense spending 12.2 percent this year as President Xi Jinping seeks to create a strong military and the navy extends its reach into neighboring waters.

The defense budget is set to rise to 808.23 billion yuan ($131.6 billion), the Ministry of Finance said in a report today. The percentage increase is greater than that of total government expenditure, which will rise 9.5 percent in 2014, according to the report.

Premier Li Keqiang told the opening session of the National People’s Congress in Beijing today that China will continue to enhance border, coastal and air defenses.

“We will comprehensively enhance the revolutionary nature of the Chinese armed forces, further modernize them and upgrade their performance, and continue to raise their deterrence and combat capabilities in the information age,” Li said. China will boost research on national defense and the development of new and high technology weapons, he said.

China’s military modernization is increasing tension in the region as it challenges the guarantee of security provided by the U.S. for more than a half a century to sea lanes that handle the bulk of world trade. Xi has made a strong military a key priority for a revitalized China and said he wants the nation to be a maritime power.

China has also taken an increasingly assertive stance on territorial disputes that have lingered for decades with its neighbors. In November, China declared an air defense identification zone over a swathe of the East China Sea that includes islands disputed with Japan.

COMMENT:  Nations in Asia will take note of China's growing power, and our increasing weakness, and act accordingly.  I wouldn't be shocked if both South Korea and Japan, our two most important allies in the region, start to show "understanding" for China.  Thanks, Barack.  Thanks for coming to save us.

March 5, 2014