In the twenty-first century, arms races are not over weaponry but over connectivity—and the United States is losing ground. At the heart of the connectivity competition is infrastructure. Between 2005 and 2012, to keep up with urbanization, rising international travel, growing trade, the dispersal of supply chains, and increased dependence on global digital services, spending on infrastructure for transportation, energy, and communications has doubled from approximately $2 trillion per year around 2005 to $4 trillion by 2012. That figure is projected to rise to $9 trillion by 2020.
With the world now crossed by a latticework of connections, the age of territorial conquest is largely over. International conflict has fallen; instead, nations compete to gain leverage in the connected world.
TIES THAT BIND
The China-led Asian Infrastructure and Investment Bank (AIIB) is one of the foremost examples of competitive connectivity. Since the collapse of the Soviet Union in the 1990s, successive waves of Chinese infrastructure investments have washed over the former Soviet States. China quickly settled border disputes (it borders more post-Soviet Central Asia republics than Russia does), put in place customs agreements, and completed multiple oil and gas pipelines from the Caspian Sea through Kazakhstan and Turkmenistan.
China has more neighbors than any country. It has tense and even hostile histories with some, and suspicions about all. But its strategy of choice was not war but roads, railways, pipelines, and other investments. China treats friends and foes alike: as construction projects to build, own, and operate.
China will not rival the United States in military power anytime soon, but it has a definitive home-court advantage in Eurasia. In fact, all infrastructure built on China’s periphery—irrespective of who builds it—ultimately serves China. For example, when the AIIB announced its initial $100 billion commitment to the region, Japan declared its own intention to fund $110 billion in Asian infrastructure projects. Yet Japanese projects from Kazakhstan to Myanmar will only make these countries more efficient trading partners and passages for China. Japan might applaud itself for writing off $5 billion