China's defense industrial base is operating on a wartime footing, while the U.S. defense industrial base is largely operating on a peacetime footing. Overall, the U.S. defense industrial ecosystem lacks the capacity, responsiveness, flexibility, and surge capability to meet the U.S. military's production and warfighting needs.

Unless there are urgent changes, the United States risks weakening deterrence and undermining its wartime capabilities. China is heavily investing in munitions and acquiring high-end weapons systems and equipment five to six times faster than the United States. China is also the world's largest shipbuilder and has a shipbuilding capacity that is roughly 230 times larger than the United States. One of China's large shipyards, such as Jiangnan Shipyard, has more capacity than all U.S. shipyards combined.