lets cut to what i believe to be the two most important parts of this article;
"Itís also true that the Chinese defence budget has grown by doubledigit increases for the past 14 years: this year itís up by 12.6%. But that is not significantly faster than the Chinese economy as a whole is growing, and itís about what you have to spend in order to convert what used to be a glorified peasant militia into a modern military force.
It would be astonishing if China chose not to modernise its armed forces as the rest of the economy modernises, and the end result is not going to be a military machine that towers above all others. If you project the current growth rates of military spending in China and the US into the future, Chinaís defence budget catches up with the US about the same time that its Gross Domestic Product does, in the late 2030s or the early 2040s. "
"moderation has usually applied in nuclear matters. The CIA frets that China could have 100 nuclear missiles targeted on the US by 2015, but that is actually evidence of Chinaís great restraint. The first Chinese nuclear weapons test was 40 years ago, and by now China could have thousands of nuclear warheads targeted on the US if it wanted. (The US does have thousands of nuclear warheads that can strike Chinese targets.) "