IN THE coming decade, the United States will face a very different and much more challenging security environment than the one it confronted during the Cold War. New challenges will be posed by non-state actors, growing instability in the Muslim world, political shifts in northeast Asia and the accelerated proliferation of weapons of mass destruction. Meeting these challenges will require significant adjustments in the force posture and the modernization and investment priorities of the U.S. armed forces. In particular, more attention will need to be paid to managing challenges at the low end of the conflict spectrum and to post-conflict reconstruction.

While the Bush Administration has taken some steps to adapt U.S. defense policy to meet these new challenges, discontinuities in several regions, especially northeast Asia and the Middle East, could require more far-reaching shifts in the U.S. defense posture. The Iraq War, moreover, is likely to further complicate matters. The problems posed by the conflict and its aftermath were largely unanticipated when the Quadrennial Defense Review and subsequent defense plans were undertaken. Domestic factors, especially the growing budget deficits, could also affect the readiness of the American public to support large increases in the defense budget. Thus the new strategic challenges may have to be addressed in a defense environment that is far less propitious than the one that has existed until now, making starker defense choices necessary.

The Changing Nature of Threats

THE UNITED States will face a very different set of threats in the coming decades than it has in the past. The new security environment will be characterized by a number of key features.

Non-State Actors: This threat, in the form of terrorist groups, religious extremists and other anti-Western groups, poses unique challenges to defense planners. Because they do not permanently occupy territory nor directly control governments, they cannot be defeated by traditional military means alone. A successful strategy must include economic and law enforcement measures in addition to military and political ones. Furthermore, these organizations are more nimble and flexible than states. Small sub-groups often operate on their own and are only loosely coordinated from the top. Thus, killing the top leadership may weaken such groups, but it will not necessarily eliminate them.

Failed States: In addition, weak or failed states may pose a greater challenge than militarily strong ones. First, they may become havens for terrorists, criminals and insurgent groups. Somalia, Afghanistan under the Taliban, and to some extent Colombia provide examples of this problem. Second, they can be a source of humanitarian disasters. In an age of instant communication, and the so-called CNN factor, these problems may prove difficult for the United States to ignore. Even if it wants to turn a blind eye, there may be strong public pressure for the United States to take action, as the conflict in Kosovo underscores.

Instability in the Islamic World: The Islamic world, especially that which is located in the so-called "zone of instability" extending from the west coast of Africa to Southeast Asia, is likely to be a key source of problems for the United States. Weak and unrepresentative governments, serious economic and social problems, resentment of the spread of Western--especially American--culture, U.S. support for Israel, and the global War on Terror are likely to fuel a trend toward greater Islamic militancy and radicalism. This in turn could make U.S. access to military facilities in many parts of the zone of instability increasingly uncertain.

Strategic Discontinuities in Northeast Asia: The current geopolitical status quo in northeast Asia is highly fragile. Major strategic shifts during this decade will likely compel the United States to radically rethink its defense policy and military presence in the region, beyond the current plans to restructure and downsize the U.S. posture in South Korea. In the last several years, the rapprochement between the two Koreas has taken on new momentum, which could lead to growing domestic pressures in South Korea--as well as in the United States--for the United States to substantially reduce its forces in South Korea and possibly even withdraw them entirely. Furthermore, a reduction of the U.S. presence in South Korea could prompt Japan to begin to rethink its security relationship with the United States. Feeling that it could no longer rely as heavily on the United States for its security, Japan might move in a more nationalistic direction. The result could be a more "Gaullist" Japan--one less dependent on the United States and less solicitous of U.S. interests. The emergence of a nuclear-armed North Korea will change the regional strategic dynamic and could lead South Korea and Japan--and possibly Taiwan--to consider developing their own nuclear arsenals.¹

China's Uncertain Evolution: China has the potential--as well as the ambition--to become the dominant power in East Asia over the next several decades. But it faces formidable economic and political challenges that will significantly affect the pace and scope of its military modernization.² The Chinese leadership appears committed, at a minimum, to developing a military posture that would enable it to deter Taiwan from moving toward independence. It also appears to hope to have a military posture by the end of the decade that could deter the United States from openly intervening in support of Taiwan if the Taiwanese leadership should decide to move toward independence.

Simultaneously, Beijing faces several dilemmas on the nuclear front. The first is how to respond to the U.S. decision to deploy a ballistic missile defense system. China's response is likely in part to be conditioned by its desire not to provoke a major offensive-defensive arms race with the United States. At the same time, Beijing will probably maintain a robust investment program designed to provide an assured retaliation capability. This might include the deployment of a wide range of sea-, air- and ground-launched cruise missiles that could bypass any regional or national ballistic missile defenses that the United States might deploy during this decade. The second is the current nuclear crisis with North Korea. China has tittle interest in seeing North Korea develop a robust nuclear arsenal, which could, as noted above, provoke nuclear balancing by China's neighbors.

A final question mark is posed by China's policy toward Taiwan. In recent years, China has engaged in a steady military modernization that is eroding the military and technological balance of power that Taiwan has enjoyed. China has increased the number of short-range ballistic missiles deployed in the region across from Taiwan and is also developing a medium-range ballistic missile which is expected to be deployed in the near Future. So far, Taiwan has been cautious about pushing for independence, in part because of U.S. pressure against such a move. But there is no guarantee that this caution will continue indefinitely.

The Accelerated Proliferation of Weapons of Mass Destruction: Following the end of the Cold War, the United States military placed emphasis on planning for wars against regional opponents who lacked nuclear weapons. A key assumption on the part of United States planners was that middle-sized regional powers such as Iraq or North Korea would not have nuclear arms. However, the emergence of a nuclear-armed North Korea has rendered this assumption obsolete.

In the Future, U.S. military planners will have to explicitly take into account the possibility that a hostile regional power will have nuclear weapons and the means to deliver them. Furthermore, there is the prospect that future opponents armed with nuclear weapons may develop more sophisticated concepts of their use than merely threatening mass destruction.³ This will change how the United States plans and executes major combat operations against such nations.

Finally, the proliferation of chemical, biological, radiological and nuclear (CBRN) weapons, together with delivery systems that range from ballistic missiles in the hands of a hostile state to clandestine devices delivered by non-state terrorists, has greatly complicated the defense of the U.S. homeland. The deterrence policies of the Cold War may not work against such opponents, especially non-state terrorists.

The Impact of the Iraq War: The U.S. decision to invade Iraq is likely to have several profound implications for U.S. defense policies and planning for at least the rest of this decade. ⁴ First, the continual instability in Iraq more than a year after the overthrow of Saddam Hussein's regime means that the U.S. military, especially the Army and the Marine Corps, may have a major commitment in that country for several years to come. Second, the fiscal costs of Iraq are already having an effect on the modernization plans of the U.S. armed forces. With the costs of Iraq amounting to roughly $4 billion per month, the modernization plans of the services are in jeopardy of having to be truncated to pay for the long-term costs of the Iraqi occupation.⁵ Third, operations in Iraq are consuming a considerable percentage of Army and Marine Corps force structure. Thus far the burden has been somewhat reduced by the extensive use of reserve forces. It is not clear, however, how much longer the large-scale or extended (over one year in many cases) use of reservists can go on, and there are already indications of recruiting and retention problems in the reserve components, especially the Army Reserve and National Guard. Fourth, the large-scale, extended deployment of troops in a hostile occupation situation could, if it lasts for years, test the viability of the entire volunteer-force concept, in both the reserve and active components. Indeed, several members of Congress, including Sen. Chuck Hagel (R-NE), have publicly raised the possibility of re-instituting the draft. Fifth, the occupation has shortened the horizon for U.S. defense planners. The focus is increasingly on meeting the immediate needs of U.S. forces that are engaged in ongoing and likely protracted military operations. This has led to a bias toward those parts of the defense budget associated with operations and maintenance versus long-term capital investment. Much of the most recent defense increases have been absorbed by consumption at the expense of investment. In addition, tax cuts, healthcare and Social Security are all likely to put serious pressure on future defense budgets.

Finally, Iraq may also have an important impact on U.S. domestic attitudes toward the use of military force in the future. In the aftermath of Iraq, it may be much harder to gain domestic support for military interventions abroad, except if the United States is directly attacked. "No more Iraqs" could become a strong sentiment within large parts of the American public. At a minimum, future U.S. presidents are likely to think twice before committing U.S. forces in messy conflicts abroad and to give greater consideration not just to the military costs of any intervention but also to the problems of post-conflict reconstruction. In particular, support for preventive war and preemption is likely to be harder to obtain.

New Challenges for Defense Planning

THIS CHANGING strategic environment has a number of implications for U.S. defense planning that will require the attention of future administrations:

* While the United States will still need to hedge against threats from state actors, many of the threats the United States will face will come from non-state actors. As a consequence, the United States may find itself increasingly facing a new type of threat--a "war in the shadows" that combines elements of conventional warfare, special operations and law enforcement. Many current and future opponents, both state and non-state, may decide that challenging the United States using conventional military means is a losing game. Instead, they may conclude that the United States can best be confronted by unconventional means--either by relying on terrorism and insurgency or by trying to acquire nuclear weapons.

* The current forward-presence posture of the U.S. military should be revised. Important steps in this direction are already underway, including a draw-down of the decades-old U.S. presence in western Europe. Given the likelihood of many future operations taking place in the zone of instability, more attention should be given to increasing U.S. access to that region, including a gradual repositioning of forces around the periphery of the area, with greater emphasis on selected "hubs" such as Guam and Diego Garcia.

* The United States may find it more difficult to obtain access to facilities in Muslim nations in the zone of instability. Turkey's refusal to allow the United States to use its facilities during the Iraq War highlights this problem--and Turkey is a NATO ally. Consequently, the United States may have to look at other options, especially sea-basing and the increased use of long-range aviation. The U.S. experience in the first few months of operations in Afghanistan in 2001 provides another example of the access problems the United States could face in the future, as it took months to negotiate basing permission from the countries surrounding Afghanistan.

* Expeditionary operations will increasingly become the norm. Moreover, in many cases the deployments may be into areas where the United States has no or very little military presence in the pre-crisis period. While formal alliances will remain important, many crisis response operations beyond Europe may be conducted by ad hoc coalitions of the willing. As a result, the United States may find itself compelled to operate with new and different allies and partners such as Pakistan or India. This will complicate interoperability and require the United States to intensify defense cooperation with a new set of partners while continuing to encourage our NATO allies to enhance the deployability of their forces for operations beyond Europe.

* Post-conflict stability and policing operations are likely to increase. Most of the operations that the United States conducts over the next ten years are likely to be at the low to middle end of the conflict spectrum. Some, if not most, of these operations could be of long duration. Some may be in a relatively benign environment, but others may be in a much more hostile environment (such as Somalia and Iraq). Moreover, the type of forces and training needed for the stabilization and reconstruction phase are quite different from those needed for the combat phase of an operation. In the post-conflict stage, the United States needs civil engineers, military police, civil affairs personnel, and troops with specialized language training. These are currently in short supply, and those that exist are mostly in the Reserves, not in the active forces.

* The United States needs to be able to transition much more quickly from the combat phase to the stabilization-reconstruction phase. This is the key lesson from the Iraq experience. Addressing this will require training more troops in post-conflict reconstruction tasks. Indeed, it may be useful to create forces specifically trained and structured to carry out post-conflict reconstruction and stability tasks. This could include the creation of more peace-enforcement units such as military police and civil affairs or, more radically, the creation of specialized combat units whose training and organization are optimized for such missions.

* The United States may well not face another opponent similar to Iraq in the foreseeable future. Only four plausible opponents come readily to mind: China, Iran, North Korea and Syria. China is a special case, with much greater military power--specifically a transoceanic-range nuclear arsenal--than any other plausible opponents. North Korea has a small but expanding nuclear arsenal, and there is evidence that Iran is on verge of developing one as well. At present, Syria appears to be conforming to the new strategic reality in the Middle East and is not taking any actions that would directly provoke the United States. There is no evidence that Syria has or is attempting to acquire nuclear weapons.

* The proliferation of nuclear weapons by regional opponents fundamentally changes the stakes involved in any potential conflict. At a minimum, the presence of nuclear weapons would significantly reduce the likelihood that the United States would be inclined to accept the risks associated with the deployment of sizable numbers of ground forces and/or land-based aviation within range of such a threat. All of the services will need to come to grips with the realities of fighting in a military environment where there could be limited use of nuclear weapons. The joint operational concept of any future large-scale forcible entry operation and the ensuing campaign of regime change will have to be redesigned to minimize the vulnerability of those forces to nuclear attack. Furthermore, that operational concept will have to deal with the challenge that major population centers of local allies may be menaced by this regional nuclear strike capability.

* The increasing threat from CBRN weapons will require the United States to rethink aspects of homeland defense in order to defend against slow motion and stealthy delivery of CBRN weapons. These weapons can be used by either hostile nation states or non-state actors. The most difficult threat to counter may be a covert movement of CBRN weapons into the United States, probably by a non-state terrorist group. The threat could require a greater level of effort by the U.S. military to supplement current border control measures, as well as monitoring abroad the flow of goods such as those found in the vast movement of seaborne containers.

* In light of the shifting focus of future threats, U.S. defense planners need to rethink defense investment priorities. In the past decade, the main focus has been on preparing to fight major regional contingencies against state actors armed with classic, combined-arms weapons systems and organizations that have at worst a biological and chemical weapon arsenal. However, in the future, most conflicts are likely to be at the low end of the military spectrum, thus requiring the U.S. military to place more emphasis on this type of military challenge. In addition, the U.S. armed forces will have to design and deploy forces that can effectively defeat a major opponent armed with nuclear weapons.

Implications for the Services

THE NAVY and Marine Corps are best suited to overcome the effects of constrained access. The importance of naval aviation in both the Afghanistan and Iraq operations highlights this reality. Whereas the Air Force's relatively short-range, land-based fighters were significantly constrained by political considerations in both operations, carrier-based fighters faced no such limitations. A strong case can be made that the bulk of tactical aircraft modernization should be directed toward the modernization of sea-based Navy and Marine Corps aviation rather than the larger USAF fleet of tactical aircraft.

The Navy and Marine Corps need to continue to improve their sea-basing capabilities to facilitate the rapid projection and sustainment of significant amounts of power from offshore locations. Increased sea-basing could also benefit Army and Air Force elements that the United States might want to project into a threatened region, at least in terms of logistics. The evolution toward a more robust sea-basing philosophy may prove to be one of the more practical ways in which the United States adapts to nuclear-armed regional powers. This would allow the logistical support to operate in mobile fashion offshore and be defended against nuclear-armed ballistic and cruise missile strikes. Additionally, the Navy and Marine Corps need to give greater emphasis to how they can contribute to prolonged, low-intensity, counter-insurgency-type operations in littoral areas such as Colombia, the Philippines or Indonesia.

The Marine Corps should work closely with the Navy to determine the optimal future mix of traditional amphibious ships, fast sealift vessels, and new types of pre-positioning ships. Additionally, the Marine Corps has two expensive programs, the V-22 tilt-rotor aircraft and the Expeditionary Fighting Vehicle, that may be inappropriate for many future missions. Amphibious assaults, which have been a rare event since the end of World War II, will remain an occasionally needed capability in the future, compared to uncontested operations from the sea. Therefore, the Marine Corps should balance their traditional focus on assault operations with other aspects of sea-based operations.

Given the trends in the global threat, less emphasis should be placed on systems related to ship-to-ship combat and our own submarine forces. Just as the United States already has a decisive advantage in air-to-air combat, we also have a huge edge in our ability to dominate any engagement with enemy surface craft. This is an area where the Navy could forego any near- or mid-term investment. With the exception of the Chinese, the submarine threat the United States would face from regional opponents is limited to relatively small numbers of generally obsolete submarines that are only capable of operations fairly close to their own bases. While that threat cannot be ignored, it does not require large investments in new anti-submarine capabilities. Additionally, while other uses can and should be made of the current U.S. submarine force, the Navy should not attempt to find uses for submarines (which tend to have very limited conventional weapons payloads compared to their overall tonnage) if surface combatants and aviation can perform the required missions. The primary advantage of using submarines for strike operations is their stealth, which on occasion is an important attribute. However, only China and Russia are capable of creating a future naval surveillance and strike capability that warrants the investment required to use our submarine fleet, especially the converted Trident nuclear-missile submarines, as stealthy cruise missile carriers.

Certain elements of the Air Force truly have "global reach", such as long-range heavy bombers, aerial tankers and transports. Increases in these capabilities should be given priority to ensure that strike and transport aviation can be used in areas where shore access could be challenging. Additionally, the Air Force should continue to increase its air- and space-based reconnaissance and surveillance capabilities, including the ability to locate and track small numbers of enemy operating in restricted terrain such as forests, cities and suburbs. It is noteworthy that today the Air Force has no firm plans to build another long-range bomber to eventually take the place of the B-52s, B-1s and B-2s that are available today in relatively limited numbers. Meanwhile, it is on the verge of a major purchase of a large number of short-range fighters. The F-22 Raptor and F-35 Joint Strike Fighter--precisely the type of aircraft that was badly constrained in both the Afghan and Iraq wars due to political access problems. Further, these relatively shorter-range fighters have to use bases that are far more vulnerable to the growing regional nuclear threat. At a minimum, the Air Force should plan to extend the life of the B-52s and B-1s through reengining and avionics upgrades. In the longer term, a new, long-range, long-endurance, large-capacity strike aircraft is needed. In addition to altering the bomber-fighter investment mix, the Air Force should also place greater emphasis on airlift and long-range, high-endurance reconnaissance and surveillance platforms. The latter can be a mix of manned and unmanned, air-breathing and space-based systems.

All operations since the end of the Vietnam War have shown that the United States has an overwhelming edge in the air-superiority battle. Indeed, in both the Afghan and Iraqi operations, the enemy did not manage to get any aircraft into the air to oppose U.S. forces. Nevertheless, the Air Force continues to invest heavily in new platforms (the F-22 is the best example), sensors and weapons that are focused on air-to-air combat. The United States must continue to maintain its considerable advantage in air superiority, but that need must be balanced against other missions the Air Force has to perform. The most challenging threats to U.S. air dominance are probably politically driven access problems and the regional threat of nuclear attack. Even the threat from modern surface-to-air missile systems, while probably a greater challenge than the fighter forces of most likely opponents, is not as severe as is often portrayed, since the large cost of modern SAM systems has constrained their proliferation.

While the Air Force should continue to hedge against the possible emergence of a significant air-to-air threat as well as continuing to enhance its ability to counter modern surface-to-air missiles, it has to strike a better balance of those needs with other, more likely challenges and requirements. The Air Force would be better off buying a limited number of F-22s and investing in the next generation of aerial platforms designed to detect ballistic and low-level cruise missiles.

An important consideration for the Air Force (and naval aviation) is the recent willingness of the Army to reduce its organic artillery (and thus the amount of tonnage the Army must deploy in a crisis) based on the assumption that air support will be available in sufficient quantity and in a timely manner. This increased willingness of the Army to rely on air support presents the Air Force and Navy with an opportunity to focus resources on an important mission that will benefit the entire joint force.

The Army will be the most directly affected by the changes in the security environment. Of all the services, the Army is the best suited to conduct mid- to low-intensity operations, as events in Iraq clearly show. But this is not an area that the Army leadership has traditionally wanted to emphasize. Culturally, the Army has wanted to focus on the "high end" of the conflict spectrum, and often thinks of itself as the "supported service" in conventional combat operations, assuming, therefore, that its concepts will dominate campaign planning, with the role of the Navy and Air Force being to transport the Army to the operational area and then provide it with fire support. While this view of joint operations may still hold true in some operations, the "reconnaissance-strike" potential of the Navy and Air Force is now so good that many senior U.S. military and civilian leaders will be inclined to attempt to force a decision with that lower-risk technique, employing ground forces only when necessary and after an opponent has been severely weakened by strike operations. This is changing the relationship between air and ground forces in major combat operations--the "high end" of the conflict spectrum that the Army wants to focus on. Meanwhile, the global strategic situation strongly indicates that the majority of military operations that the United States will conduct in the next decade or more will be stability missions such as peacekeeping and peace enforcement.

Therefore, while the Army will need to maintain the capability to conduct major combat operations in the future, it will have to put greater emphasis on being able to conduct operations at the low- to mid-level portion of the conflict spectrum, and on special operations forces and counter-insurgency warfare. The kinds of operations that the Army is currently conducting in Afghanistan and Iraq--or possibly in Indonesia, Colombia or elsewhere in the future--are the missions that will consume most of the Army's time and resources. The service must be better trained and organized for this possibility.

As far as its investments are concerned, the Army needs to take a more realistic view of what its Future Combat System (FCS) might be. The level of technological risk of the current FCS program is unwarranted, and the cost of re-arming most of the Army with the system is prohibitive. Recent operations in Afghanistan and Iraq have clearly shown that the Army will need to retain a mix of heavy, medium (such as the current Stryker and the still-to-be-developed FCS), and light forces, plus an enhanced special operations element.

Today the Army is in the process of eliminating from the active force some field artillery and air-defense units and using the manpower savings to create more military police, civil affairs and other support-type units that are more conducive to low-intensity stability-type operations. This is a positive trend that will help reduce reliance on the Reserves and National Guard to provide such units. But the Army should also place more emphasis in its training and doctrinal writing on stability, counter-insurgency, and other low-intensity operations that will certainly be by far the most frequent missions in the coming decade and beyond. In order to improve its ability to conduct stability operations, the Army basically has two options: either include more training for such missions in conventional combat support units such as military police, or create specialized elements that are optimized for the mid to low end of the conflict spectrum. Of the two, the more controversial choice is the creation of specialized units that have skills focused on contested stabilization and counter-insurgency operations. A strong case can be made that the Army's approach to treating these type of political military operations as a "lesser included case" is a mistake. Certainly, lessons emerging from the contested occupation of Iraq suggests that combat troops need considerable retraining to effectively become more like heavily armed police rather than warriors sub-optimized for high levels of military violence. As the army of the world's only superpower, the U.S. Army must maintain its emphasis on high-intensity conflict. However, it needs to strike a better balance between high-intensity combat operations, where it has traditionally wanted to focus, and preparation for mid- to low-intensity missions.

ADAPTING TO these new strategic imperatives will require the next administration to make some hard choices regarding investment priorities. In particular, it will need to give higher priority to equipment and forces designed to fight wars in the shadows, as opposed to major conventional wars, and then undertake effective postwar reconstruction. This shift in emphasis will undoubtedly be controversial, especially for the Army. But it is essential if the United States is to adequately address the new strategic challenges it will face in the coming decade.

1 In particular, the emergence of a nuclear-armed North Korea and a more assertive China could induce Japan to begin to rethink its approach to missile defense and nuclear weapons. The recent Japanese government's decision to deploy a national missile defense suggests that some rethinking is already under way. A discussion has also begun in some parts of the Japanese elite about whether Japan should acquire an independent nuclear deterrent.

2 Currently, China devotes about 5 percent of GDP to defense. However, China's military budget is far larger than the $25 billion Beijing announced in March 2004. Pentagon analysts put the figure somewhere between $50 and $70 billion, making it the second- or third-largest defense budget in the world.

3 For example, a nuclear-armed opponent might be prepared to use a limited number of nuclear weapons at an appropriate altitude to cause wide-area electromagnetic effects, in essence using them as weapons of mass disruption.

4 For more on the strategic ramifications of the Iraq War, see William Odom's article in the Summer 2004 issue of The National Interest.

5 Some lawmakers, such as Sen. John McCain (R-AZ), have called for the elimination of the USAF's cherished F-22 fighter program to help pay for Iraq, and the Army has been forced to scrap the Comanche helicopter program.

F. Stephen Larrabee holds the corporate chair in European Security at the RAND Corporation. John Gordon IV and Peter A. Wilson are senior staff members at RAND. The views expressed here are the authors' own and do not represent those of RAND or any of its sponsors.