A New Mechanism for an Old Policy: The United States Uses Drawdown Authority to Support Taiwan

Audio Brief

A short, spoken-word summary from CSIS’s Mark Cancian on his Critical Questions with Bonny Lin, A New Mechanism for an Old Policy: The United States Uses Drawdown Authority to Support Taiwan.

Audio file

President Biden recently announced the provision of $345 million of military aid to Taiwan using drawdown authority passed by Congress last December. Although this does not represent a change in overall U.S. policy, it does represent a major change in U.S. practice for providing arms and implies a closer military relationship. Previously all weapons were provided through sales, not through a drawdown of U.S. stockpiles. This change occurred because of concerns regarding China’s military threat to Taiwan and the slowness of regular arms sales. The bad news is that this action will compete to some degree with the provision of weapons to Ukraine. The good news is that helping Taiwan defend itself has strong bipartisan support.

Q1: What has the administration announced?

A1: On July 28, the Biden administration announced that it was sending Taiwan $345 million of military aid. Details are few, but the equipment reportedly includes “man-portable air defense systems, or MANPADS, intelligence and surveillance capabilities, firearms and missiles.” The package could include services such as training and education.

This is the first slice of a $1 billion authorization for such aid, though the White House has made no mention yet of any subsequent packages.

The lack of detail is unusual. Announcements of aid to Ukraine specify types—and sometimes amounts—of equipment, even though Ukraine is at war and has a great need for operational security. Details are likely withheld on the Taiwan package because it is a highly sensitive issue for China and there is a U.S. desire to keep this effort lower profile. However, because this transfer involves the movement of many physical objects, some details will likely emerge, if not officially then informally through press leaks and on-the-spot observations.

Q2: How is this military aid different?

A2: What is different is the transfer mechanism. The size of this intended aid is well within the range of the packages of prior U.S. arms sales to Taiwan, which has included on the higher end the 2019 notification of $8 billion sales of F-16 fighter aircraft to Taiwan. Receiving military aid also does not make Taiwan unique—the United States provides military aid to over 150 allies and partners globally. However, receiving large amounts of aid from existing U.S. stockpiles is nearly unique, being limited to Ukraine and now Taiwan.

This is a change from past practice for providing military equipment, but not a change in fundamental U.S. policy towards Taiwan. The Taiwan Relations Act (TRA) of 1979, which lays out U.S. policy on provision of arms to Taiwan, stated that “the United States shall make available to Taiwan such defense articles and defense services in such quantity as may be necessary to enable Taiwan to maintain a sufficient self-defense capacity.” The TRA does not specify how the United States should make defense articles and services available to Taiwan, leaving U.S. leaders the flexibility of deciding how to do so. Previously, the United States provided weapons and services through sales, but that was a policy choice, not a legal or treaty requirement. Although U.S. overall policy towards Taiwan remains the same, the Biden administration’s changing of how the United States provides military aid to Taiwan is significant in three ways. First, Section 5505 of the 2023 National Defense Authorization Act (NDAA) gave the president authority for “drawdown of defense articles from the stocks of the Department of Defense, defense services of the Department of Defense, and military education and training.” Providing aid directly opens the possibility of more such aid in the future, not constrained by Taiwan’s relatively modest defense budget and not subject to the lengthy reviews that the TRA requires. Notably, the NDAA also provided $2 billion in loans per year for five years, and $100 million for stockpiling equipment on Taiwan, but nothing has happened with those provisions yet. The 2023 NDAA did not include any money for Taiwan to buy equipment although it had been discussed. Stockpiling of U.S. equipment on Taiwan would be significant if it occurs. These will be topics for future commentaries.

Second, because the equipment comes from existing stocks, it should arrive in Taiwan quickly. It does not have to go through the foreign military sales process, and Congress does not need to approve it. Congress already gave the president the transfer authority.

Finally, the transfer represents an increase in U.S. support for Taiwan by helping Taiwan expand its self-defense capabilities beyond what the island’s current defense budget can support. Thus, this military aid package can be viewed as the United States more directly contributing to the defense of Taiwan. Further, if the United States provides services, military-to-military relations will also expand. Both arms sales and arms transfers signal support since United States aligns both with overall defense priorities and policies. Nevertheless, arms sales are a commercial transaction, and there is an element of economic self-interest that is not present in an arms transfer.

Q3: Why did this change in practice occur?

A3: Two concerns have come together to produce this change. The first is a growing concern that China’s military buildup and assertive rhetoric is not just a long-term challenge, but also a near-term threat. In 2021, Admiral Phil Davidson, then commander of the United States Indo-Pacific Command stated this forcefully, but many others have as well. Wargames, such as a CSIS project on a U.S.-China conflict over Taiwan and a CNAS wargame in Congress and on television, have made the issue vivid for many Americans. In January 2023, the House responded to these growing anxieties by creating a Select Committee on the Strategic Competition between the United States and Chinese Communist Party, chaired by Representative Mike Gallagher (R-WI).

The second set of concerns flowed from the slow pace of foreign military sales. The process takes many years to complete with problems on both sides, including Covid-19-induced manufacturing delays. It was recently revealed that $19 billion in potential sales was in the pipeline, with some items dating back to 2016. This long timeline is incompatible with an immediate sense of threat.

In the background is a recognition that presidential drawdown authority is a powerful tool. Although the authority (technically, section 506 (a) (1) of the Foreign Assistance Act of 1961) has been around since the 1960s, the amount was limited to $100 million a year (the legal cap unless superseded). Further, the equipment was truly excess and, generally, obsolete. It was what the United States did to help partner countries that did not need advanced capabilities.

The war in Ukraine changed that. Through July 2023, the United States has provided $23 billion of drawdown aid to Ukraine in 43 packages. Not only has the amount been substantial, but the equipment and munitions provided are the same that front-line U.S. forces use. That sparked a recognition that this authority was a good mechanism for rapidly improving a partner state’s military capabilities.

Q4: Will this package interfere with aid to Ukraine?

A4: Unfortunately, the answer appears to be yes. It would be convenient if there were little competition because trading off between two threatened partners is painful. However, the systems reported to be in the package, “man-portable air defense systems, intelligence and surveillance capabilities, firearms and missiles,” appear to be the same systems provided to Ukraine.

This competition is a change. Previously, there was not much overlap. The war in Ukraine has been mostly a ground war and consequently most of the equipment sent has been oriented toward land combat. Equipment sent for air warfare (Mi-17 helicopters, air-to-ground munitions like high-speed anti-radiation missiles, or HARM, and Zuni rockets) and naval warfare (Harpoon missiles, small boats, Unmanned Coastal Defense Vessels) have been limited in scope and generally in adequate supply. Taiwan has mostly bought air and maritime weapons. Recent weapons requests did have weapons that had been sent to Ukraine like Javelin and HIMARS, but Taiwan was asking for new production that would not take place for years, well after the war ended, not a drawdown of current stocks.

However, elevated concern that a Chinese cross-strait invasion might be possible has pushed Taiwan to upgrade all elements of the Taiwan armed forces. Equipment for the ground forces competes with both Ukraine and the United States’ own military needs. With time, industry will catch up with demand, but that will take years.

Of course, the degree of competition depends on what is in the package. The more it contains air and naval weapons or services like training and education, the less competition there will be. A few big-ticket items, like F-16s, would use a lot of the funding without competition with Ukraine. Taiwan has been trying to buy F-16s for several years.

Scale is also important. The United States has committed $41 billion to Ukraine, a combination of drawdown ($23 billion) and contracts for new production ($18 billion). That is over 100 times as large as this July aid package to Taiwan.

Q5: Will there be domestic political opposition?

A5: Some on the populist right and the progressive left may complain about the cost and the risk of the United States getting dragged into another war, but they will not gain enough traction to delay or modify the transfer. Support for Taiwan has been strongly bipartisan. The House, which might be expected to exhibit opposition from its populist wing, created the previously noted Select Committee on China. The committee has prioritized competing with China and supporting Taiwan.

Further, because this is a drawdown for which Congress has already given the president authority, there are few mechanisms for congressional interference. So, there may be sound and fury in some corners, but it will signify little.

Q6: How has China reacted?

A6: Not surprisingly, China protested, stating that the action would turn Taiwan into a “powder keg.” Beijing views U.S. military aid to Taiwan as more significant than direct commercial sales of equipment. Beijing’s perceptions of this action will be colored by its deep distrust of U.S. policy on Taiwan and fears that the United States is seeking to “use Taiwan to contain China.”

It is likely that China will continue to ramp up military coercion and pressure against Taiwan. Beijing could also take more specific and targeted actions against the provision of military aid. This January, for example, Chinese media cited U.S. arms sales to Taiwan and a U.S. Navy destroyer transit of the Taiwan Strait as a rationale for engaging in combat drills around the island.

Mark Cancian (colonel, U.S. Marine Corps Reserve, ret.) is a senior adviser with the International Security Program at the Center for Strategic and International Studies (CSIS) in Washington, D.C. During his time in the Office of Management and Budget, his staff helped develop military aid packages for eastern Europe and Ukraine. Bonny Lin is a senior fellow for Asian security and director of the China Power Project at CSIS.

Bonny Lin
Director, China Power Project and Senior Fellow, Asian Security