Understanding the potential sources of escalatory risk is an increasingly important priority for U.S. policymakers. If rivalries produce a series of crises or even proxy or limited conflicts, the danger of those confrontations escalating to higher levels of violence will be an ever-present concern for U.S. decisionmakers. To support current planning, U.S. Army Space and Missile Defense Command and U.S. Army Pacific requested that the RAND Arroyo Center investigate potential sources of escalatory risk from U.S. policy actions and build a tool to assess such risks. This report summarizes that work and concludes with the components of the framework. The analysis combines theoretical and historical research with a current assessment of Chinese and Russian views of escalation and a recognition of the way emerging technologies are changing the context for escalatory dynamics. Escalatory pressures can be highly unpredictable and derive from many independent factors. The tool developed in this research can help decisionmakers think more broadly about such risks. However, an actual crisis or wartime situation will involve a complex and nonlinear interaction of these and other factors, including mistakes and accidents, that can be very difficult to control.

The U.S. Department of Defense's (DoD's) Planning, Programming, Budgeting, and Execution (PPBE) System was originally developed in the 1960s as a structured approach for planning long-term resource development, assessing program cost-effectiveness, and aligning resources to strategies. Yet changes to the strategic environment, the industrial base, and the nature of military capabilities have raised the question of whether existing U.S. defense budgeting processes remain well aligned with national security needs. Congress called for the establishment of the Commission on PPBE Reform. As part of its data collection efforts, the commission asked RAND Corporation researchers to conduct case studies of budgeting processes across nine comparative organizations: five international defense organizations and four U.S. federal government agencies. Congress also specifically requested two case studies of near-peer competitors, and the research team selected the other seven cases in close partnership with the commission. In this volume, the first of four, RAND researchers conduct case studies of the budgeting processes of China and Russia, the two near-peer competitors. Researchers conducted extensive document reviews and structured discussions with subject-matter experts with experience in the defense budgeting processes of the international governments and other U.S. federal government agencies. Each case study was assigned a unique team with appropriate regional or organizational expertise. For the near-peer competitor cases, the assigned experts had the language skills and methodological training to facilitate working with primary sources in Chinese or Russian. The analysis was also supplemented by experts in the U.S. PPBE process.