In reality, the real problem that the U.S. government has with China is two-fold: China's growth is pushing aside U.S. influence/power all over the world, which has negative influence on the profits of U.S. corporations, which are losing contracts to Chinese companies.
In response, the U.S. is provoking China in the media and militarily, encircling China by arming U.S. allies in the region, especially India, Japan and South Korea. Hillary Clinton responded to this allegation by denying it, while the Obama administration immediately contradicted her by its actions.
China is becoming a principal global investor. In so doing, it is entrenching itself as an engine of growth for the future, which has an added effect of laying the groundwork for its own currency to take a central role in the new relationships being developed.
At the heart of China's global initiative is China Development Bank; counterpart to the U.S. Federal Reserve Bank. However, unlike the private Federal Reserve, China's investment bank is firmly under state control, not the other way around, allowing it to openly invest domestically and abroad, while integrating coherent government policy decisions. Its investment strategy is rooted in entering a market where they can 'buy up low-priced (financial) assets.'
China’s huge accumulation of US dollars gives it the sway to lead the United States by the nose like a sheep to slaughter, holding in its hands the power to decide the economic destiny of the now collapsing American empire. The culmination of this process moved a step closer this week when Hu Jintao made it clear that China was preparing to sharpen the knife for the bloodletting to begin, by deriding the dollar as a "product of the past" and signaling its replacement with a new global monetary system based around the Chinese yuan.
As Constantine Menges wrote in "China: The Gathering Threat," "In the traditional Chinese view, the world needs a hegemon - or dominant state - to prevent disorder. The communist Chinese regime believes China should be that hegemon." Traditionally, the Chinese communists have cloaked their hegemonic ambitions under the guidance of the late Deng Xiaoping to "keep a cool head and maintain a low profile. Never take the lead - but aim to do something big.
China is racing to be the number one economic world power and the U.S. is retreating from that position, slowly but surely. Each day, the power of the U.S. to dominate or even influence China falls slightly. Each day the power of China to influence and eventually dominate the global economy grows. At this moment in time China owns around half of U.S. Treasuries. They are already in a position to hurt the U.S. very badly, should they want to. But it is not in the interests of China to do that. China is empire-building and doesn't want to be distracted from that. They appear to be on a winning road already. China's is on the rising road and will soon pass the U.S. going the other way.
