When discussing the report, one of the initial "this can't be possible" responses of total shock and disbelief centers around the simplistic thought that the Chinese would never harm the U.S. economy. The argument is that we are simply too interdependent. Massive Chinese holdings of U.S. dollars and Treasury bonds would suggest that it is not in their interest to allow anything to happen to the value of the dollar globally. The only problem with this argument is that it presupposes a monolithic China which is simply not the case.
Just this past week, Secretary of Defense Gates visited China and was shocked to learn that President Hu was unaware of the test flight of the new Chinese Stealth Fighter. This is a clear attempt to show military independence from civilian authority. Don't forget that the PLA (People's Liberation Army) published the "how to" manual titled Unrestricted Warfare (see earlier post). It was the PLA that suggested that China could and should dump its Treasury-bond holdings as retaliation if we interfered in China's relationship with Taiwan. It is the same PLA that once considered nuclear exchange with the United States if they held the tactical advantage. This military is not afraid to suffer short-term casualties in the pursuit of long-term objectives.
The intelligence given to Secretary Gates suggested that China would be unable to build a credible Stealth Fighter anytime before 2020. Clearly, that intelligence missed the mark.
Can we be so certain that the extremely well-financed PLA is willing to forego their own doctrine of Unrestricted Warfare when presented the opportunity simply so that Chinese business people can maintain their exports? Would you better our future on it?
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