What the Chinese Don't Know

This story from AP makes it clear the China is not the threat we all make it out to be.

He are some parts:

Hu told members of the Communist Party's powerful Political Bureau that the financial meltdown posed critical challenges to a government that has staked its legitimacy in part on competent management of a rapidly developing society.

Whether the pressures can be turned into a driving force and the challenges turned to opportunities ... is a test of our ability to control a complex situation, and also a test of our party's governing ability," Hu said.

First, a government that stakes it's legitimacy on competent management is doomed to fail.  Government is made up of bureaucrats and politicians that have incentives to stay in power, not create value for society.  When the pace of change is as fast as it is in China, government cannot respond as fast as markets.  Hu is right on one front, the situation is complex.  It is so complex that no human, or group of governing humans, can expect to coral and control it.  Market forces work and are unstoppable.  They brought down the Soviet Union and they will bring down China as well.

He said greater effort should be made to raise living standards, use resources more efficiently and develop rural and urban areas, the report said.

Governments cannot choose how to use resources more efficiently.  Only markets can and after entrepreneurs that fail are allowed to go out of business and successful ones thrive.  The above statement says the government will always know how to best use resources and that is just not possible.  Products have to be created that people actually want and those products have to be created as inexpensively as possible.  Again, governments cannot do either of those things.  Governments create things like the Postal Service, Department of Motor Vehicles, and Medicare.  These are the best creations of our government where losses mount every year, are inefficient uses of citizens' time, and where waste, fraud and corruption run wild.

As long as the US is a free market and upholds the virtues of economic freedom, China will never be a threat to the US.