Both in the USA and around the world, many people are wondering why the USA keeps provoking China.
The Escalation. Firstly there was aggressive pressure over pollutant emissions, accompanied by Obama's threat to use military satellites to spy on China's environmental behaviour.
This was followed by Hilary Clinton's outspoken attack on Chinese internet policies following the Google affair, when the search engine (closely linked with the most powerful US intelligence agency, the National Security Agency) made a great fanfare about denouncing an internet "attack" that was not much different from many previous incidents.
A few days later came the US announcement of its sale of six and a half billion dollars-worth of weapons to Taiwan, for potential use against China, just when the two countries seemed to moving towards better relations.
Then the announcement of Obama's meeting with the Dalai Lama in Washington.
And finally, the surprising statements made by the US president who (just ahead of new worries about growing unemployment in America) openly accused China of hindering US trade and thereby putting a brake on the employment revival... as though offering American public opinion a foreign scapegoat for its economic difficulties.
The Risks. What can Washington hope to gain from boosting tension with the country that is artificially keeping the crisis-hit US economy afloat by continuing to finance America's astronomical national debt (Peking holds American Treasury Bonds worth 800 billion dollars) and by propping up the dollar (holding two trillion dollars in its monetary reserve)?
If China were to tire of bailing out the decadent US economic hegemony based on the dollar, and decide instead to challenge it by creating an alternative system based on the Yuan, selling its US bonds and diversifying its reserves, America would be in big trouble.
The problem is - US analysts have been warning for months - that it looks as though Peking has decided to follow precisely this strategy.
The Alarm. The first alarm-bells began ringing in the corridors of Washington in March 2009, when the Chinese premier Wen Jiabao expressed his concern about the future of China's investments in US bonds, given the weakness of the American economy.
A few days after this, the Governor of China's Central Bank, Zhou Xiaochuan, floated a proposal for abandoning the dollar as the international reserve currency and substituting it with the IMF's currency-basket (the Special Drawing Rights) with the inclusion of the Yuan.
In the same period the Chinese Government negotiated currency swaps for 650 billion Yuan with the Central Banks of Hong Kong, Indonesia, Malaysia, South Korea, Belarus, Argentina and Jamaica, effectively permitting these countries to trade with China without passing through the dollar.
In May, for the first time, Peking began buying short term US Treasury Bonds (instead of long term bonds, which it had previously always chosen), in order to ensure itself greater disinvestment flexibility, reducing the risk of losses in the case of sale.
And last September the Chinese government began international sales of its own Treasury Bonds: a further step towards the internationalisation of China's currency.
On the 1st of January 2010, when the Free Trade Treaty between China and the ASEAN nations came into effect (involving Vietnam, Laos, Cambodia, Burma, Thailand, Malaysia, Singapore, Indonesia, Brunei, the Philippines, Japan and South Korea), the Yuan began its transformation into the regional exchange currency for Asia... a process openly encouraged by the Peking government.
The Impotence. To sum up, as seen from Washington the situation seems clear: China is preparing to turn its back on the dollar, and to do so in such a way as to avoid damaging itself economically, by laying the foundations for an alternative international commercial and financial system based on the Chinese currency.
A decidedly ugly prospect for America's ailing economic hegemony, forced to cooperate with the nation planning to take its place. A situation that certainly appears humiliating and dangerous to many powerful figures in the US political, economic and military establishments. Powers behind the scenes that, according to some analysts, may have influenced the recent escalation in provocative gestures aimed at Peking.
The Solution? In April 2009, when US-China tensions were just beginning to rise, the economic journalist Ilvio Pannullo wrote in Business Online "In a historical perspective, and seeking similar situations in the past, malicious observers might point to this as the beginning of a strategy of tension designed to lead to some "incident" sufficient to create a state of war... not outright war, just enough of a crisis to block normal economic and trading relations, with the aim of cancelling America's debt towards the Chinese state."
For certain influential circles in US politics, continued Pannullo, "the idea of being so deeply influenced by the state of economic and monetary relations with Peking is simply intolerable. What is at stake is the end of American hegemony, and these people will stop at nothing. (...) A moment of major crisis could be just what's needed to make it possible to wipe out the enormous US foreign debt and thereby rekindle hopes of revival."