China Fires the First Warning Shots at Washington

U.S. China tensions are growing rapidly with China now firing warning shots at Washington over increasing U.S. interference in China's domestic affairs. China appears to be hitting back at increased U.S. rhetoric over the yuan's revaluation, freedom of Internet and speech (the Google fracas), Iran (a huge supplier of oil to China), arms sale to Taiwan and Tibetan sovereignty (Obama's meeting with the Dalai Lama legitimized the struggle for Tibetan autonomy from China). The Telegraph is reporting that:

Evidence is mounting that Chinese sales of US Treasury bonds over recent months are intended as a warning shot to Washington over escalating political disputes rather than being part of a routine portfolio shift as thought at first. A front-page story in the state’s China Information News said the record $34bn sale of US bonds in December was a "commendable" move.
It follows a piece last week in China Daily, the Politburo’s voice, citing an official from the Chinese Academy of Sciences praising the move to "slash" holdings of US debt. This was published on the same day that US President Barack Obama received the Dalai Lama at the White House, defying protests from Beijing.
"There are ongoing spats between the US and China on so many fronts so you have to assume that this is some sort of implicit threat," said Neil Mellor, a currency expert at the Bank of New York Mellon, who cautioned that it can be hard to read the complex signals from China.

In addition, Chinese regulators appear to have thrown a wrench in a Chinese company's acquisition of Hummer for $150m. In October of last year, Sichuan Tengzhong announced plans to buy Hummer, but the deal is still pending approval from Chinese regulators. The explanation offered by the Chinese Commerce ministry, is that the deal is pending approval because the ministry is yet to receive the acquisition application from Tengzhong. This strikes to us as really bizarre, because the deadline for the completion of the deal is Feb 2010. Surely Sichuan Tengzhong would have filed for approval by now. It is clear that the Chinese are either stalling to gain political mileage or are planning to reject the deal outright. Remember GM is in Obama's mid-western home base and many workers stand to lose their jobs if the deal falls through.

Webster Tarpley, a historian and terrorism expert sums up the situation:

US-Chinese relations are now rapidly deteriorating towards a new Cold War or something worse. The entire foreign policy of the United States is strongly motivated by anti-Chinese considerations. Pakistan is targeted for destruction in large part because it could function as an energy corridor between Iran and China, to the benefit of the latter. What is done by the United States in Yemen, Somalia, Sudan, Zimbabwe, Burma, and many other points across the globe is fundamentally dictated by a desire to checkmate China.

The news is that China is fighting back far more effectively. At the recent Copenhagen climate change conference, the basic strategy of the US and the British was to use global warming to institute a world carbon dictatorship which could then be used to strangle the economic development of China, India, and other developing sector nations.

As accounts in the British Guardian have pointed out, Chinese Prime Minister Wen directed a successful blocking operation with the help of countries such as Sudan, Venezuela, Cuba, Bolivia, and others, personally snubbing Obama several times in the process. When it comes to sanctions against Iran, the Chinese are signaling that they will block them in the UN Security Council, and they are also circumventing them in various ways.

For a number of decades, Chinese diplomacy was typically extremely cautious, with a very low profile and a low-key approach. Prime Minister Wen’s successful operations in Copenhagen are a clear indication that major changes are afoot in this department.