First of all, have money is not the same as powerful.
Never said that.
US did not become the global powerhouse on the back of its industrial might, US dominate the world by the financial might, which specifically, modelled the global economy around USD.
Tomato Tomato… same same
US became dominant world power on the back of victory in WW2, where it safely could churn out massive war machinery, because it had the industrial power to do so. Rest of the world was in ruin. So the world was there to be taken, militarily then financially, with only the Soviet acting as a somewhat millitary counterweight. But Soviet never was a industrial or economic superpower the way China is.
Problem for China is that they can be rich, but they don't know how the power game play, China right now is a richer form of Russia, and Russia in turn is a richer form of North Korea. That DOES NOT buy you power. Nor make you a competitor of any kind. Because power is both lead and command, China do not have either.
China is very different from Russia and North Korea, both economically and industrial. China dosent rely on setting boots on the ground and historically hasnt been a nation that force its ideology on other nations. So it dosent have to fight constant war, or export its societal model in order to influence other nations. This goes way back to the time of Silk Roads.
You cannot dominate currency market if you do not let it float freely, rather if Yuan is float freely, their price will be slaughtered, because a simple fact is no one are going to trade a currency that is going to be heavily controlled by the government, and if that happen, Chinese business base will suffer.
By contrast its the Peoples Bank that keeps USD value higher vis avis CNY, by buying and taking USD out from the market.
So, what's left? The massive population and its manufacturer base. Manufacturer base can be relocate, US and the world had learn a lesson, they are migrating their supply base back in the US and Europe.
They are not gonna relocate to Europe or America. Maybe relocate to other developing nations like India, but then again you just create a counterwight to China, creating another powerhouse, which in the end will trade with China, both will become more powerful than today, hastening Multipolarity. That is exactly what i meant with Checkmated. In order for US to have allies and influence in Asia, it has to create big counterweights to China. Asian nations are reluctant to forge any millitary alliance against China and you end up with actually diluting US relative power.
On the other hand, COVID 19 also show the weakness of Chinese economy, less than 3 months of shut down and Chinese economy tanked 0.2%, it may not seems a lot, and it's GDP has gone down to 4.8, half of what pre-COVID level. Factory shut down do more harm to the Chinese than to their buyer (US, EU and so on).
And the US economy contracted waaay more. China didnt grow, yes, but calling 0,2% growth for tanked is a exaggeration, compared to the conditions in the rest of the world. OTOH China already has a massive base where 4-5% growth is good enough to add trillions every year.
China population growth is very slow these days, creating some labor shortages in certain sectors. So they themselves are gonna start outsourcing labor intensive industries (Guess to where!?). Compared to 15 years ago, the service sector makes up a much bigger cake of total GDP, i believe its close to 60% of GDP. Making it less vulnerable to export as it used to be. There is also a emerging market next door in Asia, and big markets in Latin America, Africa that also demand cheap goods.
China is similar to what we think about Japan in the 80s. It's a global factory where many thing were made in Japan back then. Japan is rich, probably as rich as the US if not richer, but does that mean power? I mean today, if I can't get stuff made in China, it is not the end of the world, I can simply pay 10-15% more and get the same stuff that made in Japan, Korea or in Europe.
Comparison with Japan makes little sense.
Japan is geographically small land of 120 million people, and in many ways a US protectorate with little to say in major defence and foreign policy matters. Thats why Japan was forced to accept Plaza Accord, which broke its back and has stagnated its economy. US could do that because Japan militarily was not a match. China can confidently defi any such agreement by sheer size of its economy, population and millitary power. Trump tried, but lost. Not a shocker.
More worrying for the west, China is actually becoming a very inventive country, by registering millions of patents each year. In many fields they are way ahead, like forexample drones. In high tech they are catching up fast and in some areas ahead of western tech (ref. US congress report). So again, they are not only depedent on selling cheap goods. This trend will only accelerate.
Good luck with getting Made in China products for mere 10-15% higher cost but produced in Europe. That wont happen with the wages here. To not talk about the profit margins. No business owner will move factories to higher cost nation and make less profit, just for sake of patriotism. It would kill many companies.
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