"Don't wear a hat too big for your head." It is a bit of gritty Cantonese wisdom, but let's be honest: It applies to everyone.
You get exactly that flavor when digging into the new "2025 National Security Strategy" just dropped by U.S. President Trump. The whole document screams a single message: The U.S. is pulling back. It is retreating its main battle lines to the Western Hemisphere and embracing a hard line of "semi-isolationism."
Trump is a businessman at heart. He handles state affairs like a merchant, prioritizing cold, hard realism. He happily trashes the utopian thinking of "white left" politicians like Biden, tossing global interventionism into the trash bin.
This isn't just Trump picking a new path for America. It is a necessity. He simply has no other card to play. But make no mistake, this shift triggers massive implications.
The Dollar Illusion: Fading American Muscle
First, look at the numbers. On paper, the U.S. remains the heavyweight champion of GDP in dollar terms. China’s total looks to be less than 70 percent of that. But that is just a currency conversion trick. Use a fairer metric: Purchasing Power Parity (PPP), and China blew past the U.S. way back in 2014. That isn't Beijing bragging; it’s the cold math used by the IMF and the CIA.
It isn't just about total output. China has leapfrogged the U.S. in critical innovation sectors. Look at the "new trio": electric vehicles, lithium batteries, and solar energy. China has locked down a near-monopoly global advantage. For the U.S., this kind of dominance used to be unimaginable.
Militarily, the U.S. holds the advantage in stock, but its capacity to replenish is alarming. "Stock advantage" means they have more toys right now. But "worrying incremental capacity" is the nice way of saying U.S. manufacturing has gutted out. In a war, if a ship sinks, replacing it takes forever compared to China. Sixth-generation fighters? Hypersonic missiles? China has them in service. The U.S.? They still only exist on PowerPoint slides.
Trump knows the score. That explains the strategic contraction. He is done playing global cop. You want protection? Open your wallet. That goes for Japan, South Korea, and the NATO club in Europe.
Trump's endgame is focusing energy on the American homeland. He wants to rebuild a brawny manufacturing sector and a robust economy. Why? Because that is the only way the U.S. survives a long-run brawl with China.
A New Warring States Chessboard
Second, view the global chessboard like China's Warring States period. Trump’s worldview splits the hemispheres: "Befriend the distant while attacking the near." He wants the Western Hemisphere under lock and key. As for the Asia-Pacific? He is effectively ceding it as China's sphere of influence to cut costs, while plotting to keep a foot in the door for later.
This strategy has morphed from the old Yalta talks into a G2 model—a pure two-power game. When trouble hits, Beijing and Washington meet to fix it. Europe gets kicked to the curb. Western Europe has slid from a vital anti-Soviet ally to a heavy American burden.
Third, seeing Trump retreat feels like a win. It means the end of the Democrats' "pivot to Asia." But don't get lulled into paralysis. The hostility hasn't vanished; the U.S. is just "not wearing a hat too big for its head." They are avoiding a direct fight now only to bulk up for the ultimate showdown later.
Plus, there is another election in three years. Can the Republicans hold on? If the Democrats storm back, they will tear up this semi-isolationist playbook. Whether this strategy sticks or not, the competitive intent remains. China has to work day and night to strengthen itself during this short window.
The Trap of Complacency: Don't Blink
China needs to dominate the economy—not just plugging holes in chip manufacturing, but becoming number one in every innovative industry. While the U.S. tries to decouple and fix its own broken supply chains, China must build the strongest new systems in the next five or ten industries.
Finally, look at the stakes for Hong Kong. On one hand, U.S. contraction eases the political pressure cooker. On the other, as the country builds a brand-new, autonomous international system, Hong Kong has a critical role to play. We have a three-year window. We better use it. Time waits for no one.
Lo Wing-hung
Bastille Commentary
** 博客文章文責自負,不代表本公司立場 **
Washington played underhand tricks at the G20 Finance Ministers and Central Bank Governors Meeting. It tried to push the meeting into issuing a communiqué targeting China. It came away empty-handed.
But Washington did not let the matter rest. On September 1, acting in its capacity as rotating chair, it unilaterally released a chair's statement. The document is widely seen as dripping with insinuations aimed at Beijing. A Chinese foreign ministry spokesperson hit back strongly on September 2, expressing regret that the meeting had failed to issue a communiqué.
Yuyuan Tantian, a social media account under CCTV, followed up with an analysis. It noted that the US statement made a point of spelling out: "The statement was agreed by all G20 members present except China, which objected to paragraphs 4, 10, 11, and 13." That line was seized upon to hype the narrative that "China refused to cooperate."
For a country to single out another member by name at an international multilateral meeting on its own home turf is a highly unusual move. A host is supposed to bridge differences and safeguard an atmosphere of cooperation. Instead, Washington aired the divisions in public, which amounts to announcing to the world that the very meeting it hosted had failed.
Sources close to the negotiations believe Washington's maneuver undermines the bigger picture of this year's multilateral agenda. Both the G20 and APEC are important platforms for global economic governance, and this year happens to be the year in which China and the United States each serve as host of one of the two organizations. By staging petty tricks at the G20 venue, Washington damages the credibility of the G20 and poisons the atmosphere for China-US cooperation.
Wash Hands, Shift Blame
Yuyuan Tantian points out that the US statement conceals four sinister ploys.
Ploy one: washing its hands of all responsibility. Paragraph 4 of the US statement says the global economy has remained resilient in the face of multiple shocks, including wars and conflicts. It stresses that value chains for energy, food, fertilizer and critical minerals must keep running smoothly.
In Yuyuan Tantian's reading, the subtext is a demand that all countries jointly manage these problems. Yet the statement studiously avoids mentioning exactly who launched the wars that threw energy markets into turmoil, or who erected chip export restrictions.
What concerns Beijing is whether Washington's description of the global economic situation is objective and comprehensive. One of the world economy's most prominent challenges today is precisely the damage that tariffs and restrictive measures do to the multilateral trading system.
The International Monetary Fund (IMF) projects global inflation to climb from 4.1% last year to 4.7% in 2026, with geopolitical conflict one of the drivers. As Yuyuan Tantian sees it, Washington puts issues such as energy and fertilizer on the table yet never mentions the shocks inflicted by its own policies, much like "an arsonist standing at the scene of the blaze, selling firefighting supplies."
On top of that, reform of the global financial architecture, free trade, the role of the World Trade Organization and the elimination of protectionism were all left out of the statement.
Ploy two: shoving the blame onto China. Paragraph 10 of the US statement says countries should eliminate "non-market policies and practices" that exacerbate economic imbalances. In particular, countries with persistent and excessive external surpluses should remove the distortions that constrain domestic demand and breed an overreliance on exports.
Enlist, Then Demand Payment
Yuyuan Tantian argues that although this passage never names China, it is in fact aimed at the "overcapacity" narrative recently hyped up against the country.
The G20 set up a study group on global imbalances this year. Discussions among the parties concluded that the causes of economic imbalances are complex, spanning the international division of labor, demographics, finance, the dominance of the US dollar and capital accounts. Yet Washington skipped over these professional discussions. It kept only the "non-market" attribution, a label on which no consensus has been reached, in an attempt to pin the responsibility on China.
Ploy three: ordering international organizations into action. Paragraph 11 of the US statement asks the IMF and the OECD to refine their imbalance analysis data. In particular, it urges them to strengthen data coverage of "non-market policies and practices." Yuyuan Tantian points out that the G20 has never produced a clear definition of "non-market policies and practices." Yet Washington is asking international organizations to supply data for a label that commands no consensus. In substance, this piles up evidence for its narrative targeting China.
Ploy four: telling China to write down debts. Paragraph 13 of the US statement says relevant stakeholders, including official creditors, should be encouraged to make appropriate contributions toward the debts of developing countries. Yuyuan Tantian argues that Washington is in effect demanding that official bilateral creditors, China among them, shoulder more of the burden and provide debt relief to developing countries.
Yet official bilateral creditors account for only about 15% of developing countries' debt. The private sector and multilateral institutions are the principal creditors.
Washington deliberately demands "appropriate contributions" from official bilateral creditors. At the same time, it says nothing about America's own dwindling development aid, nor does it ask the US-led financial institutions to cut debt. This shows that its goal is not genuinely to resolve the debt problem. The goal is to concentrate the pressure on China.
China Will Fight to the End
After reading Yuyuan Tantian's analysis, the whole affair can be summed up like this:
First, the United States tabled a proposed G20 joint communiqué on trade imbalances targeting China. It knew full well that China would object and that the proposal stood no chance of passing. But the real aim was to blow the issue up in public and keep hammering away at China's so-called trade imbalances. Washington even enlisted international organizations to make moves on its behalf, demanding that China fix problems of America's own making.
Second, China brought in Yuyuan Tantian to blow the lid off the scheme. The signal: it will fight the United States to the very end.
Lo Wing-hung
