Posted by JMM,

The net result is an intentional "strategic ambiguity".
I think this is appropriate at this time, it is somewhat challenging to develop a counter strategy against an ambiguous strategy. We don't need to draw lines in the sand, just be postured to respond in a manner of our chosing based on the situation and our interests.

If the US and China get into an armed conflict over Taiwan, the assets of China and its citizens (including US bonds) are subject to seizure under the International Emergency Economic Powers Act:
Are economies are so intertwined I don't see this as possible without an unacceptable retaliation. How many Americans live and work in China now? How many assets do U.S. companies have in China?

Posted by JMA,

Death by a thousand cuts...

I suggest that (confirmed by your reply) the Chinese have chosen the right strategy.

None of the moves they make will warrant (as seen by most) action to be taken.
Rather than the sexy sounding death by a thousand cuts, it two nations maneuvering for strategic advantage. You seem to think that China is getting it right and we're getting it wrong, but the fact that other countries are turning to us because they're concerned about Chinese aggression actually plays in our favor.

I think we are taking action on the diplomatic front, and I'm not sure what other action you think we need to take at this time? What has China done exactly in your view that requires us to take more action? What action should we take? Cost/benefit?

China has a lot of internal troubles, their foreign policy is clumsy, and yes they are modernizing their military and becoming more assertive, but I suspect we are also applying the strategy of a thousand cuts against them. This is normal big powers jockeying for influence and advantage, but nothing to date is cause for war. Will there be a war in the future with China? Only time will tell, but I do not believe it something that is predestined. Will there be another war? As the ancient Greeks said, "only the dead have seen the end of war."