Very thoughtful and well argued article. America is already withdrawing some of its industry from Asia and returning it to home and very high tech energy dependant American based manufacture! Moreover, they have halved their dependence on foreign oil!
It's almost as if they've seen the writing on the wall and the potential challenge an exponentially expanding China presents.
R+D and the cost of energy and how it's distributed, will decide many issues and eventual primacy.
However, there is little comparative correlation between a resource poor Japan and a resource blessed China, not held back from nation building reform, by the inevitable roadblocks inherent in democracy.
We for our own part need to build bridges; and further develop and enhance our ties with regional liberal democracies, with symbiotic free trade deals and military integration, if not defence pacts!
We also need to renegotiate our current FTA's, to ensure genuine reprecoscity?
We must finally understand, we stand virtually naked and defenceless, if we fail to fully develop our own independent energy resources, which will in the first instance, reduce our carbon production by at least 37%; plus, give us a brand new position of strength from which to renegotiate genuine reprecoscity; and provide the income and the lead time, we still require, to convert our export dependant economy, into a carbon neutral one!
[Even if we started now today, we would require around 20 years to grow enough algae, to provide the replacement low cost bio-diesel, we will need in our future!]
Rhrosty

America’s middle class is dying, the reason is economic, depressed wages are now a permanent feature of the American landscape, due to suppression of organised labour, globalisation (or the corporatisation) of the economy. You can not have a strong middle class without decent wages.

Additionally mass consumerism, media and entertainment is the norm, which wields enormous influence on people's "thinking".

Technological advances which allow status quo messages to be disseminated to the masses have also created an enormous increase in the power and reach of the state (as opposed to the people).

America is a full-blown Empire in the modern sense, with a military and economic presence in virtually every country in the world except perhaps Russia, China or Iran. The general populous can always be easily distracted by a new foreign enemy if need be, if they are conscious enough to notice the outside world at all. If things get bad enough, a new war will make for a very lively, interminable discussion in the mass media which wipes from existence any other thought their contented citizens might have. As they always do, Americans will rally around the flag and that will be the end of it.

If you have this astonishing mass media, and the power of the state is greater than ever before in human history, and if the state is utterly corrupt, which it is, then there is no hope whatsoever for real social change. America's historical situation is unique in the 21st century because of all that has gone before.

The comparison with the historical period after the Gilded Age (up until about 1980) no longer applies. The elites who own all the resources and have all the money will have no problem hanging onto (and increasing) that wealth in the 21st century, at least for the time being. No force will arise to take it from them.

Of course, in the larger, sense, we are witnessing the beginning of the real end of America, China notwithstanding, a process which will take several decades to play out.

Regarding the comment from Geoff of Perth above about the depressed wages of the American Middle Class.
Beside the reasons he cites for this I was just wondering if the use of cheap Mexican labour
may have played a part as well.
I had some relatives that went on a holiday to Los Angeles, and one of the comments that they

made was, they wondered where all the Americans were as they only ever saw Mexicans working in the service industries.

(Sorry this is the missing line from above, I did something to upset things and the end line came up missing.)

In many ways the US is not the paradigm of liberal democracy it once was.

Geoff says 'The elites who own all the resources and have all the money will have no problem hanging onto (and increasing) that wealth in the 21st century, at least for the time being.' (Probably right but I hope you you are wrong).

The elite of the US (<1%) is those who head up huge and basically amoral corporations. These include the oligopoly of barely regulated banks and the 'military industrial complex' of companies being paid by the huge defense budget.

The US 'democracy' gives the people a choice of two parties ( both bankrolled by corporates with nothing but profit motives. The result - taxation and government services rolled back over the last 3 decades.

E.g better health care in Cuba than in the US (see M. Moore's 'Sicko'). Government spending on health, like defense has become more of a cash cow for huge price-gouging corporations (the same ones who give us the 'democratically' elected politicians) than for the benefit of the nation as a whole.

This makes the US in some ways less 'democratic' than China in that the Chinese leadership are still primarily responsive to the needs of the people not the profit motive. The US no longer has the moral high ground over socialist stakes in many areas of government and governance, and this is the major threat to stability in the region.

China can and does achieve what it wants peacefully within its borders without militarism. There is no reason for the experiment in empire building, militaristic competition that lead to the two world wars last century to repeat itself. Many things have changed - global trade under international trade agreements means all nations have a potential path to prosperity e.g. China, Indonesia and Malaysia have already achieved a good measure of it.

Mutually Assured Destruction that would occur with nuclear war is the ultimate disincentive for war between such huge powers as China and the US. Corruption from within is the main threat to western democracies, not Chinese expansion.

The demise of the West was orchestrated by the Banking Military Industrial Complex a long time ago.When Private Central Banks create from nothing all the money to equal our productivity and loan it back to us as debt,this means they own us and our Govts.We are their debt slaves.

The movement of nearly all production to China was organised 20 yrs ago with the unsaid agreement that China would allow the Western Banksters to own their currency too.China let them in for a while and the Western Banksters took the bait,but in 2008,China shut the doors to the total ownership of their currency.

China still produces 80% of it's currency via Govt Banks and can grow 3-4 times that of the West because the money stays where it is produced.

The Western financial system has created a casino economy called derivatives,which sucks the life blood of real productivity.

The Western Oligarchs are now is trying to contain China via aggression and cutting off China's access to energy and resources.This is exactly what they did to Japan which forced them to enter WW2.

Just recently both Malcolm Fraser and Paul Keating have warned us about siding with the USA and their policy of containing China's economic growth.China is doing what the Western Imperialists have done without war and this is what irks our greedy oppressors who are driving us deeper into debt.

China and Russia are not our enemies.Our enemies reside within our own ranks.