Last week’s announcement by President Barack Obama of a new strategic focus on China has intensified a debate already underway in Chinese ruling circles over how to respond to Washington’s confrontational stance and threat of military conflict.

The Pentagon document, “Sustaining US Global Leadership: Priorities for 21st Century Defence,” represents a major reorientation of the US military forces globally, particularly toward the Asia-Pacific region. It insisted that China’s military expansion “must be accompanied by greater clarity of its strategic intentions in order to avoid causing friction in the region.”

In fact, China is under threat by the US. Through Obama’s efforts to strengthen alliances with Japan, South Korea, Australia and the Philippines, as well as build new partnerships with India, Indonesia and Vietnam—not to mention the US-led occupation of Afghanistan on China’s western flank—Beijing is being encircled on every front.

China has increased military spending by an estimated 200 percent over the past decade. But the US military still dwarfs that of China on any indicator, from spending (six times bigger) to the size of its nuclear arsenal (35 times larger), and maintains a vast technological superiority in virtually every field.

The initial official Chinese response to the Pentagon document was cautious. The state-owned Xinhua news agency called on the US to “abstain from flexing its muscle.” At the same time, it stated that “if fulfilled with a positive attitude and free from a Cold War-style zero-sum mentality,” the new US strategy “would not only be conducive to regional stability and prosperity, but be good for China, which needs a peaceful environment to continue its economic development.”

Chinese Defence ministry spokesman Geng Yansheng was more critical, declaring on Monday that “the accusations levelled at China by the US in this document are totally baseless.” He hoped the US would “deal with China and the Chinese military in an objective and rational way, be careful in its words and actions, and do more that is beneficial to the development of relations between the two countries and their militaries.”

Writing in the People’s Liberation Daily on Tuesday, Major General Luo Yuan bluntly warned that the US was targetting China. “Casting our eyes around, we can see that the United States has been bolstering its five major military alliances in the Asia-Pacific region, and is adjusting the positioning of its five major military base clusters, while also seeking more entry rights for military bases around China. Who can believe that you are not directing this at China?” he asked.

The differing responses reflect a debate in Beijing that intensified after last year’s NATO intervention in Libya, which caused losses of billions of dollars of Chinese investment in that country. One camp advocates a continuation of the present cautious policy of avoiding a confrontation with the US. The second calls for a shift to a more aggressive policy to defend China’s growing economic and strategic interests around the world.

Those advocating a low-key approach argue that China is in no position to challenge the US. Their concerns reflect the vulnerability of the Chinese economy, which is heavily dependent upon the advanced Western countries for investment, technology and markets, and would be severely disrupted by any open confrontation with Washington.

In a commentary in China Newsweek on January 3, academic Zheng Yongnian warned against “a new Cold War” with the US and its allies, in particular over North Korea. He argued that such a confrontation would be “very unfavourable to China” because China was no match for the US, whose international dominance “is all-dimensional, including in politics, economy and military, whereas China’s is still predominantly economical.”

Zheng indicated that China could weather a new Cold War, explaining: “If East Asia is divided into two blocs, with China losing the space in the east, it must strive to expand into the west. This scenario is not only possible, but has already begun, which is to develop ties with Arab countries.” However, he argued that the best option for China was to cooperate with the US, in line with Beijing’s chosen “road to integrate into the West-dominated international community” since its rapprochement with America in the 1970s.

The critics of Beijing’s present policy of a “peaceful rise” point to the impact that US aggression has already had on China’s investments and carefully cultivated diplomatic influence. The US not only supported the ousting of the Libyan regime but is now threatening Iran, upon which China relies as a major source of oil. In South East Asia, the Obama administration has encouraged the Philippines and Vietnam to assert their claims in the South China Sea against China’s and undermined China’s influence in regional bodies.

Dai Xu, a researcher at Peking University’s Chinese Centre of Strategic Studies, argued in the Global Times last week that China “must draw a line.” He argued against the stance of former Chinese leader Deng Xiaoping who advocated that the country “keep a low profile,” focus on economic development and avoid joining or forming alliances or any international grouping.

Dai is known for his 2009 book, C-shaped Encirclement, which warned that the US was seeking to contain China in the Asia-Pacific. Now he is calling for an end to appeasement with the US, pointing to the supposed historical lessons of the Song Dynasty 1,000 years ago. It faced a military threat from the nomadic kingdoms to the north and responded by offering concessions and abandoning military preparedness, only to be annihilated.

In his Global Times article, Dai said the US had “a clear roadmap and timetable to ‘conquer’ the world,” stretching from Afghanistan, Iran and Pakistan, with the ultimate aim of taking on China and Russia. In the face of the escalating US threat against Iran, which could lead to a war involving America, Israel and Russia, Dai called for China to prepare accordingly.

The debate highlights the fact that the Chinese ruling elite has little room to manoeuvre. “Cooperation” with the US would mean making concessions to Washington’s economic demands, such as revaluing the yuan, which in turn would bankrupt sections of Chinese industry and foment wider social unrest.

Washington’s aggressive stance against China has strengthened the position of those who advocate an end to appeasement, which in turn heightens the danger of war.