In 2007 the USA had a 14 trillion GDP. In spite of prevailing perception the USA is still the worlds largest manufacturer. What the USA needs to do win the economic war is to completely reform the defined benefit pension system and go to a defined contribution paradigm. The crushing weight of legacy entitlements is sapping our competitive strength. This will never happen in the current administration-I understand. The old saying that it took 4 years of Jimmy Carter to get us to Ronald Reagan applies here. From what I have seen thus far, Obama has never studied the mistakes of the 1970's-the disasterous energy policy for instance. I remain hopefull.
USA's debt/deficit of $65 Trillion makes it impossible to borrow. USA credit rating is already destroyed from financial crisis so USA has nothing to lose from China war