The move toward a less efficient, more expensive global supply chain is not a failure but a strategic correction. Over-prioritizing efficiency created a dangerous dependency on China. Diversification, while costlier in the short term, is a fundamental principle of long-term risk management.

Unlike in the West, China's economic dysfunctions like industrial overcapacity paradoxically strengthen its global position. This creates massive trade surpluses and investment leverage, forcing other nations to welcome Chinese capital and increasing Beijing's geopolitical heft.

The idea of China's economy inevitably surpassing the U.S. is no longer plausible. China peaked at 18.5% of global GDP in 2021 and has since declined. The systemic economic competition with the U.S. is "basically over."

China's economic rise was enabled by the post-WWII globalized structure the U.S. created. The U.S. Navy's protection of sea lanes gave China unprecedented coastal security and access to global markets, making its modern form possible. Without it, China would likely collapse.

By dismantling the post-WWII global order, the Trump administration forces allies to realign with China. As the U.S. retreats from global partnerships, China is positioned to dominate key industries like renewable energy, making the 21st century "the China century" by default as the world moves on without America.

The globalized system allowed countries to hyper-specialize in high-value production, like Germany in manufacturing or Korea in memory chips. As this system breaks down, nations lose access to global supply chains and must revert to being generalists, causing a catastrophic drop in technological capability and standard of living.

The Western belief that free trade would cause authoritarian states like China to liberalize has proven false. Instead, this policy created a powerful manufacturing competitor whose interests diverge from the West's. The current era of deglobalization is an unwinding of this flawed foundational premise of the post-war order.

The true 'mega risk' is not a single policy but a fundamental shift in the US global role. The post-1945 global economic system, including free trade and dollar dominance, has been built on a foundation of US security and leadership. If that leadership is withdrawn, the entire international order could change fundamentally.

With its domestic, investment-led growth model broken, China has pivoted to an export-heavy strategy. This significant shift creates new vulnerabilities as it must fight for a shrinking pie of global demand amid rising protectionism.