It happened this week. The US finally said outright exactly what Cadence has been saying for years, the strategy in play. According to a Reuters article via Yahoo News, US security adviser John Bolton said, "If they're put back in the proper place they would be if they weren't allowed to steal our technology, their military capabilities would be substantially reduced. And a lot of the tensions we see caused by China would be reduced."
The US wants to put China "back in the proper place". If it weren't for one-sided trade deals over the last to decades and an accumulation of technology that China neither researched, conceptualized, nor paid for, Bolton thinks China would be as friendly as a cute, little house cat, not the bossy tiger it has grown into.
Specifically, the US would need to humble the diesel-powered aircraft carrier, the Liaoning, from which China's other aircraft carriers in the making were reverse-engineered. Taiwan held rehearsals against the Liaoning this week. In other areas, Taiwan isn't backing down, but announced 30 new international flight destinations this week.
Looking at things in this broader context, the escalating military conflict will not result from a trade war gone awry. Rather, the trade war was but a small part of a much larger scheme to provoke China into a military conflict sooner than it wanted. Tech and money has already been cut off. New weapons have been developed and prepared. Now, the US hopes to put China "back in the proper place". In Beijing culture, that means an attempt from the US to shame China on the seas.
We should be preparing for an insulted, post-defeat China and long-term strategists should being their review of the psychological atmosphere in pre-WWII Germany.