There is a reason why dumping the Chinese US Treasuries is called 'The nuclear option'. Sure there will be a lot of harm to the US if that is done. But as much, if not more harm to China.
From a comment of Brad Setser's latest post:
"The facts that you present show mind-boggling numbers. 750bn$ is an amount of roughly 25% of Chinese GDP in foreign asset growth PER YEAR. As you say, this is now not only an 'imbalance', it is a symptom of a massive transfer of wealth and the entire financial system from other countries."

The Chinese state is buying up FX en masse. Much more than the Trade surplus, which is anyhow melting down at the moment. The Chinese state is buying low yielding overvalued (compared with CNY) dollar debt, and selling more yielding undervalued CNY debt to sterilise monetarily. If their Dollars become worthless, and their CNY shall not become worthless, they have to stem  a big net debt from the currency mismatch on their balance-sheet.
It is trivial, why should the debtor be hurt more than the creditor, when it comes to a default?

Of course the US would have to finance its trade deficit then in another currency. But the west has plenty of currencies, which could take over. Euro, Sterling, maybe SFR.

Der Amerikaner ist die Orchidee unter den Menschen
Volker Pispers