This feeds into the second issue, wage inflation.  While Europe is staring down deflation, Chinese industry is facing rising wages in industry.  In the five years after the economic crisis (2009-2013) Chinese wage in manufacturing have been rising by 15% a year on average. By 2013, annual wages in manufacturing have risen to the equivalent of $6,660. Run that out into the mid 2020s, and the manufacturing wage in China converges with US rates.  Of course, Chinese productivity is a fraction that of the US, so the convergence is actually much sooner.

Now compare China to Mexico.

Manufacturing wages, adjusted for Mexico's superior worker productivity, are likely to be 30 percent lower than in China by 2015. China's wages have soared. They were about one-quarter as high as Mexico's in 2000 but are catching up rapidly and will be slightly higher by 2015. And labor productivity remains higher in Mexico, even though the gap is narrowing. The crossover point was 2012, when unit labor costs in China (i.e., wages adjusted for productivity) grew to equal those in Mexico. By 2015, Mexico will be around 29 percent less expensive.

In short, China is in no position to challenge the reserve status of the US dollar. For several years, Chinese central bankers have been eyeing their horde of US dollar reserves with unease.  If you or I convert dollars to yuan, it isn't going to change the exchange rate.  If Chinese central bankers do.  That will lead to a significant devaluation of the US dollar against the yuan.  Which both means that Chinese investments in the US lose value relative to China, and that the wage inflation problem escalates.  All that an attack on the  reserve status of the US dollar would do is hasten the collapse of Chinese industry. Doing that would pop the Chinese real estate bubble, and lead to the collapse of  a number of banks.  

Again. In short.  There is absolutely zero chance that China willing participates in an effort to attack the the dollar.

And I'll give my consent to any government that does not deny a man a living wage-Billy Bragg

That is the whole point I am trying to make, long with the point that an alternative FX settlement system not controlled by the USA will greatly diminish the power of the USA to conduct economic warfare. That system does not yet exist but is clearly developing. It is very unwise to risk accelerating that development just to make the current US administration look strong. If US actions in Ukraine continue on the current course that seems a real danger.

"It is not necessary to have hope in order to persevere."