China is a dominate player in the world and will get stronger. Its economy may overtake the US in terms of GDP. It will be many years before it has a greater per capita GDP. Its culture will be pushed into the world alongside ours. This will create competition and rivalries but does not need to create conflict.
Unfortunately, we do not seem to be going in a non-confrontational direction. The two countries are escalating conflict in the South China Sea, North Korea, and now Taiwan. As China is finally recovering from its own civil war, it is growing into a true second super power. The US can not stop it. It has 1.3 billion fairly creative and intelligent people. The leaders are exerting their growing power to show it off to the US and the world. If we acknowledge China's current position as the second superpower, and its historic glory, we can give them the recognition they seek and deserve, and lower the confrontational attitudes now prevalent. Yes, some of their glory was at the violent expense of neighbors; but all political powers in history are tainted with that issue. We can understand the past and work on ways to increase our influence to the benefit of all peoples.
The most open conflict is the South China Sea. The building of islands give the Chinese some military advantages just as Hawaii, Midway, and Guam give the US military advantages. It also provides a foundation to claim fishing and mineral rights to the entire region. Mostly, this is a play for power to show the world it can stand up to the US Navy - a power China will eventually gain. The US could defeat the Chinese navy if we engaged it soon. However, the political and economic fallout would be extreme. We would also need to maintain constant vigilance and attacks to keep them from rebuilding its navy. Unless we are willing to confront China militarily, we can not stop them from building a formidable navy and projecting that navy into the South China Sea and Western Pacific Ocean.
The other big problem we need China's help with is North Korea. It can't be good for Chinese leaders' sleep patterns knowing the leader of North Korea is a crazed out kid itching to prove how tough he is by starting a nuclear conflict. However, they also know the US has historically wanted to invade the country and impose a government of its choosing on their border a few hundred miles from Beijing. We need to back off our desire to take over the country or reunite Korea under the South's control. If China does not feel threatened by the US's desire to control North Korea, they may be more free to force a change to stabilize the entire region.
Taiwan diplomacy is a career in itself. I don't have the knowledge or time to figure out the nuances of a long term solution. However, I don't think China really wants to attack Taiwan. Just to be sure, we can certainly maintain a military protection agreement with Taiwan. Given the amount of financial interconnections between the US and Taiwan, that protection can be justified. At the same time, the more the US can work with China to intertwine Taiwan's economy and culture with their own, the more the cost of confrontation will go up and the desire for confrontation will go down.
Like I said to start, China is regaining its super power status. The US cannot stop the momentum. We can and must work with China to reduce conflicts, remove the risk of military engagements, and smooth the transition of China's rise.