Operation Epic Fury

Beijing takes the diplomatic high ground in the Gulf The geopolitical chessboard is shifting as China and Pakistan unveil a five-point peace plan for the Iran conflict, precisely when Donald Trump is dialing up the heat. While Washington leans into military escalation and threats to return Tehran to the "stone ages," Beijing is positioning itself as the rational adult in the room. This isn't just about regional stability; it’s a calculated play to seize the moral high ground and present the United States as a perpetual warmonger. The plan calls for an immediate cessation of hostilities and the reopening of the Strait of Hormuz, a vital artery for China's energy security. However, the credibility of this initiative is tethered to US and Israeli cooperation. Neither power is likely to hand Beijing a diplomatic victory in a region so central to American interests. Yet, by pulling the strings behind Pakistan, China creates a narrative of leadership that resonates across the global south, even if it refuses to act as a physical security guarantor. The intelligence edge and trade tit-for-tat While Beijing publicly preaches peace, its private sector is sharpening the spear. Chinese AI firms like Vision are reportedly marketing real-time intelligence tools that track US military movements with frightening precision. By utilizing satellite imagery and open-source data, these firms expose American naval deployments, effectively neutralizing the element of surprise. This dual-track strategy—peacemaker by day, surveillance provider by night—complicates the US-China relationship as they head toward a tentative summit between Trump and Xi Jinping. On the economic front, the gloves have come off. China has launched trade investigations into US practices, retaliating against Section 301 probes. These moves target American policies that allegedly disrupt green tech supply chains. This isn't just trade; it’s political signaling. The timing, synchronized with reports of a China-linked hack into US surveillance systems, suggests that the "deep state" in both nations is operating on a baseline of zero trust. Every diplomatic overture is being eroded by the grinding machinery of cyber warfare and economic protectionism. OpenClaw and the rise of agentic AI In the tech arena, China is currently winning the adoption race. For four consecutive weeks, Chinese large language models have outpaced their US counterparts, fueled by the explosive popularity of OpenClaw. Developed by Peter Steinberger, this open-source agentic AI has ignited "lobster mania" across the country. Unlike simple chatbots, OpenClaw executes tasks—booking flights, managing calendars, and writing code—at a scale that dwarfs Western deployment. The token economy shift This surge is fundamentally reshaping the token economy. In March alone, China consumed 140 trillion tokens, up from 100 trillion in December. This rapid scaling indicates a shift from experimental AI to industrial-grade application. James Kynge reports that 67% of Chinese industrial firms have already deployed AI agents in production, compared to just 34% in the United States. The cultural appetite for digital experimentation, combined with a lower initial resistance to data privacy concerns, has allowed Beijing to create a massive, real-world laboratory for agentic AI. The looming employment backlash However, this "let it rip" strategy carries massive internal risks. While 93% of Chinese workers report using AI, there is a growing undercurrent of fear regarding job security. The transition from chat models to task-executing agents threatens to hollow out middle-class employment. If agentic AI continues to replace human roles at this velocity, the social contract in China could fray. Kynge predicts youth unemployment among 18-to-24-year-olds could breach the 20% mark this year, turning a tech triumph into a political liability. Future outlook for the Strait and the summit The immediate future hinges on the Strait of Hormuz. If Operation Epic Fury fails to dislodge Iranian influence, the waterway could effectively become an Iranian toll booth. In this scenario, China is best positioned to negotiate bilateral access, securing its energy flows while the US remains bogged down in a military quagmire. As Trump and Xi prepare for their May summit, the "mood music" will be positive, but the underlying currents are treacherous. Washington finds itself in a weakening position, struggling to manage a volatile Middle East while Beijing builds a lead in the next generation of AI. The race isn't just about who builds the best model; it’s about who can navigate the social and geopolitical disruptions these technologies unleash. For now, China is playing a more sophisticated game, leveraging both diplomatic posturing and technological speed to challenge American hegemony.