As an aside, I found the analyst's reference to "Quemoy and Matsu, Pratas, and Kinmen Islands" strange -- after all, Quemoy and Kinmen are two names for the same place.
Peter Jennings is not described as an "analyst" but as "ASPI's executive director". Most likely he simply copied those names from multiple internal reports written by actual analysts. (Also strange to omit Wuqiu.)
For context lookup the Chinese civil war, Shanghai international settlement, boxer rebellion and the WWII campaigns of the western pacific. Your analysis of the US forcing crisis is utterly simplistic.
China would be absolutely bonkers not to take advantage of the political landscape in the US right now, which is to be buddy-buddy with China for no better reason than to stick it to the Bad Orange Man and his followers.