You guys are kidding right?
Okay this is a simplistic version.
China is an extremely racist nation with ambitions of Empire that have existed for centuries. They pretty much believe, and have believed before the advent of communism that the world is basically theirs. What's more they have a sort of "master race" doctrine similar to Hitler's above both westerners and other asians.
China is also a closed culture that intentionally seals itself off from outside ideas. The "Bamboo Curtain" having been extended to things like a national firewall. It's also internaally very ruthless in broadcasting a specific agenda and point of view.
On top of this China has a massive population problem combined with a culture that favors the idea of very large family units. Something at odds with goverment population control plans and the like. The bottom line is that China's attitude is one where they believe that it's natural and intended for them to conquer other lands and dominate other people for living space if nothing else.
So far there has not been a massive issue with China, because their abillity to project their power has been limited, combined of course with the threat of WMD and the like. However advents in technology have seen China building up it's potential for military projection by building a strong navy, escort submarines, and anti-satellite technology including some kind of laser system that can blind US spy satellites. Not to mention their own space program which is not bound by the same agreements we made with the USSR.
On top of this there is the issue of the Chinese "robber economy" which is largely based off of knocking off technology from other nations and then selling it cheaper in the global market. There are mixed opinions about this, but basically it costs countries trillions of dollars each year. Patent violations and the like are an issue brought up before the so-called "world court" but no ruling has yet to be made largely because any official ruling would arguably start World War III.
Also if you look at China's economy even on articles here involving "World Of Warcraft" and such, there are laws prohibiting non-Chinese businesses from making so much money on Chinese soil, or taking so much money out of the economy. As well as limitations on what kinds of businesses can be run, which has lead to issues with companies like Blizzard having to work with third parties, a falling out with Chinese Associates having taken WoW offline in China not too long ago.
The bottom line being that for all comments about money borrowed, and economic links, China does not engage in fair trade policies on any level which is an issue. China's relationship with the US being not so muc as one of a trade partner and wierd mutal creditor, but as a loan shark working to prevent the repayment of a loan, who is also robbing their client at gunpoint.
All of these things lead to international tensions which have been brewing. Before 9/11 I sort of predicted we would have come to blows with China before anyone else.
The basic situation is one where China is pretty much a super power in everything except for their military, and they are developing that. Due to overcrowding alone, never mind nationalist/racist philsophy China has every practical reason to seek invasion. What's more given a general lack of enemies, there would be no other reason for their military build up except to attempt to attack us or europe since there isn't any force in their region that could threaten them that hasn't been present for a long time (and they had maintained independance).
The thing with China though is that they have a lot of shallow, short term friendships with a lot of other nations which are blinded by the abillity to obtain cheap Chinese knock offs. Basically they can get stuff similar to what the US develops/trades (for example) for a fraction of the price. This can range from needed things like drugs, to luxury items. This seems like a "positive" thing until you consider that it's unfair to those who develop those technologies (often at great expense) and hold the patents. Not to mention the goverments that have an interest in them.
Right now ICBMs and the like are an archaic technology that has maintained world peace for decades. Like any technology it's inevitable that it is going to become obselete.
The US right now also suffers from a disadvantage of it's own morality in respects to not being willing to engage in a pre-emptive military campaign, instead acting almost totally reatively (even The War On Terror was a reactive action).
The bottom line is that it has less to do with Communism Vs. Capitolism that many people might think. There are a LOT of issues, including those above which I have simplified greatly for the sake of this (long) post. Such scenarios are based on things coming to a head between our respective nations. Really things haven't gotten that bad because of the threat of WMD and the sheer range between the US and China (opposite sides of the world).
In Fallout it's a retro-future setting, the world wasn't actually the 1950s but after the Millenium despite what the tech turned out like. Presumably a lot of similar events took place including the fall of the USSR, and the replacement of that threat with the current Chinese situation.
Oh and one final point: China actually posseses the arrogance that the US has been accused of. People have a short memory but we had that whole "David Faye" incident back during the Clinton administration. There is no doubt Dave deserved what happened to him, however when the leader of a nation personally requests an exception for a minor crime it's a massive slight not to comply. We have done things like this constantly for other nations (Diplomatic Immunity and the like). For China NOT to do it meant a lot. It's not like the guy was accused of treason or something. On top of this we had an incident before 9/11 that was the big news of the time where a US Spy Plane over international waters was grounded/pirated by the Chinese military. The Chinese eventually released the pilots, but dug through the plane to steal technology as we watched them with satellites (allegedly the pilots had jettisoned anything they could use). Basically China has no respect for the US whatsoever.
This is dangerous because it's not just hype and politics, and it's been going on for a while. In general the US tends to be fairly mellow and turn the other cheek. Even our underhanded stuff is intented to avoid more extreme situations. What it means is that when there is no central respect, it means that any pretensions of diplomacy are going to fail. Right now it seems China maintains diplomatic ties largely to buy time while it upgrades it's technology and builds that military. For the most part every chance it gets to snub or one up the US it's been taking.
Yes the US and China *WERE* allies, but things changed. Right now I guess you could say we're rivals, simply because we won't push the button to turn it into full blown enimity,
and they won't push the button until they feel they are ready.
This is simply MY opinion and observations, but the fact that I am not alone (even if it's not popualr with elements of the left wing) is exactly why you see so many people pointing towards this as the next big war. It gets into mainstream productions as much as it does, because despite what some might want to think, it's not just paranoia. Things really are that bad, and are slowly getting worse.