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If their products are as lousy as people are claiming they are (I have no knowledge of the Chinese furniture industry), and their industries are being supported by government intervention and protectionism (thereby causing people in their society to pay more for other things than they are worth), they won't be able to invest in their industrial base for long. Eventually, that kind of system has to collapse.

Were China a free society you would be correct but because opposition ot government policies is not allowed they are able to sustain this for a prolonged period. Is every such endeavor a success for them? No. However teh investment in plant and equipment is such that after foreign competition moost especially the uSA has been driven out of business they will be able to provide goods and service within their nation as needed. however, the primary goal is to exdpand through military means and that in the end will ead to a confrontation with the USA. Now when that confrontation comes it will be a question of their population, technology and industrial base versus the USA's population, technology and industrial base so ever erosion they make in the underlying US induatrial base tehy view as a military victory.