Well to be fair, it turned out that we should probably have been more hawkish towards China sooner.
So it seems to me you are arguing against what you say you are arguing for.
Nothing in what you describe shows anything wrong with the report or the article.
There is little doubt that China is spending way more on research than most countries, and being a close #2 in the world on economy, that makes it very plausible that China is in fact #1 in research today, and if we do nothing, China is destined to surpass us.