ARTICLE: "Venture Capital Swarms China: Gobi Leads a Frenzy to Snare The Next Tech Darling as Concern Abounds of Another Sector Bust," by James T. Areddy, Wall Street Journal, 14 March 2006, p. C1.

ARTICLE: "Pentagon's Blank Check May Be Withdrawn: Congressional Unease Mounts Amid Off-Budget War Spending and Ballooning Deficits," by Jackie Calmes, Wall Street Journal, 10 March 2006, p. A6.

American high-tech venture capitalists head to China while Congress re-thinks the open piggy bank approach to the Global War on Terorrism. Something's gotta give, me thinks.

Too many in the Pentagon want to hold onto the past and subcontract the future to Special Operations Command, but going long on China and short on the ground-pounders just won't do.

And it's amazing that the ground forces feel such a budgetary squeeze amidst this stunning rise in spending (our spending rise alone since 2000 is roughly three times the highest estimate of Chinese defense spending).

The real danger to defense, of course, will be the big push to shift funding from the Pentagon to other long neglected parts of the federal budget. You just watch the Big War crowd wave the red flag on China then to stem the inevitable platform acquistion losses.

But isn't it weird to see our own best and brightest VC pick China over the U.S. economically while defense spending remains so fixated on Big War spending that can only be justified by China's "rising threat"?

I guess it all depends on how you define "smart money."