U.S.-Pakistani relations, under redoubled strain after the May raid on Osama bin Laden's Abbottabad compound, are only getting worse. This week, the Obama administration announced it would withhold $800 million in military aid to Pakistan, more than a third of Washington's annual allotment. The proximate cause of this reprimand was the apparent betrayal by Pakistani officials of plans to attack Afghan Taliban bomb-making sites inside Pakistan -- the bomb-makers, who undoubtedly have the blood of many U.S. soldiers on their hands, escaped. Meanwhile, the security outlook in Pakistan's tribal areas bordering Afghanistan has darkened. In retaliation for the blocked U.S. aid, Pakistan's defense minister threatened to withdraw some of his soldiers from the badlands, including over 1,100 border checkpoints. This would come on top of a previous decision to throw out over 100 U.S. Special Forces soldiers who had been training the Frontier Corps. As it attempts to scare U.S. officials by threatening to cede territory to the Afghan Taliban, the Pakistani government didn't hesitate to take action against its own insurgents -- over the past six weeks, the Pakistan army has fired over 760 rockets and artillery shells into three Afghan provinces, killing at least 60 people. The decision to finally impose a penalty on Islamabad for the duplicity of some of its officials will no doubt further worsen the relationship in the short-run. Policymakers in Washington will have to assess whether the relationship is a viable candidate for a "reset." If not, the United States will have to tally up its options for expanded unilateral action against militants in the region. If it comes to that, President Barack Obama will undoubtedly turn to his incoming CIA director Gen. David Petraeus to implement more quasi-military operations. The CIA has had a covert presence in Pakistan for decades, a presence that has taken on a wide variety of forms as circumstances have changed. A continued downward spiral in the U.S-Pakistani relationship will cause the covert CIA presence to evolve again, or at least intensify in its present form. As a marker of what may be to come, the night of May 11 witnessed one of the heaviest drone bombardments of Pakistan, with four separate strikes killing over 50 people. Petraeus will shed his Army uniform before he reports for work in Langley. But he will still be a battlefield commander, in charge of a robotic air force and a small army of U.S. and Afghan paramilitaries, many of whom are former special operations soldiers. Under U.S. law, Petraeus's campaign in Pakistan will be a civilian-led covert action, authorized under Title 50 of the United State Code. To Pakistan, it will look a lot like war. China's message to its neighbors: don't count on the United States Adm. Michael Mullen, chairman of the Joint Chiefs of Staff, just completed a four-day visit to China. Mullen's hosts provided him with unprecedented access to some of China's most important military capabilities. Restoring military-to-military relations with Beijing, which have regularly been disrupted over the past decade, has long been a goal of U.S. military officials. Mullen and his colleagues at the Pentagon should be pleased that his visit, coupled with a tour his Chinese counterpart recently made to the United States, will open communications between the two defense establishments and thus reduce the odds of potentially damaging misunderstandings. But Mullen's trip also revealed the steady pressure the Chinese government is placing on the U.S. forward presence in the Western Pacific. Mullen's tour of Chinese military bases included a visit to the headquarters of China's Second Artillery Corps, the unit responsible for China's nuclear deterrent and many of its rapidly-growing missile forces. His hosts also allowed him to sit in the cockpit of a SU-27, one of China's most advanced operational jets, and to inspect a late-model diesel-electric submarine. Mullen also observed an army training exercise and had numerous meetings with junior and senior officers. The trip seemed to modestly advance the U.S. objective of creating greater transparency between the two sides. But Chinese military leaders also made progress on some of their goals. They took advantage of the publicity associated with Mullen's visit to broadcast doubts about the sustainability of U.S. commitments to the region and question the propriety of U.S. military cooperation with countries around the South China Sea. During a press conference with Mullen, Gen. Chen Bingde, chief of the General Staff of the People's Liberation Army, offered some unsolicited advice for policymakers in Washington. "I know the U.S. is still recovering from the financial crisis," Chen said. "Under such circumstances, it is still spending a lot of money on its military and isn't that placing too much pressure on the taxpayers? If the U.S. could reduce its military spending a bit and spend more on improving the livelihood of the American people wouldn't that be a better scenario?" Chen's suggestion was undoubtedly designed to reinforce doubts about the Pentagon's ability in the long run to fulfill its security commitments to the region. China's message to its neighbors is that they should take those doubts into account when formulating foreign policy. Chen also publicly criticized military training exercises U.S. forces recently conducted with Vietnam and the Philippines. Chen asserted that the timing of the exercises was "inappropriate [a]t this particular time, when China and the related claimants [to the South China Sea] have some difficulties, have some problems with each other." Chen's message is that it is illegitimate for the United States to interfere with a squabble in China's neighborhood. From China's perspective, such interference only makes it more difficult to resolve the South China Sea dispute - on terms Beijing would prefer. American officials are likely to respond by ignoring Chen's remarks and carrying on with business as usual. Indeed, the Pentagon plans to further expand its military-to-military agenda with China by hosting a Chinese visit to U.S. Pacific Command headquarters and by including Chinese forces in upcoming anti-piracy and disaster relief training exercises. But China will very likely continue to patiently assert its claims in the South China Sea, question the legitimacy of a U.S. presence there, and raise questions about the reliability of U.S. security promises. Before the financial crisis, U.S. policymakers had not heard such challenges. Now they have a new problem in their inbox. (FP)