A few months ago Tim Geithner, the US Treasury secretary, assured a group of Chinese students in Beijing that their country's US dollar investments were in good hands. “Chinese assets are very safe,” Mr Geithner said. His comments brought the house down.

White House officials will be hoping that Barack Obama can avoid a similar loss of face on Monday when he meets a group of students in Shanghai for the set piece “town hall” that has become the US president's signature event.

The chances are that he will. But no amount of dexterity can disguise the fact that Mr Obama's visit to China crystallises a big shift in the global centre of gravity over the past few years. Just a decade ago Bill Clinton persuaded Capitol Hill that China's membership of the World Trade Organisation would strengthen the forces of democracy within China.

Today, almost nobody in Washington even tries to make that case. Subsequent developments in China – and elsewhere – make it hard to sustain the argument that economic liberalisation leads necessarily to political liberty. More importantly, the US no longer has the luxury of being able to play teacher to China's student (not that China ever took instruction).

Since the Clinton years, Chinese holdings of US dollar assets have rocketed and now top $800bn, making China the largest foreign claimant on US obligations. That shift makes nonsense of the traditional US human rights agenda in China. Debtors do not normally get to lecture their creditors.

It was Hillary Clinton, ironically, who gave the first whiff of this new reality on her first trip abroad as secretary of state in February. Rather than browbeating China on human rights, Tibet and freedom of religion, Mrs Clinton said in advance that she would not permit these issues to “interfere” with what is now the most important bilateral relationship in the world.

Mrs Clinton's comments caused disquiet among the human rights community, which accurately points out that on some measures, including freedom of religion and expression in Tibet, China is going backwards. No matter. Last month Mr Obama became the first US president since 1991 to refuse to meet the Dalai Lama on a visit to Washington. Officials say Mr Obama will meet Tibet's spiritual leader after his visit to China.

They add that Mr Obama will raise such issues with his Chinese counterparts “in his own way”. Those versed in diplomatese might spot the difference between Mr Obama and George W. Bush's agenda in China. The latter promised to hold “constructive, co-operative and candid” talks in Beijing. Mr Obama has dropped “candid” and promises the engagement will be “positive, constructive and co-operative”.

Set against this are Mr Obama's own domestic compulsions. Many in Asia, Europe and elsewhere have complained about the degree of time and energy the new administration has devoted to healthcare reform since it took office. China echoes those concerns but for very different reasons.

As America's largest banker, China is worried about America's ability to pay for the kind of reforms Mr Obama is advancing. Last weekend the House of Representatives passed a 1990-page healthcare bill that will cost $1,200bn (€802bn, £719bn) in new outlays over the next decade. Mr Obama has promised that any final legislation will be deficit-neutral – unlike the measure passed in the House.

His words are directed as much to the Treasury bond markets, of which China owns such a large share, as to American voters. Back in March, Wen Jiabao, China's prime minister, urged the US to “maintain its good credit, to honour its promises and to guarantee the safety of China's assets”. Next week, Mr Wen and Hu Jintao, China's president, are likely to be more polite. But there can be little doubt that whatever candour is exchanged behind closed doors, the flow of preachiness will be at least two-way.