While I am pretty sure that the PRC is making a strategic error where costs will far outweigh gains, that makes me no happier that it looks very much like the Hong Kong we've known (me only from afar) is coming to an end. Freedom retreats; the world gets a little darker.
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...but the bigger thing to watch is the response of less democratic countries. Part of the PRC's sell was that they were trustworthy deal-keepers who didn't do things like regime change and wouldn't demand policy changes one way or the other.
Here they are, breaking a deal they made with Britain by changing out the regime of a quasi-autonomous enclave in the process of enforcing a policy change. It's everything they said they wouldn't do, and it provides ammunition to the people in almost every government...
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...who have been warning that PRC investment, the Belt-and-Road or PRC-linked firms were the thin end of an influence wedge that would lead to vassalage. The problem is less "PRC did a bad thing," but instead "PRC contradicted the fundamental thesis of its foreign policy."
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What Andre Beaufre described as a 'false note.' It both triggers human risk/change aversion (we grow comfortable with the evils we know, but are shocked by the ones we don't) but also makes the false note-maker seem unpredictable, which causes other states to react...
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