During the 1980s, China was having its first "opening up" ever since the long run of the heavy handed personality cult of Mao. I think there was some optimism in many countries that China was going to transform itself. The economy opened up some in following the examples of Hong Kong and Singapore. Leaders at that time probably aware of the trends towards democracy in South Korea and Taiwan as well. South Korea achieved it in 1988. Taiwan achieved it in 1996. Sentiment in Japan towards China was also actually quite good and China wasn't playing the anti-Japan 'causes history propaganda so heavily. Among these factors, the US surely would have been keen to see China drift further away from the SU and draw closer to what is to be a "Western Country". But comes along 1989 and the start of those demonstration in China in April and going on for 2 months before the crackdown on June 4th. Within the CCP at that time, there was the PRC president Zhao Ziyang at the time who favored political reform. He wasn't alone, there were other high ranking PRC CCP politicians that wanted political reform such as Wan Li. However in 1989, there was also a staunch side in the CCP whom did not want political reform and wanted the demonstrations crushed. It is interesting to know that before the PLA was ordered to crush the demonstrations on June 4th, there was an earlier order to do so, sometime in May IIRC, but the PLA did not comply on the grounds of being the Army for the people and so crushing the people would violate that thinking. The staunch side included people such as Li Peng and Yao Yilin. They worked against Zhao Ziyang. Ultimately, Deng Xiaoping would back the existence of the CCP thus being against political reform, felt changes were happening too quickly, and gave the final OK to crush the 1989 demonstrations.
So I think during that phase of opening up throughout the 1980s was a timing that fared quite well with the lease on HK and so in the mid 1980s, the UK and others probably could have felt that at that time, they were not necessarily dooming HK to ChiCom hell.
After the 1989 crackdown at Tiananmen Square (and other locations apparently) and into the early and mid 1990s was probably the moment for reconsidering into backing out of the returning of HK to the PRC. And to not hastily back the PRC in joining the WTO.
But well, here we are now. China's reputation has surely been shot up and trade dependency between the US and China looks to be going to reduced levels. And defense relations between Japan and other Asia-Pacific nations has developed, something important for whenever the US goes through an isolationists phase or exhausted and drained from high tempo training and maintenance wear down.
As for what to do with HK more specifically, maybe sometime later.
Edited by JasonJ, 24 August 2019 - 2141 PM.