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Look I'm not saying it's a desirable position but I don't think misrepresenting the situation is helpful either.
The ISS was complete so there was no more use for the shuttle other than bleeding money. Obviously the geopolitical situation allowed for them to use the cheap option, they are capitalists after all. But obviously those 90+ y/o nazi engineers were the real reason.
CNSA has been around for 30 years and NASA for 66. It's also much easier to catch up (which they haven't) than to develop initially especially since they were cooperating until 2011. I wish China was putting more effort into their own version of Starship (Long March 9) but at least as of last year they don't intend to have it ready and fully reusable before 2040.
They're defunding planetary science, not Artemis really. Which is bad obviously but SpaceX is certainly less of a grift than Lockheed Martin or Boeing so I'm not sure where you would put that money instead.
The OP is about JPL, the division actually being affected by the cuts. Again, they don't make rockets. CNSA says 2030 for the moon but it will be on Long March 10 (i.e. not reusable). NASA says 2026 (which admittedly will probably slip to 2027/2028) but it requires Starship to work. If China manages to get there first it would be impressive and a welcome surprise but they would be unable to sustain a presence there (just as the US was) without a fully reusuable superheavy vehicle.
Not germane to your points above but now that there are organizations other than NASA I am not actually sure that layoffs are detrimental (from a tech/development standpoint). Instead of layoffs resulting in the knowledge being lost people can just jump between JPL/SpaceX/Blue Origin and so on. This is one of the easier ways to get knowledge to distribute through the field since our economic system & IP laws discourage meaningful cooperation.
This is nice in theory, but isn't how knowledge transfer of this variety tends to happen in the aerospace industry. Many of those laid off have very specific expertise in niche areas of mechanical and aerospace engineering. Some of that is transferrable, but a lot is specific to things like Mars rovers and planetary science. Tearing those people away from JPL will result in the loss of a ton of institutional knowledge and much of it will not be applicable to the private sector and might just be lost all together.