The "Japan panic" was rooted in fears of economic subordination—like having a Japanese boss or seeing landmarks bought by Japanese firms. In contrast, anxiety about China is dominated by concerns over direct military conflict and a technological arms race, a much starker form of geopolitical rivalry.
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The dynamic between a rising power (China) and a ruling one (the U.S.) fits the historical pattern of the "Thucydides' trap." In 12 of the last 16 instances of this scenario, the confrontation has ended in open war, suggesting that a peaceful resolution is the exception, not the rule.
Public and political fear of Japanese economic takeover reached its zenith in the early 1990s, with books like Michael Crichton's "Rising Sun." Ironically, this coincided with the bursting of Japan's asset bubble, highlighting a critical lag between economic reality and popular discourse.
The justification for accelerating AI development to beat China is logically flawed. It assumes the victor wields a controllable tool. In reality, both nations are racing to build the same uncontrollable AI, making the race itself, not the competitor, the primary existential threat.
China's showcase of advanced military hardware, like its new aircraft carrier, is primarily a psychological tool. The strategy is to build a military so 'forbiddingly huge' that the US would hesitate to engage, allowing China to achieve goals like reabsorbing Taiwan without fighting. This suggests their focus is on perceived power to deter intervention.
The US won World War II largely due to its unparalleled manufacturing capacity. Today, that strategic advantage has been ceded to China. In a potential conflict, the US would face an adversary that mirrors its own historical strength, creating a critical national security vulnerability.
The core driver of a 'Thucydides Trap' conflict is the psychological distress experienced by the ruling power. For the U.S., the challenge to its identity as '#1' creates a disorienting fear and paranoia, making it prone to miscalculation, independent of actual military or economic shifts.
Current anxiety surrounding China is largely confined to policy and financial circles, lacking the broad public and pop culture resonance that characterized the fear of Japan's economic rise in the 1980s, which permeated movies, media, and consumer attitudes.
The most significant point of friction for ordinary Chinese citizens is the constant U.S. military presence near its borders, such as naval patrols in the Taiwan Strait and bases in South Korea and Japan. This sense of being militarily encircled is a more potent source of public frustration than economic disputes.
Trump's consistent economic nationalism is not a recent phenomenon but is deeply rooted in the 1980s. He publicly railed against Japanese trade practices and high-profile investments in American assets, demonstrating that his protectionist instincts are a core, long-held belief.
From 2001 onwards, while the U.S. was militarily and economically distracted by the War on Terror, China executed a long-term strategy. It focused on acquiring Western technology and building indigenous capabilities in AI, telecom, and robotics, effectively creating a rival global economic system.
