July 12, 2021 BARRON’S 15
Corbis via Getty Images100 YEARS OF BARRON’S
TheUpsandDownsin
The U.S. and China’s
Fraught Relationship
T
wenty-five centuries after Sun Tzu
wrote The Art of War and five since
Zheng He sailed the seas in ships five
times the size of Columbus’, Barron’s
noticed something stirring in China.
“China has awakened from the tor-
por of ages,” we wrote in 1921, and
America was “destined to share in the economic
transformation of China and in the great prosper-
ity and wealth destined to accrue from it.” We
also noted that, before long, “China will focus the
attention of the whole world.”
Seldom have truer words been written. China
was indeed awakening, though less from “torpor”
than from centuries of economic exploi-
tation by Western powers and Japan. It
would eventually be a world power itself.
America’s relationship with the Mid-
dle Kingdom has changed over the de-
cades. In the first half of the 20th cen-
tury, China was looked upon as a great
untapped labor market. After the 1949
Communist revolution, it was seen as
the enemy. In the decades since, we’ve
vacillated between extremes, from
Nixon’s diplomatic re-engagement to
Trump’s tariff wars.
But in 1921, it was all about the “care-
ful, painstaking, docile Chinese
worker,” Barron’s wrote, who “is satis-
fied with a wage of two cents an hour.”
The writer likely didn’t know that, only
days after those words were published,
the Chinese Communist Party would be
founded to put an end to that docility
and to those low wages.
American businesses weren’t de-
terred from trying to tap the cheap Chi-
nese labor market. In 1923, we wrote,
Chinese workers “are about the
poorest paid in the transportation
world.” And though the standard of
living in China remained “wretch-
edly low” in 1931, we wrote, “a new
China is coming forward.”
Barron’s first takes note of Mao
Zedong in 1937, as the Chinese com-
munists joined Chiang Kai-shek to
present a common front against the
invading Japanese. By June 1941—six
months before Pearl Harbor—the
U.S. was providing the now-united
Chinese with munitions to fight
Japan and help “to build up new in-
dustries.” Among American compa-
nies with “substantial interests” in
China was Curtiss-Wright.
Everything changed when the
Communists chased Chiang’s Na-
tionalists across the Taiwan strait.
Within months, in June 1950, the
Korean War brought the U.S. and
China into direct military conflict.
As U.S. soldiers faced “battle-hard-
ened veterans of China’s Red army,”
Barron’s wrote in July, there was
“panic buying” back home of “sugar,
coffee, nylons, automobiles, tires, tele-
vision sets, refrigerators,” and more.
Fear of East-West conflict would
be a theme for decades to come. In
1966, we wrote of North Vietnam
“acting as a cat’s paw” for China in
attacking Laos and South Vietnam.
The next year, we reported on the
“ominous implications” of China det-
onating its first thermonuclear device.
Then, in 1972, Nixon went to
China, stunning the world, upending
the status quo, and inspiring an op-
era. But Nixon’s “China caper” didn’t
impress Barron’s. “East-West trade is
a trap,” we wrote. “Inevitably the
Communists will use the added eco-
nomic leverage” to “pave the way for
the downfall of the Free World.”
Deng Xiaoping’s rise to power
brought on another case of “China
euphoria,” Barron’s wrote in January
1979, the month the U.S. established
diplomatic relations with Beijing. But
while Deng set China’s economy on
its modern course, his legacy is
tainted by the Tiananmen Square
massacre of June 4,1989. The massa-
cre goes almost unmentioned in Bar-
ron’s , which only alludes to “events in
China” as a reason for the Hong
Kong market’s drop. Tiananmen
Square isn’t referred to by name un-
til 1994.
The next battlefield between the
U.S. and China was in the trade
arena. In 1996, Barron’s wrote of the
U.S. threatening “to slap stiff sanc-
tions” on China for pirating Ameri-
can software and CDs, with China in
turn threatening to tax American
imports and bar business deals.
Relations reached a nadir during
the Trump administration, which
accused China of currency manipula-
tion, provocatively referred to the
Covid-19 virus as the “Kung Flu,”
and began a trade war that continues.
Yet the dream of opening the Chi-
nese market to American business
hasn’t died. “Not a day goes
by without a multinational
company unveiling plans to
step up Chinese invest-
ment,” Leslie Norton wrote
in 2001, though it could
have been written on virtu-
ally any day since then.
All this time, China has
been growing and modern-
izing. In 2010, it surpassed
Japan to become the sec-
ond-largest economy in the
world, and with the gap
shrinking with the No. 1
U.S., Randall W. Forsyth
wrote in 2013 of “A Scary
New World Order.”
A century after Barron’s
first noted a stirring, we
can say that China has
officially thrown off its
torpor.B
By KENNETH G. PRINGLE
President Nixon, center, during
a visit to the Great Wall of
China in February 1972.
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