Didn't the Japanese go through this phase?

All sorts of alarmist news stories and editorials are being written about Chinese attempting to seize financial control of major American corporations.

For the record, if a potential military enemy (like the Chinese) gained control of a major corporation (like Chevron) in an industry of strategic importance to the United States (such as the petroleum industry), that would be a bad thing.

And I don't expect the government will permit it.

However, I do fully expect that over the next couple years we will see shocking headlines of the Chinese buying this and buying that; buying a major league baseball team, a Hollywood studio, a big bank, a tall building or a theme park. Everyone is going to be outraged and scared and wonder if we are going to be forced to read the Little Red Book and start taking Chinese in school. Bill Moyers is going to put on a television special called "If the Chinese can do it, Why Can't We." We will all be wandering around in a state of national depression over the inevitable Chinese eclipse of American civilization while Democratic leaders talk about how it is all Bush's fault and college lefties can talk about the genius of Mao again and media types from NPR can hint that it is all simply America's just deserts for our great national hubris.

And what everyone is forgetting is that this is exactly what happened with the Japanese back in the late eighties and early nineties. The Japanese economy experienced a big temporary surge at the same moment that the United States economy experienced a minor, temporary slowdown. This caused trade deficit to surge and the value of the American Dollar to drop against the Japanese Yen. Japanese investors with surplus cash went hunting for cheap investment in the United States and started scooping up nice buys, including the Sears Tower in Chicago, at least one major bank, and one major Hollywood studio. Americans went through a big angst period while some Japanese started fantasizing about finally achieving cultural dominance over the folks that bombed Hiroshima and Nagasaki.

A new Japanese Godzilla movie was made in which the big guy goes back in time to smack the Marines at the Battle of Tarawa. I'm not kidding. Another movie was made in Japan about a theoretical future war in which the Japanese (again) get to avenge themselves on the Americans. An American movie was even made (Michael Keaton starring in "Gung Ho") about Americans learning to adjust to the new Japanese economic dominance.

Then the Japanese economy, badly overheated because they had nobody like Alan Greenspan to pull back on the reigns, bottomed out.

And everyone forgot about it.

The same thing, I believe, will happen with the Chinese. They will go hog wild on American financial purchases, partly because they will be cheap, attractive investments; and partly because it will make Chinese investors feel good to buy up American stuff. Then the Chinese economy, always volatile because centralized planning and sound investment go together like Army Rangers and Al Qaida, will take a big dip and all the big Chinese purchases will turn into bargain buys for American investors.

President Bush merely needs to watch, and prevent the Chinese from buying up any major, strategic industry champions, until this episode is over.

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UPDATE (Monday, 6/27/05, 11:30 AM)

I'm having second thoughts. See story here.