Made in China: When US-China Interests Converged to Transform Global Trade

by Elizabeth O’Brien Ingleson

The surprising story of how Cold War foes found common cause in transforming China’s economy into a source of cheap labor, creating the economic interdependence that characterizes our world today.

For centuries, the vastness of the Chinese market tempted foreign companies in search of customers. But in the 1970s, when the United States and China ended two decades of Cold War isolation, China’s trade relations veered in a very different direction. Elizabeth Ingleson shows how the interests of US business and the Chinese state aligned to reframe the China the old dream of plentiful customers gave way to a new vision of low-cost workers by the hundreds of millions. In the process, the world’s largest communist state became an indispensable component of global capitalism.

Drawing on Chinese- and English-language sources, including previously unexplored corporate papers, Ingleson traces this transformation to the actions of Chinese policymakers, US diplomats, maverick entrepreneurs, Chinese American traders, and executives from major US corporations including Boeing, Westinghouse, J. C. Penney, and Chase Manhattan Bank. Long before Walmart and Apple came to China, businesspeople such as Veronica Yhap, Han Fanyu, Susanne Reynolds, and David Rockefeller instigated a trade revolution with lasting consequences. And while China’s economic reorganization was essential to these connections, Ingleson also highlights an underappreciated but crucial element of the the US corporate push for deindustrialization and its embrace by politicians.

Reexamining two of the most significant transformations of the 1970s―US-China rapprochement and deindustrialization in the United States― Made in China takes bilateral trade back to its faltering, uncertain beginnings, identifying the tectonic shifts in diplomacy, labor, business, and politics in both countries that laid the foundations of today’s globalized economy.

Genres: China, Economics, Nonfiction, History

352 pages, Hardcover

Published March 19, 2024

Reviews

[Ethan Knecht · Rating 5 out of 5]

One of the best book I’ve read this year. Fascinating trade history of why and how US-China trade occurred in the 1970s despite the political hurdles (normalization negotiations, Taiwan) and small real quantities of trade flows involved. Also does an excellent job of contextualizing in the 1970s US/China domestic politics and the global political economy.

A few other highlights:

- The history of the first U.S. anti-dumping case against China
- How Taiwan reacted to U.S.-China trade
- U.S. export controls (or lack thereof) on sensitive tech (RCA radios, Boeing jets)
- The cultural importance and human component of the Canton trade fair (and its purposeful link to Qing dynasty trade controls)

[Mia Retallack · Rating 5 out of 5]

Ingleson’s highly original account of US/China trade and normalization of relations could not come at a more pressing time.

Her research was incredibly detailed, and especially stood out in her analysis of business records and business people. Throughout, her account is balanced by accounts of not only business people and politicians, but also the stories of workers, many of whom were immigrants and/or POC, moving her narrative beyond a mere account of Cold War politics, towards an integrated social history of consumerism in the era of normalization.

Shout out to the fellow USYD alumni!!

[xiaobao · Rating 5 out of 5]

Try to understand the rationales behind bilateral relations when you blame on others.

[Jim Gulley · Rating 3 out of 5]

How and why did the U.S. come to see China as a nation of 800 million workers instead of 400 million consumers in the 1970s? Elizabeth Ingleson argues that American corporations found it more profitable to leverage inexpensive Chinese labor than to sell to SOEs or their underdeveloped consumer market. She draws on the historiography of “convergence theory” that centers around Deng Xiaoping’s reforms beginning in 1978. Ingleson uses the history of the textile industry as a case study to demonstrate her thesis. During this era, the U.S. textile industry was trapped in a paradox: importing finished goods from China bolstered profitability but pressured its domestic workforce. Made in China is also a diplomatic history, detailing the negotiations between the PRC and the Nixon, Ford, and Carter administrations that resulted in the normalization of relations between the two countries in 1978. This step was essential to advancing their trading relationships. The great negotiation complication was China’s insistence on Taiwan and its One-China policy.

[Turnip Head · Rating 5 out of 5]

Made in China, provides a timely insight into the origins of the China-US trading relationship. Focusing on the 70s, the historiographical angle differs from the more orthodox approach that sees China's integration into the global economy as the fruit of Deng Xiaoping's Reform and Opening Up policy in the late 1970s and early 1980s. Rather, Made in China places the inflection point at the beginning of the 1970s. It cites the domestic upheaval of the Cultural Revolution as a key enabler to China's shift away from Marxist autarky to acquiescence of trading ties with the outside, capitalist world, the leader of which was the US. This endogenous shock was also met with an exogenous one; Richard Nixon's double decision in 1971 to end both the 20-plus year trade embargo on China and the Bretton Woods system of US-dollar convertibility. The book shows how these events laid the foundation for the China-US trading relationship to form throughout the 1970s.

Initially, the relationship was characterised by increased volume of US exports into China but later the balance tipped to favour Chinese exports into the US. This transformation is an underlying theme of the book. Over the course of the 1970s, American perceptions of China shifted from focusing on its potential to be an enormous consumer market to being the site of 800 million workers. With the shifts in global financing norms, in part provoked by Nixon's decision to end dollar coverability in 1971, China's role as a manufacturing centrepiece on the monopoly board of global trade was solidified.

The book is masterfully written with a myriad of excellent primary sources. It skilfully weaves Marco-level historical analysis with personable and fascinating individual stories. Original concepts, such as Fashion-diplomacy, are lovely little gifts sprinkled throughout the book.

I do have one point of clarification, in what is otherwise a superb piece of research. One important domestic shift that the author cites as being a reason for China's opening to global capitalism is Mao's "three-world theory" (p. 108-110). While this theory does demonstrate China's turn away from the Communist movement to focus on development, thus making cooperating economically with capitalist countries more politically viable, it has its origins earlier than the 1970s. Mao articulated a similar theory in the early 1960s(1), ten years earlier, which was a result of the Sino-Soviet split and competition for third world allies rather than openness to cooperating with capitalists per se. This could undermine the argument that the 1970s was the turning point for China's political system that caused it to integrate into the global trading architecture, as the theory was already in circulation ten years prior, suggesting that there may be more continuity to Mao's earlier policies than change.

Nevertheless, for anyone wishing to understand the foundation for one of the most consequential economic relationships today, this book is indispensable.

1. https://digitalarchive.wilsoncenter.o...