Once derided as a country of transistor salesmen, Japan was now the world’s second-largest economy. It was challenging American industrial dominance in areas that were crucial to U.S. military power. Washington had long urged Tokyo to let the United States contain the Communists while Japan expanded its foreign trade, but this division of labor no longer seemed very favorable to the United States. Japan’s economy had grown at unprecedented speed, while Tokyo’s success in high-tech manufacturing was now threatening America’s military edge.
