Friend or Market? Case Studies in Strategic Trade
By the late 20th century, U.S. trade policy had evolved into more than a tool for prosperity. It became a litmus test for political alignment.
If you played by Washington’s rules, you got access to the world’s largest consumer market, investment, and economic growth.
If you didn’t, you faced sanctions, embargoes, and exclusion.
Let’s look at how different countries experienced the American-led trade order—not just as economic participants, but as players in a larger geopolitical game.
Japan & South Korea: Allies by Access
After WWII and the Korean War, both Japan and South Korea were devastated. The U.S. stepped in with a clear strategy:
Security guarantees (bases, treaties, and military aid)
Massive economic support
Access to U.S. markets to rebuild export-driven economies
These nations weren’t just helped—they were transformed:
Japan became an industrial powerhouse by the 1980s.
South Korea went from dictatorship to democracy, powered by manufacturing and trade.
In return, they aligned closely with U.S. interests throughout the Cold War.
Trade was the glue that held the alliance together.
China: From Outsider to Factory of the World
In the 1970s, China was still closed off from the global economy.
Then came Nixon’s visit in 1972, a historic opening. Over the next few decades, China:
Gradually opened its economy
Attracted foreign investment
Was admitted to the WTO in 2001, with U.S. support
The result? China became the world’s manufacturing hub, lifting hundreds of millions out of poverty—and deeply tying its fate to the global (and American) economy.
But it wasn’t just economics.
The U.S. believed that trade would lead to reform, liberalization, even democracy.
Spoiler: It didn’t.
But it did create a powerful competitor embedded in the very system America built.
Cuba, Iran, North Korea: The Cold Trade
Then there were the countries that didn’t play ball.
Cuba: Sanctioned since 1960 after nationalizing U.S. property and aligning with the USSR.
Iran: Cut off after the 1979 Islamic Revolution and hostage crisis.
North Korea: A rogue state, heavily sanctioned and diplomatically isolated for decades.
These nations became examples—not just adversaries.
They showed the world what happened when you stepped outside the Pax framework: no trade, no aid, no access.
In a system built on prosperity, exclusion became punishment.
Trade as Political Pressure
U.S. trade policy wasn’t just about money—it was a foreign policy tool.
It rewarded alignment with:
Open markets
Liberal democracy
U.S. geopolitical interests
And punished those who challenged the system, even if their people paid the price.
This wasn’t free trade.
It was strategic trade—a way to shape behavior, contain threats, and reward loyalty.
What Comes Next
Tomorrow, we’ll wrap up Week 2 by asking:
Did all this trade really keep the peace—or just shift the pain elsewhere?
Because while trade tied the world together, it also left deep imbalances. And some of the biggest costs were felt not overseas—but right here at home.