Recent anti-Japanese disturbances in China remind us that the two countries are locked in a dificult relationship, with heavy historical baggage. Although there are glimmers of Chinese 'new thinking' about Japan, the history issue, deep societal antipathy and substantial strategic divergences keep the political relationship from progressing the way the bilateral economic relationship has grown. Japan is not likely to re-emerge as a great power or discontinue its alliance with the United States, despite the steady expansion of the Japan Self-Defense Forces. Japan-China tensions therefore simmer on, with the risk that a crisis over Taiwan or some other issue will plunge the East Asian giants into a cold war.