FEDERAL RESERVE CHAIRMAN Alan Greenspan teamed up with Treasury Secretary John Snow to urge calm when they went before a Senate committee last week. Once again, politicians and policy wonks are up in arms about a foreign takeover of an American company, in this case the attempted acquisition of Unocal by China's National Offshore Oil Corporation (CNOOC). To those who remember the hysteria that greeted Japan's purchase of Rockefeller Center, the jewel in the crown of New York real estate, in the late 1980s, "It's déja vu all over again," to borrow from the Yankee sage, Yogi Berra.

That might just be dangerously wrong. The current Chinese takeover movement is different from the earlier buying spree by Japanese companies. Japan was not a rival for influence in Asia, or in the world; China is. Japan was not a major competitor for scarce resources such as oil; China is. Japanese companies were privately owned; China's acquirers are state-run entities. Japan is a democratic country, and by and large an American ally; China most definitely is not. Japan did not engage in the wholesale theft of intellectual property, China does. Japan did not buy strategic assets: ownership of New York real estate has no implication for national security; ownership of oil resources does.

CNOOC's $20 billion, all-cash bid for Unocal is only one of several being made by the Chinese regime, eager to expand the international influence of its state-owned companies. Last week, China's Haier offered $1.3 billion for Maytag, the troubled manufacturer of

At this writing it is impossible to predict whether the CNOOC bid will succeed. It does top Chevron's offer by about $2 billion, but the American company is quite capable of raising its already-generous offer. Or Unocal's board might decide that the several relevant regulatory authorities are so likely to veto the CNOOC bid as a threat to American security, that it would be wise to accept the lower Chevron offer.

But whatever the outcome of CNOOC's decision to bid for a major American oil company, it has raised the temperature of the already red-hot dispute over trade policy. The authorities are starting to realize that U.S. companies are not operating in a free market as that term is generally understood. The battle for Chevron is not a bidding war between two privately owned companies, both responsible for maximizing shareholder value. CNOOC is 70 percent state-owned, the beneficiary of cheap government financing, and expected to act in support of the regime's geopolitical objectives. That makes a mockery of the Chinese authorities' warning to the Bush administration not to politicize the CNOOC takeover bid. China has decided to use its state resources to convert its major companies into important multinationals--part of an aggressive policy of projecting Chinese power on a global basis. If that's not political, nothing is.

THAT POLICY is most noticeable in oil markets. China's acquisition of Unocal's substantial Asian assets will increase its political influence in that part of the world. China has also purchased 40 percent of Sinopec's Northern Light oil sands project in Canada, at an ultimate cost of $2 billion; taken a 10 percent stake in an Azerbaijan field and pipeline; and invested in Venezuela's oil industry in return for President Chávez's promise to divert some of his nation's crude from the United States to fuel-hungry Chinese factories.