This won't be the first investment in Hollywood by the Chinese. Two months ago, Legendary Pictures sold a 3.3 percent stake to China's Orange Sky Golden Harvest Entertainment for $25 million. China is beginning to partner with Hollywood in major productions.

In what will be the most expensive Chinese co-produced movie so far, American company Hollywood MovieWorks has teamed with Beijing entrepreneur Sheng Boyu to make a new film called Double Lives The MGM acquisition, however will be the largest and most visible.

For me this was déjà vu all over again and recalled Sony's $3.4 billion purchase of Columbia Pictures in 1989, as well as Panasonic's $7 billion 1990 takeover of MCA, owner of Universal Studios and one of the recording industry's biggest labels.

Along with Mitsubishi's purchase of another US icon, New York's Rockefeller Center, many of us felt that we would soon be a Japanese colony and that Japan was sucking up US assets so fast that they would own us lock, stock and barrel. Of course when Japan's economic bubble deflated shortly thereafter so did most of our fear.

Now Americans are faced with the same sort of continuing and growing anti-Chinese paranoia.

An early symptom was the Unocal debacle in 2005, when SOE China National Offshore Oil Company Ltd. (CNOOC) withdrew an offer to buy out the American oil company after organized opposition from Congress arguing that the deal posed a threat to America.

More recently we have seen an unprecedented wave of China-bashing during the recent elections, perhaps the most severe being the ad showing a Chinese professor in a future 2030 classroom saying in Mandarin that since the Americans borrowed so heavily from China " now they work for us."

Imagine the possible US reactions to the Chinese buying fabled MGM in this poisoned climate. Many will feel the same way we did two decades ago.

The current situation makes the earlier one look like child's play. Japan has been the US economic and political ally since the war ended. The relationship with China is much more ambiguous, and sometimes schizophrenic. China can be an ally, a partner, or an opponent, depending on the issue of the day.

The author is former director and vice president at ABC Television. He spends most of his time in Beijing now working on media projects. hdzodin@hotmail.com