The New York Times podcast “The Daily” ran a great story on Apple and China’s history. The whole thing is a worthwhile listen, but it has a lot of insight into the succesful and increasingly fraught relationship between the most profitable company in the world and the country with the 2nd largest economy.

The story begins familiarly, recounting Apples troubled period in the 90s and the triumphant return of Steve Jobs. In 2001 China joins the World Trade Organization and Apple, which is starting to make a comeback, decides to bet big on the country.

Well, Apple was suddenly growing very rapidly. The iPod had become a smash hit. And it started to realize that it was going to need more space and more labor to keep up with demand. And so China, especially, was appealing because it obviously had an enormous labor force.

There was very rapidly a supply chain that was building out there with many different suppliers already based there, which made manufacturing products easy. And the Chinese government crucially was pouring literally billions of dollars into infrastructure and factories to build out the supply chain and really make it easy for companies like Apple to come in and make these rather advanced products there.

The infrastructure investment is paying off, but political, public, and humanitarian concerns are causing friction. When Xi Jinping consolidates power, the situation boils over into hostility. And as much as Apple wants to call the shots, they have to contend with the reality that they painted themselves into a corner.

Pretty quickly, there were these conversations inside of Apple about the dilemma that they faced in China. And specifically, there was this former Apple employee who was a senior adviser in China. And he told me that early on he realized the predicament Apple was in, and he tried to get the company’s leadership to do something about it.

And so he was able to get an audience with some of Tim Cook’s top deputies and make the case that Apple had basically no plan B to China, and that really left the company vulnerable to the whims of the government. But ultimately, nothing really changed at Apple. And that was, in part, because there was really no other country that could support the type of manufacturing that Apple now required, and there were certainly no consumer market that could make up for the lost sales if Apple had to leave China.

There are a few other stories and anecdotes that really highlight the state of the relationship, and the whole podcast is worth listening to (or reading), but this conclusion sums it all up well.

So from an economic standpoint, Apple’s bet on China has been one of the biggest successes in modern business history. Apple is the most valuable company in the world, and it is the richest company in the world and the most profitable company in the world. But at the same time, Apple was in some ways making a bet that its entrance into China, its investment in China, would force China to open up and to liberalize and to reflect more of the values that Apple itself believes in.

So at the outset, I think that Apple believed that it could change China. But two decades later, it seems to be clearer that China has instead changed Apple.