Japanese and Chinese hold strikingly similar opinions of each other—both are negative. Since the normalization of Japan’s postwar relations with China in 1978, opinion surveys document a clear deterioration of goodwill after nearly two decades of relatively good relations. This trend has accelerated over the past ten years. Most noticeable is how much the decline of trust coincides with a rise of internal socio-economic anxieties in both countries. The central governments are faltering in their ability to provide social stability and cohesion—a sense of safety and material well-being—while establishing a sense of national identity. We argue that current Sino-Japanese tensions reflect more each country’s domestic stresses than they do disagreements over history, any inherent geostrategic competition, or regional economic rivalry. Restoration, or the establishment of prosperity, social certainty, and “moral security” in both countries, is necessary before China and Japan can have any meaningful resolution of their historical and geopolitical issues.