In the 1400s, China owned the greatest seagoing fleet in the world, 3,500 ships. But by 1525, China's "Treasure Fleet" was destroyed.

The Treasure Fleet was abandoned at the urging of a political elite inside China alarmed at the rise of a merchant class who had become rich from international trade.

Nobel economist Angus Deaton says, “A lot of inequality comes from that sort of rent-seeking, you know, from going to Washington and saying 'protect my industry.’”

International trade is once again under attack from governments. Are we looking at another Treasure Fleet moment right now, failing to see the danger of elite-driven rentier mercantilism?

In the 1400s, China owned the greatest seagoing fleet in the world, up to 3,500 ships at its peak. (The U.S. Navy today has only 430). Some of them were five times the size of the ships being built in Europe at the time.

But by 1525, all of China's "Treasure Fleet" ships had been destroyed — burned in their docks or left to rot by the government. China had been poised to circumnavigate the globe decades before the Europeans did, but instead the Ming Dynasty retracted into itself and entered a 200-year-long slump.

Few people in the West realise how economically and technologically advanced China was by the 1400s. The Treasure Fleet was vast — some vessels were up to 120 metres long. (Christopher Columbus's Santa Maria was only 19 metres.) A Chinese ship might have several decks inside it, up to nine masts, twelve sails, and contain luxurious staterooms and balconies, with a crew of up to 1,500, according to one description. On one journey, 317 of these ships set sail at once.

Admiral Zheng He. jonjanego, Wikimedia, CC Under the command of the eunuch admiral Zheng He, the Chinese were routinely sailing to Africa and back decades before Columbus was even born. Yet they did not go on to conquer the world. Instead, the Chinese decided to destroy their boats and stop sailing West.

In the 1470s the government destroyed Zheng's records so that his expeditions could not be repeated. And by 1525 all the ships in the Treasure Fleet were gone.

Why?

Historians have a variety of explanations. The Yongle Emperor was distracted by a land war against the Mongols, a conflict in which the navy was irrelevant, for instance. Others argue that the vast cost of the Treasure Fleet's expeditions far outweighed the actual treasure they came back with.

But Angus Deaton, the Nobel Prize-winning Princeton economist, prefers a different theory. In his book "The Great Escape: Health, Wealth, and the Origins of Inequality," he argues that the Chinese burned their boats (almost literally) in an attempt to control foreign trade.

The Treasure Fleet was abandoned at the urging of the political elite inside the Emperor's civil service who had become alarmed at the rise of a newly rich merchant class. "The emperors of China, worried about threats to their power from merchants, banned oceangoing voyages in 1430, so that Admiral Zheng He’s explorations were an end, not a beginning," Deaton writes.

A model of one of Zheng he's ships. Mike Peel, Wikimedia, CC

China retracted into itself and the industrial revolution sprouted first in Western Europe, three centuries later. China's influence on the world got smaller until the 1600s. And only in the last 10 years or so has China fully caught up with the West.

Over coffee at the World Economic Forum in Davos this year, I asked Deaton if he thought the Treasure Fleet story was newly relevant, given the sudden desire in the US and the UK to withdraw from international free trade agreements in favour of protectionist policies. I also wanted to know whether he thought the fear of trade might also be a function of increasing inequality in the West. When society becomes extremely unequal, elites tend to gain enough power to use the government to secure artificial advantages that shield them from competition.

In other words, are we looking at another Treasure Fleet moment right now, and failing to see the danger of elite-driven rentier mercantilism?

Economist Angus Deaton. REUTERS/Dominick Reuter "A lot of inequality comes from that sort of rent-seeking, you know, from going to Washington and saying 'protect my industry, or let me charge whatever I want for pharmaceutical prices, and pass a law which says that everything that's approved by the FDA must be covered by government health schemes,' and that's basically legalised theft," Deaton said.

"So you've got a big number of people in banks, pharmaceutical companies, the military, and so on in the US who are getting fabulously rich by stealing stuff essentially, and I think that pisses off [people]."

"The bank bailout gave hundreds of billions of public money to people who were already probably the richest people the planet has ever seen, right? Now it doesn't make you 'deplorable' if you resent that. I think that's the truth of where inequality is really hurting us. These people are being rewarded for hurting us."

OK, so tracing a direct link from the Treasure Fleet of the 1400s to Trump and Brexit might be a stretch.

But it's more than a little ironic that 500 years after Zhenge He set sail, the Chinese empire is now begging the West to keep trade routes open. The West, meanwhile, wants to put up new barriers. At the same time as Deaton and I discussed the fate of the Treasure Fleet, Chinese president Xi Jinping went on stage at Davos to castigate Trump and the US for being scared of international trade. He used nautical terms to do so:

"If one is always afraid of the sea he will get drowned in the ocean sooner or later. So what China did was to take a brave step forward and embrace the market. We have had our fair share of choking in the water and we have encountered choppy waves. But we have learned how to swim in this process. It has been the right strategic choice ... whether you like it or not the global market is the big ocean you cannot escape from," Xi said.

No doubt Admiral Zhenge He would have approved.