A Good Deal For Trump and Abe
The Right Way to Press Japan on Trade
In the aftermath of World War II, American policymakers understood that a prosperous Japan anchored in a U.S.-led economic order would be in the United States’ interest, since it could help support forward-deployed U.S. forces and counter the Soviet Union’s influence. For that reason, the United States supported Japan’s postwar recovery, developing a relationship with Tokyo grounded in economic and security cooperation. But the United States eventually became a victim of that policy’s success. As Japan’s economy grew, its companies gained market share at the expense of American producers. Sheltered under the U.S. security umbrella, Japan became an economic rival.
For nearly 50 years, Washington has struggled with this dynamic, which one could call the “allies and competitors” problem. Every U.S. administration has had to balance maintaining a close political and security relationship with Japan and preserving fair economic ties.
U.S. President Donald Trump will start writing the next chapter in this history when he meets with Japanese Prime Minister Shinzo Abe on February 10 and 11. The Trump-Abe meeting is perhaps the most important encounter between Japanese and U.S. leaders in more than two decades. Tokyo wonders whether the new president will follow through on his longtime criticisms of Japan’s “taking advantage” of the United States, perhaps by seeking to reduce the U.S. trade deficit with Japan and by pushing for Japan to increase its defense spending.
Trump would not be the first president to prioritize fixing the U.S. trade deficit with Japan.
Trump’s decision to withdraw the United States from the Trans-Pacific Partnership (TPP), a landmark agreement in the U.S.-Japanese economic relationship, has already indicated that his approach to Japan will differ from those of Presidents Barack Obama and George W. Bush, who believed that the United States and Japan shared not only security and economic interests but also common values. Japan’s trade surplus with the United States was of little concern to Trump’Ross’ and Navarro’s words, to “increase the GDP growth rate, decrease the trade deficit, and strengthen the U.S. manufacturing base.”Read the full article on ForeignAffairs.com