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US expert-tariffs

U.S. expert warns tariffs against allies and foes alike will make America 'less well-off,' 'less secure'

By Song Sang-ho

WASHINGTON, July 21 (Yonhap) -- A U.S. expert on Monday stressed the need for President Donald Trump's administration to exercise restraint in imposing tariffs on allies, warning that using them against allies and adversaries alike will make America "less well-off" and "less secure."

Cullen Hendrix, senior fellow at the Washington-based Peterson Institute for International Economics, made the call in an article released on the day, noting that Trump's approach to trade policy does little to distinguish between allies, rivals, enemies and the truly unaligned.

The Trump administration has rolled out or threatened to impose new tariffs on its trading partners, fanning concerns that the levies could affect cohesion in the United States' alliance network at a time of a deepening Sino-U.S. rivalry.

"Wielding (tariffs) against allies and adversaries alike will make the United States less well-off -- and less secure. U.S. security and prosperity are best served by robust alliances and predictable, rules-based trade with security partners," Hendrix said.

"This moment -- with more active armed conflicts than at any point since the end of the Cold War and an uncertain global economic outlook -- is exactly the wrong time to erode trust further through blanket tariffs. This is a time for clear strategic signals and tariff restraint -- especially vis-a-vis U.S. allies," he added.

The scholar underscored the benefits that the U.S. enjoys from cooperation with its alliances, including augmented deterrence, enhanced defense capabilities and forward-basing opportunities not to mention markets for U.S. weapons that Washington does not sell on the open market.

Despite those benefits, Hendrix pointed out that allies have not been spared from the Trump administration's tariffs and tariff threats.

"While not all U.S. allies are equally aligned ... tariffs that ignore even our most reliable partners undermine alliance cohesion," he said.

Moreover, he noted that asking alliance partners to sustain a high level of defense expenditures while "damaging their economies with higher tariffs" will be "challenging" given budget constraints and commitments to social spending.

"Threatening and imposing tariffs on trading partners, including free trade agreement partners, already erodes trust in U.S. commitments," he said.

"Treating alliance partners like trade adversaries will further increase intra-alliance frictions, weaken collective deterrence and invite potential adversaries -- none better positioned than China -- to exploit these divisions."

He proposed an approach under which the U.S. would promote free trade with established security partners, using tariffs "sparingly" and only in a "targeted" fashion.

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