Former U.S. Deputy Trade Representative Cutler: U.S. Should Be a Reliable Partner to Other Countries

The Yomiuri Shimbun

6:00 JST, May 18, 2025

WASHINGTON — Former Acting Deputy U.S. Trade Representative Wendy Cutler said in an interview with The Yomiuri Shimbun that countries may shun the United States and intensify work among themselves if they cannot regard the U.S. as a trusted and reliable partner.

The following excerpts from the interview have been edited for flow and clarity, with input from Cutler herself. This interview was conducted by Yomiuri Shimbun Staff Writers Yuko Mukai and William Corcoran.

***

The Yomiuri Shimbun: How do you see U.S. President Donald Trump’s tariff policies impacting the U.S. economy and also the world economy?

Wendy Cutler: Clearly the U.S. tariff policies are impacting the U.S. economy. We’re already beginning to see some price hikes. People are forecasting we’re going to be shortly seeing shortages in supermarkets and on the shelves in retail stores. We’ve seen volatile impacts on our stock market and our bond market. U.S. businesses are delaying investment decisions until they have a clearer picture of how things will play out. These tariffs are impacting our economy at all different levels and at all different angles.

Yomiuri: Japan and the United States have started negotiations. What is the biggest challenge from the Japanese perspective in negotiations with the United States?

Cutler: I understand that negotiators from Japan and the U.S. are making progress, but there are still some serious outstanding issues, which are raising concerns in Tokyo. Probably, the most important concern is whether the U.S. will move off any of its sectoral tariffs, particularly in the automotive sector. Japan will be hard pressed to conclude a trade deal with the United States that does not address its automotive concerns, particularly given that the recent U.S.-U.K. deal includes tariff relief for this sector.

Yomiuri: The Trump administration appears to be fixated on the trade deficit. How do you think that plays into the negotiations?

Cutler: It definitely plays into the negotiations because, not only does Japan have a large trade surplus with the United States, its trade surplus is also in products like autos, auto parts, machinery and other manufactured goods that are the priority sectors for President Trump.

That said, Japan is a close ally and has been a strong partner on our economic security agenda. Its companies have made extensive investments in the United States, and further investments are in train. It has strengths in the shipbuilding sector, in which the U.S. is looking to rebuild. I would hope that all of these factors will be taken into account as the administration negotiates with Tokyo.

Yomiuri: When you look at the Trump administration’s tariff and other economic policies, do you see that how they are trying to create a united front against China? Do you see their purpose for doing this?

Cutler: There is an economic security pillar in the trade negotiations underway. The recently announced U.S.-U.K. deal suggests that stricter rules of origin, strengthened transshipment measures and bolstered investment screening measures are important objectives for Washington in these talks.

But what I find surprising is that if China is really the big challenge of this century, then the policy of hitting our allies and partners with tariffs at the same time we’re asking for their cooperation on China-related matters makes little sense. My concern is that if our partners feel like they were pressured into concluding trade deals that run counter to their interests, they will be less enthusiastic about working with the United States on matters surrounding China.

Yomiuri: How do you see Trump’s economic policies in light of U.S.-China competition?

Cutler: I think the White House has been pretty clear that it doesn’t place a lot of importance on our World Trade Organization obligations and is willing to ignore them, if necessary. In the meantime, China is using this opening to portray itself as the champion of free trade and the rules-based international order.

I am concerned that, if the U.S. is viewed as stepping back from the rules-based international economic order, it will lead other countries to double down and work among themselves to maintain and strengthen that order without the United States. This trend will ultimately disadvantage the U.S. for years to come.

Yomiuri: How can a country like Japan receive assurances that Trump won’t break his deal in a year or so when he’s upset with it?

Cutler: President Trump looks at tariffs as the tool to solve a wide array of concerns, not only in the trade space. If he doesn’t like a country’s migration policies, or he thinks a country may not be spending enough on its own defense, he has shown he is willing to consider tariff hikes.

Many countries negotiating trade deals with the U.S. are very concerned that, even if they achieve some certainty now through a trade deal, they won’t necessarily be shielded from tariffs in the future. I expect countries to push for more certainty regarding the prospects of future tariff hikes in the ongoing negotiations.

Wendy Cutler

Cutler served at the Office of the U.S. Trade Representative for nearly three decades, working on a range of trade negotiations including ones involving Japan, South Korea and China. During the presidency of Barack Obama, Cutler was involved in negotiations regarding the Trans-Pacific Partnership agreement. She is currently vice president at the Asia Society Policy Institute and received the Order of the Rising Sun, Gold and Silver Star in 2022.