WASHINGTON — Bullied and buffeted by President Donald Trump\u2019s tariffs for the past year, America\u2019s longstanding allies are desperately seeking ways to shield themselves from the president\u2019s impulsive wrath.<\/p>\n
U.S. trade partners are cutting deals among themselves \u2014- sometimes discarding old differences to do so \u2014 in a push to diversify their economies away from a newly protectionist United States. Central banks and global investors are dumping dollars and buying gold<\/a>. Together, their actions could diminish U.S. influence and mean higher interest rates and prices for Americans already angry about the high cost of living<\/a>.<\/p>\n Last summer and fall, Trump used the threat of punishing taxes on imports<\/a> to strong-arm the European Union, Japan, South Korea and other trading partners into accepting lopsided trade deals and promising to make massive investments in the United States.<\/p>\n But a deal with Trump, they\u2019ve discovered, is no deal at all.<\/p>\n The mercurial president repeatedly finds reasons to conjure new tariffs to impose on trading partners that thought they had already made enough concessions to satisfy him.<\/p>\n Just months after reaching his agreement with the EU, Trump threatened new tariffs on eight European countries<\/a> for opposing his attempts to seize control of Greenland from Denmark \u2013 though he quickly backed down<\/a>. And last month, he said he\u2019d slap 100% tariffs on Canada<\/a> for breaking with the United States by agreeing to reduce Canadian tariffs on Chinese electric vehicles<\/a>. <\/p>\n \u201cOur trading partners are discovering that the largely one-sided deals they concluded with the U.S. provide little protection,\u2019\u2019 said former U.S. trade negotiator Wendy Cutler, senior vice president at the Asia Society Policy Institute. \u201cAs a result, trade diversification efforts by our partners are on turbo charge, looking to reduce dependence on the U.S.\u2019\u2019<\/p>\n Trump supporters such as Paul Winfree, who was deputy director of the White House Domestic Policy Council during Trump\u2019s first term, are wary of the relative decline in U.S. Treasury note holdings by foreign central banks and view the national debt as a vulnerability rivals would like to exploit.<\/p>\n Winfree, CEO of the Economic Policy Innovation Institute, a think tank, said that some of Trump’s advisers do not feel America has fully benefited from the dollar’s status as the world’s dominant currency.<\/p>\n \u201cBut the fact remains that every other country is jealous of our status, and many of our adversaries would love to challenge the U.S. dollar and Treasuries,\u201d he said.<\/p>\n White House spokesman Kush Desai insists America’s standing on the global stage has not been diminished. <\/p>\n \u201cPresident Trump remains committed to the strength and power of the U.S. Dollar as the world\u2019s reserve currency,” he said. <\/p>\n The most eye-opening deal so far has been the pact announced last week between the 27-country EU and India,<\/a> the world\u2019s fastest growing major economy. Negotiators had been at it for nearly two decades before they closed the agreement.<\/p>\n