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Editorial: Step up global cooperation in the face of 'America first'

Rest of world should fight, not feed, protectionist impulses

In diplomacy, as in life, getting along with others requires give and take. Countries focusing solely on their own interests is a recipe for perpetual conflict. This is why, as U.S. President Donald Trump sets about imposing his "America first" doctrine, it is crucial to expand international cooperation and coordination.

"Protection will lead to great prosperity and strength," Trump said in his inaugural address, reiterating his intention to reel in foreign investment and generate employment with forceful protectionist measures.

"A new vision will govern our land," he said. "From this day forward, it's going to be only America first, America first."

No political leader neglects his or her country's interests. The question is how they pursue them. One can make a case that unfair trade deals hurt domestic industries. Yet it seems as if Trump is saying protectionism is an end in itself.

Earlier this month, Chinese President Xi Jinping made an appeal for freer trade at the World Economic Forum in Davos. It was a stark reversal of roles: U.S. leaders had long been the torch-bearers of trade liberalization.

BIG SHAKE-UP Soon after Trump was sworn in, his administration announced that the U.S. will withdraw from the Trans-Pacific Partnership. The multilateral pact was expected to set the bar for trade, investment and intellectual property protection for decades to come; that it now looks moribund is extremely worrisome.

The White House also wasted no time in declaring its intention to renegotiate the North American Free Trade Agreement with Mexico and Canada. And the U.S. is likely to seek to redress trade imbalances through bilateral talks with specific partners. This managed-trade approach could impede global commerce and hinder the world economy.

Meanwhile, Trump has threatened to slap hefty tariffs on automakers and other companies that set up factories in Mexico and sell the output in the U.S. On the other hand, he has praised businesses that plan to employ more U.S. workers. In the short run, this stance may win the Trump administration some applause. But supply-chain disruptions and weaker corporate activity are likely to result over the medium term. Costlier goods will also take a toll on American consumers.

Trump is committed to achieving annual economic growth of 4%, and some of his plans could indeed have stimulating effects. His administration is expected to bring down corporate taxes, which are high by world standards, while pushing investments in infrastructure, such as roads and airports. Deregulation in sectors like energy and financial services is also on the agenda. But the government must also consider the global effort to stem climate change, as well as the risks of ballooning budget deficits.

At the same time, the U.S. needs a consistent currency policy. Shortly before his inauguration, Trump said the dollar was "too strong," hinting that the U.S. might guide the currency lower. But Steven Mnuchin, Trump's pick for treasury secretary, quickly spoke up about the importance of maintaining a strong dollar over the long term.

The dollar has been rising on investor hopes that Trump's fiscal expansion will spur U.S. growth. Any haphazard attempt to talk the greenback's value up or down would only trigger market confusion.

DOMESTIC DIVIDE This is not a time for other governments to sit on their hands. Asian and European countries need to work together to stop the U.S. from tilting further toward protectionism. Asian governments should take concrete action -- pushing for high-grade economic alliances in the region and urging Trump to recognize the importance of free trade.

The political divide within the U.S. raises the risk that the administration will turn more -- not less -- inward.

American presidents typically use inaugural addresses to express their hopes for the future. Trump, in contrast, focused on criticizing the Washington political establishment, just as he did during the campaign. His theatrical style -- portraying himself as a righteous hero taking on the villains -- will only deepen the split among the American public. "We are one nation," he said in his speech, sounding divorced from reality.

Trump's first executive order was to scale back the health insurance reform known as Obamacare, launched by his predecessor, Barack Obama. Relegating low- and middle-income earners to uninsured status, without offering new blueprints for health care, is a sure way to stoke anxiety.

Intense political friction at home could limit the time the Trump administration spends on diplomacy. This could exacerbate the tensions in Asia, where China is asserting its naval presence while North Korea forges ahead with its nuclear and missile programs. Trump made little reference to security issues in his speech, other than mentioning the need to combat "radical Islamic terrorism, which we will eradicate completely from the face of the Earth."

Asian countries should press the Trump administration to uphold U.S. commitments, not only on trade but also security.

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