US-Japan: Reimagining an alliance for a fractured world
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In the first six months of the second Trump administration, the U.S.-Japan alliance has been rocked by renewed uncertainty. Although the July 22 tariff agreement has relieved some of the immediate pressure, the negotiations were contentious and drawn-out, with the White House's threats to impose fresh tariffs on Japanese automobiles and agriculture, coupled with demands that Tokyo increase its host-nation support for U.S. forces and step up its security commitments in the region -- demands that may have contributed to the "postponement" of a planned 2+2 meeting earlier this month -- reviving painful memories of the trade wars and alliance strains of the 1980s.
Trump's public questioning of whether the United States will live up to its alliance commitments, alongside his erratic posture on Ukraine and unilateral cuts to foreign assistance programs -- including those supporting Indo-Pacific infrastructure and governance -- have further shaken confidence in the reliability of American leadership.
At a time when the foundational pillars of the post-war world are cracking under the combined weight of technological upheaval, environmental crisis, demographic transformation, and a new era of great-power rivalry, these moves have undermined the sense of strategic stability that has long defined an alliance that has served as the cornerstone for peace, security and prosperity for Tokyo and Washington alike.
In the face of these structural changes, alliance managers must move beyond the conceptual mainstream, and seek to imagine a new world rather than continue to act as custodians of a fading order, attempting to solve 21st-century problems with 20th-century blueprints and defending the sanctity of an alliance built for a world that no longer exists.
And yet, Japan remains one of America's most capable, trusted, and forward-looking allies. With its advanced economy, technological prowess, and increasingly assertive defense policy, Japan is uniquely positioned to work with the United States on the basis of shared interests and shared values to navigate the strategic challenges of a more contested Indo-Pacific -- and the generational challenge of a more assertive and aggressive China, with its own vision for what the regional and global order should look like. Neither the U.S. or Japan are likely to be successful in this undertaking alone, and even less so if Washington and Tokyo are working at cross-purposes. Doing so will also require more than a reaffirmation of old commitments. The rapidly changing global geostrategic and geoeconomic landscapes demand a fundamental reimagining of the alliance -- across economic, technological, diplomatic, and military domains.
The rise of a more assertive China -- militarizing the South and East China Seas, threatening Taiwan, weaponizing economic coercion, and seeking to shape global norms to its advantage -- has made clear that alliances anchored in Cold War-era assumptions about roles, missions and capabilities are no longer sufficient. Tokyo recognizes this: Japan has undertaken a historic defense build-up, doubled its defense budget, and committed to acquiring counterstrike capabilities, signaling a Japan that is ready to be not just a junior partner, but a co-equal shaper of regional stability.
The United States must meet this moment with strategic imagination, not just a narrowly construed "America First" transnationalism. That means moving beyond instrumental debates over cost-sharing to deepen integration across defense planning, technological innovation, and economic resilience. The U.S.-Japan alliance faces a precarious security landscape, one demanding immediate and decisive action. From China's assertive military expansion and "gray zone" tactics in the East and South China Seas, particularly around the Senkaku Islands and Taiwan, to North Korea's relentless pursuit of nuclear and ballistic missile capabilities, the Indo-Pacific is increasingly volatile, all part and parcel of an international system that is rapidly evolving from X to Y.
Given the scope and scale of these challenges, we cannot afford complacency. It is imperative that Washington and Tokyo accelerate our joint development of next-generation defense technologies -- AI-enabled command systems, autonomous platforms, cyber defense -- and fast-tracking the co-development and deployment of advanced technologies, strengthening integrated air and missile defense systems, and ensuring seamless interoperability of our forces across all domains. This will help the alliance to deter aggression and operate effectively in an era defined by multi-domain conflict. The time to act is now, not only to safeguard our shared security interests but to uphold regional stability and to set the rules for the evolving international order against growing authoritarian challenges.
Economically, the alliance must focus on shaping the rules of the road for the 21st century. With the Trans-Pacific Partnership long abandoned, the U.S. and Japan should spearhead digital trade agreements, investment screening regimes, and supply chain partnerships that insulate both economies from coercive pressures. Initiatives like the U.S.-Japan Economic Policy Consultative Committee (EPCC) should be scaled up into a formal economic dialogue akin to the 2+2 defense framework, driving coordination on geoeconomic strategy.
While headlines may be dominated by tariffs and calls for economic rebalancing, it's crucial to recognize these discussions as echoes of a bygone era. While there are valid arguments for rebalancing, obsessing over trade deficits and protectionist measures risks diverting our focus from the true challenges and opportunities of the 21st century. The global economic landscape has fundamentally shifted, and our attention must pivot from the battles of the past to the imperative of co-leading the future. This means looking beyond traditional trade in goods to foster deeper collaboration and shared investments in areas like the governance of emerging technologies, resilient supply chains, and the green economy, ensuring our alliance is not just economically balanced but future-proofed.
Finally, Japan and the United States should jointly invest in regional capacity-building -- from infrastructure finance to maritime domain awareness to climate resilience. This means reconsidering cuts to foreign assistance and treating development as a strategic instrument. Japan's extensive development networks and America's innovation ecosystem can be combined to offer a robust alternative to China's Belt and Road.
To meet the test of this moment, the U.S.-Japan alliance must become more than a security arrangement. It must be a platform for shared strategy, innovation, and governance in the Indo-Pacific. The future of the U.S.-Japan alliance hinges on our willingness to confront the present with clear eyes and bold action. This isn't a moment for nostalgia; it's a demand for strategic reimagining. We must move beyond outdated notions of stability and influence to rebuild an alliance fit for a fragmented and fast-moving world. This means prioritizing investment beyond military modernization to include the governance of emerging technologies. It requires us to fully integrate climate adaptation and economic competitiveness as core pillars of national security. And critically, it compels us to evolve the institutions and coalitions -- both formal and informal -- that are essential for managing geopolitical volatility and for competing effectively with the PRC. The past six months have been challenging for Tokyo and Washington. But we have an opportunity to seize the moment to forge an alliance that is not just resilient, but truly transformative for the 21st century.
Profile:
Michael Schiffer has served as U.S. Deputy Assistant Secretary of Defense for East Asia, senior advisor and counselor on the Democratic Staff of the Senate Foreign Relations Committee, and assistant administrator of the USAID Bureau for Asia. His areas of expertise include U.S. foreign and defense policy, and security in the Indo-Pacific region.
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