US Defense Secretary Pete Hegseth criticizes NATO and some Asian allies for insufficient defense spending, threatening a 'clear shift' in US business dealings with those not meeting the 5% GDP target.
Donald Trump has suspended a $14 billion arms sale to Taiwan and signaled a shift away from US defense commitments in Asia, tilting towards Beijing after meeting with Xi Jinping. This move has caused concern among US allies.
Policy analyst Rob York argues that US efforts to push allies toward greater defense autonomy may backfire, as allies like South Korea and Israel praised as 'model allies' are now involved in policies (like potential strikes on Iran) that could drag the US into unwanted conflicts. The challenge for post-Trump US policymakers will be restoring American importance among like-minded countries.
Seven in 10 South Koreans support developing nuclear weapons according to polls, while Japan's PM refuses to rule out nuclear armament. The war on Iran has transformed nuclear discourse in both countries, with IAEA chief Rafael Grossi warning of a potential global nuclear arms race. Analysts caution the non-proliferation order in East Asia remains intact but psychological barriers are eroding.
Treasury Secretary Scott Bessent defended the possibility of U.S. currency swap lines with allies in the Persian Gulf and Asia seeking financial backstops due to the Iran war. Bessent said discussions are part of routine conversations the Treasury has had with partners for years, calling them a testament to the U.S. dollar's primacy. The Trump administration is considering offering a financial lifeline to the UAE, with many Gulf allies seeking similar backstops as the war disrupts their economies.
