The New York Times has an interesting article on Strong Reactions to U.S. Trade Moves.
I condensed some these quotes.
- Emmanuel Macron, France’s President: “If attacked, we will respond without weakness. We talk about everything, in principle, with a friendly country that respects the rules of the W.T.O. We talk about nothing, in principle, when it is with a gun to our head.”
- Charles Michel, Belgium’s Prime Minister: “Maybe it’s a way to exert strong pressure on the European Union, to start some sort of a negotiation with a revolver to our head. That’s a strange way of negotiating with an ally.”
- Chinese Commerce Ministry Representative: “China does not want to fight a trade war but is absolutely not afraid of a trade war.”
- Federica Mogherini, the European Union’s Foreign Policy Chief: “This European Council will send a strong message on where the European Union stands in relation to trade: No protectionism.”
- Gabriel Felbermayr, Director of the Ifo Center for International Economics in Munich: “The long-term costs of weakening the W.T.O. cancel out the short-term advantages of temporarily preventing a trade war between the E.U. and the U.S.A. The E.U. should not let itself be drawn into this game.”
The most hypocritical comment is quote number 4. “No protectionism”. What a joke. The EU is among the worst in the world at protectionism, arguably the worst with agricultural tariffs.
Mike “Mish” Shedlock
“… respects the rules of the W.T.O. …”
Yeah right! Respect the rules of a transnational unelected corporate entity answerable to no one and not subject to the laws of any country.
And this guy Macron is a leftie?! What a load of crap!
The free market always tries to get things back in balance, when government interventions create anomalies. It doesn’t always succeed, however. As SleemoG pointed out, a lot of small businesses get slaughtered in the process. This will be particularly true of small US manufacturers who use steel.
Macroeconomically, yes. Microeconomically, a lot of individuals and small businesses are going to be slaughtered.
Feeding this whole debate is the idea that the US would be competetive were it not for the unfair trade practices of others. However, footing more than half of all global military expenditure and a ridiculously bloated monopoly medical racket make the US uncompetitive, not to mention crappy infrastructure and low quality educational standards.
The notion that other countries are subsidizing all these exports to the US makes no sense. How would they get the wherewithal to keep this up?
The US is the only major economy to have no industrial policy, any sort of planning and investment being taboo in terms of vested ideology, also responsible for the most polarized OECD society, in terms of the divide between rich and poor.
The EU is certainly no worse than China, Japan, Korea, and many other examples. Agricultural subsidies are a toss up between the US and EU. The US is itself no paragon of open trade.
These are the same ass-holes that threaten to punish the UK because it’s people decided they no longer wanted to be in the EU. Anti-democratic hypocrites. All the while they live under the defence umbrella of others, unwilling to pay their fair share. They should kiss the feet of the US and UK.
Mogherini at al must be scared stiff that the customer of last resort might go on strike. It puts the entire EU in jeopardy if Germany catches a cold. Germany, running a massive trade surplus, USA goes on strike and UK slows down and becomes a less useful customer = bye, bye EU welfare gravy train.
The EU are unbelievable and the Belgian PM one of the largest f-wits on the planet. Their hypocrisy stinks. It would be funny except for the fact the EU actually believe their own B.S. Good luck to the USA even if Trump is not my cup of tea.