The Wall Street Journal reports U.S., EU Agree to Resolve Trade Differences.
President Trump on Wednesday declared a “new phase” in the relationship between the U.S. and the European Union, agreeing to hold off on proposed car tariffs and work with the EU to resolve their dispute over metals duties, while also promoting bilateral trade.
Speaking in the Rose Garden of the White House alongside European Commission President Jean-Claude Juncker, Mr. Trump said the U.S. and the EU had agreed to “work together toward zero tariffs, zero non-tariff barriers and zero subsidies on non auto-industrial goods.”
“This was a very big day for free and fair trade,” Mr. Trump said. He said the U.S. and EU would “resolve” the steel and aluminum tariffs he imposed earlier this year and the retaliatory tariffs the EU imposed in response.
He said the EU had agreed “almost immediately” begin buying more U.S. soybeans and that the European bloc had agreed to increase LNG exports [imports?] from the U.S. The EU will be a “massive buyer” of LNG, Mr. Trump said.
“I had the intention to make a deal today,” said Mr. Juncker. “And we made a deal today. “
Lie When It’s Serious
Ahead of the meeting, Juncker said it was not his intent to work out a deal. Now he says it was his intention all along.
In case you forgot, please consider the most honest thing Juncker ever said: “When it becomes serious you have to lie.”
So, is Juncker lying today or was he lying two days ago?
The US is not going to supply the EU with LNG. That is a direct and blatant lie by Trump. The EU will get natural gas from Russia via Nordstream2. US LNG would be far more costly.
So there are lies all around.
Meaningless Agreement
As I have pointed out, it will take the EU and the US a decade to work out a real agreement. Juncker by himself cannot promise anything. All 27 nations in the EU have to ratify trade deals.
The EU can add retaliatory tariffs without every nation agreeing and now it can remove them.
Winning?
Is this winning?
Please be serious. Not imposing auto tariffs was smart, but was that a result of today’s meeting or was it a result of every automaker and all the farmers complaining loudly?
Even if you credit Juncker or Trump, all that has happened (at most) is a return to the status quo with the EU before Trump started blasting away with absurd tariffs.
With 35 companies and organizations bitching about Trump’s inane tariffs, this is best viewed as either a reversal by Trump or a political stunt that accomplishes nothing.
For discussion, please see Trump’s Trade War Casualty List: 35 Companies and Organizations Complain.
Obvious lies aside, it is a good thing to deescalate trade war talk.
Mike “Mish” Shedlock
“this is best viewed as either a reversal by Trump or a political stunt that accomplishes nothing.” Then again, it could also be viewed as a successful negotiating strategy by Trump. I am constantly amazed by how many people just don’t get that. I am also amazed by the TDS sufferers who hope for bad things to happen to America, as long as that looks bad for Trump.
What about Trump using EU as ally against China?
Junker is only there as a mouthpiece for German industry. He has no other role in this, neither does the rest of the EU. It is becoming obvious by the day Germany is the EU past, present and future and the likes of Junker are sent on errands for the German industrial complex.
CJ – If you want to give Trump credit, then tell us what the hell he accomplished. The answer is Nothing.
The pipeline was added as a joke.
I for one continue to be glad the socialist war harpy lost.
Allow me to point out that this would only be relevant if Russia were an enemy of Germany, but it isn’t (as an aside, Putin speaks German fluently and almost without accent. He once held a speech in the German Parliament without notes, and it was flawless). Even in Soviet times Russia never once welshed on its contractual commitments with respect to oil and gas deliveries, nor did it ever use them to threaten or blackmail any of its Western European customers – despite the fact that the Soviets actually were real enemies. Pecunia non olet, as they say. In fact, Germany and Russia would have every reason to work together – the two countries have long had close ties, since at least the time of Czar Peter (the guy who founded St. Petersburg – which was built by German architects he imported). Admittedly Russia is not exactly a model democracy – but this cannot be changed by confrontation. At best it can be changed gradually, by engagement. Trade ties are an important part of such engagement.
EU is not a model democracy too.
Take a look at that photo of Juncker. Is that the face of a man who has just done a deal? Good grief, he looks like an oenophile who’s just been told by his physician that he can’t touch a drop of wine again in his life.
“Not imposing auto tariffs…”
This is what the “deal” was all about. Juncker wasn’t in DC on behalf of the EU. Juncker was in DC on behalf of VW/BWM/Daimler, period. Everything else ‘involved’ here is fiction. Juncker’s actions/role here betray the EU/EP charade – he’s an errand boy for german industry, not a parliament in Brussels.
The arsonist burns down your house. You lose use of it while the arsonist rebuilds it. Maybe the rebuilt house will be as good as the destroyed one, maybe not. Equals Trump.
Before the meeting the situation looked serious and hence EU sent in the right messenger, Juncker.
Politicians work ethics at play!
It would be graceful, Mish, to note the positive statements from the President and the other guy about the objective of reaching free trade. It would be informed to note this will mean bigger reductions in the EU’s higher tariffs.
The real criticism is that this will do little about non-tariff barriers to trade. Remember, this is the same EU that regulates the permissible curvature of imported bananas!
Correct. Don’t trust them as far as you can kick them. They will also use energy sources as a means to put up barriers if US dare use less than ideal methods – coal etc – get hit with tariffs.
Does anyone really expect Germany and the rest of Europe to buy gas from the US just because we are allies? Let them buy gas and oil from whoever gives them the best price. I find this discussion somewhat ridiculous. If the Russians try to extort them as a result I guess they will have to learn the hard way. It happened to the US with the Arab oil embargo.
Good points. The establishment must maintain Russia as a villian to justify their actions in Ukraine and Syria, which is all about energy. US energy interest would like to replace Russian gas with US LNG, and gas from SA and Qatar, and future supplies from the massive find in the Golan Heights (controlled by Genie Energy and its Deep State leaders).
“Why doesn’t Trump build a pipeline to Europe, and stick it to the Russians? ” because it would be fucking idiotic. Of course, that has not stopped politicians in the past. Why doesn’t Germany simply get gas from the low cost provider? Unless you propose the US ship gas to Germany at a lost.
Only 9% of German energy comes from Russian nat gas. Why doesn’t Trump build a pipeline to Europe, and stick it to the Russians? That would entice Europeans if the price was right. EU can safely say it will buy more LNG because total volume that can be transported is insignificant. If LNG could be supplied in volumes necessary to supplant Russian gas, US gas price (and electricity) would go up 25%! Curious as to whether Trump will cancel the longstanding US 25% import tariff on European light trucks (pickups).
All that is important is that Trump can pose and say he won and forced the EU to make massive concessions. The reality is immaterial, it’s about ego and narcisism.
I believe EU will get more LNG from USA and use this LNG to replace coal since Germany is running down it’s coal power plants or switching them to NatGas.
Remember that EU energy demand is massive and due to the Climate Change brouhaha and targets to cut CO2 emissions hugely around EU so coal use must be cut around EU hugely.
Also Germany will be without nuclear power starting in 2022 due to Merkel making her dictator decisions after Fukushima to please voters.
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Putin was planning to build a NatGas pipeline from Russia past Crimea under the Black Sea to Bulgaria aka SouthStream but this was stopped by EU pressure on Bulgaria.
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Putin’s newest gas pipeline project has already been agreed and started to be built and that is from Russia to Turkey under the Black Sea aka TurkStream and from Turkey there will be pipelines to Greece and onward to Italy and maybe Austria so Putins grip on southern Europe will become as firm as it is towards Germany.
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Now it appears that Since Greece and Italy wanted Putins gas pipelines that Bulgaria has had second thoughts and wants a line from TurkStream to Bulgaria so they can collect transit fees from gas going to Serbia, Slovenia, Hungary and Austria.
There is ALREADY a HUGE pipeline from Russia through the Baltic Sea to Germany bringing massive amounts of NatGas.
EU also imports lots of NatGas from Russia through the many pipelines going from Russia through Ukraine to EU countries.
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The new pipeline being built from Russia through the Baltic Sea to Germany is a sister-pipeline of the first NatGas pipeline and that is needed because Merkel promised after Fukushima to stop all German nuclear power plants by 2022.
After 2022 Germany will be totally at the mercy of Putin since NO more nuclear power and due to the Climate Change brouhaha in EU and the promise to slash CO2 emissions massively Germany is also phasing out coal despite there being good quality filtering systems for coal power plants by now.
Germany will live or die on Russian NatGas from 2022 on.
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IF I was Trump I would demand that as a condition of NATO membership country could NOT import more than 20% of it’s energy needs from one country.
Germany is on the road to becoming a vassal state of Russia energy wise…
As long as there are viable alternatives to Russian gas. Germany will hedge its bets. It’s a country still largely ran by heavy industry. Not FIRE sector yahoos and ambulance chasers.
Eastern Med gas will likely be brought into Greece by pipeline in the not to far off future. It’s a project where Israel and it’s neighbors are on the same side for change.
And even if Putin should manage to stir up enough trouble in the Middle East and Eastern Med to stall this, or even render it unlikely, “Everyone” wants to make their gas available to Europe, and in particular Germany. As they can pay for it.
Whether by pipelines, LNG ships, German magazining, or via other means; an additional, direct, low cost supply directly from a relatively stable producer to an even more stable consumer and payer is only to Germany’s advantage.
Germany and Russia are about as naturally allied in this, and most other, areas as any two major countries anywhere. Russia has natural resources, Germany has capital and human resources allowing them to derive more value from those natural resources, than pretty much anyone else. Things don’t get much more win-win than that.
This was a good deal from Trump.
Much better than I expected after EU has been humiliating UK intentionally for months and months regarding Brexit negotiations.
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However almost everything with EU depends on follow-up so Trump needs to remind them regularly what has been agreed and demand something is done on the more general “in the air” promises.
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Most what was promised to Trump like soybeans and LNG can be done by individual large EU countries that have an interest in stopping a trade war because they export so much products to USA like Germany and France.
This is a good thing because EU as a whole is a slow moving behemoth due to so many (28-29) members each of whom have to agree for most things to go forward.
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There has been some issues where things can be now decided through a qualified majority voting in the European Council and this was used in 2015 to push through the spreading around EU of 120,000 asylum seekers from Greece and Italy that Merkel demanded. (there had been a previous burden sharing of 40,000 people from Greece and Italy to around EU earlier in 2015 but there was no voting then because it was a decision all agreed on or at least did not want to demand a vote on).
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Hungary voted against this 120k burden sharing with some other Eastern European countries but they were defeated because Austria was still open borders in 2015. However Hungary still refused to take any and is now fighting EU in EU courts despite only around 35,000 asylum seekers from this 40k+120k ever being spread around Europe because eligible relocated asylum seekers ran out after people stopped coming to Greece when borders were CLOSED by Austria and Slovenia in early 2016 and Hungary in late 2015 and after Italy received less of the nationalities eligible for burden sharing aka Syrians and Eritreans than anticipated.
Both Greece and Italy had also PUSHED most people north as a policy earlier in 2015 so there was less burden to share. Greece registered only 1% of the people going through it and Italy registered about 50%ish.
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Juncker treated Trump like he treats Merkel.
Towards smaller EU countries Juncker (or Druncker as some say) is a total arrogant a-hole.
Agreed – even before I saw your comment I edited in this final sentence: Obvious lies aside, it is a good thing to deescalate trade war talk.
“The US is not going to supply the EU with LNG”
Yes and no. The pipeline goes online in 2020 so all the EU need is buy some more LNG (Which they are already) to make Trump happy and avoid more unpleasantness. All Trump needs is to keep the hoses. With Trump is always about looking good and a “winner”. I speculate this is from upbringing
“This is nothing but a political stunt that accomplishes nothing.” Maybe it’s simply back to the way things were 6 months ago, but that’s way better than the way it is now and way way better than even more tariffs. Let Trump declare this the greatest trade deal ever made and move on.