EU Unlikely To Prevail against America in Coming Trade War

U.S. President Donald Trump has announced that tariffs will be imposed on steel and aluminum imports.

An article about this by the newspaper Die Welt begins with an almost lyrical tale, recalling a Trump business project from 15 years ago. Planning to build a hotel in Chicago, Trump cut a very lucrative deal. He paid just $350 million for 11,500 windows with aluminum frames.*

At first, Trump didn’t give much thought to how cheap this profitable acquisition was, but later it became clear why the price, given the cost of aluminum, was so low − the windows weren’t made in the U.S., but imported from China.

And now 15 long years later, Trump has decided to change the situation with cheap goods imported from other countries and announced a planned raise in tariffs on imports of aluminum (10 percent) and steel (25 percent).

The tariffs on these imported goods are being imposed within the framework of the “America First” policy that Trump promulgated during his election campaign.

Trump wants to use the tariffs to support American producers who are suffering losses from the import of cheap products from the Far East.

According to some industry representatives, leading American corporations, like steel producer U.S. Steel and aluminum producer Century, lobbied for the change.

A spokesperson for one of these corporations stated in an interview that the import of cheap goods is killing American industry and destroying jobs, and thus poses a threat to U.S. national security.

In mid-February, the U.S. secretary of commerce argued for the need to raise tariffs for “national security” since aluminum and steel are of great importance to the defense industry and the country’s infrastructure.

Raising tariffs isn’t just about Trump’s concern for Americans and their jobs. It’s already the start of his election campaign for another term.

In 2016, voters in “swing states,” many of which are experiencing social problems as a result of the shuttering of metallurgical and machine-building companies unable to withstand international competition, voted for Trump.

And now Trump has shown that he’s keeping his word. After all, he promised a policy of protectionism − everything, above all, for America. And there you have it: The man does what he says he’s going to do!

Immediately after the announcement of Trump’s plans, steel and aluminum producers’ shares shot up.

Critical voices from the European Union and Canada instantly made themselves heard. Imposing new tariffs hits Canada a lot harder: 85 percent of Canadian steel is sold in America.

European Commission President Jean-Claude Juncker, with his traditional quick temper, asserted, “We will not sit idly while our industry is hit with unfair measures that put thousands of European jobs at risk!”

What exactly will be done about the new U.S. tariffs Juncker hasn’t yet articulated. But his job consists of making such statements in general terms, so no one’s even expecting any specifics from him. As one of the commentators wrote, “Juncker is preparing a tempest in a teapot.”

Yet in Brussels, experts have been working for a long time already to draw up a list of American goods on which an additional tariff should be imposed − for example, whiskey, potatoes and tomatoes, and Harley motorcycles as well.

The EU has something up its sleeve − for example, American meat with hormones and dumping prices on foods that are lower than their cost.

Besides, the EU can respond to America’s actions by filing suit at the World Trade Organization. The media are already writing about an impending global trade war.

Angela Merkel tackled the customs duties with particular zeal. She needs a topic right now to restore her approval rating, which is falling catastrophically, and the issue with forming the government still hasn’t been completely resolved.

But the European Union is unlikely to be able to prevail against America in the coming trade war. Trump won’t reverse his protectionist tariffs. The EU’s dependence on the U.S. is still too great.

America cuts down to size those who stand up to it. “America can.” It will step over them and move on.

*Editor’s note: The accuracy of these figures could not be verified.

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About Jeffrey Fredrich 199 Articles
Jeffrey studied Russian language at Northwestern University and at the Russian State University for the Humanities. He spent one year in Moscow doing independent research as a Fulbright fellow from 2007 to 2008.

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