They are upset at France taxing tech companies. The targeted attack is very much intentional and intended to be a tit for tat.
Fairness would be no tariffs at all and no taxes that effectively act as tariffs because there’s no comparable domestic competition. Life isn’t fair though.
One reasonable thing to impose tariffs on is products made with slave labor, or labor paid at less than the minimum wage in your own country. The benefits are twofold, disincentivizing slave labor in other countries, and incentivizing local supply.
Surely products made with slave labour should be banned outright?
There are good reasons to impose tariffs otherwise. Slavery is a good reason, and the counterparty-country being a communist dictatorship is another good reason. You want to start a list?
If effective, there can be a second order effect that pressures other countries to raise their standards as well.
The fairest trade is where two people walk away after an exchange with both people feeling like they made out well in that exchange. Tariffs are a form of state interference in these exchanges because to import my fancy cheese, I have to pay more than the fair market value and shipping costs, I have to pay for a tariff as well. I just want my fancy cheese to go with my domestic wine, I don’t want to pay more than I have to for it.
Now if the tariffs on both sides of the metaphorical pond sum out to zero so that imports on both sides paid about the same in tariffs, that’s fair, but that’s rare. Tariffs aren’t about fairness though.
Now if you want to impose tariffs to be fair to the businesses operating in your regulatory environment, well that’s fair, but that’s a different type of fairness obliging a different set of entities.
To be clear, I’m not anti-tariff. My priorities might be different, and all other things being equal I prefer no tariffs to tariffs by default, but let’s not pretend they’re intended to make trade fairer. They’re revenue first, retribution second (these last two may have flipped in the 20th century, but that’s a separate argument to have), and all other effects are tertiary.
Tariffs raise revenue and serve political ends, which can be protectionist in nature or serve some other purpose. That’s fine, as long as we recognize that we’re using them for political ends. The fairest trade of them all is going to be between two people that can make an exchange without state interference and without feeling like the other person got more than they did, and tariffs interfere with that type of exchange.
Why does your definition of fairness include a clause about state interference? I don't think you can argue in good faith about whether or not governments can act to increase fairness if your definition of fairness excludes government action.
Trade will occur at any price between the value to the consumer and the cost to the producer. In a perfectly competitive market, the agreed upon price approaches the cost to the producer, and it will necessarily be the case that the consumer got more from it. Is that fair?
This is going to sound condescending, and I'm sorry about that, but you should consider adopting a principled set of economic beliefs rather than one based exclusively on your politics.
> This is going to sound condescending, and I'm sorry about that, but you should consider adopting a principled set of economic beliefs rather than one based exclusively on your politics.
I appreciate the consideration and that is good advice. If I had more time I would go back and re-read what I said to see if there’s anywhere my politics and economics appear to be blending together because I do actually try to keep those separate.
Primarily what I’m arguing here, or intending to be arguing are terms from a mostly neutral perspective, it’s still my perspective, so not entirely neutral.
With all due respect I enjoy reading discussions where people are agreed upon on what they are discussing, and tariffs are one of those discussions where words like “fair” get thrown around in several different directions, and inherently they are not fair and not intended to be fair. They serve a purpose, a revenue generating political purpose, maybe even several political purposes, and when words like “fair” get thrown around in such a manner, it really ruins the discussion because it’s not a discussion: it’s a tactical game of obfuscation played by whoever influenced the participants views most strongly.
So let me quote myself from a different comment chain. Perhaps you will still perceive my economics and politics to continue bleeding together; I think any considerations of economic policy are going to have some level of politics in then considering what is being discussed is a form of policy, but I haven’t put forward any explicit policies today.
> To be clear, I’m not anti-tariff. My priorities might be different, and all other things being equal I prefer no tariffs to tariffs by default, but let’s not pretend they’re intended to make trade fairer. They’re revenue first, retribution second (these last two may have flipped in the 20th century, but that’s a separate argument to have), and all other effects are tertiary.
How does the counter-party nation feel about the tariffs imposed on their exports?
You’re right to bring in why existing tariffs exist, there’s always a reason, but when fairness is the cited reason, what you are really talking about is a retaliatory tariff. “Fairness” is the rhetorical justification when people ask why the fancy cheese is more expensive than it used to be; “our cheese is worse” and “it costs them less to make it” are just harder sells.
One could argue that despite all the headline drama, evening US-EU goods tariffs and making US tech companies pay taxes in Europe lands on a more equitable arrangement, rather than de facto subsidizing EU agriculture and US tech.
[0]It's hard to find intuitively meaningful numbers for this stuff since it's so complicated, but you can see that the EU "general goods" tariff has a mean average of 5.1% vs 3.4% for the USA here: https://www.wto.org/english/res_e/booksp_e/tariff_profiles20...
[0]: https://www.reuters.com/article/us-trade-wto-eu-russia-idUSK... [1]: https://www.wto.org/english/news_e/news20_e/good_11jun20_e.h...
> They come as the tit-for-tat battle over aircraft subsidies continues to escalate. Both Boeing and Airbus are accused of taking government subsidies to support their businesses, and both Washington and Brussels have won cases at the World Trade Organization to levy tariffs in response.
Occam's razor says we should go with the hypothesis that something that fits in perfectly with the ongoing actions both sides have been taking in a long running active dispute is probably part of that dispute.
Hopefully cooler heads prevail after the wine industry in France gets their politicians to back down.