EU to impose counter tariffs on $28 billion of US goods
reuters.com
reuters.com
If the US doesn't want to buy Chinese or EU or Canadian etc., make it cheaper for China, the EU, Canada, etc. to replace the US with each other.
The problem with anti-import schemes is that they inevitably hit exports. Trade has to have something in both directions, eventually.
Like which? Because recently Canadian investment firm Brookfield Asset Management moved their head office from Toronto to New York. So it seems it's only strengthening the US and weakening Canada.
Large corporations don't care about nationalism/patriotism, they just go where the money is. They'll say they support Canadians to save face and get public support, while through the back door moving their assets and jobs to the US, or any other jurisdiction that makes them more money.
That sounds like the kind of decision that would take way more turnaround time to implement than the month or two of uncertainty we've had.
> Large corporations don't care about nationalism/patriotism, they just go where the money is.
And it's not about nationalism, it's about certainty as was claimed above. Long term that's a necessity for profit.
Maybe, but the end result is still Canada loosing and US winning.
>And it's not about nationalism, it's about certainty as was claimed above. Long term that's a necessity for profit.
Good democracy and certainty don't go together very well most of the time. It's a feature of democracy, not a bug. The best regimes for certainty are autocratic ones like the CCP, Saudi Arabia, etc where citizens don't have a say. I for one value democracy more then the quarterly profits of soulless corporations who would gladly make the world burn for profit.
It is but when the discussion is about businesses racing a certain way to decisions made by a government that's only been in power for two months then it's misleading to focus on a decision made before that time.
> Good democracy and certainty don't go together very well most of the time. It's a feature of democracy, not a bug.
Good democracy? I'm not sure how loaded that phrase is but, regardless, doing business with the US has seemed a lot more certain for at least the past 20 election cycles than it does today. The current government, whether or not its behaviour is indicative (for you) of a "good democracy," is an outlier in terms of looking friendly to businesses or other investors looking to trade there.
In other words, people have the freedom to choose candidates who make decisions that are also bad for business. That's the amazing perk of having a completely free democracy (yes that includes letting the people vote bad candidates who make bad decisions) which you'll only appreciate when you don't have that freedom (ask me how I know).
And yes, it's better than everything else out there, like someone else establishing who you get to vote for, "for your own protection", but you're too clueless to see it.
Isn't that exactly what's wrong with the US system, parties, primaries, etc. all results in the national choice being between two candidates decided by small minorities (party members)?
On the other hand the US import a lot from China but export much less so they can hurt China more (but balanced with the fact that this would probably hurt US consumers more as well). Hence we've seen that the Chinese response to Trump has been minimal.
From Wikipedia:
EU: $20T nominal, $29T PPP
China: $19.5T nominal, $39.4T PPP
US: $30.3T (nominal == PPP by definition)
I'd wager there are other areas though that could be mutually beneficial though.
The EU has many members who are in it primarily for the transactional benefits. If the EU eliminated external tariffs not only would the French be out on the streets again immediately, but one of the primary motivations for membership would evaporate and the EU would lose a lot of leverage over member states.
(Also, I said "lower" not "eliminate"; I was thinking more of Chinese PV, and perhaps cars, though cars would have a different group protesting).
It's a huge difference! It's why the https://en.wikipedia.org/wiki/Brussels_effect exists at all.
Regulatory barriers are the foundational reason the EU parliament exists — to remove those barriers between member states and make sure all member states are on the same page when change needs to happen.
One of the big talking points from the Leave campaign was about sovereignty: that's the ability to make the rules in your own jurisdiction. I never bought those arguments in part because the UK got basically everything it asked for, but also because Brexit combined (1) losing the power to influence those rules going forward, (2) still being de-facto subject them thanks to the Brussels effect, and (3) having a trade barrier with the EU despite #2, because the EU couldn't afford to just trust the UK on the matter.
Every small business that stopped trading with the EU post-Brexit due to customs forms being too complex even when they and their customers would have been fine with the actual cost of the tariffs themselves, is a non-financial barrier.
> This is why Trump talks about things like VAT, and others in his camp talk about the fines levied on tech companies. From their perspective it's all financially equivalent to tariffs.
Does any inter-state trade within the US have tariffs due to different states having their own sales-tax rates? Because to me, the US talk about VAT is that kind of foolishness.
Similar for fines for non-compliance with laws — what's the difference between two US states having different laws and one state suing a business for non-compliance, vs. the EU and US having different laws and an EU member state suing a business for non-compliance?
In fact, if the regulatory barriers between the EU and US were levelled out, then the result would be somewhere on a line between "every Big Tech firm could be sued in a US court for GDPR violations" or "GDPR doesn't exist any more". I'm sure there's plenty of people in the US who would love to delete all the cookie popups and are eager to spy on everyone, but it really isn't just about pure monetary cost.
Actually, now I think about it, cars and eggs: for cars, UK (and IIRC EU) law doesn't permit Cybertruck on the roads — if you tried to model that as a tariff, it would be ∞; likewise for eggs, US controls the salmonella risk of eggs by requiring cleaning which in turn damages the shells meaning they must be refrigerated in the supermarkets, while EU eggs handle it with vaccination of the hens and regard refrigeration before sale as a potential risk factor due to causing damage to the shells.
You're wrong: https://policy.trade.ec.europa.eu/eu-trade-relationships-cou...
The EU justifies the high membership fees for the rich members by the benefits those rich members get - the poorer EU countries get invested in, get developed, some of their people go live in the richer countries and contribute there, but in the end, the country evolves a lot and becomes a significant market for EU goods and contributor. Point in case, Poland, the Baltics, Spain, Romania. France has benefited from Romanian development a lot, and from Romanians when Romania was less developed. It's literally a win win win win.
I'm not sure what relevance your link has to what I said, by the way. The Mercosur agreement only happened because the EU was able to keep agricultural tariffs in place:
https://policy.trade.ec.europa.eu/eu-trade-relationships-cou...
> For sensitive products like beef, poultry or sugar, in particular, access to the EU market will be permanently limited through gradually implemented quotas. The EU will grant very limited access to its market to imports of agri-food products.
Moreover, a bilateral safeguard clause can be applied in case increased imports from Mercosur cause - or even only threaten to cause - serious injury to the relevant EU sectors.
For the first time, this safeguard clause also covers imports under tariff rate quotas.
The agreement does not give duty-free access to Mercosur beef. It will allow 99,000 tonnes of Mercosur beef to enter the EU market with a 7.5% duty. 55% of the quota will consist of fresh or chilled meat and 45% of lower-value frozen meat.
The way you phrase this suggests you're considering it from the wrong perspective. What you're arguing against doesn't even seem to be present in my reading of the comment you're replying to.
The membership benefit isn't the fees, any more than your Amazon Prime (etc.) membership's benefit is the fee.
The benefit of the fee to rich countries (i.e. net spenders) is that these other countries, the ones that you're sending money to, are going to align their laws with yours, have a cheap workforce willing to to supply you with labour at a lower cost than your own citizens would otherwise, and that they are now a stable destination for any investment opportunities with your own capital precisely because they're getting integrated with your own economy and law.
Specifically this:
> nobody attempted to defend the membership fees as anything other than a purely transactional arrangement.
We did. You may not have heard it, but we did.
> You certainly can't claim that immigration is a membership benefit because a country can set its visa policy to attract however many migrants it wants if it's outside the EU, but not if it's inside.
Incorrect. Closest you get is that there's a scheme called the "Blue Card" (modelled after the US green card), that applies to everyone except Ireland and Denmark (and before Brexit, the UK): https://en.wikipedia.org/wiki/Blue_Card_(European_Union)
But each member state gets to set quotas on how many Blue Cards they accept, and can also open up rules for other routes into their countries.
> The EU justifies the high membership fees for the rich members by the benefits those rich members get - the poorer EU countries get invested in
Which is just another way of saying "the benefit of paying the fees is that someone else gets them". That's not a benefit and membership fees aren't investments (you don't own anything as a result of paying them).
Same for the rest of this thread. Other countries can align their laws without being given money, and should if those laws are better than their own. It's not a "benefit" to be paying them to fix their own legal systems. Cheap immigrant labour isn't a benefit to the workers in the country, minimum wage laws still apply anyway so the benefits even to rich people are limited, and you don't have to pay foreign countries to attract immigrants from them. They come regardless of what money their government is receiving. In fact big transfer payments make it less likely that they will want to migrate, not more. Finally, countries generally try to be stable locations for investment regardless of EU membership or receiving transfer payments.
> We did. You may not have heard it, but we did.
I don't think anyone did. If they did, then this thread doesn't reflect well on what they must have been saying because not a single argument in it for why fees are a "benefit" make any sense. It's common sense that fees are never a benefit, which is why free trade zones don't normally charge for membership. In fact AFAIK only the EU does that and that's because it's primarily an ideological project that needs huge sums of money for its other goals: free trade is just a carrot-cum-stick used to get countries to go along with it.
> Incorrect. Closest you get is that there's a scheme called the "Blue Card"
The Blue Card is an EU-level scheme with rules set by the Commission, and it only applies to people with "higher professional qualifications" and whose salary is higher than average. Obviously, nobody needs to pay billions in membership fees for the privilege of having random visa scheme imposed on them, any country that wants to can set up such a scheme itself. It's even named after a non-EU document. There is no immigration benefit to being an EU member. If you want to attract lots of migrants from poor EU countries, you can do that easily outside as well.
"Better" presumes something which does not always exist. Sometimes "aligned" is itself the improvement — but aligned to whom? Why should, e.g. Bulgaria pick alignment with Parisian interests over alignment with Moscow's?
But also, mere alignment is not sufficient: note that customs checks were introduced immediately after Brexit, because the requirement isn't simply to be aligned, but to have the force of international agreement over maintaining that alignment.
> It's not a "benefit" to be paying them to fix their own legal systems.
Compare and contrast with where this hasn't happened — there's a huge growth opportunity in many African nations since well before the end of the colonial era, so much of that potential is held back precisely because the legal systems there aren't able to prevent corruption. Making the investment in the legal system would make it possible to invest in the nations there, which would benefit both those nations (by having lots of money pouring in that doesn't immediately turn into a corrupt official's holiday home) and also the investors (who get a return on that investment).
> Cheap immigrant labour isn't a benefit to the workers in the country,
Oh yes it is: https://en.wikipedia.org/wiki/Baumol_effect
> minimum wage laws still apply anyway so the benefits even to rich people are limited,
That benefits both sides of the equation: the workers from the poorer country get a boost, you get more people willing to work at (or near) that level.
> and you don't have to pay foreign countries to attract immigrants from them. They come regardless of what money their government is receiving.
Only when their qualifications are going to be recognised, when their health insurance options are valid, etc. — it isn't enough to just know how to be an electrician, you also need the local insurance company to sell you public liability insurance.
> In fact big transfer payments make it less likely that they will want to migrate, not more.
Only once the investments have actually converted into a real boost to the economy, thus paying for themselves.
> Finally, countries generally try to be stable locations for investment regardless of EU membership or receiving transfer payments.
The EU is a mechanism for doing that; that it isn't the only mechanism is irrelevant.
> not a single argument in it for why fees are a "benefit" make any sense
You're misreading this, I think. Fees pay for the benefits, they're not the benefits themselves.
They one of the things that makes EU a place of growth. It's like all the discussions about USAID, except on your doorstep. Or, for that matter, any investment scheme your own government pays for out of taxes which are spent entirely within your own country, like highways — I benefit from the existence of a highway network, despite having only owned a car for a week total and that nearly a decade ago, this is like that.
> Please re-read what I wrote, as this answer doesn't seem to make sense in context.
Could say the same to you, on this, given you've ignored that:
(1) The Blue Card scheme is not used by all EU nations
(2) Each nation can set its own quotas for how many are issued — "As of August 2020, European countries vary wildly in the number of issued Blue Cards. Cyprus, Greece and Netherlands have not yet issued any cards," from my link
(3) Each nation has its own additional visa scheme entirely separate from this
(4) The Blue Card scheme was not "imposed", it was a voluntary streamlining (see #1)
Your previous comment claimed, falsely:
> a country can set its visa policy to attract however many migrants it wants if it's outside the EU, but not if it's inside.
The countries absolutely can. And do.
https://www.dw.com/en/german-immigration-policy-whats-changi...
I was showing you that the closest thing you had, the blue card, still wasn't what you claimed.
If a non-EU government wants to give foreign aid to Poland, it can.
If it wants to invest in Romania (normal definition of invest), it can.
If it wants to enable mass immigration of min-wage workers, it can. (and the UK government is doing so right now).
If it wants to align its laws with those of the EU, it can.
Not a single benefit in this thread is actually a benefit. EU membership fees are mandatory foreign aid European countries are expected to pay as a price of not being tariffed, and that's an artificial "benefit" that nobody else in the world charges for and that the EU also doesn't charge non-European countries for.
I'm not going to get into an argument about who benefits from cheap labour, it's a different debate and well worn. On your other points:
• The EU isn't a place of growth. Last year it managed GDP growth of 1%, the year before it was 0.4%. The US managed near 3% each time. It's scary that people living inside it aren't aware of this. EU growth should be higher than the US given that it contains countries still catching up from the communist era.
• Blue Card is mandatory under EU law. It's "not used" by a few countries because it was forced on them with the loophole of there being no minimum issuance quotas, not because it's a voluntary scheme they didn't choose to sign up for.
But once again, we seem to be talking at opposites here. What claim are you responding to with this Blue Card stuff? Is it the "not if it's inside" bit? Because to repeat, Blue Card doesn't let you attract as many migrants as you want if you're inside the EU - it has a legal requirement for higher-than-average salaries - and obviously it's not a benefit of paying membership fees, which is where this thread started.
Outside of that, it is a net loss for your average person and in fact the current events show very well the lie of its usefulness.
Allegedly the EU is good because it gives its citizens a power comparable to the other big/rich countries like the US or China. But in fact, it is very weak on almost all fronts because it just built a dystopian bureaucratic system that only favored bureaucrat creation at the expense of everything else.
It has terrible defense/army, terrible industry, terrible commercial balance in general, terrible innovation (the main reason of no tech stuff there) and more I can't think about right now...
The only thing it has done "successfully" is legislate the shit out of everything, at great cost for everyone. And it didn't even allow to meet the idealistic goals (like the greenwashing and Germany's moronic "leadership" on that).
The trade war ongoing highlight the inadequacy of the EU and the reality is that their arsenal for retaliation is rather thin, without hurting their own population that is.
If you think the EU doesn't work, you either haven't been paying attention or don't understand it.
> It has terrible defense/army, terrible industry, terrible commercial balance in general, terrible innovation (the main reason of no tech stuff there
Yep, you don't understand it. Just for starters to illustrate how wrong you are... the EU doesn't have a military nor defence. France does. Bulgaria does. They have vastly different priorities and budgets and interests and industries. The EU has nothing to do with that other than the occasional collaboration or common funding like right now.
Also, innovation in EU countries is a very complex topic that again, if you're just dismissing as "terrible" because of EU legislation, you either don't understand the topic or haven't been paying attention. Things like market size and capital available impact the successfulness of newcomer innovator much more than the supposed lack of innovation many Americans who don't have any clue about what's happening decry.
Here an example with my limited understanding:
Chinese steel is super expensive in the US now, so US manufacturers buy less of it raising the cost of US products.
This makes Chinese steel more available on the world market and it becomes cheaper for everyone else.
Due to the increased cost of steel US stuff made out of said steel, is generally more expensive while everyone else's become cheaper.
So products not made in the US become cheaper in comparison and thus sell better for more profit.
Oddly enough the EU imposed counter Tariffs on some weird stuff like Alcohol and Motorcycles...
Europeans can easily replace Jim Beam in their Cola.
And Harley Davidson is insanely expensive anyway with the usual customers being by MC-Members or dentist in their midlife crisis.
Red state tariffs.
NB the US tariffs apply to EU steel and steel products, not just Chinese ones, which is why this whole thing is happening.
How does that help? That will only make red states hate the EU more, not Trump. The EU already had tariffs against red state as retaliation back in his first term and it didn't affect him.
I don't know if you know but MAGA crowd already doesn't like the EU because they see them as ungrateful freeloaders in term of trade deficit and receiving free defense and would very much like to see the US pull out of NATO and leave them to the Russians.
EU targeting them specifically will only prove their point not turn them against Trump.
IMHO, if you wann get to trump target Elon Musk's businesses and the likes of Big Tech who kissed his ring, Meta, etc.
On the other hand some of these elections are won by narrow margins. Most Trump voters didn’t sign up for pain (not personally, they only voted to harm others). Pain may influence their votes in the future or motivate their legislators to contain the executive branch.
If you tariff most tech stuff there is no EU native replacement available.
This would be fun bet, where I'd be willing to take the opposite end of it just cause I'd be curious about the outcome either way. I have no doubt they would turn on Trump if the economy was depressed for a year or more as a result, enough at least to have an impact on the midterms. On the other hand, if Trump turns the economy around significantly in six months using whatever means then yes, the base would be emboldened.
I don't know now how that will work in the era of an authoritarian White House.
I guess they tried to find stuff to tax which does not hurt the bigger European populace.
The US biggest export is oil and they certainly want that to be cheap so no tariffs there.
And they are incapable of putting tarifst on online services and digital products.
This would be interesting. And worrying. Laws are easy to write, regardless of applicability.
Sadly its the EU and for every law there are untold numbers of lethargic and mostly incompetent beaurocrats trying to enforce it.
Those work very every slowly, but they are many and usually unstoppable when it comes to collecting money.
I wouldn’t be so disappointed just yet; even the most lethargic beaurocrats in the EU know what’s going on. This ship is slow to steer, but if she gets moving, she’s hard to stop. Just wait!
https://www.euronews.com/my-europe/2025/03/12/tariffs-eu-hit...
https://www.politico.com/news/2025/02/03/canada-tariff-targe...
Blockcades are an act of war. They are strategically useful to disable a foreign military through robbing it of supplies it needs.
These tariffs are having a blockade like effect by cutting off trade. Does it matter that much whether trading is ceased due to foreign ships blocking trade routes or a foreign backed coup making us do it to ourselves "willingly?"
Our military is absolutely failing to live up to their oath to defend us against enemies foreign and domestic.
A good portion of them are probably cheering.
That being said, even for those with humanity, empathy and a conscience, a coup against the elected president is quite a serious thing to do, even if he is treasonous and obviously trampling human rights, constitution, separation of powers and being allowed to do so by the other branches of government that are supposed to be the checks and balances.
You guys voted to have the republican being the majority in both the house and the senate, get the presidency and also, indirectly, the supreme court. That is democracy in action. If the military intervened right now it would just look like a coup. You can't really be surprised that the people you put in power do what they say they were going to do.
Now if they try to do something like the January 6 again, that is something else.
This is exactly what was happening and precisely one of the reasons Trump got elected. His electorate might not be surprised, but the anti-Trump (those who are so by emotion, not because they understand) are completely shocked he is doing exactly what he said he would.
It's like to them the principle of how democracy is actually supposed to work is very novel.
Well, yes. It's the difference between me boycotting Walmart by not shopping there, and me using physical force to prevent other people from shopping at Walmart.
The very limited evidence so far, from Canada, seems to suggest that immediate retaliation works better.
If we wander through a typical supermarket, there'll be very little produce (if any) from the U.S. - most if it will be from europe or asia.
Do you have a source on China saying they're not escalating any more? Because they just applied a pile of farm tariffs two days ago in response to the 10% US tariffs.
> China, the world’s largest steelmaker and exporter, warned it would “take all necessary measures to safeguard its legitimate rights and interests” but did not immediately announce retaliatory tariffs.
No discernable benefit to you maybe, but every crisis ends up benefiting those at the top as it always leads to a wealth transfer either during the crash phase, or the recovery phase, or both. See 2009 crash, Covid, etc.
Your leadership doesn't work to serve you, they work to serve themselves and the elite. People keep calling Trump a stupid bafoon but how come this stupid bafoon keeps getting richer and richer all the time if he's as stupid as people think him to be?
To whit, how much are you willing to bet that after Trump's mandate is over in 4 years time, both Trump, Elon and all his other cronies, will walk away with a bigger net worth than the one they came in? So no, what you see as stupidity now on the news is actually a carefully orchestrated multi year enrichment plan for the elite covered in bread and circus to distract the plebs, that will become evident as time goes on and events unfold.
1. Launch TRUMP and MELANIA cryptocurrencies to get a few hundred millions of dollars of cash. (and possibly also get some cash from the "First Buddy" Elon Musk)
2. Announce tariffs, and in general cause chaos, crashing the stock market.
3. Buy the dip.
4. Revoke all tariffs.
5. Profit.
Humans are not good a thinking.
Why the plural? This is something that was very much US made and other countries have no choice but to react. This is not something caused by multiple "upper echelons of governments".
This is something caused by exactly one government - US one. What did you expect, other countries to instantly give up their economy and soverenity the moment Trump said "I hate you and seek to harm you economically"? Especially since he added multiple times "and I want to annex you, take away pieces of your territory" and then added completely baseless accusations as a reason for it?
The US government is specifically to blame here though, of course.
Occam's razor - they are all morons.
Reading about Hitler's rise to power, it's obvious he kind of bumbled his way into it. There were many people for whom it was convenient, he did many random reckless things that should have been disastrous but somehow he made them into success - for example rearming the Ruhr, or frankly invading Poland with the French army right on its western border.
Hitler was incredibly lucky for a long time, and that's why he managed to do so much damage. But there wasn't really a clever master plan to it. He had hateful ramblings in his head and acted rashly on them. It was sheer luck and shock effect that he wasn't spat out after just a few heads in politics.
I suspect this is also what Trump is doing. And as in 1930s, for a while, everyone else has too much to lose to stand up to it. But unless he will have Hitler's luck for just as long, eventually the random lashings will end badly for him.
Of course Hitler's luck ran out in the end too, with him dead, Germany on its knees and split into two, and German imperialism more or less dead.
Hitler had a fairly consistent worldview and sets of goals going all the way back to Mein Kampf, even though he didn't know how to get there from the start. I don't think this can be said about Trump.
Though you could argue Trump was always going on about tariffs, even as a supposed Democrat. Also Hitler's views radicalized dramatically over time. Or maybe more accurately, the ideas were constant, but their scope and ruthlessness expanded.
We just like to pretend otherwise in history manuals, because it started as a socialist thing, and since left HAS to be the camp of the good, it has to become far-right radicalism.
But if you look at history in various countries it is extremely consistent with socialist/left ideology that necessarily need to have an authoritarian state to put the world in the "right" state.
He wanted to get rid of the communists but not because their ideas didn't suit him (in many ways it's extremely similar, central state deciding everything) but because they were sympathisan of the soviets; another big power that he just wanted to take over.
I'm not confusing with Mussolini but yes it is more of the same. What I'm pointing out is that all those authoritarian centralised government are almost always some sort of far-left by definition.
In my opinion the way we classify the political ideas and government is very flawed and illogical. It is that way to respect the sensibilities of the people theorising such things and they always want to have the left side look better (even though it is by far the most murderous ideology there has ever been).
Thinking that Nazism is socialism just because it calls itself "national socialism" is like thinking that Javascript is a version of Java.
It’s just that the goal sucks for everyday people. Why would these powerful people want goals that suck? Because the converse of it sucking for you is it getting better for them - meaning, money is being siphoned.
I think Trump is following a plan as best as he can given the state of our economy and government. I think the fact the plan is so bad that it doesn’t even feel intentional IS intentional. The plan sucks because it’s meant to.
I agree, but these weren't Trump's goals that he's had for 10 years or something like in Hitler's case. It's a plan by the Heritage Foundation that somehow got Trump to sign off on it.
Trump is a business magnate that say things and behave in a way that shouldn't appeal to the bottom part of the population, yet he got elected.
Comparing Trump to Hitler is next-level conspiracy theory.
Thankfully there are alternative currencies that can be used for that nowadays.
Small countries would probably have an easier time of it because they can just trade however they like without having to mollify their own bureaucrats. The traders will figure it out. The threat of US intervention is real, but I wouldn't be certain about whether it gets more or less pressing for smaller countries. The US probably won't even notice what they are doing if they keep quiet enough. Oil trading would be a different story though.
Because EU and US sanction Chinese banks and company that do that. What does that have to do with the exact currency? they’d have the same issue if they wanted to use dollars or euros (to answer your question € is the other option smaller countries have).
Iraq and Libya have tried, and look what's happened to them ...
The main reason countries are using the USD as the reserve currency is because if they don't, the "Free World TM" will bomb them back to the stone age.
Depending on risk profile, desire for diversification and acceptance of variability, swiss francs, british pounds, chinese yuan, indian rupee, japanese yen, south korean won, etc. can also be used.
There's not enough euro issuance to replace Treasuries, and issuing more (particularly at EU level where it would really help) is super, super controversial.
From what I could find, the modern example is the EU tariffs on Chinese solar panels. The outcome was negotiation.
I think trade negotiation is the best outcome we can hope for. Tariffs are going to really hurt jobs if they persist.
Why tariff such low margin US goods and not high margin US services like software? US doesn't export much goods, as most of the bulk of their economy is tech, finance and services not exporting cheap merch in shipping crates like Asia. How about a 100% tariff on Office 365, Windows, AWS, Azure, etc?
How is a tarif on US textiles or eggs supposed to be a deterrent? When was the last time you saw US eggs or clothes in the EU shelves? Even in the US, less than 10% of the textiles are domestically made.
VW producing cars in their factories in the USA? Put a tariff on these cars as the parent company is based in Europe.
It’s really not that simple, as e.g. big tech has their development centering the EU as well - so these products are at least partially produced here.
If you want to write some custom rules, sure, but then you’re really opening a pandora box. Technically you could just add 100% tax just on vehicles that have Tesla in their name. Try making such moves and look as investors immediately drop any trust in your countries political system (and currency).
That's expected. The other side already imposes some tarrifs (as did the EU - it's BS that Trump's tarrifs to EU are some unprecedented move, the EU already had tarrifs of US cars and other products).
The problem we're discussing (at least according to a parent comment) is that the US has a lot more "digital services" products than actual physical products where EU tarrifs are currently applied.
So, what's discussed is how to tax those (and how to sidestep "but it's a European subsidiary, not a US company" hurdle).
So, sure the US can counter EU digital services by also using the same sidestepping. But it's not like EU has many such worth talking about. All the big players are from the US (Facebook, Google, Amazon, MS, etc).
Or, going the other way - if you’re an EU company but your software users are outside EU, you don’t need to charge them VAT.
When I was running Appcodes, I didn’t want to ask about the country directly, so I got an official opinion from Polish IRS that if I store geolocated IP address of registration and browser timezone for additional confirmation, it’s a good enough proof to not charge vat to consumers outside EU.
If there's a political will and your position is strong enough, a scheme / legal formula is trivial to find.
Even something like "5% of what you make off showing ads to European users" would be enough.
Can add any arbitrary qualifier like "if your main base of operations is outside the EU" - which could hold whether you're a EU subsidiary or not.
Do you block your own citizens from accessing sites hosted in foreign countries if those sites/companies don’t comply with your foreign law?
Do you arrest your citizens for accessing those sites anyways or use VPNs to circumvent blocking?
And there are dozens of other questions that raises, but you’re talking about what most people describe as totalitarian states.
Sure happens, including in the EU. There are some european anti-copyright-theft laws for example, and local ISPs are forced to block some warez/pirated ebook etc websites (you can bypass via VPN, but the "official" gateways/DNS block them).
>Do you arrest your citizens for accessing those sites anyways or use VPNs to circumvent blocking?
Not at the moment. And the logistics do not make it very easy (can't track each individual). But you can sure fine any commercial company accessing such sites, prohibit state infrastructure and any company doing work with your state from using them, etc.
I'm not sure what the objection is. Do you mean "does not make sense" from a democratic/open society standpoint (as if european countries are a bastion of that, and such moves are beneath the legislators)? Or that it "does not make sense" from a technical aspect? For the latter, when there's a will, there's a way.
A tarrif is a tax. Doesn't have to be on physical products or be applied at the customs office.
>If you start taxing foreign entities different from local you are violating all sorts of treaties and depending on how the laws are written it could be unconstitutional discrimination (once you start talking about foreign ownership etc.)
Nothing that couldn't be overcome. Those treaties didn't exist at one point, and wont exist on another point.
Implementing anti US tax is escalating the tarrif posturing to a full blown trade war.
I will note (as an Irish person who's followed this case), that it wasn't about this specific case (and the first deal was in 1991, when Apple was not in a good place) rather it was to demonstrate to multinationals that we'd support them if the EU decided there was an issue.
It was a signalling thing rather than a principles thing.
Also note that Apple last got that deal in 2007, before the iPhone was launched.
Also afaik the only way to implement tariffs on packets is through lawyers attacking an arbitrary set of big enough players that aren't sufficiently globalized that they would be taxing the EU's own productivity, and any attempt to levy that inherently appears selective and thus resembles cronyism.
/s
Original press release: https://ec.europa.eu/commission/presscorner/detail/en/qanda_...
This seems to be the list: https://circabc.europa.eu/ui/group/e9d50ad8-e41f-4379-839a-f...
Edit: a skim of the list suggests it's pretty broad. Agricultural products, wood, clothing, wine, polythene. There's an insane number of very slightly different product categories, no wonder compliance is so expensive.
Them being red state products is a weak argument that sees no base of argument or success.
Red states voted for this, because they wanted other people to suffer and thought it will bring them prosperity. It makes sense to target that part of america.
Because Trump (presumably) listens to Rep Senators/Congresspeople. If he doesn't, then making his voters worse off is a good way to get them to complain.
That's the logic anyway, who knows if it'll work.
By focussing tariffs on only the places that politically support Trump, they get the political impact with the smallest currently-possible negative side-effects.
Microsoft, Apple and Amazon all sell from EU countries, not US. My AWS and Azure Bills are EU based, not US based...
When AWS has its HQ and development in the EU it's another matter, but so far it's just a bunch of salespeople.
- data centers operated in the EU
- R&D done in the Europe (almost all major tech companies employ lots of developers etc. across Europe)
What if European companies have offices and hire workers in the US? Do you tax them too?
What EU could do that is double down and regulating US tech companies and charging them even more multi-billion “fines”.
+ Apple products, + google (& their ads), + Facebook (& their ads), + Netflix, + all Hollywood film and television output.
Funnily enough all the money everyone outside the US spends on these things is not included in the "trade deficit" that is "the problem".
Which would effectively have to be implemented as a tariff on products manufactured in China and Taiwan and imported and sold by an Irish company.
It’s impossible to do that without some massive legal changes which are politically infeasible and would also hurt European economy.
If the US sees the world as zero sum, as they are entitled to, it is time we stopped accomadating a globalised tax system.
This doesn't happen anymore (the royalty payments), now the revenue is booked in Ireland, with consequent impacts on their tax collection.
2)Software is very hard to tariff because often you can set up a company inside the other country and sell the software from there. And then it never crosses the border. Same can't be done with beef. It has to cross a border.
Taxing US meat is hitting right where it needs to, with very limited impact on he local population. France for instance will just increase it's domestic sales, and other EU countries can also turn to neighbor to get their meat.
Software and electronics are a different beast and a lot more impacting in that regard.
[0] https://www.mda.state.mn.us/sites/default/files/inline-files...
What would be the plan exactly here? These services are being sold by European-based companies and being served from European territory (eg AWS Frankfurt). There’s no import happening here.
In general it makes sense to tariff something that you can replace. E.g. tariff American eggs, so suddenly it makes more sense to import them from Peru.
If you put a 100% import tax on Windows license, the only result is that the EU customers are now paying double the price for Windows. It’s very unlikely it’ll result in people switching to an alternative system.
Same with AWS - even if you’d tariff all American cloud companies, what result would you expect? Sure, in X years maybe you’d grow an EU cloud company, but until then you’d make every European business using cloud very uncompetitive globally.
You use tariffs to prop up the companies you already have. You could put “tariffs” on Apple Music, so people would move to European Spotify.
Not just the music providers, you could go after American IP and effectively stop international payments to American movie/music/film providers. You could bootstrap the music part from Spotify - i.e. just prohibit Spotify from remitting any licensing fees for American-owned IP. Like when Antigua had the WTO ruling around piracy: https://torrentfreak.com/antiguas-legal-pirate-site-authoriz...
How do you determine where exactly is software “manufactured”?
But the government in Canada passed a federal sales tax holiday that applied to a very arbitrary selection of products for a couple months here.
It was kind of a nightmare for small businesses, but I expect a similar legal framework would work for software. If you sell software, you're now obligated to remit 25% of the sales revenue to the gov unless the software is on a list of "Canadian software" as determined by some team of bureaucrats.
There is a lot of political posturing but it happens precisely because there not much to be done without hurting EU citizens tremendously.
The EU is way too dependent on everyone else and is now going to pay the price. Maybe we will get rid of the bureaucrats.
I was reading the HN thing on the potato famine yesterday and I think it was the same idea - they Brits didn't want to starve a million Irish to death, they just had this free markets are great idea and were to stupid to change. Likewise Trump doesn't actually want to wreck the US and global economies but has this tarrifs are great idea and same thing.
Just because the Trump administration is punishing (ultimately) its citizens for buying non-US goods doesn't mean I want the EU to punish me as well.
And its rise is largely linked to the internet (from DARPA) and later Android (from Google).
The EU is largely a freeloader when it comes to tech things and it seems like it cannot succeed in that field largely because of the EU bureaucracy (try to standardize things before they even started).
I think it's about time the EU starts to worrying about that, because it is no good to be so dependent on another country for something so critical.
... because, if you are referring to Greenland, then are not in the EU and have again just voted for their Parliament and sent a clear message that they don't want to be controlled by Denmark, either (not part of the US, either, just independent with possibly closer ties with the US).
And in any case, this is typical Trumpian bluster. Possibly the aim is to make independence happen because that would suit the US.
Even more, none of the tariffs imposed on the USA will impact your consumption directly, there are alternatives to them and with the price increase you'll naturally choose those alternatives that are cheaper. Nothing being levied a tariff is a product that only the USA exports to the EU.
You'll be impacted by lower exports regardless. Reciprocal tariffs do not change that fact.
My question to you is: why would I, as a consumer, want to make certain US exports more expensive for me to buy? Because the US does the same to their own consumers? How does that make any sense?
Because without reciprocity of tariffs USA's exports will have an unfair advantage against EU's exports, the EU will be losing money which impacts every EU citizen.
Does it suck you will be impacted? Of course, without reciprocal tariffs you'd also suffer the impact but instead of being higher prices it'd be by the USA selling more of their products while the EU would lose jobs, lowering our tax base, and all its 2nd and 3rd order effects.
If we are going to suffer anyway then it's best to make the USA suffer as well to have leverage when eventually it gets negotiated, what you are asking for is for the EU to have no leverage, creating an environment where in any negotiation the EU will have less power.
Blame the USA's government, the EU is just trying to protect itself and have some leverage against those stupid actions.
- Alcohol: Are you really buying American Alcohol when you live in EU???
- Harley-Davidson: Do you plan to buy one the next few years?
- Jeans: I'm sure there will be plenty of choice in all price ranges.
EU did the same thing in the past when Trump was president. It's really a 'been there done that' type of thing: https://en.wikipedia.org/wiki/First_Trump_tariffs#European
If I, as a consumer, were interested in "hurting red states" I could just not buy anything from them. No need for the EU (or my country's government) to impose this choice on me.