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Comment by baridbelmedar | Hacker News Reader

The EU as a whole is walking a tightrope. Its largest economies still depend heavily on the US market. If the current US regime perceives that US companies are being targeted by EU "taxes", regardless of whether those laws are legitimate, there is a real danger of US retaliation.

Key sectors could take the hit, including automotive manufacturing, industrial equipment, chemicals, electronics, fashion, textiles, and luxury food and wine.

Given that these nations are already managing high debt loads while funding generous social welfare programs and expanding their defense budgets, trade sanctions could cause serious damage...

So yeah...EU is performing a delicate balancing act here.

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Yes. But what this discussion so often misses is.. So is the US.

The US needs military bases, it needs general market access, it wants to sell military equipment and so on and so on. The US is already being reckless with the relationship and diversification is underway, but how deep the split will be is in large part determined by how the US wants to behave going forward.

It's like a divorce, there aren't really any winners here (in terms of wealth, assets, ...). So it's a tightrope both need to walk, balancing each other's interests.

US tariffs on EU automotive manufacturing, industrial equipment, chemicals, electronics, fashion, textiles, and luxury food and wine, would be only slap on wrist.

The real danger of US retaliation for EU are: export tariffs on US LNG, loosing arms exports for Ukraine. This the real EU delicate balancing act.

At the beginning of 2025, the US was only supplying 20% of the military aid to ukraine.

After that it has practically completely dried up. Ukraine and the EU are already producing themselves.

This is a big long term loss to the US.

Also if US makes their LNG unaffordable the EU will simply switch to countries like India.

Who exactly is the US going to still sell to?

India is LNG importer, not LNG exporter.

India exports small amounts to Nepal and Bhutan, but more importantly already resells Russian oil and gas.

So it’s a nice circumvention for the EU if they were to require one.

> there is a real danger of US retaliation

This would make some sense under normal circumstances. However the Trump administration isn't "retaliating" except in the same sense you saw ICE "retaliating" by murdering unarmed protesters.

Violent bullies respect strength to the extent they respect anything at all.

I think that's the point; much like how Canada isn't blinkimg every time the US jacks up whatever nonsense tariffs.

They know it's going to hurt and they can't just order their own country -- or in the case of the EU; countries -- to fully decouple and so they're using the pain to encourage the creation and growth of alternatives.

Nobody says it isn't painful or that it isn't going to suck but it's viewed as inevitable rather than something to be avoided.

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