The "retaliatory" tariffs that the EU is imposing on the US fall well short of where I would like them to be. Don't get me wrong, I don't like tariffs and all of this shit is nonsense, but I think that it is high time the grip the US has on the global economy is broken, once and for all. The EU has of course gone with the lame approach of only targeting an assortment of goods, rather than a blanket tariff, and more importantly, it hasn't touched the services yet, which is considered the "nuclear" option, as it accounts for almost half of the imports from the US into the EU.
Stop pussyfooting about European Union.
What the EU should be doing in order to break the stranglehold, is to escalate the trade war with the US, whilst simultaneously reduce trade barriers with other countries affected by the tariffs. All the other counties should be doing the same. Rather than just increasing the taxes, there should be increasing incentive to buy from other sources whether it be meat or military. There should be a massive revamping of production and trade routes, and there should be incentives to boost consumption, but not from the US.
It will hurt in the short term as reordering takes place, but ultimately, it would lead to a more distributed economy that doesn't suffer the risk of centralised failures at the hands of a small group of greedy individuals. The goal should be to weaken the US economy to the point that,
When America sneezes, no one gives a fuck.
Because let's face it, when it comes to the economic crashes within living memory, the US is at the centre of it all.
The causes of the 2008 crisis included predatory lending in the form of subprime mortgages and a resulting U.S. housing bubble, excessive risk-taking by global financial institutions, and lack of regulatory oversight.
The origins of the 1980s Debt Crisis can be traced back to the acute shocks to the international monetary system in the 1970s: the collapse of the Bretton Wood system; the major oil prices hikes; and the substantial liberalization of international finance.
The 1929 crash was caused by many factors including a boom after World War I, overproduction in key industries, increased use of margin for purchasing stocks, and lack of global buyers around the world due to the war. Many people blamed the crash on commercial banks that were too eager to put deposits at risk on the stock market.
Maybe the rest of the world can't do any better than the US has done and will suffer the same fate. But isn't it better to have a shot, rather than be at the mercy of one country that proves time and time again, that when it comes to financial practices, greed trumps wisdom? But in order to have a shot at financial self-determination, the US has to be removed as the controlling force of the global economy, because they aren't spreading colds, they are spreading terminal illness.
The US is never going to empower their people, but the EU actually has somewhat of a shot to build a framework where the wellbeing of people are the focus of legislation. The decline of this over the last years is because rather than building people up, the focus has been to follow the practices of the US, where the ideology of profit over people reigns supreme. This is not a new approach for the US.
Lot's of people disagree with me on these things, but I think it is because most of us naturally don't want to experience what is likely to be a lot of discomfort caused by financial hardship. However, if we stay on the same path, we are going to feel it anyway and with increasing frequency, as the cycles will speed up. Eventually, we would have to all bite the bullet and restructure the economy anyway, which is going to include what we value, people, or profit?
The EU has the chance to start the process early and take the lead on people before profit financial systems, whilst still building a successful market without relying on the US as the largest single market. This reliance on the US consumer is akin to a social platform's reliance on ad revenue - it means that the content isn't truly independent, because the incentive is there to meet the demand of the algorithms. And similarly, the algorithms are built to increase profits of the platform owners, not to empower the users. The US is the social platform, and for decades, the rest of the world has been trying to leverage the algorithms, rather than building their own platforms.
I have pretty much given up on my own financial wellbeing in a stable economy, but perhaps there is a chance for my daughter in the future to live in conditions that support her to succeed, that incentivise her to be a valuable member of society, rather than someone who only looks to gain at the expense of others.
Societal health should be the default algorithm of the economy, not the exception.
Taraz
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This escalation does not bode well for anyone. A lot of Americans have been bamboozled by Trump's bombast, but taxing trade is the opposite of promoting free markets and prosperity. Trump thinks he's somehow being "fair" by imposing tariffs on countries that tariff US goods already, but then he conflates taxes and trade deficit in some kind of nonsense formula to justify his policies.
And the spending still increases.
We're still taxed at the state and federal level on wages, investments, property, purchases, license fees, and so much more. The tariff burdens are just one more burden on the average American when we're already struggling with the consequences of inflation.
And they want to add war with Iran to the mix, too.
We're in a bad spot.
A war with Iran might be to take focus and stimulate military spending. More debt to pay the bills.
The trade deficit thing is insanity. Do they expect small countries that ship to the US, to buy more than they sell?
There is a slight possibility that Republicans will abandon Trump on tariffs and reverse the course.
It is only slight. I guess it depends on what their aversion to loss is.
It kind of makes you wonder about the stuff that these countries trade that they aren't talking about. Most notably weapons and things like that. I'm sure the US produces and supplies a lot of those (just guessing anyway), they probably don't want to rock the boat too much because of stuff like that. Unfortunately that just leaves the stuff that impacts the citizens.
And this is definitely another place that the RoW should stop purchasing for at least the time being. 450B worth a year.
The thing is, the US has very good weapons and in many cases the best, but the others aren't that far behind, and are likely cheaper. If there is no trade benefit to buy from the US, why buy?
I'm guessing there are back room deals that we can only guess on. So much for transparency!
Oh for sure. I reckon there is a whole lot of stuff that isn't spoken about, because it is "inconvenient" to expose it.
I’d suggest that rather than placing a tariff on US services, the EU and indeed the rest of the world just calls in the unpaid tax that US service providers already owe!
Adobe, Amazon, Meta, Alphabet, Microsoft, etc all owe the UK alone approximately £4 Billion in tax.
Tax paid where it is earned should be an EU rule.
Did you know the US taxes its citizens on wages they earn abroad as well as at home?
Yeah, I have some US friends here. Pretty crazy.
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Do you think major trade routes will get affected...
In what way?
In terms of supply chain raw materials, commodities and most importantly oil...
There is little reason for oil to be disrupted into Europe at least, or most of the world.
Are you very sure, alternative fuel demand is growing...
I totally agree with the pints you’ve put out here..my points is that the EU and most countries have not realized the power that they could wield in starting out on entire fronts without giving a fluff to US…it may be difficult initially but not impossible…and that could clip US wings and give them some decorum
I agree. I'm in the US and believe bullies should be put in their place, whatever it takes
I think the EU should stop being scared and push back harder. The US always causes problems but never pays for it. Time to change that. I just pray it's not WW3 👀
While I very much agree with you on creating more independent economies (I hope I understood that correctly), I disagree on one thing:
I'm always hoping that the whole consumption thing will finally be revised, as especially in the EU so much is way above the necessary, and even way beyond the pleasant. People already have so much, less value so little of it. And taking into account the current state of the planet, a global recession might not be the worst thing, either. With less sales, there's less money, with less money, people have to reconsider what they actually need and what they want. But I'm a dreamer, they probably won't reconsider anything, but just blame everyone else for what's happening to them. Nevermind.
¿Do you know how pendulums work in current international geopolitics?
Let me show you!!
The strategy...
Oowwww so cute this puppi