Well, now Donald Trump has gone and done it. As it turns out, the European Union (EU) was not nearly as weak as POTUS implied. Trump hit the countries within the EU, and they hit back 10 times harder.
At first it appeared that Germany’s Chancellor Angela Merkel would be willing to negotiate with 45, when it came to tariffs. However, The French government told the man sitting in the Oval Office that Europe will present a “united retaliation,” according to Reuters.
France’s Finance Minister Bruno Le Maire was speaking at an economic conference in Aix-en-Provence, which is in southern France. He said “the war has already started:”
‘If tomorrow there is an increase in tariffs, like in the car industry, our reaction should be united and strong to show that Europe is a united and sovereign power. The question is no longer whether or not there will be a trade war, the war has already started,” he added, speaking at an economic conference in Aix-en-Provence, southern France.’
Reportedly, this all began as the man who would be president looked down from Trump Tower and condemned the number of German cars passing in front of his building. What he has forgotten is that the largest German car manufacturing plant in the world, BMW, was located in South Carolina. It employees over 9000 Americans with good jobs. France placed a number of its companies in the U.S., too.
Chancellor Merkel said last week that she would consider lowers the EU levies on the cars her country imports from the U.S. She said this after the U.S. commander-in-chief threatened higher duties on our cars.
Trump originally came out with tariffs of 10 percent on aluminum and 25 percent on steel for the EU, Mexico, and Canada. He had to use the loophole of a threat of national security to impose these tariffs, which was laughable. POTUS had given these countries exemptions, but then he decided to end them after three months.
As if that was not enough, the former leader of the free world threatened the EU with a 20 percent import tariffs on all vehicles manufactured in the EU. Experts agreed that this would wreak havoc upon the automobile industry in the U.S.
Right now, the U.S. imposes a 2.5 percent tariff on passenger cars it imports from the EU. It also imposes a 25 percent tariff on imported trucks. At this time, the EU imposes a 10 percent tariff on cars imported from the U.S.
Le Maire added that the EU would hold steady against any economic actions by the U.S.:
‘Let it be known that if we are attacked we will react collectively and we will react firmly.’
The World Trade Organization (WTO) says that the EU cannot lower its import tariffs for just the cars made in the United States. Instead, if it lowered the U.S. car tariffs, it would have to lower them for all members of the WTO. The self-described smartest man in the world has threatened to pull out of all allied organizations and treaties, including the WTO.
France has imported few cars from the United States, so tariffs would have little effect on it. Should the EU tariffs get cut, that would place France in severe competition from Asian car manufacturers.
Featured Image via Getty Images/John MacDougall.