US goods set to double in price as Europe plans huge trade war

[zimv20]

link (http://news.independent.co.uk/world/politics/story.jsp?story=462607)


American jeans, Florida orange juice and dozens of other US products could double in price from next month because of a growing transatlantic trade war.

The World Trade Organisation gave the European Union permission yesterday to impose huge import tariffs, which will allow price increases of between 8 and 100 per cent on a range of goods.

The row, which began when America imposed special duties of up to 30 per cent on European steel last year, reached a climax yesterday when the trade watchdog gave a final decision in favour of the EU. It said the US action was "inconsistent" with free trade commitments. Europe can now impose duties on products ranging from T-shirts and lavatory paper, to bras, pantyhose, suspenders, ballpoint pens, ski suits and bowling alley equipment. Harley Davidson motorcycles were included in an early draft of the sanctions list, but were not included yesterday.

The EU says its sanctions, amounting to ¤2.2bn (£1.5bn) a year, will come into force on 15 December unless Washington drops its steel duties. The sanctions would be the biggest in the history of the WTO.

(more)


this should be interesting...

[mactastic]

And I think Dubya (or rather Rove via Dubya) wanted to keep those steel tarriffs in place until the election next year. I'm sure they would bo phased out after that anyway, since they do violate his free trade convictions. Funny, if he's willing to trade that particular principle for votes, what others would he violate for votes....

Could get ugly on both sides of the Atlantic before this is over though. And expensive.

[Ugg]

I had read somewhere that the items chosen were from swing states. Florida orange juice is already up against imports from Brazil so this could have a huge impact. Also, that BMW plant that gw visited in NC is complaining that the tariff on imported steel makes its products more expensive. Free trade is a bugger but gw sure put his foot into it this time. Had his tariff been in the 10% range, it might not have drawn so much attention.

[zimv20]

Originally posted by Ugg
Had his tariff been in the 10% range, it might not have drawn so much attention.

bush has all the subtlety of a plane crashing into a skyscraper.

[Sayhey]

I'm not sure trade wars hurt Bush in this election. He can show he is standing up to those "nasty, cowardly" Europeans and for the working man without doing anything of value to lower unemployment in manufacturing. What he loses in farm states he may make up for in "Reagan" Democrats, on this issue at least. It not as if the "Free traders" in the Republicans are going to bolt the party on this issue. Right now it looks to be the war that will be his make or break issue.

[pseudobrit]

When do we invade?

[gwuMACaddict]

Originally posted by zimv20
bush has all the subtlety of a plane crashing into a skyscraper.

please.... i understand that he is easy to make fun of... but we dont need metaphors like that... a little respect

[zimv20]

Originally posted by gwuMACaddict
please.... i understand that he is easy to make fun of... but we dont need metaphors like that... a little respect

for whom?

it was the least subtle thing i can think of. the message, completely lost, is: "we are feeling disenfranchised."

i'm drawing a parallel between bush's complete lack of understanding of what causes hatred against the US w/ his complete lack of understanding of political give and take. an event that defined his term in office served my needs nicely.

[caveman_uk]

The sad thing is that these steel tariffs are hurting Americans as well as the raw cost of steel is still higher than it need be. So firms using that are shipping jobs out of the US (to Canada etc) as 'finished' steel products do not attract US import tariffs. So your inefficient steel inductry is detered from becoming more efficent and US manufacturing jobs are being lost. Great Idea

[Desertrat]

If Europe puts a tariff on orange juice, why would the price, here, go up? That is, if Florida exports less to Europe because of a lower demand there, there would be more orange juice put into the U.S. market--and that would make the price drop.

Forty years ago, the price of Swedish steel, delivered in Detroit, was less than that of steel from Pittsburgh. IOW, a thorny question for decades. It is my understanding that there are no more steel mills in Pittsburgh.

At some point, any administration is going to have to face the issue of strategic materials or strategic industries. There are already stockpile of tungsten and cobalt, for instance. We have the Strategic Petroleum Reserve. A certain amount of protection for an industry like steel production seems necessary...

'Rat

[Ugg]

Originally posted by Desertrat
At some point, any administration is going to have to face the issue of strategic materials or strategic industries. There are already stockpile of tungsten and cobalt, for instance. We have the Strategic Petroleum Reserve. A certain amount of protection for an industry like steel production seems necessary...

'Rat

That is a good point and in my mind one of the greatest dangers of free trade. Boeing wants to import entire aircraft wings from China, is this a good idea? The aluminium industry is in deep doo doo in this country as are all other manf. industries. Where do we draw the line? How much should the govt. subsidize corporate and union greed, missteps and stupidity?

There is no easy answer but gw is going to take it in the shorts for this one, of that I have no doubt.

[mactastic]

Originally posted by Desertrat
A certain amount of protection for an industry like steel production seems necessary...

'Rat

Protection for the steel industry? Now who's the statist?

The steel mills that are doing well in this country are the small ones that have adapted to newer methods of production. The large ones like Bethlehem and US Steel are the ones who need help, and it is only because of their ties to high places that they are getting it. Well that and the fact that they employ enough people and support enough towns that it is politically worthwhile to pay attention to them. We are propping up companies that need to evolve or die. Steel can be produced here at competitive prices, but not by these behemouths.

[Docrjm]

Originally posted by Ugg
Had his tariff been in the 10% range, it might not have drawn so much attention.
If you have true free trade and you believe in it why the need for a tariff?

[Ugg]

Originally posted by doc_mac
If you have true free trade and you believe in it why the need for a tariff?

"True" free trade is like "true" democracy. While they exist in theory, in reality they're as ephemeral as clouds in the sky.

[visor]

Originally posted by Ugg
Also, that BMW plant that gw visited in NC is complaining that the tariff on imported steel makes its products more expensive.

Just note that the US$ fell about 30% in whithin the last year against the euro. of course imported goods are more expensive. On the other hand - exported goods can be sold cheaper... which is good for the US economy.

[Rebel]

Imagine this – 16 million Americans out of work, the economy in shambles, 6+ million American children living in poverty, millions of jobs sent overseas for cheap labor, and our political employees in the U.S. House and Senate approve a free trade agreement with Chile and Singapore, that for the first time include immigration provisions that will allow thousands of foreign technical workers to work in America - indefinitely. Moreover, our employees in the White House want to make this agreement the blueprint for all other trade bills.

The Ingersoll Milling Company, the foremost machine builder in the world, no longer exists. It has closed its doors but its demise did not catch the interest of the press. America , we had better rethink our priorities. The only reason we won WW II was our industrial might. We no longer have this might. Our people in Washington {our employees} scratch their heads trying to figure out why the economy isn’t rebounding. Go to Wal-Mart and pick-up 10 different items and see where they are manufactured. Nine will come from China , one possibly from Japan – NOTHING from the United States .

Holmes Group Inc. Missouri, GS of West Virginia, Flextronics International in California, Black & Decker, Maytag in Illinois, all decide to close operations, lay-off workers and move operations to Mexico. Just prior to all these announcements former president George H.W. Bush praises the 10th anniversary of the NAFTA (North America Free Trade Agreement) saying "There hasn't been a giant sucking sound of jobs pulling away from the United States." Mr. Bush may need a hearing aid.

The current agreement favors others - Not America.

[Ugg]

Originally posted by visor
Just note that the US$ fell about 30% in whithin the last year against the euro. of course imported goods are more expensive. On the other hand - exported goods can be sold cheaper... which is good for the US economy.

While a cheap dollar may help the US in the short term there are signs that it will be very damaging to the US in the long term. Foreign purchases of US treasuries have plummeted in the last few months. It is these purchases that are supporting our import binge. Gold, the Swiss Franc and the Euro have all risen greatly in value due to the fact that the US' economy is based on borrowing and unwise economic policy.

The lack of investment by foreign governments means that US interest rates are bound to rise as the government is competing with business for ever scarcer amounts of credit. While there has been a lot of glimpses of good economic news, the big picture is not pretty to look at. The US has been running deficits for decades, IMO, our profligate ways have finally caught up with us and the price we will pay is beyond our means.