Just after being significantly rejected by the voters in the European Parliamentary elections, the EU vassal ruling class has decided on a new self-harming trade war with China. Having cut themselves off from Russian cheap fossil fuels and the Russian market, they are now moving to cut themselves off from the largest, and still fast growing, national market in the world. Already dependent upon US fossil fuels and increasingly the US Military Industrial Complex (as they increase defence spending), they are now hastening the deindustrialization that will render Europe as an irrelevant power; becoming more and more under the thumb of the US. Truly a declining archipelago at the western end of a rapidly growing and developing EurAsia.
An argument can be made for 'protective tariffs' in order to develop domestic industries, but this does not seem to be the case because of the lack of much EV production in Europe. I can never forget Warren Mosler's (MMT) claim that imports should be thought of as gifts, as they enrich the receiving/importin people, while exports should be thought of as liabilities as they reduce the wealth of the sending/exporting people. Of course, this idea turns mercantilism on its head.
This could have been done so much better with govt to govt negotiations in good faith. Von der Leyen is an utter liability. The reality is that European (and Japanese and US) manufacturers dropped the ball on EVs. These moves will also damage the JVs that those very same manufacturers have set up with Chinese manufacturers recently (e.g. Xpeng, Li, Nio) to help regain some ground.
Exactly. For any of these tariffs to make sense there would have to be a large investment in domestic EV production which there isn't. Even if there was it would be highly wasteful since most of the money would go right to shareholders and people like Elon Musk.
Ultimately we westerners get the short end of the stick since we miss out on high quality EVs.
No you have it wrong..….Your article seems to be a capitulation to a problem that must be solved head on.
Although I agree that It will be a huge challenge to push back on China the west has no choice but to reverse the disaster of the global free trade mistake that started as far back as 1980.
The USMCA is in a better position to create a true trade bloc and push back on any trade outside of such a trade zone. In a decade or two It will have the most resources and the most consumers and the youngest population of consumers and workforce than the other unions on the planet, and especially if the USMCA is intelligently extended to the south Americas. All the other unions outside of Africa are aging and won’t have the ability to create a strong true trade bloc
I do agree that the EU due to its lack of autonomy of resources will find it much more difficult and needs to be selective on the shape of a trade war ….but has no choice.
High tariffs are necessary and a mechanism to shift taxation from internal capacity to the trade bloc trade activities, and this must be a transition until industry builds up a capability to avoid the need for external trade.
I think a lot of it is down to when the current ruling class and courtiers had their foundational educational/career years, which were during the two decades of Unipolarity (1990-2010). Their worldview is utterly at odds with the new reality. A whole generation needs to be swept out and replaced. In addition, the ruling class have to face up to the severe costs in accepting the new reality. The costs of not are higher, but there is no "good" choices for them.
the more people in europe realize there politicians are shooting them in the foot, the more they will continue to vote in opposition to the main political leadership in europe, as we just witnessed in the recent european parliament elections...
And then the ruling class will choose outright fascism, just as when they were challenged in the 1930s. French Gaullism was pretty close to fascism (as was Vichy France), and that is the route the National Rally seem to be going. Italy is already on the way. A CDU/co-opted AfD could produce the same (with some variation from Nazism of course to not be too obvious).
"Whether the Bonapartist regime of “Gaullism” evolves towards a fascist form, or towards a more hybrid form combining a parliamentary façade with a de facto army-and-police dictatorship, the proletariat will in any case be excluded from any legal political role whatsoever. To break out of the dictatorial straight-jacket which the bourgeoisie is now manufacturing, it will be necessary for it one day to mobilize itself in extra-parliamentary revolutionary action."
De Gaulle was a protege of Petain, who ran the fascist Vichy state that cooperated deeply with the Nazis. Petain seemed to have no issues dealing with the Nazis, in many ways the defeat and Vichy helped the French ruling class crush the strong socialist forces in the country. After WW2 De Gaulle worked with the US/UK to disarm the socialist resistance and reinstate ruling class dominance, and also helped many of the senior Vichy collaborators get off with light sentences.
He came back to power during the 1958 Algerian crisis (an attempted coup which he skillfully took advantage of), as a Bonapartist answer to the major social and political crisis, resolving it while allying the state with capital and with a good deal of state planning - Dirigisme. The power of the executive was mystified within a project of personalization. There was also a brutalist response to dissent, as with the murder of 500 Algerians by the state in Paris in 1961. De Gaulle was elected, after creating an imperial presidency and playing on a mythical French nationalism (Ein Volk, Ein Republic, Ein De Gaulle!). Foreign policy wise he strove for full French sovereignty.
"De Gaulle crafted a symbolic history for the French in place of a real one, because symbols were among the most real things they knew ... De Gaulle is a nearly perfect example of the right-wing patriot in power—of the constitutional conservative who accepts the modern order ... The politics of grandeur, he shows, need not be the exclusive province of bullies and gangsters and crooks and clowns"
"Whether the Bonapartist... To break out of the dictatorial straight-jacket which the bourgeoisie is now manufacturing, it will be necessary for it one day to mobilize itself in extra-parliamentary revolutionary action."
This gets into the realm of Pol Pot and in revolutionary US times didn't exactly this happen in Rhode Island?
Seems to me by 1990 the elites were already into at least the 2nd generation of normalizing their grasp on power; I walked out on a number of majors at MIT because it was so offensive to my established morals - and that was late 70s and early 80s.
What that extra-parliamentary organization would look like now is difficult to imagine. What is the citizen response to Netanyahu when he comes to US to address his cock-suckers in Congress? [Sorry, I can't think of more appropriate language.]
Somehow this mused me to recall the ‘Votez Escroc Mais Pas Facho’ banners from the 2002 French presidential election. Reality has somehow become unreal and paradoxical ahead of our coming election. Great link, thanks Roger.
An argument can be made for 'protective tariffs' in order to develop domestic industries, but this does not seem to be the case because of the lack of much EV production in Europe. I can never forget Warren Mosler's (MMT) claim that imports should be thought of as gifts, as they enrich the receiving/importin people, while exports should be thought of as liabilities as they reduce the wealth of the sending/exporting people. Of course, this idea turns mercantilism on its head.
This could have been done so much better with govt to govt negotiations in good faith. Von der Leyen is an utter liability. The reality is that European (and Japanese and US) manufacturers dropped the ball on EVs. These moves will also damage the JVs that those very same manufacturers have set up with Chinese manufacturers recently (e.g. Xpeng, Li, Nio) to help regain some ground.
Exactly. For any of these tariffs to make sense there would have to be a large investment in domestic EV production which there isn't. Even if there was it would be highly wasteful since most of the money would go right to shareholders and people like Elon Musk.
Ultimately we westerners get the short end of the stick since we miss out on high quality EVs.
it sure is insane what is happening.... thanks for the article roger...
No you have it wrong..….Your article seems to be a capitulation to a problem that must be solved head on.
Although I agree that It will be a huge challenge to push back on China the west has no choice but to reverse the disaster of the global free trade mistake that started as far back as 1980.
The USMCA is in a better position to create a true trade bloc and push back on any trade outside of such a trade zone. In a decade or two It will have the most resources and the most consumers and the youngest population of consumers and workforce than the other unions on the planet, and especially if the USMCA is intelligently extended to the south Americas. All the other unions outside of Africa are aging and won’t have the ability to create a strong true trade bloc
I do agree that the EU due to its lack of autonomy of resources will find it much more difficult and needs to be selective on the shape of a trade war ….but has no choice.
High tariffs are necessary and a mechanism to shift taxation from internal capacity to the trade bloc trade activities, and this must be a transition until industry builds up a capability to avoid the need for external trade.
More in my book… Take Back Manufacturing at www.nigelsouthwayauthor.com.
Great analysis! Many thanks.
Why do US and EU keep picking battles they cannot win? Something fundamental in human nature?
I think a lot of it is down to when the current ruling class and courtiers had their foundational educational/career years, which were during the two decades of Unipolarity (1990-2010). Their worldview is utterly at odds with the new reality. A whole generation needs to be swept out and replaced. In addition, the ruling class have to face up to the severe costs in accepting the new reality. The costs of not are higher, but there is no "good" choices for them.
the more people in europe realize there politicians are shooting them in the foot, the more they will continue to vote in opposition to the main political leadership in europe, as we just witnessed in the recent european parliament elections...
And then the ruling class will choose outright fascism, just as when they were challenged in the 1930s. French Gaullism was pretty close to fascism (as was Vichy France), and that is the route the National Rally seem to be going. Italy is already on the way. A CDU/co-opted AfD could produce the same (with some variation from Nazism of course to not be too obvious).
Explain how “French Gaullism was ‘pretty close’ to fascism” por favor.
Perhaps "s'il vout plais" would have been more appropriate? Jean-Paul Martin in 1958 covered the early Gaullist regime, the whole piece is excellent:
https://www.marxists.org/archive/pablo/1958/10/gaullism.htm
"Whether the Bonapartist regime of “Gaullism” evolves towards a fascist form, or towards a more hybrid form combining a parliamentary façade with a de facto army-and-police dictatorship, the proletariat will in any case be excluded from any legal political role whatsoever. To break out of the dictatorial straight-jacket which the bourgeoisie is now manufacturing, it will be necessary for it one day to mobilize itself in extra-parliamentary revolutionary action."
De Gaulle was a protege of Petain, who ran the fascist Vichy state that cooperated deeply with the Nazis. Petain seemed to have no issues dealing with the Nazis, in many ways the defeat and Vichy helped the French ruling class crush the strong socialist forces in the country. After WW2 De Gaulle worked with the US/UK to disarm the socialist resistance and reinstate ruling class dominance, and also helped many of the senior Vichy collaborators get off with light sentences.
He came back to power during the 1958 Algerian crisis (an attempted coup which he skillfully took advantage of), as a Bonapartist answer to the major social and political crisis, resolving it while allying the state with capital and with a good deal of state planning - Dirigisme. The power of the executive was mystified within a project of personalization. There was also a brutalist response to dissent, as with the murder of 500 Algerians by the state in Paris in 1961. De Gaulle was elected, after creating an imperial presidency and playing on a mythical French nationalism (Ein Volk, Ein Republic, Ein De Gaulle!). Foreign policy wise he strove for full French sovereignty.
"De Gaulle crafted a symbolic history for the French in place of a real one, because symbols were among the most real things they knew ... De Gaulle is a nearly perfect example of the right-wing patriot in power—of the constitutional conservative who accepts the modern order ... The politics of grandeur, he shows, need not be the exclusive province of bullies and gangsters and crooks and clowns"
https://www.newyorker.com/magazine/2018/08/20/how-charles-de-gaulle-rescued-france
So I would say there were significant elements of fascism there, although Bonapartism may better fit the nature of the regime.
"Whether the Bonapartist... To break out of the dictatorial straight-jacket which the bourgeoisie is now manufacturing, it will be necessary for it one day to mobilize itself in extra-parliamentary revolutionary action."
This gets into the realm of Pol Pot and in revolutionary US times didn't exactly this happen in Rhode Island?
Seems to me by 1990 the elites were already into at least the 2nd generation of normalizing their grasp on power; I walked out on a number of majors at MIT because it was so offensive to my established morals - and that was late 70s and early 80s.
What that extra-parliamentary organization would look like now is difficult to imagine. What is the citizen response to Netanyahu when he comes to US to address his cock-suckers in Congress? [Sorry, I can't think of more appropriate language.]
Somehow this mused me to recall the ‘Votez Escroc Mais Pas Facho’ banners from the 2002 French presidential election. Reality has somehow become unreal and paradoxical ahead of our coming election. Great link, thanks Roger.