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Avoiding Self-Inflicted Trade and Economic Wounds

3 1
24.11.2024

President-elect Trump says he will impose tariffs on foreign products to raise revenue and respond to practices that give foreign manufacturers unfair advantages over American companies. Europe’s debates over similar issues offer relevant guidance, advisories, and impetus.

As the European Union looks ahead to the next five-year term of its new European Commission and Parliament, officials talk about playing “its full part on the world stage in geopolitics.” Europe and the world have heard of it since Ursula von der Leyen promised a “geopolitical Commission” at the start of her first presidential term in Brussels in 2019. It didn’t happen then, and it’s not likely to happen now.

To be fair, it was a challenging five years. The unprecedented COVID pandemic kept the EU focused on domestic healthcare questions, lockdowns, debt financing, and student learning. Russia’s Ukraine invasion shortly after ensured that European policy priorities remained largely regional.

However, possibly the most significant blow to her dream of a geopolitical Commission was entirely self-inflicted: the EU’s obsession with the utopian Green Deal.

The Green Deal regulatory regime undercut EU competitiveness, particularly in agriculture and industry, by raising energy and petrochemical prices to exorbitant levels. Thus, the European Commission's international ambitions were reduced to a domestic protectionist agenda designed to hobble potential competitors by erecting non-tariff barriers that affected and infuriated Europe’s trading partners, whether they compete on productivity or cost.

Citing the “climate crisis,” the EU demanded that the rest of the world adopt its own crippling regulations – or risk losing access to its markets. Soaring prices for “clean, renewable, sustainable” wind and solar energy (and duplicative backup power) destroyed jobs, made home heating and food extremely expensive for many families, and reduced living standards.

The EU........

© Townhall


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