And for every action there is a reaction. Thus Trump’s imposition of tariffs on EU steel and aluminium exports has sparked an inevitable trade war. Brussels has vowed “firm and proportionate” retaliation against new levies on steel imports into the US. The EU would not let the move by Trump go unanswered, Commission president Ursula von der Leyen said.
Tánaiste Simon Harris will today join an EU meeting of trade ministers to co-ordinate reaction.
“It is vital we work closely together and share perspectives and insights,” he said.
Trump’s gambit will trigger tough countermeasures. This is regrettable. As EU trade commissioner Maros Sefcovic said, Trump will be fuelling inflation that would also hit US consumers. Therefore, it can only be a lose-lose scenario. But the EU was still committed to finding a mutually beneficial solution with the US “as soon as possible”, Mr Sefcovic said.
Such tariffs are charged on goods imported from other countries. Firms that bring in goods from abroad must pay the tariffs to the US government.
It is fair to say that the potential for tariffs to turn allies into adversaries leaves few with more to lose than Ireland
Economists have repeatedly warned they will necessarily lead to higher prices for ordinary Americans.
One of the key issues that propelled Trump to victory was the fact that the cost-of-living crisis was so devastating for US families battling to make ends meet. He promised to bring inflation down immediately.
But Trump’s rambunctious return to the Oval Office has not had the desired effect of boosting investor confidence. Many have been spooked by the stop-start trade war, believing it could undermine the initial upbeat market reaction to his election victory.
Speaking in Brussels, Fianna Fáil MEP Barry Cowen deftly summed up Irish fears when he explained to the parliament how we stand to lose a lot from the fallout. Our economic ties with both the EU and the US are unique globally.
“Ireland’s deep historical ties with the US are well known,” he said, but he also spelled out how our success is built on EU membership and the solidarity we received during key challenges such as Brexit and the Covid pandemic.
“As such, it is fair to say that the potential for tariffs to turn allies into adversaries leaves few with more to lose than Ireland,” he said.
Aggressive “America First” policies may have short-term allure. However, in the long run, as the great US industrialist Henry Ford said: “Coming together is a beginning; keeping together is progress; working together is success.”
Whether on the battlefield or in economics, history has prove the cost of war is always higher than anyone imagined when the first shots were fired.