EU to put retaliatory tariffs on US


BRING IN UNIVERSITY OF MARYLAND ECONOMIST PETER MORICI. PETER WE TALK ABOUT THE SPECIFICS WHAT WOULD BE IMPACT FOR THE AMERICAN CONSUMER AND BUSINESS OWNER BUT THE LARGER PICTURE HERE, HOW DANGEROUS A TAKE, THE ROAD THAT WE’RE ON NOW BETWEEN CHINA AND CANADA AND MEXICO AND NOW THE EU, WITH THESE TRADE WARS, MULTIPLE TRADE WARS?>>YOU HAVE TO TAKE THEM ONE AT A TIME. WITH REGARD TO THE EU, THE SUBSIDIES TO AIRBUS BASICALLY PUT McDONNELL DOUGLAS OUT OF BUSINESS AND LOCKHEED MARTIN OUT COMMERCIAL WIDE BODY AVIATION BUSINESS. WE USED TO HAVE 2 1/2 MANUFACTURERS AND ONLY ONE WITH AIRBUS ON THE OTHER SIDE. THESE ARE LEGAL. THE WTO PROVIDE FOR THEM. WHEN WE PROVIDE SUBSIDIES THE EU HAS TAKEN US TO COURT AT WTO AND WON. EITHER WE HAD TO REMOVE THEM WHICH EU REFUSED TO DO OR WE WOULD BE HIT WITH THE TARIFFS. THEY’RE DESIGNED TO LEVEL UP THE PLAYING FIELD. SO THEY’RE PERFECTLY LEGAL. THIS ISN’T LIKE DONALD GETTING UP SAYING THIS IS NATIONAL SECURITY THING, THEY’RE NOT TREATING ME FAIRLY SO I’M PUTTING 30% ON CARS. CHERYL: THEY WILL PUT RETALIATORY TARIFFS ON US. WHAT IS INTERESTING, ACTUALLY THE UK IS A MAJOR PORT OF ENTRY FOR AMERICAN PRODUCTS GOING TO EUROPE. I’M THINKING ABOUT CARMAKERS. BANKS WILL BE AFFECTED BY THIS. A LOT OF U.S. DRUG COMPANIES AFFECTED BY THIS EUROPE IS A PLACE WHERE AMERICAN COMPANIES EXPORT. THAT IS ANOTHER PIECE OF THIS, COULD BE DANGEROUS IF THE EUROPEANS RETALIATE AGAINST US?>>IF THEY RETALIATE THEY’RE BREAKING THE RULES. THE WTO SPECIFICALLY PROVIDES THIS AS A REMEDY TO THE UNITED STATES. WHAT WE ARE DOING IS ILLEGAL. WHAT THE EU IS DOING IS ILLEGAL. THEY KEEP CALLING TRUMP A RENEGADE AND WORSE. AND MUCH WORSE. IN THIS CASE HE IS FOLLOWING THE RULES AND THEY ARE NOT. THE SAME THING WITH THE DUMPING DUTIES ON CABINETS. CHERYL: I DO WANT — WHILE I HAVE YOU, YOU ARE AN ECONOMIST, REALLY QUICK. WE’VE BEEN GETTING A LOT OF PRETTY WEAK MANUFACTURING DATA, SERVICE SECTOR DATA, THOUGHTS ON WEAK NUMBERS WE’RE SEEING IS THE U.S. ECONOMY IN YOUR OPINION IN DANGER, PETER?>>I THINK IT IS SLOWING, THE SLOW SPEED IT IS AT THERE IS RISK OF A RECESSION. THAT IS NOT SAYING IT IS GOING TO HAPPEN BUT IT COULD NEED A BOOST. THIS IS TIME FOR EXAMPLE, WE NEED A INFRASTRUCTURE PLAN TO GET MONEY OUT THERE FAST. IT IS POSSIBLE TO GET THINGS QUICKLY NOT IN OBAMA TIME. POSSIBLY TO GET THINGS IN STATE AND LOCAL GOVERNMENTS. CHUCK SCHUMER DEMAGOGUED ISSUE. HE SAYS I WON’T DEAL WITH INCREASE IN THE GAS TAX UNLESS WE REPEAL YOUR TAX CUTS THAT IS IT THEIR ANSWER TO EVERYTHING.

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