How to start trade wars: EU threatens to retaliate for US sanctions against Russia

This is not good news, or rather, not good: European Union threatens retaliation over proposed US sanctions against Russia. The main problem is that so starting a trade war. Someone says: “You can’t do that” and then others get mad and shout: “so you, too, can’t do that”, and we find ourselves in a spiral of claims about the impossibility of making many other things. Indeed, in some ancient books say about the value of the principle of “an eye for an eye, a tooth for a tooth,” and so we sometimes characterize children’s behavior.

But while we cannot say for sure that there was any interference on the part of Russia in elections in the United States, although this was the stated reason for the expansion of us sanctions. Of course, there are many applications of different kinds, but I tend to take the screaming about smoke as a good proof that no one has found a fire.

My task here is to talk about US politics, but about economic policy. And throwing sanctions — not the best choice in the economy. Especially when, as in this case, we risk getting into a spiral of their rise.

The bill is likely to create difficulty for the U.S. President, who hopes to improve relations with Russia. The bill aims to punish Russia for alleged interference in U.S. elections in 2016.

As I said, I don’t think there is credible evidence of these statements, and it’s too early for revenge for something not yet known. However, Brussels is preparing for retaliation against the US if Washington will adopt new sanctions against Russia, which will affect European companies.

Jean-Claude Juncker (Jean-Claude Juncker), the European Commission President, urged as soon as possible to decide how Brussels should respond if European energy companies or other companies will be subject to sanctions under discussion in the U.S. Congress.

According to the note prepared for the meeting of the Commission on Wednesday, which saw the Financial Times, Brussels “must be ready to act within a few days” if the US measures “will be taken without considering the concerns of the EU.”

The EU to some extent right. Discussing US sanctions will have a greater impact on companies in Europe than in the United States. And, in my opinion, too cruel to punish us for that, as they say, made in the USA and Russia.

The future of the pipeline “Nord stream — 2” from Russia to Germany is of special concern to the Europeans. About a third of natural gas continued to be supplied to the European Union from Russia. The proposed expansion will double throughput of the existing pipeline and will make Germany a major power center of the EU.

Yes, of course, the gas export is very important for Russia. It is also very important to us here in Central Europe, thanks to him we have heat in the winter. So, as I said, the EU at least has the right to worry a bit about it.

Officials of the European Commission said that the unit may use the EU rules, allowing him to prevent the use of extraterritorial measures by the United States, to demand the United States promises to exclude energy companies from the EU list, or impose outright bans on doing business with certain companies in the US. In addition, the EU could submit a complaint to the world trade organization.

U.S. sanctions intended to punish Russia for bad behavior. But they will lead to the fact that Europeans will suffer. At this point, the EU will begin to punish American companies, prohibiting cooperation with them. Then, of course, enraged Americans will prohibit contracts with several European companies, and will fight according to the principle “an eye for an eye”, which will lead to General impoverishment.

Indeed, there are times when sanctions are a useful tool. For example, very important I think a ban on the sale of nuclear materials to North Korea. But it’s very easy to start a trade war with their careless application, as can happen in this situation.