7 ms·

It seems that the EU could retaliate immediately, due to an old WTO win [1]. Though probably for a smaller amount, somewhere between $2.2bn and $5.0bn. And then

by Xixi 7y ago

It seems that the EU could retaliate immediately, due to an old WTO win [1]. Though probably for a smaller amount, somewhere between $2.2bn and $5.0bn. And then of course there is the pending WTO final decision against Boeing/US expected I believe next year [2]. I don't think this will be a win for anyone... [1] https://leehamnews.com/2019/09/30/eu-can-retaliate-against-boeing-immediately-old-wto-win-outstanding/ https://leehamnews.com/2019/09/30/eu-can-retaliate-against-b... [2] https://www.dw.com/en/wto-rules-against-us-and-boeing-in-mammoth-trade-row-with-eu/a-48105904 https://www.dw.com/en/wto-rules-against-us-and-boeing-in-mam...

ceejayoz 7y ago
> I don't think this will be a win for anyone... Nobody wins in trade wars.
- simion314 7y ago
  Politicians often do the wrong thing to score some points in the next elections.
  - magduf 7y ago
    Every nation gets the government it deserves.
    - jorge-d 7y ago
      That only works in case of democracies.
      - vkou 7y ago
        Every dictator rules only with the assent of his subjects.
      - magduf 7y ago
        Nope, it's true for every country (except for outright invasion and occupation, I'll give a country a pass on that). Short of an occupying force, every country has the ability to choose its own leaders. Non-democratic systems only exist because the people allow them to.
        jorge-d 7y ago
        Tell that to starving north-koreans.
        Zarath 7y ago
        Hey, they deserve it apparently
        magduf 7y ago
        They do, just like every nation does. The North Korean government persists, and does what it does, because it has the support of a majority of its people. No government, no matter how autocratic, can continue without popular support (or an occupying force, which is certainly not the case in NK). That's why the maxim is true.
        magduf 7y ago
        Lots of NKs are not starving. The military has literally millions of people in it, and they're well-fed. Do you think the regime would continue if this were not the case?
        toasterlovin 7y ago
        > Non-democratic systems only exist because the people allow them to. That is an extremely optimistic perspective.
        magduf 7y ago
        Ok, then why don't you explain how exactly a non-democratic system is able to persist if no one in the country supports that regime?
    - vageli 7y ago
      Does that count when your government is undermined and overthrown by outsiders with more firepower than you? "I don't see why we have to let a country go Communist due to the irresponsibility of its own people." ~ Henry Kissinger on Chile in the 70s.
      - magduf 7y ago
        No, I would say that's the one exception. It doesn't happen that often, though, in the big picture.
        deleted 7y ago
        [deleted]
  - bilbo0s 7y ago
    That's what I was thinking. It's not entirely accurate to say "nobody" wins. Politicians can definitely "win" in trade wars.
- aivisol 7y ago
  Not that I support trade wars, but do we have evidence that really nobody wins in trade wars? Just out of curiosity.
  - jokoon 7y ago
    My first answer would be https://en.wikipedia.org/wiki/Comparative_advantage https://en.wikipedia.org/wiki/Comparative_advantage but I'm not sure it's directly related to trade wars.
  - jorge-d 7y ago
    The situation is a bit different now but 1930's Smoot–Hawley Tariff Act [1] seems like it was quite a lose/lose scenario. [1] https://en.wikipedia.org/wiki/Smoot–Hawley_Tariff_Act#After_enactment https://en.wikipedia.org/wiki/Smoot–Hawley_Tariff_Act#After_...
  - api_or_ipa 7y ago
    As another poster mentioned, when countries don't trade, they lose their comparative advantage in producing the products that they can produce most efficiently. With free trade, countries can focus on building the products that they're most efficient at producing. Now, it's important to bring that with free trade, the distribution of benefits is not equal. Those who produce a product that is now competitive in the global market stand to gain. Those who produce products that now face cheaper foreign competition stand to lose. It can be shown that the gains are always larger than the losses, but there may not be an effective mechanism to re-distribute the benefits and losses so that everyone wins. This is known as Kaldor-Hicks efficiency.
    - mistermann 7y ago
      International trade and trade wars are two different things though. If one country conducts their trade in an unfair manner and won't stop until another country retaliates, after which they both trade fairly, this would be just one an example of an effective trade war. Whether any of this is happening today is very complex and seems to come down to a matter of opinion, especially since almost no one has sat down and really looked at the numbers and issues in depth.
- Zarath 7y ago
  Is a boycott a form of trade war? What about an embargo? I'm surprised you can make such a sweeping statement. Frankly I don't think things are as simple as "free markets" since they don't really exist. Companies are also political entities, exercising power in the real, physical world. Not some idealized vacuum market. What if we imposed tariffs on Chinese products that contain high amounts of lead? Does nobody win then? Suppose further that such a tariff hinders the expansion of companies who put high amounts of lead in their products, allowing a company who does not use lead to gain a supply chain and infrastructure advantage in these "expanded areas". Is nobody winning then?
  - ineedasername 7y ago
    >"What if we imposed tariffs on Chinese products that contain high amounts of lead? Does nobody win then?" It's a poor example because that's not how products containing dangerous levels of a substance are dealt with. None of this recent trade war back & forth has imposed tariffs on any products for any reason resembling this. Even if they did, the answer is still "no", we don't win by simply making dangerous or deadly items more expensive. We ban them. When toys from China were found to have lead paint a few years ago, which violates US law, we didn't put tariffs on those toys, we put out public alerts and recall notices. If we do start putting tariffs on, say, vaping products from China because we believe they are dangerous, then maybe there would be a good comparison. However, even then, we could simply tax them locally instead of instituting an international tariff that would provoke trade tensions, so we still wouldn't "win" compared to available alternatives. Maybe there have been examples of winning a trade war via tariffs, but I'm not aware of them, and history is littered with losses. [0] [0]https://www.ft.com/content/ed1a5480-38c9-11e8-8b98-2f31af407cc8 https://www.ft.com/content/ed1a5480-38c9-11e8-8b98-2f31af407...
    - microcolonel 7y ago
      > It's a poor example because that's not how products containing dangerous levels of a substance are dealt with. Well, it would actually be interesting, given that various RoHS-style approaches seem to rely entirely on bans and labelling requirements. Fees would be an interesting middle ground for things that can't be banned for product quality† reasons, but for which labelling is not a sufficient deterrent for low-value uses of hazardous substances. added: † Lead is a very useful material. In many cases, using lead instead of alternatives in a product can dramatically improve consumer safety. For example, lead solder is more ductile than lead-free solder; in a product that vibrates, lead solder can dramatically improve the useful life of a product, as far as I've been told. Furthermore, the higher temperatures required to make joints with lead-free solder increase the failure rate of components being soldered.
- mieseratte 7y ago
  > Nobody wins in trade wars. I would consider upholding higher-order principles to be a win.
- sushid 7y ago
  How do you define a trade “war?” Is it simply affecting free trade in some shape or form? If so does devaluating your own currency or propping up industries via government backed loans count? I’d argue that these initiatives affect trade and force other governments to enact their own measures. And of course, there are winners and losers.

by Xixi 7y ago

ceejayoz 7y ago

> I don't think this will be a win for anyone... Nobody wins in trade wars.

simion314 7y ago
Politicians often do the wrong thing to score some points in the next elections.
- magduf 7y ago
  Every nation gets the government it deserves.
  - jorge-d 7y ago
    That only works in case of democracies.
    - vkou 7y ago
      Every dictator rules only with the assent of his subjects.
    - magduf 7y ago
      Nope, it's true for every country (except for outright invasion and occupation, I'll give a country a pass on that). Short of an occupying force, every country has the ability to choose its own leaders. Non-democratic systems only exist because the people allow them to.
      - jorge-d 7y ago
        Tell that to starving north-koreans.
        Zarath 7y ago
        Hey, they deserve it apparently
        magduf 7y ago
        They do, just like every nation does. The North Korean government persists, and does what it does, because it has the support of a majority of its people. No government, no matter how autocratic, can continue without popular support (or an occupying force, which is certainly not the case in NK). That's why the maxim is true.
        magduf 7y ago
        Lots of NKs are not starving. The military has literally millions of people in it, and they're well-fed. Do you think the regime would continue if this were not the case?
      - toasterlovin 7y ago
        > Non-democratic systems only exist because the people allow them to. That is an extremely optimistic perspective.
        magduf 7y ago
        Ok, then why don't you explain how exactly a non-democratic system is able to persist if no one in the country supports that regime?
  - vageli 7y ago
    Does that count when your government is undermined and overthrown by outsiders with more firepower than you? "I don't see why we have to let a country go Communist due to the irresponsibility of its own people." ~ Henry Kissinger on Chile in the 70s.
    - magduf 7y ago
      No, I would say that's the one exception. It doesn't happen that often, though, in the big picture.
      - deleted 7y ago
        [deleted]
- bilbo0s 7y ago
  That's what I was thinking. It's not entirely accurate to say "nobody" wins. Politicians can definitely "win" in trade wars.
aivisol 7y ago
Not that I support trade wars, but do we have evidence that really nobody wins in trade wars? Just out of curiosity.
- jokoon 7y ago
  My first answer would be https://en.wikipedia.org/wiki/Comparative_advantage https://en.wikipedia.org/wiki/Comparative_advantage but I'm not sure it's directly related to trade wars.
- jorge-d 7y ago
  The situation is a bit different now but 1930's Smoot–Hawley Tariff Act [1] seems like it was quite a lose/lose scenario. [1] https://en.wikipedia.org/wiki/Smoot–Hawley_Tariff_Act#After_enactment https://en.wikipedia.org/wiki/Smoot–Hawley_Tariff_Act#After_...
- api_or_ipa 7y ago
  As another poster mentioned, when countries don't trade, they lose their comparative advantage in producing the products that they can produce most efficiently. With free trade, countries can focus on building the products that they're most efficient at producing. Now, it's important to bring that with free trade, the distribution of benefits is not equal. Those who produce a product that is now competitive in the global market stand to gain. Those who produce products that now face cheaper foreign competition stand to lose. It can be shown that the gains are always larger than the losses, but there may not be an effective mechanism to re-distribute the benefits and losses so that everyone wins. This is known as Kaldor-Hicks efficiency.
  - mistermann 7y ago
    International trade and trade wars are two different things though. If one country conducts their trade in an unfair manner and won't stop until another country retaliates, after which they both trade fairly, this would be just one an example of an effective trade war. Whether any of this is happening today is very complex and seems to come down to a matter of opinion, especially since almost no one has sat down and really looked at the numbers and issues in depth.
Zarath 7y ago
Is a boycott a form of trade war? What about an embargo? I'm surprised you can make such a sweeping statement. Frankly I don't think things are as simple as "free markets" since they don't really exist. Companies are also political entities, exercising power in the real, physical world. Not some idealized vacuum market. What if we imposed tariffs on Chinese products that contain high amounts of lead? Does nobody win then? Suppose further that such a tariff hinders the expansion of companies who put high amounts of lead in their products, allowing a company who does not use lead to gain a supply chain and infrastructure advantage in these "expanded areas". Is nobody winning then?
- ineedasername 7y ago
  >"What if we imposed tariffs on Chinese products that contain high amounts of lead? Does nobody win then?" It's a poor example because that's not how products containing dangerous levels of a substance are dealt with. None of this recent trade war back & forth has imposed tariffs on any products for any reason resembling this. Even if they did, the answer is still "no", we don't win by simply making dangerous or deadly items more expensive. We ban them. When toys from China were found to have lead paint a few years ago, which violates US law, we didn't put tariffs on those toys, we put out public alerts and recall notices. If we do start putting tariffs on, say, vaping products from China because we believe they are dangerous, then maybe there would be a good comparison. However, even then, we could simply tax them locally instead of instituting an international tariff that would provoke trade tensions, so we still wouldn't "win" compared to available alternatives. Maybe there have been examples of winning a trade war via tariffs, but I'm not aware of them, and history is littered with losses. [0] [0]https://www.ft.com/content/ed1a5480-38c9-11e8-8b98-2f31af407cc8 https://www.ft.com/content/ed1a5480-38c9-11e8-8b98-2f31af407...
  - microcolonel 7y ago
    > It's a poor example because that's not how products containing dangerous levels of a substance are dealt with. Well, it would actually be interesting, given that various RoHS-style approaches seem to rely entirely on bans and labelling requirements. Fees would be an interesting middle ground for things that can't be banned for product quality† reasons, but for which labelling is not a sufficient deterrent for low-value uses of hazardous substances. added: † Lead is a very useful material. In many cases, using lead instead of alternatives in a product can dramatically improve consumer safety. For example, lead solder is more ductile than lead-free solder; in a product that vibrates, lead solder can dramatically improve the useful life of a product, as far as I've been told. Furthermore, the higher temperatures required to make joints with lead-free solder increase the failure rate of components being soldered.
mieseratte 7y ago
> Nobody wins in trade wars. I would consider upholding higher-order principles to be a win.
sushid 7y ago
How do you define a trade “war?” Is it simply affecting free trade in some shape or form? If so does devaluating your own currency or propping up industries via government backed loans count? I’d argue that these initiatives affect trade and force other governments to enact their own measures. And of course, there are winners and losers.