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PaperclipPerfector  7d ago (text post)   25742 thread views

Culture War Roundup for the week of July 28, 2025

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Why is nobody talking about the trade deal that EU stroke with Trump

* BASELINE TARIFF RATE: Almost all EU goods entering the U.S. will be subject to a 15% baseline tariff. The 15% tariff is not added to any existing rates.

  • CARS: Cars and car parts will be subject to the 15% tariff, compared to the 27.5% they face now. The European Commission said it would eliminate remaining low-level duties on industrial goods from the United States, although EU officials said for cars they would cut the import duty from 10% to the previous U.S. level of 2.5%.

  • PHARMACEUTICALS AND SEMICONDUCTORS: The White House says EU pharmaceuticals and microchips will be subject to 15% tariffs. The European Commission says this will only be the case after the United States concludes Section 232 investigations in the coming weeks and sets new global tariff rates for the two sectors. For the EU, the maximum rate would be 15%. For now, there are only subject to low or zero pre-existing duties.

  • OTHER SECTORS: The United States is also carrying out Section 232 investigations on grounds of national security into timber, trucks, critical minerals, commercial aircraft, polysilicon and drones. EU officials say that for all of these, a maximum 15% tariff would apply for EU goods.

  • METALS: Tariffs on European steel, aluminium will stay at 50%, with the same tariff also applying from August 1 to copper. However, the EU and the U.S. have agreed that they will be replaced by a quota system, whose details still has to be negotiated, EU officials say.

European exports within the agreed quota would face the most-favoured nation tariff rate agreed under WTO rules, which are low and in some cases zero depending on the grade. Exports outside of the quota would be subject to 50% tariffs.

  • ZERO-FOR-ZERO tariffs: According to EU officials, the U.S. and EU will have zero-for-zero tariffs on:

  • all aircraft and aircraft parts,

  • certain chemicals,

  • certain generic drugs,

  • semiconductor-making equipment,

  • some agricultural products but with the exclusion of all sensitive products like beef, rice, ethanol, sugar or poultry.

  • Natural resources and critical raw materials. More products could be added.

  • WINE AND SPIRITS: A zero tariff regime for wine and spirits - a point of friction on both sides of the Atlantic - is still under discussion. EU officials said talks were more advanced for spirits.

  • AGRICULTURE, FISH: The EU will open new market access for U.S. Alaska pollock, Pacific salmon and shrimp, subject to quotas. It will also offer improved access for U.S. soya bean oil, planting seeds, grains and nuts as well as processed food such as tomato ketchup, cocoa and biscuits, again subject to quotas.

  • STRATEGIC PURCHASES: The EU pledged to make $750 billion in strategic purchases, covering oil, liquefied natural gas (LNG) and nuclear technology during U.S. President Donald Trump's term in office.

This will come as a mix of spot purchases for oil, long-term contracts for LNG and government procurement for nuclear technology. The amount has been estimated on the basis of Europe's planned phase out of energy purchases from Russia. The EU will also purchase 40 billion euros ($46 billion) of U.S. AI chips would be on top of the $750 billion.

  • European companies are to invest $600 billion in the U.S. over the course of Trump's second term. Japan's package will consist of equity, loans and guarantees from state-run agencies of up to $550 billion to be invested at Trump's discretion, Tokyo says. EU officials, in contrast, said Europe's $600 billion investment pledge is based on the combined investment intentions expressed by European companies.

  • DEFENCE PROCUREMENT: EU member states will purchase U.S. military equipment. The deal does not specify an amount.

  • OTHER ITEMS: The EU says it will cooperate with the U.S. on automotive and food safety standards, while retaining its current rules. Cooperation could take the form of streamlining certification for U.S. pork or dairy products. The two sides will also cooperate on investment screening and export controls as well as addressing 'non-market' policies, such as China's subsidised production.

TLDR is that EU makes Trump a blowjob and in return they get the privilege to swallow. The deal is one sided and quite good for the US. The other thing is that if EU is hoping to weather the storm and then it will be off - yeah right. There won't be a person as stupid as Carter in the white house anytime soon. No matter if 2028 is dem or rep year - this deal will be requested to be honored.

Trump's idea to sell access to US market is not without merits even if it is implementation is botched as hell. And no one is brave enough to even propose retaliation.

Yeah, Trump won this particular round of chicken. Of course, another way to spin it is that 15% tariffs are not a world-shattering amount, especially to the numbers he originally proposed. But all in all, it seems a bit more than just a token amount to allow him to save face.

If two people are in a positive-sum, mutually beneficial relationship then it is very likely that one of them can leverage the relationship for short term gains. "If you really love me, you will cancel on your buddies and go watch that movie I like with me tonight instead" will probably work fine the first time you pull it if your partner is invested in the relationship. On the short-term, tangible level, that is a clear win.

But just because long-term consequences may be more difficult to quantify, that does not mean that they are not there. Every time you pull a stunt like this, your partner is adjusting their valuation of your relationship a tiny bit downwards. Eventually, your partner might suddenly decide to move out and dump you.

Mutually beneficial trade relationships are not so different. I would argue that for past decades, both the US and the EU have immensely profited from the free trade with each other. Zero tariffs are a rather obvious Schelling point. But now Trump with his zero-sum mindset is in charge, and thinks that either the US is fucking someone over, or it is getting fucked over. In the short and medium term, the EU needs trade with the US, so they can not afford a trade war. In the long term, Trump is a red flag. If I was the EU, I would be working hard to secure other trade deals with other nations, so that when another MAGA president decides in a decade that he will not settle for anything less than 30% unilateral tariffs, we are in the position to tell him to fuck off.

If I was the EU, I would be working hard to secure other trade deals with other nations

What other nation nations? Witch China which we talk down to, with Russia which we hate, with India that will never develop, with Africa that is doomed, with south america that is firmly in US sphere of influence or with Australia, Japan, Korea that depends on US for protection, all while we are crybabies about bullshit like human rights.

We could create a potent anti US union - but we will actually have to do what other players do - play realpolitik. Not play "performative morally superior" just because a century ago some people did bad things.

Exactly. There is no alternative. China and Russia are the only other independent players in the world besides the USA, and China is the only one with a comparable size economy.

If a President decides to squeeze the imperial provinces, they will get squeezed.

Now, the genius move would be to build momentum with these trade deals to try to squeeze China in the near future. China also can't afford to walk away from the table. Let's see how it plays out.

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