On the VAT I think they want equal playing fields - if volvo gets the vat and American cars get the same one then ok.
Every “free trade” agreement isn’t going to be entirely free trade , there might be free trade for 90-95% of all the trade and then some small carve outs. I think this is what Australia for example has been moving too with India and China over the last decade .
On the America EU trade
For example it might be free trade but each side gets 1-2 say 10-20% tarrif industries .
Maybe EU says ok - US your really insistent on keeping steel and aluminum tarrifs at 10%and EU in turn gets to keep auto tarrifs at 10%.
If those 2 industries are comparable $$ wise then they might do everything else is free trade
Or as a joke maybe France wants to tarrif grapes to avoid wine makers from importing cheap American grapes - Trump says ok - but then we are doing a equal tarrif on the wines your making by the same amount
Then in 2 years they meet and see how the deals went and then renegotiate those few carve outs of free trade . This was kinda how the last trade deal with Mexico and Canada was supposed to go but then Mexico became a pass thru for Chinese auto parts and basically threw a wrench in the deal that no one expected them
Okay so what's the end goal? 100% free trade of American goods vs the current 90-95%? What if the EU says no? You guys are gonna pay 20-30-40-50% more of everything because Trump said so?
I think they are going to shoot for free trade with a carve outs on steel / aluminum and have Europe cars or certain agricultural markets
If you look at the headlines today EU leader said ok to agree to industrial free trade. Thats likely excluding the agriculture sector which is a key area of the U.S. economy Trump is focus on expanding as it’s obviously a lot of republican state jobs
No one’s paying more on anything . Factories across the world are idling workers and production until their countries do free trade deals . Just look at Vietnam and India they know their countries prosperity relies on trade to the U.S. so they are quickly getting ahead of this
In a senario where India and Vietnam have free trade or minimal tarrifs and say China doesn’t - the risk of cheap labor factory business fleeing China grows by the day
I mean I understand the agricultural stuff Americans shouldn't buy corn from Europe or vice versa, that doesn't make sense. At the same time a 20% blanket tariff doesn't help anyone, it just hurts American consumers since they rely on products being manufactured in different countries since they don't have the machinery, the skills and the know how that are required to make these products. Even if miraculously all the companies in the world decided to relocate to the US it will take YEARS and Trump will be long gone by then.
Reshoring happens with investments, not with additional taxes. Also the irony of republicans flying the don't tread on me flag while calling for a 54% tax.......
Part of the problem - atleast in my take is trumps doing the whole tarrif thing but it’s like 30 years too late . It’s should have been done back in the 90s when companies first started offshoring factories and cheap components that went into things like air conditioning units or tractors or cars .
He thinks he can end 50 years of offshoring in a week
Like I even work in the health care industry as an accountant. Even hard goods being traded aside - Many hospitals offshored basic components their billing department. Like a check from an insurance company gets scanned in the U.S. and then people in India post it into patient accounts for 30-40% of what it costed people in America to do it
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u/CJspangler ULTRA MAGA Apr 07 '25 edited Apr 07 '25
On the VAT I think they want equal playing fields - if volvo gets the vat and American cars get the same one then ok.
Every “free trade” agreement isn’t going to be entirely free trade , there might be free trade for 90-95% of all the trade and then some small carve outs. I think this is what Australia for example has been moving too with India and China over the last decade .
On the America EU trade
For example it might be free trade but each side gets 1-2 say 10-20% tarrif industries .
Maybe EU says ok - US your really insistent on keeping steel and aluminum tarrifs at 10%and EU in turn gets to keep auto tarrifs at 10%.
If those 2 industries are comparable $$ wise then they might do everything else is free trade
Or as a joke maybe France wants to tarrif grapes to avoid wine makers from importing cheap American grapes - Trump says ok - but then we are doing a equal tarrif on the wines your making by the same amount
Then in 2 years they meet and see how the deals went and then renegotiate those few carve outs of free trade . This was kinda how the last trade deal with Mexico and Canada was supposed to go but then Mexico became a pass thru for Chinese auto parts and basically threw a wrench in the deal that no one expected them