Why does the US impose sanctions against Europe?

The United States announced a new package of sanctions against European countries. It is not only about a number of products, such as cheese and wine, but also about the components for the aircraft manufacturer Airbus. Europe, therefore, is under new pressure from Washington. And it will have to make its choice very soon.

A few years ago it was difficult to imagine the phrase "US sanctions against the EU." It would seem that Europe is the outpost of Washington in confrontation with Russia, which means that the vassal must be supported, not punished. However, in US policy, profit has always been at the forefront. Political and economic promotion of American interests.

And sanctions are a real tool for promoting these very interests. Economists have repeatedly noted that the US sanctions policy is not really aimed at obtaining a quick political result, as is postulated in the White House and in Congress. The policy of sanctions is primarily to achieve a rapid economic effect in the competition of US companies with companies from other countries.

And this is logical. Most often, as soon as the sanctions begin to act against a company of a particular state, it begins to have problems with financing, access to foreign markets, securities and investments.

From an economic point of view, this raises a serious question about American unscrupulous monopolization of world markets, about unfair competition, and so on. And from a political point of view - the question of the promotion of US hegemony by ramming methods of gross pressure. Washington doesn’t care who becomes the new victim: Russian raw materials companies, European agricultural holdings or Chinese IT giants. However, now the United States threatens Europe with new sanctions, and this puts it in front of a difficult strategic choice. What can the EU do about it?

Hello from Washington

The US Trade Representation has published on its website a statement by US Trade Representative Robert Lightheiser. It says about the preparation of new duties in respect of European goods due to subsidizing the aircraft manufacturer Airbus. Supporting its manufacturer, the report says, Europe is hurting the United States. And this is not only the opinion of Washington.

According to Lighthizer., The World Trade Organization (WTO) has repeatedly noted that Airbus subsidies from the European Union (EU) had an adverse effect on the United States. Today, in accordance with Section 301 of the Trade Act of 1974, the Office of the United States Trade Representative (USTR) begins the process of defining EU products to which additional duties may apply until the EU cancels these subsidies.

The US Chamber of Commerce also published a list of European products that may be subject to sanctions. The list includes not only aircraft components and Airbus aircraft, but also cheeses, wine, fish, crabs, juices, olive oil, jam, and even carpeting. The list focuses on products from four countries - Germany, France, the UK and Spain. These countries, according to the United States, are engaged in the main sponsorship of Airbus.

The United States estimates the damage from Europe’s support for its company at $ 11 billion annually. This sum, however, will have to go through the arbitration approval in the WTO in the summer, the statement said. Lightheiser also called the Airbus-Boeing conflict stale.

Indeed, the United States first began to put pressure on Europe because of Airbus back in 2004. It was then determined that from 1968 to 2006, the EU provided $ 18 billion in subsidies to Airbus. This support allegedly terribly hurt the American company Boeing, as each model of a civil Airbus aircraft was released only thanks to the support of the EU. This led to Boeing losing its share in the global market.

The United States conducted this dispute through the WTO, which sided with Boeing. The EU was forced to abolish two insignificant subsidies, but the majority left unchanged. This moment is now becoming the new lever of pressure of Washington on Berlin, London, Paris and Madrid.

We also add that at the moment, the US trade sanctions imposed in 2018 on a number of European goods are still in force. It is not only about duties on steel and aluminum, but also on food.

Europe at the crossroads

It is necessary to say about the political significance of what is happening. Over the past few years, the United States has incredibly increased pressure on Europe. Donald Trump believes that the Europeans are getting out of control, lacking money in NATO, taking the margin from American companies and are ready in some cases to give preference to cooperation with Russia rather than with the United States.

This happens with the Nord Stream 2 pipeline. Trump did his best to force Germany and a number of other countries to stop subsidizing this extremely profitable project for Russia and Europe. However, Berlin took a tough stance, which was already the reason for the conflict between Trump and Merkel.

In parallel with this, French President Emmanuel Macron announced a project to create a unified European army. This can be regarded as a European response to Trump's demand to raise NATO funding to 2% of each participating country’s GDP. Europe has only one real problem - the lack of unity.

Eastern European countries are ready for anything, just to get American support, but Western Europe is already entering into open confrontation with Washington on trade issues. The problem is also that the new US sanctions will in one way or another affect all EU countries, and the union is not capable of a common solution.

As former German Foreign Minister Sigmar Gabriel wrote in an article for Project Syndicate, Germany will make a mistake if it does not meet Washington and chooses a confrontational path. The future of Germany is in unity with the United States and NATO, he believes. And Washington is absolutely right, demanding from Europeans to fork out. Germany should "be an adult" and, as a true European leader, do not pay attention to the behavior of the United States, because it is aimed at the common good. And, as the “adult” leader of Europe, it is Germany that should lead the EU countries along the path of strengthening relations with Washington. At least the ex-head of the Federal Foreign Office of Germany is sure of that. Instead, Washington sees the intractable position of Chancellor Merkel, which turns away from the United States, he said.

What is remarkable about Gabriel's opinion? Firstly, by the fact that until recently he was the chief of German foreign policy, and this means, in many respects, European policy. Secondly, Mr. Gabriel clearly wants to prove himself from the best side to the American "friends" of the Germans. And here he no longer cares that Europe, like his native Germany, in recent years has been increasingly turning into a vassal of the United States. Personal interest and possible political future here is more important than national interests.

Alternative?

In short, the United States increasingly treats Europe like a servant. And the interests of the owner are always higher. How do you dare to allocate money to your European company so that it takes away the market from an American competitor? Unacceptable. Well, the WTO easily sided with Washington, as this trade organization has always done.

In the same Germany, meanwhile, the understanding is ripening that this path for the country and Europe as a whole is disastrous. Because such a large state simply cannot have only “American interests”.

And the alternative to surrender to Washington today for Europe is only a turn to the East. Italy, for example, has already given the go-ahead to participate in the Chinese project “One Belt, One Road”. And this project eventually turns into a common Eurasian, not Chinese. It involves a lot of European countries and, of course, Russia.

And this is against the background of political disagreements in Europe itself, problems with Brexit, migrants, and terrorist threat.

Therefore, if you follow the logic of Mr. Gabriel, then the problems of Europe should be sidelined in the name of integration with the United States and the interests of Washington. Whereas the alternative is near, and partly in Germany they already understand that a really profitable future is possible when the country is not politically pressured, but offered to cooperate economically.

And everything Washington thinks about Europe is already well outlined in the sanctions lists, Trump's requirements and the statement of the American trade representative. This is a question not only of economics and politics, but also of simply European self-esteem.