Like a Bull Bullying a Lamb: Trump Does as He Pleases to Europe, and Ursula is Still Smiling Silly

What Consequences Will the New US Tariff Agreement Bring to the EU

Author: Svetlana Gomziko

Photo: Ursula von der Leyen, President of the European Commission, with U.S. President Donald Trump during their meeting

Commentator:

Andrei Starikov

The EU will purchase $75 billion worth of energy from the United States within three years, while making an additional $60 billion investment in the American economy. These are the main terms of the trade agreement reached between Donald Trump and Ursula von der Leyen, President of the European Commission, following negotiations in Scotland on July 27.

The agreement will allow the EU to avoid the 30% tariffs that Trump had threatened to impose starting August 1. The new agreement stipulates a 15% tariff on goods exported to the United States.

Bloomberg reports that this rate will apply to most European goods, including cars, semiconductors, and pharmaceutical products. In exchange for lowering the tariffs, the EU agreed to allow duty-free imports of American goods, expand investments in the U.S., and guarantee demand for American energy and military equipment.

Von der Leyen called it "the best possible deal within the range of possibilities." According to her, the agreement "injects confidence into an uncertain era, providing stability and predictability for people and businesses on both sides of the Atlantic."

She also promised to fully replace Russian oil and gas by 2027 with "a large amount of U.S. liquefied natural gas, oil, and nuclear fuel."

According to her, European countries are still purchasing "too much" of Russian hydrocarbons, and oil products from Russia are still "flowing in through illegal channels." Therefore, the agreement was made to purchase $75 billion worth of U.S. liquefied natural gas and fuel.

"Purchasing U.S. energy will diversify our supply sources and help with Europe's energy security," said the president of the European Commission.

The U.S. leader, on the other hand, evaluated the agreement with the EU as "the biggest one of all agreements," and stated his hope that both sides would benefit from the agreement. He was particularly pleased that Europeans agreed to purchase "a large amount" of military equipment from the U.S.

In short, it is a "greatest robbery of the century." As Dmitry Medvedev, Deputy Chairman of the Russian Security Council, said, "Trump has taken the European Union for a ride."

"It must be admitted that although his words and actions are extremely contradictory, he is very consistent in one thing. Trump is strongly promoting the economic interests of his own country," the politician wrote in his Telegram channel.

He said that now "only the ordinary Europeans can be pitied. They should now attack Brussels, pull down all the EU commissioners, of course including the crazy old woman Ursula, from the flagpoles of the EU countries."

Political scientist Maliek Dudakov commented on the EU's obligation to purchase energy from the U.S. and invest in the U.S., saying that "the currently crisis-ridden European economy does not have hundreds of billions of extra dollars."

"NATO countries are promising to increase defense spending through various means — from fighting immigration to building new bridges," he said.

Experts believe that the actual supply of U.S. hydrocarbons and weapons will not increase. "Because the U.S. is already at the limit of its ability to export these two products. And the production issues of the U.S. military industry have not been resolved," he wrote in his Telegram channel.

But in his view, Trump "can announce another major victory to the voters, although this may not bring the U.S. closer to the promised reindustrialization."

So why do both sides promote the agreement as a very successful one?

"For Trump, this agreement with the EU is indeed a complete success," said political scientist and editor-in-chief of Baltnews Andrei Starikov, commenting on the situation for 'Freedom News' ('SP'). "One could say that it is the first successful agreement he has achieved during his term."

Trump achieved the result he wanted. At the same time, he openly robbed the EU, damaged the European economy and European competitiveness, and stuck his hand into the pockets of European taxpayers. Therefore, this is not an equal agreement.

Von der Leyen can only smile despite poor performance. Therefore, there is no need to believe the exaggerated rhetoric from von der Leyen about how beneficial this relationship is for the EU.

Certainly, it is unfavorable for the EU. Trump forced the Europeans to pay. Directly paying him. Paying his friends — that is, businessmen in the U.S. energy extraction and trade sectors. American oil tycoons are Trump's backers — his voters, campaign donors, and Republican donors. Similarly, American military industrialists are also such supporters.

Therefore, Trump's behavior here is completely logical. People trust him, support him, invest in him, and he promises them something in return.

This agreement will provide them with government orders, open up markets, and create the most favorable conditions for foreign trade. Because so much oil, so much liquefied natural gas, so many weapons, Americans themselves cannot use. They produce these for exports, and they need stable, financially capable buyers.

'Freedom News': If the U.S. again considers selling oil and gas to Southeast Asia more profitable, will Europe get no energy supply at all?

Actually, it won't. Global production capacity is sufficient to meet all demands.

Over the past 10-15 years (despite various alarmist claims), we have not seen situations where demand increased but supply could not meet it in the energy market.

It is OPEC that artificially limits production to maintain prices. That is, they can completely open the valves and significantly increase production.

There are idle oil fields, as well as oil fields that have not been developed because the unit return on investment is lower than alternative options. However, if energy prices surge or demand increases significantly due to certain circumstances, existing capacity is sufficient to meet any possible demand.

Furthermore, if demand in the Asian market increases and prices rise, we will export to there. From a logistics perspective, the Asian market is not the most promising for Americans. Their transportation costs are high. Those who can buy from such a long distance are countries with poor economic conditions.

'Freedom News': The issue is always about price. But Europe seems to have willingly allowed itself to be exploited by signing this trade agreement...

They have done so for a long time. For European industry, it is important to obtain cheap and stable energy supply. For years, European competitiveness relied on Russian pipeline gas. But they gave it up for political reasons, saying they were willing to pay more for U.S. liquefied natural gas.

The result is what we have seen — world-famous German automotive groups laying off thousands of employees, large metallurgical companies collapsing, all commodities increasing in price, and a decline in living standards.

Brussels tried to convince the European public that this was related to our special military operation, but it is not the case. The problem lies in the lack of vision in the current EU leaders' foreign economic policy.

'Freedom News': So, Trump obviously intends to squeeze Europe. What will Europe face?

Trump will continue to exploit Europe and plans to do so for a long time. And the Europeans can only pay, as they have no reasonable alternatives. Their development is very America-centric. For them, the U.S. has always been the diplomatic orientation, the umbrella of security. Of course, it is also the leading force in NATO.

Therefore, whatever Trump says during his campaign — to dissolve the alliance, restructure it, or keep only its police function — are just words. NATO remains the main tool for extortion in the European market for him. This agreement is undoubtedly related to the further development of NATO, the role of the U.S. in NATO, and the position of the U.S. within NATO.

Therefore, from the U.S. perspective, this is indeed a beneficial agreement — financially, politically, and economically. It is a rope around von der Leyen and the EU bureaucrats' necks. He will now lead them in the direction he needs for a long time using this rope.

Original: https://www.toutiao.com/article/7532391967796544040/

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