The United States will not get away with expanding a "Buy American" protectionist measures as part of its economic rescue plan, European Union officials warned Thursday.George Walden in yesterday's Sunday Telegraph explained that the problem may be obvious, but avoiding protectionism may take the kind of political will that's simply not there.
"The one thing we can be absolutely certain about is that if a bill is passed which prohibits the sale or purchase of European goods on American territory, that is not something we will stand idly by and ignore," European Commission trade spokesman Peter Power told journalists in Brussels.
Protectionism is a disease that contaminates everything and is a cure for nothing. To resist it governments will need huge reserves of political will and an internationalist spirit, both of them currently in short supply.Last summer Barak Obama said "we're going to change the country, we're going to change the world". I'm assuming a destructive trade war was not what he had in mind. Therefore, he must resist the protectionist forces within his party or the world will change in ways nobody wants.
A major reason Obama's election was welcomed across the world was his pledge to make America less isolationist-minded, but if his first major economic act ignores the needs of the global economy and provokes a trade war with the European Union, how likely is it that China or Russia or India or South America will play by the rules?
At Davos Chancellor Merkel said her bit, but Germany, whose industrial base equals those of France and Britain combined, has also set up a fund whose transparent intention is to shield exports, and declined to take actions, such as cutting carbon emissions, that might have the effect of costing jobs.
Looking to President Sarkozy for a staunch line on the subject would be somewhat quixotic in a country that was the author of the Common Agricultural Policy, where a protectionist spirit runs in the blood, and respected writers are openly calling for the retreat not just of France but of Europe itself behind greatly enhanced trade barriers and tariff walls. To understand the political pressures and inter-European strains in the offing, one only has to observe last week's riots in Paris, of which we shall see many more, and the fact that the cost of a French or German car exported to Britain has increased by a quarter in recent months.