Trump escalates trade war with EU with $11 billion tariff threat over year-old WTO ruling

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President Donald Trump is once again threatening tariffs against the European Union, this time using a year old World Trade Organization ruling as an excuse to escalate his trade war.

Last May, the World Trade Organization ruled that the European Union has given illegal subsidies to Airbus, an international airplane manufacturer. The subsidies allegedly cost American company Boeing international sales.

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In response, the Trump administration had announced it would wait until the summer to implement them only if the WTO approved. Airbus criticized the tariff threat in a statement by pointing out the company took steps to comply with the ruling.

According to Bloomberg:

The threatened American tariffs, which come after the WTO ruled in May that Airbus had received illegal funding for its A380 and A350 models, costing Boeing sales, would be implemented only after the WTO gave the final go-ahead this summer, the administration said.

Airbus said in a statement that the U.S. tariff threat was “totally unjustified” and that it had taken “all necessary measures” to comply with the WTO ruling regarding illegal aid.

But Trump decided to involve himself by issuing a tariff threat on Twitter and accused the European Union of taking advantage of the United States on trade.

The WTO made a ruling and that should be enough to settle the issue. But Trump wants revenge, which will escalate a trade war that has already resulted in tariffs against the European Union and retaliatory tariffs against the United States. If Trump slaps new tariffs against the EU, there will be more retaliatory tariffs and the economy is already feeling the strain from Trump’s other trade wars against Canada, Mexico and China.

Besides, it’s not like the United States government hasn’t been providing Boeing billions of dollars in subsidies for decades as well as tax credits. In fact, Washington state is currently being investigated by the WTO for possibly giving Boeing illegal subsidies. And you don’t see the European Union threatening tariffs over it. That’s why the WTO exists, to settle trade disputes so countries don’t engage in self-destructive trade wars that do harm to the global economy.

Clearly, Trump doesn’t care about the economy if he intends to continue attacking our trade partners with tariffs.

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