US Sanctions and Tariffs Create Distrust and Enmity

US Sanctions and Tariffs Create Distrust and Enmity

US Sanctions tariffs EU
Brussels (SCF) – The United States has reached a new low in international relations. Not only does President Trump tweet and otherwise comment insultingly about leaders (“Little Rocket Man”) and various nations (“shithole countries”), he has gone out of his way to alienate friends and allies by imposing tariffs on some of their exports. This is in addition to his sanctions on such countries as Russia, Venezuela, and Iran which he and his cohorts in Washington regard as enemies.
US Sanctions tariffs EU
US and European Union flags
Image: Flickr

The US is in the awkward position of trying to punish Russia while concurrently punishing European nations that he had hoped would help in enforcing anti-Russia economic sanctions.

Trump has no sense of humour, so would not see the unintentional absurdity and hilarity in the comment by his erratic treasury secretary, Steve Mnuchin, when he said in justification of sanctions that “The Russian government operates for the disproportionate benefit of oligarchs and government elites” — because this is exactly what the Trump administration does for the amazingly wealthy high mucky-mucks of the US establishment.

For a start, the righteous moralist Mnuchin is just a bit of an oligarch himself. As reported by New York’s Fortune magazine, “Mnuchin’s net worth could be as high as $500 million — on top of which he has pulled in recent additional income of nearly $70 million… Mnuchin’s initial disclosures showed that he had a net worth of as much as $400 million, but just before his confirmation hearing on January 19 [2018], he subsequently disclosed additional real estate holdings valued at nearly $100 million, which he said his lawyer had mistakenly omitted from the first document.” (How inconvenient that he can temporarily overlook assets valued at a hundred million dollars.)

So far as the tariffs imposed against European nations are concerned, Mnuchin declared that “We’re not afraid of [a trade war]… This administration is going to make sure that we’re treated fairly” to which arrogant inflexibility the French riposted that “We are waiting for the United States to show some goodwill towards Europe” and the Germans insisted that “We must ensure that protectionism doesn’t become the dominant force in the world.”

Related: Why Trump’s Threat to Slap Tariffs on Foreign Steel is a Bad Idea

While it is comical that Mr. Mnuchin preaches against elitism, the matter of sanctions overall is far from amusing, as they interlock with the tariffs’ shambles to an extent that is likely to affect the entire world. A major complication is the “Countering America’s Adversaries Through Sanctions Act”, which mandates further sanctions on countries which conduct business with Russia. According to Mr. Mnuchin’s Treasury Department the Act “among other things, imposes new sanctions on Iran, Russia, and North Korea” — but it also affects many other countries. Take, for example, India.

India is a friend of the United States, although there is no actual military alliance and in spite of the fact that Russia has for decades been India’s main supplier of advanced defense equipment. The US intends to take over as the main provider of India’s military equipment, and according to the Stockholm International Peace Research Institute “the US is rapidly increasing its arms sales to India, emerging over the last five years as its second-biggest supplier by providing 15 percent of its weapons imports.”

India, however, entered into an agreement to purchase Russian “S-400 long-range surface-to-air missile systems, billed as a game-changer by the Indian military for its ability to counter ballistic missiles and stealth aircraft.” It is obvious that the S-400 has the potential to alter many games around the world, and the Israelis, for example, are terrified that it will be acquired by Syria because not one Israeli aircraft would then survive to put a wingtip into Syrian airspace which at the moment it violates with US-supported total impunity.

But the rules of the sanctions game being played by the United States demand that India should not sign the 5.8 billion dollar S-400 agreement with Russia. On 28 May the Chairman of the US Congress Armed Services Committee, Mac Thornberry, said “There is a lot of concern in the US, in both the administration and the Congress, over the S-400 system. There is concern that any country and not just India that acquires that system will complicate our ability to work towards interoperability together.”

So what is India to do? The Diplomat reported on 30 May that “a top Indian government official” had said “negotiations for the missile deal have been concluded. The financial component has been finalized,” and noted that the deal will likely be announced when Prime Minister Narendra Modi and President Vladimir Putin meet in a few months time.

Will India stand up for itself and tell the United States that it’s none of its business where and how India does business? Or will it cave in to Washington’s pressure and refuse to accept five batteries of the world’s most effective air defense missile system and look weak and stupid? That would suit the oligarchs of Washington who would prefer that India buys Raytheon’s Patriot missile system. (The day before Trump entered the White House on 20 January 2017 Raytheon shares were at $146 and by 4 June 2018 had leapt to $202. Go figure.)

Related: China Can Hold Trump’s Trade War Hostage

And while we’re talking of being made to look stupid, there is Trump’s treatment of his European partners who the Pentagon is anxious to enlist in war preparations against Russia. But it doesn’t seem to matter to Trump and to commercial Washington that imposing savage tariffs on allies will make the US Establishment unpopular with people whose assistance is extremely important in so many spheres of international affairs.

It would be difficult to improve on the description of the Euro-tariff shambles by the Washington Post’s Heather Long and Steven Mufson who wrote on 2 June that “President Trump appears prepared to unravel 70 years of pain­staking effort that the United States has led to building an inter­national system of trade based on mutually accepted rules and principles.”

At a meeting of the G-7 group of nations on 2 June there was a “rare show of division among the normally harmonious club of wealthy nations” when “the six other G7 member countries issued a statement asking US Treasury Secretary Steven Mnuchin to convey their ‘unanimous concern and disappointment’ about the tariffs to President Donald Trump.”

In fact, it wasn’t “division” at all — it was unanimity; it was harmony and unison against an overweening administration that acts entirely for the “disproportionate benefit of oligarchs and government elites” in Washington.

And, for the benefit of Trump, who hasn’t a clue about diplomacy, the words “concern and disappointment” are diplomatic terms for outrage and fury, which is the feeling in Germany following the extraordinary outburst by the newly-appointed US ambassador, Richard Grenell, who told Breitbart News on 3 June that “There are a lot of conservatives throughout Europe who have contacted me to say they are feeling there is a resurgence going on. I absolutely want to empower other conservatives throughout Europe, other leaders. I think there is a groundswell of conservative policies that are taking hold because of the failed policies of the left.” His statement was directed against the present German government, and, Breitbart made it clear that “Trump’s right-hand man in Europe wants to empower European anti-establishment conservatives.”

Related: US Fires First Salvo of Upcoming Trade War with China

The US is blending sanctions and tariffs in a destructive mixture of arrogant disdain and economic over-confidence, and the EU should heed the warning of President Putin that “The more problems at the heart of the EU, the more risks and problems there are for us. We need to build co-operation with the EU. We don’t have a goal of dividing anything or anyone in the EU.”

It would be a very good thing if the European Union (forget Britain) reassessed its priorities and looked East instead of bending to the will of the demanding and inflexible adversary across the Atlantic. Prosperity beckons and all it will take is EU-Russia economic cooperation to ensure its arrival.

This post was written by Brian Cloughley and was originally published by Strategic Culture Foundation.