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Disastrous Global Trade Wars on Tap
Townhall.com ^ | April 22, 2012 | Mike Shedlock

Posted on 04/22/2012 9:43:14 AM PDT by Kaslin

New border controls are another sign of increasing protectionism in European states. It was not supposed to be this way, yet these controls represent a Vote of No Confidence in Europe

Germany and France are serious this time. During next week's meeting of European Union interior ministers, the two countries plan to start a discussion about reintroducing national border controls within the Schengen zone. According to the German daily Süddeutsche Zeitung, German Interior Minister Hans-Peter Friedrich and his French counterpart, Claude Guéant, have formulated a letter to their colleagues in which they call for governments to once again be allowed to control their borders as "an ultima ratio" -- that is, measure of last resort -- "and for a limited period of time." They reportedly go on to recommend 30-days for the period.

Of course, using catchphrases like "ultima ratio" and "limited period of time" is supposed to make such policies sound reasonable and proportionate. After all, the reasoning goes, it's just a few occasional border controls for up to 30 days. What's the big deal, right?

But the proposal is far from harmless and would throw Europe back decades. Since 1995, the citizens of Schengen-zone countries have gotten used to freely traveling within Continental Europe. Next to the euro common currency, free movement is probably the strongest symbol of European unity. Indeed, for many people, it's what makes this abstract idea tangible in the first place.

To throw this achievement into doubt now is a vote of no confidence in Europe. The fact that this proposal is coming in the middle of the French election campaign makes it even more suspicious. With his back to the wall, French President Nicolas Sarkozy is pretending to take a tough-guy stance toward immigrants. And the fact that Germany's interior minister is allowing himself to get caught up in this charade is regrettable. Still, if you take a look at his party affiliations -- as a member of the center-right Christian Social Union (CSU), the Bavarian sister party to Chancellor Angela Merkel's Christian Democratic Union (CDU) -- it's hardly surprising. 

But this symbolic act could have drastic consequences. It is a relapse into the type of nationalist thinking that many viewed as part of the past. And it brings to mind a country that continental Europeans like to make fun of for its obsession with its own borders: Great Britain.
Border controls are not the only form of protectionism rearing its ugly head. The New York Times reports In France, Old Protectionist Idea Reawakened

An old French idea is blossoming again in the Paris springtime.

The Socialist Party has embraced a form of European trade protectionism in its manifesto, a shift from its previous endorsement of globalization as a win-win proposition for French workers.

The shift matters both because the Socialists and their Green allies have a good chance of unseating the center-right president, Nicolas Sarkozy, in the election next year, and because France has a way of setting the political agenda in Europe.

“Europe is the only continent that imposes free trade on itself in a world that is constantly making exceptions,” according to the Socialists’ program, adopted April 9.

Declaring that Europe should be neither a fortress nor a sieve, the Socialists want international labor, environmental and health and safety standards built into world trade rules.

Failing that, “we will propose putting in place tariff locks at Europe’s borders” until exporting countries adopt norms applied in Europe to issues like trade union rights, child labor and carbon emissions.

Furthermore, the Socialists want the European Union to insert tougher “fair trade” safeguard clauses in agreements with third countries, enabling the Union to reimpose tariffs to halt any import surge threatening European industry.

And they demand that the European Commission publish a study assessing the effects of each new trade agreement on European industry and employment before it is signed.

Free trade has little political constituency in France. While the seafaring British and Dutch have long been free traders, the French have a protectionist tradition reaching back at least to the 17th-century mercantilist Jean-Baptiste Colbert, Louis XIV’s finance minister.

More recently, Maurice Allais, the Nobel economics laureate, published diatribes against free trade with emerging economies until his death last year, warning that it would cause mass unemployment and depression in Europe.

Another contrarian intellectual, the demographer Emmanuel Todd, is campaigning for European protectionism and an exit from the euro, saying the loss of jobs would otherwise tear French society apart.
Disastrous Global Trade Wars Coming Up

The New York Times article stated "the drift toward protectionism has no support in Germany, France’s vital partner in E.U. leadership."

It appears the author needs to read Der Speigel article on border controls at the top of this post. More importantly, once Sarkozy is booted, there is not going to much left of the German-French alliance.

The Times also states "The Socialists’ U-turn on trade is largely driven by domestic politics, and while it resembles positions taken by the Democratic Party in the United States, it has little support so far in other European countries, except perhaps Italy."

"Except perhaps Italy" is quite the exclusion. France and Italy just happen to be the second and third largest eurozone economies.

The last thing Europe can afford is a disastrous round of increased protectionism on top of insane tax hikes, yet insane tax hikes are the norm and signs suggest more protectionism is on the way.

Moreover, Mitt Romney has stated on numerous occasions that if elected he would declare China a currency manipulator. Such an act coupled with increased protectionism in Europe would likely start a disastrous, unwinnable, global trade war


TOPICS: Business/Economy; Editorial; Foreign Affairs
KEYWORDS:

1 posted on 04/22/2012 9:43:18 AM PDT by Kaslin
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To: Kaslin

Anything that is a disaster for the global socialists is good for America.

We can pray they all go broke and are ousted from power.


2 posted on 04/22/2012 9:48:26 AM PDT by hedgetrimmer
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To: Kaslin

sprechen zie deutch

non je parle francais

Death of the euro


3 posted on 04/22/2012 9:49:09 AM PDT by yldstrk ( My heroes have always been cowboys)
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To: Kaslin

The squirming begins. Europe is feeling a squeeze, money-wise, and now they are starting to squirm. This will only accelerate.


4 posted on 04/22/2012 9:52:34 AM PDT by mamelukesabre
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To: Kaslin
increased protectionism on top of insane tax hikes

A socialist leaders dream.

5 posted on 04/22/2012 9:54:31 AM PDT by EGPWS (Trust in God, question everyone else)
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To: Kaslin

Germany is doing well because they are an exporting nation. We aren’t because most things we buy are made somewhere else. Is that because of socialism, capitalism or cronyism?


6 posted on 04/22/2012 9:57:22 AM PDT by ex-snook ("above all things, truth beareth away the victory")
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To: Kaslin

"Oops"
 

http://www.google.com/#hl=en&sclient=psy-ab&q=deutsche+bank+argent+securities
 

7 posted on 04/22/2012 9:58:09 AM PDT by LomanBill (Animals! The DemocRats blew up the windmill with an Acorn!)
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To: Kaslin

This will happen more. A more nationalistic tone will grow. Good in many ways, yet could hurt in other forms.


8 posted on 04/22/2012 10:01:17 AM PDT by Theoria (Rush Limbaugh: Ron Paul sounds like an Islamic terrorist)
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To: Cringing Negativism Network
Ping

Economic nationalism would be a good thing, IMO.
I do not support Globalism.

9 posted on 04/22/2012 10:11:37 AM PDT by ClearCase_guy (Like Emmett Till, Trayvon Martin has become simply a stick with which to beat Whites.)
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To: mamelukesabre
The squirming begins. Europe is feeling a squeeze, money-wise, and now they are starting to squirm. This will only accelerate.

Europe isn't the only one.

From Federalist #7:

The public debt of the Union would be a further cause of collision between the separate States or confederacies. The apportionment, in the first instance, and the progressive extinguishment afterward, would be alike productive of ill-humor and animosity. How would it be possible to agree upon a rule of apportionment satisfactory to all? There is scarcely any that can be proposed which is entirely free from real objections. These, as usual, would be exaggerated by the adverse interest of the parties. There are even dissimilar views among the States as to the general principle of discharging the public debt. Some of them, either less impressed with the importance of national credit, or because their citizens have little, if any, immediate interest in the question, feel an indifference, if not a repugnance, to the payment of the domestic debt at any rate. These would be inclined to magnify the difficulties of a distribution. Others of them, a numerous body of whose citizens are creditors to the public beyond proportion of the State in the total amount of the national debt, would be strenuous for some equitable and effective provision. The procrastinations of the former would excite the resentments of the latter. The settlement of a rule would, in the meantime, be postponed by real differences of opinion and affected delays. The citizens of the States interested would clamour; foreign powers would urge for the satisfaction of their just demands, and the peace of the States would be hazarded to the double contingency of external invasion and internal contention.

Suppose the difficulties of agreeing upon a rule surmounted, and the apportionment made. Still there is great room to suppose that the rule agreed upon would, upon experiment, be found to bear harder upon some States than upon others. Those which were sufferers by it would naturally seek for a mitigation of the burden. The others would as naturally be disinclined to a revision, which was likely to end in an increase of their own incumbrances. Their refusal would be too plausible a pretext to the complaining States to withhold their contributions, not to be embraced with avidity; and the non-compliance of these States with their engagements would be a ground of bitter discussion and altercation. If even the rule adopted should in practice justify the equality of its principle, still delinquencies in payments on the part of some of the States would result from a diversity of other causes--the real deficiency of resources; the mismanagement of their finances; accidental disorders in the management of the government; and, in addition to the rest, the reluctance with which men commonly part with money for purposes that have outlived the exigencies which produced them, and interfere with the supply of immediate wants. Delinquencies, from whatever causes, would be productive of complaints, recriminations, and quarrels. There is, perhaps, nothing more likely to disturb the tranquillity of nations than their being bound to mutual contributions for any common object that does not yield an equal and coincident benefit. For it is an observation, as true as it is trite, that there is nothing men differ so readily about as the payment of money.

Source.

See also California, Illinois, New York. All Dem strongholds.

Cheers!

10 posted on 04/22/2012 10:21:43 AM PDT by grey_whiskers (The opinions are solely those of the author and are subject to change without notice.)
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To: Kaslin

The imbalances brought on by modern “free trade” ideals aren’t sustainable. They never were, but the economists who pooh-poohed those who kept asking about the huge global fund flow imbalances... well, they’re about to have a heaping helping of crow.

This business of using the “trade war” boogieman has to stop. The data about the effects of Smoot-Hawley is out there for anyone who wants to read it, and the net:net is that it was a speed bump on the road into deflation in the 30’s. The real issue that brought Europe and the US into the depths of the Depression were the pig-headed insistence on war reparations even as national treasuries were running empty and massive debt defaults.


11 posted on 04/22/2012 10:24:51 AM PDT by NVDave
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To: Kaslin
MICHAEL PENTO: Decoupling Is An Illusion And Europe's Demise Will Crush Global Markets THIS SUMMER
12 posted on 04/22/2012 10:28:11 AM PDT by blam
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To: yldstrk
sprechen zie deutch

You got it almost right. It's sprechen sie deutch

13 posted on 04/22/2012 10:33:41 AM PDT by Kaslin (Acronym for OBAMA: One Big Ass Mistake America)
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To: Kaslin
I know a little German


14 posted on 04/22/2012 10:38:08 AM PDT by dfwgator (Don't wake up in a roadside ditch. Get rid of Romney.)
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To: NVDave
Nobody brings up Germany when they talk about 'free trade'. Germany is a protectionist country that has done well.
15 posted on 04/22/2012 10:47:11 AM PDT by Theoria (Rush Limbaugh: Ron Paul sounds like an Islamic terrorist)
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To: Kaslin

ahahahahaha well, I took french, and other than ein swie drei, all I know is sprechen sie deutch from watching Hogan’s Heroe’s


16 posted on 04/22/2012 10:51:36 AM PDT by yldstrk ( My heroes have always been cowboys)
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To: Kaslin
According to the German daily Süddeutsche Zeitung,

...bla, bla, bla...whatever. Over the years the once credible SZ has taken a hard-left tack, and whatever they spew forth now can be summarily dismissed. Don't waste anyone's time by quoting their propaganda. It's the NYT in lederhosen.

17 posted on 04/22/2012 1:02:42 PM PDT by Moltke (Always retaliate first.)
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To: Kaslin
The Socialist Party has embraced a form of European trade protectionism in its manifesto, a shift from its previous endorsement of globalization as a win-win proposition for French workers.

 So protecting national sovereignty is now a socialst scheme...

If we American conservatives push for a sovereign United States (plural) of America, with its own Constitution and Bill of Rights, we are now socialists...

Seems that would be calling FreeRepublic a socialist forum for socialists...

 

18 posted on 04/22/2012 1:18:02 PM PDT by Iscool (You mess with me, you mess with the WHOLE trailerpark...)
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