How some EU economists see tariffs, Don't jump on this rhetoric – tariffs are not a "countermeasure"

It may be a bit dry, but it is important. The US administration has now presented the formula used to calculate the new tariffs. Very strikingly, other countries’ tariffs and trade barriers are not included in this formula.

So it is not about how much tariff China or Europe imposes on the US – the formula only includes the US trade deficit and the size of imports, as well as a few other parameters.

The American tariffs should therefore not be seen as a response to actions by, for example, Europe – it is simply a matter of the Americans thinking that the trade deficit is too large and that they believe that it can be eliminated with tariffs.

However, it requires a complete rebalancing of the American economy before the trade deficit disappears – and here tariffs will not make a big difference.

There is therefore certainly no guarantee that we in Europe can convince the Americans to abandon the new strategy by eliminating tariffs, because lower European tariffs will not necessarily change the trade imbalances.