By on November 14, 2008

Quick, what do egregious bailouts have in common with the invasion of Iraq? Sticklers for a little-known concept called “international law” aren’t fans of either. And this time they could actually sue. “We will look very carefully at the details of the proposed aid package to the U.S. auto industry, in order to ensure compliance with international trade rules and assess the potential impact which it may have on trading partners,” Peter Power, trade spokesman for the European Commission told CNN yesterday. The World Trade Organization prohibits a range of subsidies that unfairly hurt competitors, and with pro-bailout rhetoric hitting new heights in “whatever it takes” shrillness, there’s a chance that good intentions will translate into a WTO lawsuit. After all, Europe and the US are already beefing over a number of trade issues, from aerospace subsidies to agriculture. In fact, it’s possible that Bush’s resistance to bailout plans is a result of his humiliating retreat from steel-industry protectionism some five years ago. Then, as now, a struggling industry needed his help, and help he did. Until the EU threatened $2.2b in retaliatory economic sanctions. Sue me once, shame on you…

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13 Comments on “Bailout Watch 182: EU: You’ll Be Hearing From Our Lawyers...”

  • avatar

    Can it be that international laws will come to aid of American citizenry? We’ve traveled far.

  • avatar

    It is good to hear that the EU has started acting on this. I was already wondering …

    The US has been on the forefront in the last 60 years requiring the world to open up their markets, cut down on tariffs, and let their own industries die in case US products where just better. No protectionism of local industries was allowed. And now, suddendly, when the D3 are going under, everything is different?

    The US has already lost credibility on the human rights front due to Irak, Guantamano etc. It is losing the fight for free markets as well if it rescues the D3.

  • avatar

    It boggles my mind that so many people piss and moan about Korea and Japan’s rules that make it difficult for the US cars to be sold there. Or they they claim that the Japanese government built the Toyota Prius. Yet, they don’t mind billions of tax dollars being poured into GM’s toilet.

    At least Toyota has the Prius (affordable, reliable, and profitable) to show for their supposed “government investment”. I don’t think Detroit will make anything, except for more executive compensation.

  • avatar

    $2.2b? Is that all? Ha!
    We can just pay them to go away, too. I bet $10b would shut ’em up fast!
    There’s money for everyone! (cue maniacal evil genius laugh)

  • avatar

    Yes, I was waiting for this.

  • avatar

    I’m pretty sure the one-worlders will not want to run afoul of international law.

  • avatar

    Yes, but will the current outgoing president and treasury secretary care about the long-term ramifications? I think not. They would rather bailout D2.8 and then simply utter ‘whatever lawsuits may come’ when they sign the check. Either we are part of the global economy or we are not. There is no middle point.

    For someone that is so black and white regarding a myriad of issues, Mr. Bush seems to be very gray regarding international law vis-à-vis financial matters.

  • avatar

    You guys are incredible. You really are. In an instant you’re ready to side with the most sanctimonious, hypocritical, U.S. hating people on the face of the planet, so long as their position meshes with yours on this issue. Have any of you ever heard of a little company called AIRBUS? Google it sometime. Know anything about privileged French and Germans more than happy to starve out and exclude Eastern Europe from their little “union” so that their high paid plumbers wouldn’t lose jobs? All from the people who value unity and multiculturalism? You think they value capitalism? free trade? small gov’t? Ha!

  • avatar

    @ br549
    “You guys are incredible. You really are. In an instant you’re ready to side with the most sanctimonious, hypocritical, U.S. hating people on the face of the planet”. Ugm. br549, ask your doc to adjust your medication. It is either not working or overdoing it. We are not talking Afghanistan or Iran here, the article is about Europe. In case you forgot, some (majority for now) of us came from Europe, Europe is the biggest investor in US and our NATO partner.
    I live roughly a month per year in Europe due business obligation and frankly I did not encounter much hate. During the Mitterrand days in France there was not much (if any) antipathy towards us among ordinary French (I covered the worse case scenario). Different story about some French political circles and self proclaimed intellectuals as well as immigrants from Arab and Muslim lands (in 8-10 years they will be new French majority). Germany is mimicking us as fast as they can and England, well it’s like Canada :) .

  • avatar

    I will concede a little hyperbole on the “most U.S. hating” bit, but please allow a little poetic license. European anitpathy towards the U.S. is widely recognized. Any I would not consider the Mitterrand years as extreme as Chirac’s in that regard.

    But anyway, my main point was, and remains, that it is simply laughable, nay absurd, for Europe to threaten or lecture the U.S. as regards industrial subsidies of any shape or size. From agriculture to airplanes, they’re ready to throw gov’t Euros at anything to gain an edge. Airbus was created and backed by European gov’ts for the sole purpose of burying Boeing.

    For the B&B to sit back and say, “well you know those free-enterprise-loving Europeans got a good point there” is something I cannot let pass without comment.

  • avatar

    “Yes, but will the current outgoing president and treasury secretary care about the long-term ramifications? I think not.”

    Hmmm, I could have sworn that it was Obama who was wholeheartedly supporting the D3 bailout whereas Bush was opposed in principle (or at least wants the Colombia FTA in return).

  • avatar

    I’ve got some advice for the highly hypocritical EU. Unfortunately, this is somewhat of a family site. Do they have a blind eye toward Asia?

  • avatar

    Speaking from the perspective of a small country, I’d say there’s more than enough disingenuousness on the part of both the EU and the USA when it comes to subsidies and pious utterances on free trade.

    The Americans feel they never subsidized anything in their life, and that we Canadians unfairly subsidize lumber exports to the US. They take us to the WTO, and lose everytime. We haven’t got our overpayments of US duty back yet though. The Europeans like to think they’re highminded and are the repository of all advanced social thinking, and so keep out Canadian exports because our Inuit kill seals, etc. The US buys overpriced military jets, as a way of subsidizing Boeing. The EU keeps Airbus running, well, just ‘cuz.

    Puffery on both counts. I’m sure both the US and the EU have never done anything wrong themselves, beyond the usual over the top agricultural subsidies. Why no, never.

    I’m looking forward to a WTO fight between the pair, in no small part to see what convoluted, ridiculous arguments both sides’ lawyers will dream up to advance arguments.

    The WTO was dreamed up to make sure the little countries are always at a disadvantage of the big ‘uns. Basically a case of “don’t do as we do, do as we say”.

    I say, if you don’t follow the rules baked into international agreements, may as well give ’em all up, and slap tariffs on everything, just like the old days. That’ll solve things.

    It’s like this financial G20 summit in Washington. Bush, in all his elemental glory, is insisting that there’s no need for world financial regulatory reform. Why it’s just fine. Our idiotic prime minister Harper is toeing the US line. I mean, if there’s nothing wrong with regulatory policy, why are we in this f*****g mess? Meanwhile in Canada, we have different stock market regulators for each province, which in this day and age is bullshit. So Harper’s one to talk.

    Right now, everyone’s in the “it’s all your fault mode”, and the “let me adjust my blinkers so I can studiously avoid giving any credence to your argument mode.”

    BS from start to finish. Just a lot of flailing about.

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