In every friend group, there’s always that one friend who plays the victim card or desperately seeks attention. Well, in the West’s alliance, that friend happens to be the United States.
With the Ukraine war as their stage, the US has positioned itself as the mighty savior, urging the EU to abandon Russia and join them on a quest for supremacy.
But let’s face it, Russia didn’t get defeated, instead, it is winning every other day. Instead, the EU finds itself on the losing side, with shattered energy ties, and crumbling economies, and now, to add insult to injury, the US literally choking the EU economy. If one remembers, Biden had introduced a law to lure European companies into shifting entirely to the USA.
The Economic Blitzkrieg
As gas prices soared, European companies in industries like steel and fertilizer started fleeing to the US, enticed by more stable energy prices and generous government support. Truly, the wonders of subsidies!
The Biden administration is leaving no stone unturned in incentivizing this exodus, using acts like the Inflation Reduction Act to lure companies to American shores. With legislation like the Bipartisan Infrastructure Law, the CHIPS & Science Act, and the IRA, the US plans to spend a whopping $2 trillion over the next decade to boost its economic competitiveness, innovation, and industrial productivity.
World was watching for the EU to strike back, and it seems they have finally woken up from their slumber. In an unprecedented move, the EU is ready to impose penalties on none other than the USA.
EU imposing Penalties
Bernd Lange, an EU lawmaker and head of the European Parliament’s trade committee, is proposing taxes on US-produced hydrogen as a response to the US Inflation Reduction Act, which aims to increase green investments but conveniently favors domestic production with its “Buy American” clauses.
Lange is also calling for a more assertive approach to EU trade policy, rather than promising to talk with the Americans.
The Inflation Reduction Act offers tax credits for hydrogen production, a key element in low-carbon steel production and clean tech. But Lange isn’t impressed. He criticizes the triple subsidies offered in the US, allowing them to achieve an unacceptable hydrogen price of $2 per kilogram, while Europe struggles at €9. It’s simply outrageous, according to Lange.
With five anti-dumping measures on US products already in place, the EU seems to have decided that it’s time for a harsh answer to the US’s economic assault. China faces 96 such tariffs, and now it’s the US’s turn to feel the heat. The EU is gearing up for a battle, and they won’t back down easily.
Thank god, the EU is realizing the elephant in the room. The EU is finally showing some backbone and taking a firm stand against the economic assault unleashed by Biden and his cronies. Will the US be able to withstand the retaliatory measures? Who knows. But yes, this is going to be a battle worth watching because Biden may also drag WTO in his gamble.