surinenglish

Unwinnable wars

President Trump prefers not to learn from history. Turning his back on the experience of centuries, in the same way he has turned his back on the fight against climate change, the Trans Pacific Treaty, the G7, and other established international co-operation initiatives, Trump's tweeted political innovations just make many people nervous.

Any national leader who states baldly that if things go wrong he will lie his way out of any situation, and that the North Korean leader has the respect of his people because he had many members of his own family killed, hardly commands respect. Quoting national security as the reason, Trump put tariffs on imported products from the EU, Canada, China and Mexico, among others. "Trade wars are not bad," he commented, apparently forgetting - if he ever knew - that when the US did the same thing in 1930 with 20,000 imported items, the producing countries took counter-measures. US exports plummeted by 61% and the tariffs were soon removed.

Once again the affected countries have retaliated with unexpected consequences. It will be US wineries that will feel the effect. The defensive tariffs have made US wines 15-25% more expensive in China and many other countries, and largely uncompetitive with Australian, Chilean, Spanish, etc, products. Even little Georgia, that enjoys a free trade agreement with China, could end up selling more wine there than the Californians.

China, as it happens, has in the past behaved as badly as the US; in 2013 it taxed European wines in retaliation for the threat of limiting imports of Chinese solar panels. But Torres Wineries' director in China, Alberto Fernández, thinks the Californians will shrug it off. Why? Because the Chinese don't much like their wines anyway, preferring South American and Spanish varieties.

Whatever happens, wine-producing countries affected by Trump's trade war will lose sales to the US, but US wineries will see their sales drop too. Obviously such tit-for-tat measures are the stuff of which trade wars are made, which just goes to show what nonsense they are.