Trade

Ultimatum time!

Brexit: No 10 startled by EU insistence that UK accept trade terms

Horrors!

Downing Street reacted in dismay as Emmanuel Macron led EU leaders in warning Boris Johnson that he must swallow the bloc’s conditions, in what appeared to be taken as a direct challenge to the British prime minister’s threat to walk out on the talks.

At a summit in Brussels, the EU proposed a further “two to three weeks” of negotiations but Europe’s heads of state and government offered Johnson little succour, demanding that he alone needed to “make the necessary moves to make an agreement possible”.

The intervention was evidently regarded as incendiary in No 10 as Johnson had said he would make a decision on Friday on whether there were grounds to continue the talks. In September, he had said that without agreement by the time of this summit the government would “move on” to focus on no-deal preparations.

This being how negotiations are done.

“Here’s our demands. Obey or no deal!”

“Well, if we could just clarify the details here?”

“Well, OK, we’ll change that little bit. But our demands, Obey!”

Somewhere around the 55th iteration of this the deal is done. Or, not, obviously. But that the “Obey!” bit has been done is about as remarkable as Boris or The Donald chasing totty.

Jeez

When did Robert Kuttner get his trade policy from Pat Buchanan?

In the COVID crisis, her recent writings and tweets have been far more solicitous of the effect on the WTO than on the U.S. economy. In a recent tweet, Hillman declared, “Everyone needs to keep saying it again and again. Tariffs are taxes on imports paid by American importers and passed on to American consumers.”

Apparently this is something that Kuttner disagrees with.

In fact, tariffs are a policy tool, not good or evil per se. And in the coming negotiations over how to reset the U.S.-China relationship, tariffs can be used well, badly, or not at all.

Well, yes, they’re a tax upon imports, paid by Americans, which mean that Americans will buy fewer imports. What’s the difficulty with understanding this, Bobby?

Not very free this trade deal

The UK mandate keeps the NHS out of any deal and upholds British standards on food standards and animal welfare, meaning Britain will reject any attempt to sell chlorinated chicken or hormone-fed beef to the UK….

As with all such deals, it’s a list of where we’re not going to have free trade.

What’s ‘ee talkin’ abaht?

Britain should negotiate trade deals with individual US states as a backstop while Boris Johnson tries to seal a post-Brexit free trade agreement with America, a former trade secretary will say on Monday.

Liam Fox will point out that four US states – California, Texas, Florida and New York – would be members of the G20 if they were independent nations, and that many deals could be struck with states, rather than the US as a whole.

While tariffs on goods can only be negotiated by Washington, deals on services, which account for the majority of Britain’s transatlantic trade, can be sealed on a state level, unlocking billions of pounds of business for the UK economy.

Not really, no. The US Constitution means that the Feds are the people who deal with trade. It’s not so much the over the national borders thing, it’s the interstate trade that they’ve a lock on, the Commerce Clause.

They are serious about this too. Back when FDR was trying to screw things up with the New Deal a farmer decided he’d not like to submit to the Feds telling him how much wheat he could produce or not. So, he said it was only for his own consumption therefore bugger off.

The Feds argued, and the Supreme Court agreed, that if he didn’t grow it then he would buy from some other farmer. Who might be across state lines. That therefore made restrictions upon his growing his own wheat for his own consumption a matter of interstate trade and thus something the Feds got to regulate under the Commerce Clause.

Brits selling insurance in NYC is sufficiently different to get around that, is it?

And so do we take over the world…..

Liz Truss, the new trade secretary, will promise to create up to 10 new tax-free zones at ports and airports in a move condemned by Labour as setting up tax havens and money-laundering opportunities along Britain’s coasts.
….
Those advising Truss on a new free port panel will include Eamonn Butler, the director of the rightwing, libertarian Adam Smith Institute, and Tom Clougherty, the head of tax at the Thatcherite thinktank the Centre for Policy Studies (CPS).

Tom, of course, used to be at the ASI. Thus does the march through the institutions continue.

As to the actual free ports – they’re really just large bonded warehouses and no one has been complaining about those.

Well, yes, guess so

Kim Jong-un, the North Korean leader, has condemned international sanctions on his country as the work of “hostile forces” to impede efforts to improve the living standards of his citizens.

That is pretty much what they are.

How to make the financial system safer

Ten years after the crash: have the lessons of Lehman been learned?
Our panel of writers considers what has changed – and what still needs to

OK, reasonable point for discussion.

Yanis Varoufakis:

Second, trade agreements must commit governments of poorer countries to minimum living wages for their workers.

Killing the ability of poor places to get richer makes the financial system safer, does it?

If only the young Mr North read his own material

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8. It’s all part of the “invisible government” that we take for granted. That’s why toryboy morons assume we can get rid of it. To them, these non tariff barriers are just protectionist devices cooked up by Brussels bureaucrats with nothing better to do.

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Pete North

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22h22 hours ago
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9. So let us put this to the test shall we? If JRM thinks deregulation to African levels is right for the UK let him put his money where his mouth is. Let’s let him pick one, from three containers of baby milk, to feed the latest of his brood.

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Pete North

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10. Then let’s lace one of them with powdered floor bleach and ask him to take the gamble. What then do you suppose the arsehole’s view on non-tariff barriers would be? I wonder.

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Pete North

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11. And if you think I’m building a straw man here, here’s Tim Worstall of the ASI’s worldview. They really do think like that.

http://peterjnorth.blogspot.com/2017/02/the-freedom-to-die-horribly.html …

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Pete North

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12. This is the mentality behind the Toryboy think tanks and BrexitCentral. They really genuinely don’t have the first clue. This is why they only talk about tariffs. Anything else is light years beyond their understanding.

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13. You would think that think tanks claiming to represent commerce would have a better handle on this but in the end they are free market dogmatists who favour their own scripture over real world evidence. London free marketeers are cult.

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14. What they don’t understand is how regulatory controls add value. Most trades in goods are not one of purchases. They are part of established value chains. Business wants to stay in business and its only fly by nights who want one off trades.

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Pete North

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15. In this the essential element of any value chain is trust. Supermarkets can but with confidence if they can see that trusted institutions have certified produce – and that in turn is peace of mind for the consumer. It also reduces waste and improves quality.

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16. Trade analysts will often say that an FTA doesn’t necessarily reduce prices, but it does improve the quality of value chains and trade facilitation measures removing bureaucratic overheads increase the profitability. This is why we have regulatory harmonisation.

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Sigh.

Yep. I – we – agree that trade and business is a multiple iteration process. We all end up trading with those we trust. On the grounds of getting what we asked for. Without that powdered bleach, unless a box of powered bleach is what we actually asked for.

Which is why we don’t think that regulation by the bureaucracy is all that important. Because people do trade with those they trust, trust doing that job of regulation rather well. Regulation does have its merits, most certainly. If all are following it then it means that you can take a flyer on some supplier you don’t know, who doesn’t have a reputation nor track record. As long as new entrants can afford to meet the paperwork costs of the regulatory standards of course. But then it’s not entirely unknown for people to lie about having followed the regulations, so it’s less effective than it might be.

Note that this isn’t the view merely of some Tory Think Tank Boy. I supplied much of the world – for a decade – with its desires for one specific metallic element. As far as there was any international standard for the material I wrote it. The thing I was really selling was that I delivered what I said I would when I said I would. When I didn’t – mistakes happen – I corrected matters. That’s why I got repeat orders.

Quite, regulation matters, but who is doing the regulating? That trade works on the basis of trust means that trust – and verify! – works. The bureaucracy might be nice, might not, but it’s not necessary.

I did, in those metal days, have one intervention with that regulatory apparatus concerning international trade. A bloke in the US bureaucracy wanted a sworn statement that 10 kg of scandium oxide was not an animal product.

Most useful, that declaration, most useful to all concerned.

Bit of a surprise

America’s International Trade Commission (ITC) overturned a decision to impose 292pc trade tariffs on the C-Series jets, which are being sold to US airline Delta.

The levies would have massively ramped up the cost of the 75 aircraft and likely caused Delta to cancel the contract.

But, in a surprise ruling, the ITC rejected a complaint brought by Boeing, voting 4-0 in favour of Bombardier.

The court rejected Boeing’s claims that it suffered injury in the case.

That ITC is less politically directed than I had thought.

Amusing that they’re still bloviating about this

The U.S. Commerce Department on Wednesday finalised steep anti-subsidy duties on Bombardier Inc’s CSeries jets, setting up the next round of a fierce international trade dispute between the United States and Canada.

The move announced by the department to impose duties of nearly 300 percent stems from a complaint by rival Boeing Co.

The company claimed Bombardier had been unfairly and illegally subsidised by the Canadian government, allowing the planemaker to dump its newest jetliner in the U.S. market below cost.

“Today’s decision validates Boeing’s complaints regarding Bombardier’s pricing in the United States, pricing that has harmed our workforce and U.S. industry,” Boeing said in a statement after the department decision.

Delta Air Lines, the second largest U.S. carrier by passenger traffic, has an order for 75 of the 100-to-150 seat CSeries jets.

Airbus now owns 50.1% of the Bombardier C Series. They will be assembled inside the US as a result.

Both Boeing and Wilbur Ross will be able to go fuck themselves.

Trade was always the worry, wasn’t it?

Mexico may be forced to pay for the building of a wall between itself and America through an aggressive 20 per cent tax on all its exports to the United States, the White House said last night.

As Mexican President Enrique Pena Nieto refused to fund the estimated $15 billion cost of the wall, and cancelled a visit to the US next week, President Donald Trump vowed to renegotiate the North Atlantic Free Trade Agreement.

He said: “The US has a $60 billion dollar trade deficit with Mexico. It has been a one-sided deal from the beginning.”

His spokesman Sean Spicer later said there were plans to “tax imports from countries that we have a trade deficit from, like Mexico”.

He said: “If you tax $50 billion at 20 per cent of imports, by doing it that way we can do $10 billion a year and easily pay for the wall just through that mechanism alone. That’s really going to provide the funding.”

Mr Trump has discussed the proposal for a 20 per cent import tax on Mexican goods with Republican leaders in Congress, and wants it to be part of a comprehensive tax reform package.

That’s Americans paying for the wall then…..

A liberal arguing against competition

Melton Mowbray pork pies, stilton cheese and British-made chocolate such as Cadbury’s could be under threat from Brexit, the former deputy prime minister Nick Clegg has warned.

Speaking to a food and drink industry conference on the impact of leaving the European Union, Clegg said it was possible that European rivals would start producing lookalikes to British foodstuffs if they lost the legal protection from imitation offered by EU rules.

“Outside the EU they won’t enjoy the appellation bestowed on those products and I would have thought other countries would take advantage of that pretty quickly and put products into the European market that directly rival those protected brands,” Clegg said.

Then again, it is Nick Clegg, not an actual liberal.

Clegg said that food import tariffs were there to protect British as well as German and French farmers. He added that it would not be in the national interest to unilaterally remove them as this would remove the UK’s bargaining power when it was trying to gain access with trade partners for exports such as legal services and accountancy.

This is the fucking heir to the party of Cobden. Oh Woes, Eheu Fugaces, tempora mores.

Oh dear

He added: “We’ve got to change the culture in our country. People have got to stop thinking about exporting as an opportunity and start thinking about it as a duty — companies who could be contributing to our national prosperity but choose not to because it might be too difficult or too time-consuming or because they can’t play golf on a Friday afternoon.”

Contributing to national prosperity is not a duty of anyone or anything. Let’s not come over all fascist here, shall we?

I wish someone would tell me where this is

This is a continual claim:

One of the legitimate complaints against the EU is its determination to drag us into treaties that claim to be about trade but are really about releasing multinational corporations from democratic control. Three of the agreements it is trying to impose – the Transatlantic Trade and Investment Partnership (TTIP), the Comprehensive Economic and Trade Agreement (CETA) and the Trade in Services Agreement (TiSA) – make a mockery of parliamentary sovereignty.

They threaten to reduce to the lowest common denominator the laws protecting us from predatory finance, the exploitation of workers, food adulteration, climate change and environmental destruction. They threaten to force the privatisation of public services.

Specifically that privatisation. I have at least skimmed two of those three. And I cannot find anything, anywhere, which advocates, insists upon, determines, hinders or advances privatisation.

I can find things which say that if you do privatise and then reverse then compensation must be paid but that’s a standard part of current law anyway.

Anyone help me out here? Where is this insistence or advancement of privatisation?

Isn’t this fun about Philip Morris?

An international tribunal has unveiled a secret ruling confirming it rejected a bid by tobacco giant Philip Morris to sue Australia over its plain packaging laws, calling the attempt “an abuse of rights”.

In its heavily redacted 186-page ruling dating from 17 December 2015, the permanent court of arbitration said it had no jurisdiction over the case brought by Philip Morris.

There’s lots of heavy panting about the ISDS provisions in TTIP and TPP. And this Philip Morris case is eternally used as an example of how terrible it all is. But, but, corporations would be able to sue governments!

Yep, they can. And look what happens: often enough they get sent away with a flea in their ear.

ISDS gives people a neutral court venue to sue a government. It most certainly doesn’t say that they’re going to win.

Caroline Lucas sure is dumb

Green MP Caroline Lucas said that access to documents on “this hugely significant trade deal” was necessary before UK parliamentarians were asked to vote on it. “But the bad news is that a cloak of secrecy still surrounds TTIP. If the same rules apply here in the UK as they do in Brussels, which is what the minister is implying, then MPs will be bound by a confidentiality agreement if they want to see the text,” Lucas said. “This opaque process, which shuts citizens out of this crucial debate, is profoundly undemocratic.”

MPs don’t have all that much say in the matter actually.

And when we have a final text, it’ll be governments and MEPs who decide.

Oh, and the reason for the secrecy? Because it’s a document still being negotiated. The final text will be public.

Pillock of the day

Yep, if we let foreign investors into the NHS then all that money that is paid to doctors, to nurses, to porters, all that cash spent on water, electricity, land, every single penny of the £120 billion a year we lavish upon health care for the citizenry immediately flows abroad, doesn’t it?

Pillock.

The only part that can possibly flow to foreign investors as a result of privatisation is the profit. And the profit is, by definition, the amount that is being added in value. So, they send their capital in (and we get the use of their capital, Yippee!) and if, and only if, they manage to add value do they get that profit stream back.

Adding value = we get more health care for less of our money.

Pillock.

BTW, do note the implication of his argument. The more locally the cash circulates the better. Thus I should never buy anything outside my own household because that makes the cash move outside my household. And thus, by his argument, makes me poorer.

Pillock.

He’s arguing that I am made poorer by buying my bananas from Tesco rather than building a greenhouse to grow my own.

Pillock.