Our trade deal with the EU has 'essentially collapsed'

The trade deal that gets all the media love these days is the TPP which deals with Pacific nations, but you may recall that we’ve been hammering out a similar agreement with the European Union for the past three years. But all of you free traders out there probably shouldn’t get your hopes up too much. According to some of the leaders involved in the negotiations, that deal is pretty much dead in the water. (Telegraph)

The European Union’s long-planned trade deal with the US has collapsed with negotiations showing no sign of progress despite three years’ of talks, according to Germany’s economy minister.

Sigmar Gabriel, Germany’s Vice Chancellor, claimed this weekend that disagreements between the EU and the US, and between countries within the EU, appear to have “de facto” killed off any prospect of a deal to create the Transatlantic Trade and Investment Partnership (TTIP), which would be the largest bi-lateral free trade agreement ever.

TTIP was envisaged as a wide-ranging free trade deal between the two enormous economic blocs, which European officials estimated would boost the EU’s GDP by €120bn, or 0.5pc.

Given the current climate on the United States political front it would be tempting to assume that skittish American politicos were steering away from this plan, but it turns out that it’s the Europeans who are driving the nails in this coffin. You might think Brexit is a big driver (and it’s certainly having an effect) but that seems to be a smaller portion of the picture as well. The Europeans are insisting that they, “must not succumb to American demands.”

Wait… what? We’re the ones who do almost all the giving in these negotiations and we wind up seeing more competition at home and fewer American jobs as a result. Our trade deficits tell the full tale, and the winners in these trade deals are generally everyone who suddenly gets expanded access to American markets and the chance to tempt more American companies to relocate overseas. But France is complaining that we could start competing in their farming and film markets and Germany feels that the deal would undermine labor standards. Seriously?

The biggest supporter of the deal was Great Britain, but now that Brexit is underway they aren’t really involved in the process. Instead, the Brits are quickly moving to work out individual trade deals with not only the United States, but China, Australia and others. What we should really be asking at this point is… what’s wrong with that? If we’ve got any shot at a realistically fair trade deal with anyone it should come from one on one discussions with individual nations. Each one has a unique economy with their own needs and resources to offer us in exchange. Painting such deals with a broad brush across multiple nations is almost guaranteed to leave us holding the bag in more than one area.

Let the Europeans remaining in the EU fight it out among themselves as far as I’m concerned. We’re the big dog on the block in terms of buying power and if they want greater access to our markets it needs to be in a way which benefits us equally and protects American interests.