SPRING FASCISM PREVIEW: Germany ‘heading back to the 1930s.’
Germany is heading “back to the 1930s,” a top economist warned on Thursday in response to the US tariff surge, as Chancellor Olaf Scholz predicted there would “only be losers” from a trade war.
Some of Germany’s top economists have reacted with alarm to tariffs of at least 20 per cent announced overnight by Donald Trump on the European Union, which will have a particularly severe impact on German carmakers.
“The 1930s are back,” said Carsten Brzeski, an economist at ING Germany, comparing the wave of trade barriers imposed by the White House to 1930s-era protectionist trade rules.
Mr Scholz, the outgoing Chancellor, described the tariffs as “fundamentally wrong” and warned that there “would only be losers” in terms of the global trade fallout.
“This is an attack on a trading system which has created prosperity all over the world,” added Mr Scholz, while his outgoing economy minister Robert Habeck complained of “US tariff mania”.
Germany is set to be one of the EU countries hit the hardest by the tariffs, along with France, the Netherlands and Belgium. Beyond Europe, developing or crisis-stricken nations such as Myanmar and Madagascar could be the worst affected overall.
Britain has been spared some of Mr Trump’s wrath, receiving tariffs of only 10 per cent as a result of being outside the European Union and able to negotiate its own trade policy.
The United States is Germany’s biggest trading partner for its juggernaut car industry, which is already struggling with increased competition from China and disappointing results in the electric car market.
The German car industry is worth an estimated half a trillion euros, with one German carmaker – BMW – selling one in five of its cars to the US market.
Mr Trump’s new trade barriers will impose a tariff of 25 per cent on German cars imported to the United States, a cost that will likely be passed on to US consumers.
Last year, the German left was racing to “deindustrialize” the nation with a self-administered Morgenthau Plan, so they should be thrilled that Trump seems determined to finish the job for them.
(Classical – and NSFW – reference in headline.)