Now they are all complaining. Europe has been taken advantage of and treated unfairly in the ‘deal’ with the US. The US is not showing any consideration for anyone. The European Commission has embarrassed itself. Europe should have shown strength and responded with trade restrictions, etc., etc.

The German Chancellor suddenly even knows that the tariffs and the weak US dollar will cause massive damage to German exports. Fifteen per cent higher tariffs and a 15 per cent devaluation of the dollar (since the beginning of this year) are impossible for most German companies to cope with without losing market shares in the US. The German current account surplus will decline significantly, with enormous consequences for economic policy.

The French Prime Minister even spoke of submission and a black day for Europe. If only it were that simple. If the French head of government had a good economic advisor, he would have held back in his response to the US. A good advisor would have told him where the root of the whole mess lies. He would have told him that America’s trade fury did not come out of nowhere but is the result of decades of huge US deficits in international trade. Donald Trump could also have taken the matter to the World Trade Organisation and sued Europe with a high chance of success. However, that would have taken years, and Trump would not have been able to savour the victory.

The wise advisor would also have told Monsieur Bayrou that France is indeed in a particularly difficult position because it has contributed nothing to the justified anger of the US. On the contrary, France has also suffered among the countries that have abused Europe and the euro as an export generator and at the same time reduced Europe to ‘competitiveness’ as the overriding goal of all economic policy efforts.

The Netherlands and Germany in particular (followed by Denmark and Sweden) have spent the last twenty to thirty years using all their political power to increase their competitiveness at the expense of others and to achieve foreign trade surpluses. Now it is the time for reckoning. Those who gain trade advantages by unfair means (as shown here, for example) must expect that one day the unfairly treated countries will strike back.

France, however, will also be hit, even though it does not belong to the group of mercantilists. Bayrou should therefore have said that all his predecessors in government are now paying the price for fearfully keeping quiet about the mercantilists and pretending that there was cause to celebrate European successes in competitiveness.

Overall, there is now clear evidence of enormous failure on the part of the European Commission, the ECB and the most important European governments since the beginning of the European Monetary Union in 1999. To this day, no one has understood how such a union works and how much the Netherlands and Germany have violated the rules of reason in such a union with their mercantilist economic policies (as demonstrated here a while ago). You cannot create highly complex systems that are supposed to prove themselves in an even more complex world and then put one tractor driver after another at the helm. Anyone who is surprised that Europe is failing need not look to the great events of world history; a glance at the personnel is enough.