Europe responds to trade policy with political attack

The European Union is responding to clearly justified tariffs instituted by President Bush to protect the endangered U.S. steel industry with a cynical political attack on the president and U.S. trade.
The E.U. is drawing up its list of American exports on which it intends to place tariffs in retaliation for the president's steel tariffs. They intend to tax American steel, textiles and citrus fruit.
That list of disparate products was not arrived at by accident.
A European official familiar with the process told The New York Times that those products were selected with an eye toward domestic U.S. politics.
Citrus was chosen because of the importance of Florida to President Bush, who won the 2000 election by the narrowest of margins in that state. Steel was selected not only as a reprisal, but because of its importance to Pennsylvania and West Virginia -- also political swing states. And textiles were included because of the importance of that industry to North and South Carolina -- states that will be pivotal to the Republicans maintaining control of Congress in the 2002 elections.
This is not trade policy, it is political blackmail against a president of the United States.
Extortion: The European Union is telling President Bush that if he does not agree to compensate them in excess of $1 billion for the losses they anticipate due to U.S. steel tariffs, they will make his political life difficult. It is worth noting that the tariffs announced by the president were smaller than those sought by steel companies and unions, and were structured to keep European steel mills from increasing the volume of steel products they've dumped on the American market.
Other steel producing nations, the European Union countries included, took advantage of U.S. fair trade policies and backed this nation up against the wall. The very survival of a domestic steel industry was at stake. In four years, 31 steel companies in the United States filed for bankruptcy. Thousands of American steel workers lost their jobs. Tens of thousands of retirees saw their pensions and medical benefits reduced or eliminated.
Under the "safeguard" provisions of the U.S. Trade Act of 1974, it was perfectly proper for the U.S. International Trade Commission to recommend protection for the endangered steel industry. The World Trade Organization sanctions such emergency safeguards. President Bush's action, while it may have offended the sensibilities of hidebound free-traders, was necessary to protect an industry vital to this nation's well-being.
President Bush should tell the European Union that he will not be intimidated. He should point out that Europe's response threatens to turn a short-term effort to preserve the U.S. steel industry into a long-running trade war that will hurt everyone, but is likely to hurt Europe more than the United States before it's over.