The European Commission, the European Union’s executive body, issued vast fines against two U.S. tech giants on Wednesday.
Apple has been told it must pay a $568 million fine, and Meta that it must pay a $227 million fine. The EU claims these penalties are about protecting consumer rights. That is a lie. These fines represent the extortion of successful American companies in order to serve less competitive European tech businesses and generate revenue for the EU. As the political and economic union explains, “This money is not earmarked for particular expenses, but Member States’ contributions to the EU budget for the following year are reduced accordingly.”
Google and X have previously suffered similar fines, and Amazon is under EU investigation. In turn, Trump should respond robustly and expediently to the EU’s attack on American businesses.
The key here should not be to exacerbate the U.S.-EU trade war, but rather to retaliate against the EU for this specific injustice. The truth is that free trade has definitively increased the purchasing power of the vast majority of Americans while also increasing the range of products available to them. Outside of Communist China, and bearing in mind the need to counter specific instances of unfair trade policy by other nations, free trade is a manifestly good thing.
This is not to say that we can’t develop a more inclusive economy. The United States education system and our college-first-and-always culture continues to prejudice against skilled labor training of a kind that would help millions of out-of-work people find well-paid and sustainable employment. There are already a great many job vacancies in the skilled labor industry, and even more should exist. China’s development of a vast and capable Navy and Air Force is cause alone for a massive domestic shipbuilding program, for example.
Still, a response to this unfair EU action is needed. The EU clearly believes it can extort American businesses without suffering major U.S. reprisals. Teresa Ribera, the EU official responsible for these fines, told Politico that “these are decisions that are not taken with passion,” but rather with “seriousness and evidence. It’s law enforcement.” Notably, as the Wall Street Journal noted, the EU did not hold a press conference to announce these fines. That the EU departed from this normal practice shows its concern about upsetting Trump.
But there should be a righteous Trump administration passion against these fines. Because what we’re ultimately seeing is anti-American jealousy at the fact that capitalist innovation has made the U.S. a tech powerhouse. Meanwhile, the EU lacks the self-awareness to see that its overbearing regulatory system has crippled its own tech industry.
Trump should thus make clear that whenever a U.S.-EU trade deal is reached in relation to existing tariffs, the U.S. will (including retroactively) apply a 200% measure of tariffs in response to any new fine unjustly imposed on an American tech firm. These tariffs should be targeted at the top three EU export industries to the U.S.: pharmaceuticals, industrial goods, and vehicles. For example, applied to the $795 million total of these latest fines, the Trump administration could impose $1.590 billion worth of tariffs spread across France’s Sanofi drug company and Germany’s Siemens industrial manufacturing company. Two hundred percent counter-penalties are needed to deter future EU action.
TRUMP’S CHAOTIC EUROPEAN DEFENSE SPENDING MESSAGING
The objective here would not be to build momentum for yet another trade war. Instead, it would be for the U.S. to protect its own interests alongside growing and mutually beneficial U.S.-EU trade. The two concerns must go together. Trump is wrong about generalized tariffs, but he has the responsibility to protect American businesses from unfair treatment abroad.
What the EU is doing to American tech firms has nothing to do with consumer protection and improved competition. It’s extortion, pure and simple. And it should not stand.
This article was originally published at www.washingtonexaminer.com
