UK trade with the EU plummets but surges with non EU countries

As opposed to Germany making the conditions most favourable to them wait what's that they want low steel prices?

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The powerful always screw the less powerful, the EU keeps commodities like sugar from African and South American countries out of the EU because they are too weak to oppose the EU. China will do the same to the UK because they can and they will. Thats not to say its not beneficial to both countries but the more of the benefit go to the more powerful country.

The powerful don't always screw the less powerful. Grown up negotiations are two way mutually beneficial deals.

Switzerland for example is a tiny country compared to most. But it successfully negotiated trade deals.

Read up on comparative and competitive advantages.

The powerful always screw the less powerful, the EU keeps commodities like sugar from African and South American countries out of the EU because they are too weak to oppose the EU. China will do the same to the UK because they can and they will. Thats not to say its not beneficial to both countries but the more of the benefit go to the more powerful country.

I think this is a misdiagnosis of both cause and effect of tariffs.

No country ever benefits economically from refusing to import from anyone, for precisely the same reason I don't benefit from refusing to import from Tesco. At worst, Tesco is not offering anything I want, in which case I don't trade with them anyway. At best, they are offering the best price on something, and so I would be throwing my money away by buying it somewhere else.

Tariffs are not about improving the economy of the country imposing the tariffs. They are about benefiting certain protected industries and their owners against other people within the same country

Tariffs are political, not economic.

Tariffs are not about improving the economy of the country imposing the tariffs. They are about benefiting certain protected industries and their owners against other people within the same country. EU sugar tariffs don't transfer money from Africa to the EU; they transfer money from EU citizens who don't produce sugar to EU citizens who do produce sugar.

Tariffs are political, not economic.

The powerful always screw the less powerful... [t]hats not to say [free trade? is] not beneficial to both countries but the more of the benefit go to the more powerful country.

Those who impose tariffs believe that they are improving the economy of their country. It is a widely held fallacy.

China will be more than happy to screw Britain by making us accept cheap steel that cost UK jobs.

The Chinese are going to make us pay less for an incredibly common staple material but this is bad because it will reduce the supply of an already tiny source of employment in this country.

I cannot parse this otherwise than that the interests of those handful of people are supremely important and that the interests of the general population are irrelevant.

You made claims about the economic effects of tariffs:


If your position is that no important harm to the British economy would result from leaving the EU because of changes in trade terms, then we are in agreement.

That is probably widely believed by casual supporters of tariffs. But look at what Maker has said:


The Chinese are going to make us pay less for an incredibly common staple material but this is bad because it will reduce the supply of an already tiny source of employment in this country.

I cannot parse this otherwise than that the interests of those handful of people are supremely important and that the interests of the general population are irrelevant. He has made no attempt to disguise, even to himself, that the Chinese are benefiting the vast majority of British people, who buy but do not make steel. Including of course export industries like Rolls Royce that use steel as a raw material.

One thing to bear in mind is that this country has been historically opposed to tariffs, to a far greater extent than most others. The belief that tariffs are good for the general welfare is therefore perhaps not as widespread here as in other places. One benefit of Brexit would be the ability to dump tariffs that are imposed on us for the sake of the protectionist continental states.

You've overlooked part of what Maker said.

He said that putting steel workers out of a job would "screw Britain". This is isn't about protecting steel workers as special.

This is a belief that the only consequence of an action is the consequence at which the observer is looking. That is the fallacy. The only consequence so far as Maker is concerned is that steel men will lose their jobs and that, virtually everyone would agree is a bad thing. Cheap steel doesn't mean more aero-engines in Maker's world because Maker isn't looking at aero-engines, If Maker was looking at aero-engines,nothing would happen to the employment in the steel industry if the price of steel was increased by prohibiting imports. The only consequence of dear steel would be that we would sell fewer aero-engines.

The classic example of this fallacy was the reaction to the last Foot and Mouth outbreak.

Well it's being fairly widely reported that the Chinese government is dumping steel into the market at below cost price. If true that's a long term strategic move aimed at screwing everyone. I'm surprised everyone seems to cheerfully assume that we're looking at the effect of an unmanipulated market that's functioning the way GCSE economics textbooks say it should.

I'd think RR would be one of the steel using companies to suffer least from high steel prices, the majority of the cost of the jet engine is surely the hi-tech manufacturing processes & know how. Just because coca-cola is made of 99% water doesn't mean the company's particularly worried about the cost of water supplied to the bottling plant doubling.

It depends on why steel from China or any other country should be significantly lower than steel made in another country. If China is giving government subsidies to its own steel industry to lower prices, than that is unfair because the price is not the true cost.

The effect would be to reduce the amount of steel made by other countries as their own steel producers would not be able to compete and go out of business. This then gives Chinese steel producers a window to increase prices substantially before new capacity in other countries can be built.

I think making commodities in high cost countries like Britain is uneconomical and likely to fail. Britain needs to leverage its resources better rather than try to compete with low cost countries like China and India making generic products.

I'd think RR would be one of the steel using companies to suffer least from high steel prices, the majority of the cost of the jet engine is surely the hi-tech manufacturing processes & know how. Just because coca-cola is made of 99% water doesn't mean the company's particularly worried about the cost of water supplied to the bottling plant doubling.

I don't think it does depend upon that. If Tesco offers something I want at half price clearly their goal is not to make me happy but to entice more people to buy from them rather than from other supermarkets, but I am still better off buying from them than 'tariffing' them and buying from another supermarket anyway.

If the PRC's government is subsidising steel to for instance paper over economic problems to avert constitutional reform or civil war, it is absolutely in our interest to take the cheap steel the PRC is offering us rather than buying from Corus at a greater price. Britain is getting a free lunch here because Britain is more stable than the PRC and therefore does not need to subsidise industries to avert the collapse of our constitution or civil war. We can let Corus (which isn't a British-owned company anyway) collapse and take the improved living standards that come with lower commodity prices.


If you think so you should be buying shares in other steel producers or you should be buying and stockpiling steel, because the price of steel is certainly going to increase in the near future.

Question: if you have this insight, why doesn't the market? If the market does have this insight, why is the steel price dropping at all, when increased PRC supply should be being matched exactly by increase demand from speculators? Why would we want to stop our speculators from e.g. stockpiling this below-cost steel in the UK for later use, by tariffing it?


Hence Britain should not damage high value added producers and exporters like Rolls Royce and Aston Martin by making them pay more for steel in order to prop up a low value added company like Corus that is probably doomed anyway.

If Tesco is reducing prices by half, its goal is not to make you happy but to drive its competitors out of business with the long term aim of increasing prices so the consumer loses in the long run.

If Tesco is reducing prices by half, its goal is not to make you happy but to drive its competitors out of business with the long term aim of increasing prices so the consumer loses in the long run.

I am sure people in the know has already bought steel futures if they are available but these low prices may fall yet lower so its a gamble like most types of speculation.

On the point of going lower, I recall reading an article about a week back in the FT that suggests that based on various metrics commodities have more or less bottomed out now, hardly surprising given that the likes of Britain have been priced out of the market so now it's a case of the Chinese moving to the equilibrium point to maximise profits.

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