BERLIN –– German Chancellor Angela Merkel raised the specter of a new global financial crisis as she warned of the potential fallout from a trade war with the U.S., saying tariffs on European cars would be “much more serious” than levies on steel and aluminum.

In an address to Germany’s lower house of parliament Wednesday, Merkel cited President Donald Trump’s threat of targeting U.S. imports of cars from Europe, which risk hitting Germany the hardest. She backed efforts by the European Union and U.S. negotiators to reach a deal this month.

“The international financial crisis, which ensured that we now act in the framework of the (Group of 20), would never have been resolved so quickly, despite the pain, if we hadn’t cooperated in a multilateral fashion in the spirit of comradeship,” Merkel said. “This has to happen.”

As the leader of Europe’s biggest economy, Merkel underscored her resolve to fight for the survival of post-World War II global institutions under attack by the Trump administration. At the same time, she renewed her counterattack against U.S. criticism of German exports by saying that the U.S. has a trade surplus with the EU if services are included.

“This is taking on the contours of a trade conflict. I don’t want to use words that go any further,” Merkel said in her speech. “It’s worth every effort to try to defuse this so that this conflict doesn’t become a war."

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(9) comments

BakersfieldEagle

Consumer spending + Investment spending + Government spending + Net exports = Gross National Product. Increasing net exports and put America first... everyone wins. Germany is mad because we are shredding its international "EBT card" paid by American middle class and blue collar workers.

kw2012

I thought all of the banks have been stress tested to prevent a financial crisis. That being said, Trump actually wants to reduces tariffs and subsidies. He offered Canada to mutually drop all tariffs and subsidies and Canada refused so Trump countered by raising Tariffs

rusoviet

Merkel first opened the gates to such that refuse to assimilate and now that she is headed for the legacy she so earned is doing what all frauds do - '....don't look there...look over here...I am the great Oz!"

necod

When "moderate" fascists of Europe don't get their way, they announce impending disaster on the World. Like Arafat & K on Middle East when not get their parasitic ways.

I'm not here

Merkel has a point. The US does run a trade surplus with Germany when including all trade categories i.e. services. Also, as with Canada, some of the outrageous, price controls are meant to block specific unwanted US items because they do not meet the standard of certain countries. Canada and their high milk tariff keeps low grade US dairy (US really has over milked cows with poor nutritional values) from flooding Canadian markets. Euroland has higher standards for most agriculture products than the US exports specifically targeting weed control residues like glyphosate and genetically engineered crops. The US does not even bother testing Japanese imports for radiation like in rice resulting from the 3/11 nuclear meltdowns, the rest of the world still rejects most Japanese farm products.

So while there is always room for improvement in trade relations some protection barriers are meant to be for the good of the end consumers involved. China and others manage to dump slave/child labor produced products ever since being granted Most-Favored Trade Status since about 1980. (Seems not that long ago the US saved China from a Japanese invasion)

Gregregregreg

Merkle ought ro be more worried about the immigrant crisis that she and her international business class cronies have created inside their own borders. Ethnic Germans have so many abortions that they are not even replacing themselves. So they have to bring in foreign labor from africa and the middle east. You dont have to be a rocket scientist to see that this will not end well.

Bob McStench

So there will be a worldwide financial crisis because one less doosh bag buys a BMW?

cabo

America built the a Trade and Military alliance to defeat the Soviet Union and allow the rest of the world to grow. We succeeded. American went from 48% of global GNP to around 18% now (The rest of the world recovered). and the the Soviet Union ended in 1991.

It is no longer in the US interest to suffer $800B+ trade deficits (with stagnant wages & lower labor participation) and spend 4% of it GNP protecting free riders. A new alliance might be useful to deal with the emergence of China and help keep the peace. The US will could be a large contributor, but PAX Americana is ending. The other nations can Arm up and/or seek a new alliance structure.


For the last 40 years the stability that America build has benefits the world elites (US 1% income went from 10% to 22% of GNP), it has no benefited the average US citizen who paid its costs

SamJames

If Merle doesn’t want to trade war, she should lift the tariffs that have been imposed by her country against the U.S. Trump is that he is willing to reduce tariffs, Merkel should respond to that.

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