Another week passes, and another Trump-era trade irritant between the US and EU has been partially resolved. This time it’s the 2018 steel and aluminium tariffs the US slapped on European metals on contentious national security grounds. Europe retaliated with duties on a range of US goods, and despite halting an escalation in tariffs earlier this year, they had more scheduled for December if talks between US and EU officials didn’t resolve things.
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A report by the US-based Climate Leadership Council argues that the American steel industry actually emits a low level of greenhouse gasses compared with competitors, and that it would in theory benefit from a carbon border adjustment mechanism — that is, a penalty aimed at imports that are less green, designed to level the playing field if domestic industry incurs higher costs by being environmentally friendly. This is a politically useful idea for Team Biden — it can protect its steel industry with green policies, and Europe loves green policies. That said, Brussels and Washington haven’t always seen eye to eye on such policies. So far, the US has not been keen on Europe’s developing ideas for a carbon border adjustment mechanism, and while Europe has gone down the road of carbon pricing, Biden has instead set out a plan to subsidise green technologies and regulate emissions standards.