The Brief – Praise be Brussels for resisting the call o f mercantilism

The second term of Donald Trump has the golden MAGA emperor figure come ever closer to becoming a knock-off of the “Sun King” Louis XIV. While the Frenchman pursued ever greater excess, the Americans are chasing a toxic cocktail of respect and dominance.
With today’s would-be emperor announcing a 30% baseline tariff on EU exports from 1 August – on top of a blanket 10% on all goods, 25% on cars and 50% steel and aluminium – Brussels sees yet another existential challenge.
With trade ministers piling into the city to discuss the game plan, France was especially eager for a more combative stance, urging the Commission to adopt a “change of approach”. This comes after the bloc’s executive, which is exclusively in charge of trade policy for the bloc, hit the pause button on Sunday.
And though the Commission hasn’t shown the courage France would like, other influential voices have willed Europe to show some muscle.
“My advice to the EU is to go ahead and retaliate,” said US economist Paul Krugman. “Trump says he’ll raise his tariff even higher if it does, but how much more damage can he do?” he pondered. American consumers would eventually pay for the policy, he added.
Within Europe’s own ranks, Italy’s erstwhile PM and leading thinker Enrico Letta also feels the “time has come to react”. Similarly, the Parliament’s trade committee chair Bernd Lange said that “now we should start our first set of countermeasures.”
Sage counsel, one might think. After all, when punched by a bully, isn’t the best course of action to punch back?
Already the case for tariffs was made when China's stand-off with the US stoked fears of trade diversion. This argument is only made stronger given Beijing’s strategy to usurp climate-friendly industries.
This is a simplistic reading of the situation.

Brussels has grand budget ambitions. But without unanimous support from the member states, changes will be blocked. Here's where they all stand.

How budget fraudsters keep getting away with it – Brussels is failing to take simple steps to stop funds being wasted. “If we’re going to ask citizens to accept budget discipline, we should start by showing that the money isn’t being stolen,” said an EU official.
Keeping steak for cows – “Specific legal provisions should be introduced to protect meat-related terms,” reads a draft document that seeks to protect “cultural and historical significance”.

Progress in Brussels' government saga? – Brussels has been without a functioning government for 400 days. But a “creative solution” to fix the political deadlock is struggling to get off the ground.
Bayrou's budget bombshell – France’s Prime Minister will try to reduce the deficit by introducing austerity measures for the 2026 budget. But it could be his downfall.
Russian timber passes under the radar – Russian and Belarusian wood is still entering the EU despite wartime sanctions, as several member states push to delay enforcement of the bloc’s anti-deforestation law.

Today's issue of The Brief was brought to you by Nikolaus J. Kurmayer.