Wednesday, May 16, 2018

The 'Iran-Tax'

N-TV, Germany's commercial news network carried this story, and it's a remarkable piece.

If you remember from the past week, President Trump's comment over the Iran nuclear deal was terminated (non-deal).  The EU is naturally upset.  Various companies in Europe were set to make money off the business side of dealing with Iran.

So today, the EU Commission got into the middle of things.  They suggest that they can activate a EU-mechanism.....called a "blocking statute". 

The EU would then negatively reward (penalize is a better term) all European companies that comply with the US economic sanctions against Iran.

Course, you would start to ponder this....there would be a loss on US sales?  Well...yes.  So there's another mechanism built where the EU would be compensated for the losses involved.

In general losses for the EU, if you use 2017 numbers?  Around 10-billion Euro a year for general trade.  The BBC reported that a week ago.  But wait, there are several mega deals on the table (AirBus was set to sell 100 passenger/cargo jets to Iran, SAGA had a 3-billion Euro deal on energy, Siemens had a locomotive deal on the table, and Italy had a billion-Euro deal on the table for rapid-rail). 

Add up the numbers and you can figure an average of probably 20-billion Euro for the next twelve months, and to repeat that again in 2019, and maybe in 2020.  Totalling.....sixty billion Euro that the EU would have to come up successfully 'force' the companies to comply with Iranian trade for three years.  And if Trump is still around for four more years?  Well....yeah, this could end up being near 150-billion Euro  for the whole Trump era , until some Obama-like character appears to 'save' the day.

Where would the sixty billion Euro come from?  Yep, that's a curious question. 

The EU would have to tax every citizen of the 'empire' to throw money into the pot, and then each nation would transfer the money to the EU, who would then disperse this out to the companies claiming a loss.  The odds of corruption being done by the companies?  Well....yeah, it's best not to bring this up to the working class Germans.  You can probably figure another one or two billion in over-inflated get compensated by the companies.

Triggers for inflation?  Yes.  Oddly, all of this would come after the British leave the EU. 

Just standing there and watching EU intellectuals explaining this on German chat forums, and how the money would just come from some EU pot, and eventually....some dimwit in the audience would explain to the intellectual that he'd have to work an extra twenty hours this year to shovel his contribution into some 'Iran-tax' pot. 

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