The trade war continues to escalate as Europe has threatened the United States with $300 billion worth of tariffs. The threats come as a retaliation against the US, which insisted on moving forward with duties on European cars.

US President Donald Trump recently threatened imports of European cars with a 20 percent tariff if Brussels doesn’t remove levies and other trade barriers on US goods. Instead of removing the levies, Brussels ratcheted up the trade war and rhetoric by returning threats.

In a letter sent Friday to the U.S. Department of Commerce, which was seen by the Financial Times, the European Commission warned that Trump could trigger a devastating global trade war with his auto-tariff threats.  The EU insists it would be a trade war that the US could not win either. The letter did not lay out any specific measures, but only that the retaliation against the US would be forthcoming.

According to RT, in a written statement to the US Department of Commerce, Brussels reportedly warned that imposing tariffs on European cars “will be harmful first and foremost for the US economy.” According to the 11-page document, “an additional import tariff of 25 percent, applied to automobiles and automotive parts, would in first instance have a negative impact on US GDP in the order of $13-14 billion, and the current account balance of the US would be not affected positively.”

According to the document, European carmakers produced 2.9 million vehicles, or 26 percent of all American car production, in the US last year. Even without Chrysler, production by EU-owned companies in the US “still amounts to 16 percent of national production and 1.8 million vehicles.” The Commission noted that Chrysler was once “one of the traditional US ‘big three’ manufacturers” but is now of “European ownership.”

Trump said on Sunday that the European Union was just “as bad” as China when it came to the way most European countries traded with the United States. Trump also dismissed suggestions that his attacks on the EU were counterproductive and that he should instead strengthen relations with European countries to tackle the Chinese trade issue together. Talking about “the car situation” Trump told Fox News: “The European Union is possibly as bad as China, just smaller. . . It is terrible what they do to us.”

Global stocks picked upon the [trade war] tensions on Monday, with Dow futures YMU8, -0.49%  down nearly 150 points and the Stoxx Europe 600 SXXP, -0.77%  off 0.7%. In Asia, the Shanghai Composite SHCOMP, -2.52%   and Japan’s Nikkei 225 indexes NIK, -2.21%  each fell over 2%. –Market Watch

The ripple effects of any trade war will be felt by those regular citizens in the nations participating in such economic warfare, while the ruling classes of “elite” humans will be shielded from the effects of their policies.

“Around 60 percent of automobiles produced in the US by companies with exclusive EU ownership are exported to third countries, including the EU. Measures harming these companies would be self-defeating and would weaken the US economy,” the document said. It pointed out factually that cars would become more expensive and harder to sell further burdening the already doomed US economy.

The EU Commission president Jean-Claude Juncker is expected to meet with Trump in Washington this month.