46 SOCIAL SCIENTIST and Belgium. In other wards, it would create an insurmountable obstacle for roughly a quarter of the entire steel export of five to six million tonnes of the Ten to the U S, striking at the heart of their efforts to reconstruct. Bending under the US monopoly pressure in weeks of hard negotiating, in early August the European countries finally agreed to a proposal. The EEC would reduce their share of the U S market from more than 6 per cent to 5.75 per cent and phase out all government subsidies to their steel companies by 1985. In return the U S government would drop its plans to impose countervailing duties on European steel imports. But the 'Allies' were in for a shock. The American steel industry out-of-hand rejected the accord and in Washington angry EEC representatives broke off all negotiations with the American government representatives. Britain, facing the harshest penalties of any European steel producer, made no secret of its dis< pleasure. Bill Sirs, General Secretary, British Confederation of Iron and Steel Trades, warned that the EEC would try to prevent American goods from coming into Europe. The EEC had even earlier threatened that if the U S government imposed additional tariffs and duties on steel imports, the EEC might retaliate by running its own challenge to a two billion dollar "DISC" tax subsidy for all U S exporters. The U S government is still discussing whether the additional levies will be imposed. Just a week after the first salvo in the 'steel war' had been fired, came the unilateral announcement of the Siberian gas pipeline embargo, on June 18. Termed in Western circles as "The Deal of the Century", in July 1981, West Germany and the Soviet Union arrived at an agreement for the construction of a gas pipeline to Western Europe from Urengoi in eastern Siberia, to feed 40 billion cubic metres of natural gas, annually, to a number of countries belonging to the EEC. In the first instance, the gas would be supplied to West Germany, France, Italy and Austria, with West Germany taking about one-third of the total. Later the supply would be extended to Belgium, Holland, Switzerland and Spain. The project was to be completed in two years, at an estimated cost of ten billion dollars, and the gas was to start flowing from January 1984. Various European companies have contracted to supply the pipes and equipment for the 125 compression pumping stations. Fulfilment of these orders will not only mean billions of dollars worth of equipment to be manufactured in Europe, but also in effect provide about 20 million work-hours—thousands of jobs—and a permanent trade of European goods against Siberian gas, of around 10 billion dollars a year by the end of the 1980's. It is this prospect of trade and employment which is threatened by the Reagan Administration's embargo. The embargo was originally