Get ready for a trade war? Donald Trump has hit the European Union, Canada and Mexico with punitive tariffs on steel and aluminium and all three have vowed to retaliate.
If all you have is a hammer, every problem starts to look like a nail, and predictably the looming clash is being seen through a Brexit lens here in the United Kingdom – a painful reminder of how grim life outside one of the world’s major blocs will be and a dramatisation of the choice the UK faces after Brexit, of which rule-setting regulatory hegemon we want to be dragged along with, the EU or the United States.
But the truth is that, actually, the United Kingdom’s exposure to a trade war has very little to do with anything that has happened on this side of the Atlantic and everything to do with what’s gone on at the White House. Neither Canada nor Mexico – American allies who have, through reasons of geography as much as anything else, opted to adopt a greater level of regulatory alignment with the United States than the European Union – have escaped Trump’s tariffs. As for the protection of a larger bloc, well, that the entirety of the EU has been hit these tariffs gives you a clue to how valueless that line of argument is.
It is a reminder that the brave new dawn of exciting free trade agreements after the United Kingdom frees itself from “the death grasp of the protectionist EU” is all so much hot air, as George expounds in greater detail here.
But the biggest delusion that has been pierced is not about Brexit, nor is it confined to the United Kingdom. Emmanuel Macron and Theresa May might not agree on much but they have both frittered a great deal of political capital on the fantasy that if you say the right words in the right order, a light will go off in Donald Trump’s head and he will suddenly govern like a normal American conservative. The list of May-Macron failures is long: from the Iran deal that they begged Trump not to tear up, the Paris climate accord they cajoled him not to walk out, to the tariffs they hoped to flatter him into to not levying on them.
Each attempt has ended in failure, yet still, this morning, British ministers are talking almost as if the tariffs were some kind of misunderstanding and not the result of one of the few consistent principles that Donald Trump has stuck to throughout his corporate and political career. And if it a 25 er cent tariff won’t snap London and Paris out of that delusion, what will?
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