Tag Archives: Keir Starmer

Britain, Economic, Government, International trade, Politics, Society, United States

UK-US trade deal: Parliament must vote on any agreement

TRADE DEAL

Intro: Abolishing tariffs would be welcome for UK firms, but not at the price of reducing high regulatory standards or a reset with the European Union

LOOKED at dispassionately and objectively, a bilateral trade agreement between Britain and the United States is of relatively small economic significance to this country. Even ardent supporters of UK-US relations will find it difficult to argue otherwise. Back in 2020, for instance, Boris Johnson’s government estimated that a US deal “could increase UK GDP in the long run by around 0.07%” – a statistical calculation that is not exactly transformative. The view touted by some Brexiters that a US trade deal would fire up the entire British economy was always fantastical. Based on the assumption of a yearning for deregulation, there was little public support, even among leave voters themselves. Any urge of that kind now is even more delusional, in the wake of Donald Trump’s tariff wars.

The deregulatory alarm is hopefully a thing of the past. But global trade has new traumas too. Trump’s protectionist policies and bullying of US rivals are resetting the terms. There are nevertheless specific reasons why it is in Britain’s interest to pursue free trade talks with the US. Chief among these is the direct threat posed by current tariffs, especially on cars and pharmaceuticals. There is also the distinct prospect that a 10% tariff will be re-imposed on all UK exports to the US after the current 90-day pause ends in July.

The problem with any trade deal lies with the prices that the US may try to extract for tariff reductions or exemptions. And while the U.S. vice-president, J.D. Vance, has said that he sees a “good chance” of a deal, this could still be contingent on UK concessions in sectors such as agriculture, sanitary rules, and digital regulation. These are the same sectors that, for good reason, proved to be stumbling blocks in the post-Brexit discussions. Efforts to rebrand things like AI, biotech, and digital infrastructure, as strategically vital industries of the future, do not dispel some real threats now facing British food standards, healthcare, or online controls.

All this is multiplied by the Trump administration’s unreliability and geostrategic approach. Trump’s policy in Europe is to weaken and destroy the EU. Urged on by right-wing Brexiter politicians, the president sees pulling Britain away from the EU’s orbit as part of that effort. So, however, does the EU. As a result, any attempt by Washington to offer generous terms to the UK in particular sectors is likely to make any reset with the EU far more problematic. Sir Keir Starmer says that Britain does not need to make an either/or choice. Insisting that Britain can have its cake and eat it, that’s hardly the brutal reality being faced; neither the US nor the EU will necessarily take the same generous view that Starmer holds.

Even if the prospective UK-US deal is less wide-ranging than it once might have been, it is still significant. Politically, the Trump factor also makes any such deal more explosive. UK treaties and international trade deals are traditionally delivered under prerogative powers. As the Brexit argument about a “meaningful vote” showed, there is a very limited role for parliament. That needs to change. It would be intolerable in the UK-US case. This is clearly a matter for parliament to debate, both during and after negotiations, and for both houses of parliament to vote on.

In recent days, the Labour chairs of the Commons foreign affairs and trade select committees called for such votes. The Liberal Democrats and the Scottish National Party are both in favour. The UK government should make clear that no agreement will go ahead without a meaningful Commons vote in favour. Democracy cannot be usurped on this issue.

Standard
Britain, Economic, Government, International trade, Politics, United States

US tariffs: a show of coercive control

INTERNATIONAL TRADE

Intro: President Trump is wielding tariffs not as a policy tool but as an instrument of political pressure – rewarding loyalty and punishing defiance

THERE is a growing consensus that Donald Trump is embodying the French philosophy of Michel Foucault in that “politics is the continuation of war by other means”. Nowhere is this more apparent than his penchant for tariffs. He presents taxing foreign imports as a way to rebuild the American economy in favour of those workers left behind by free trade and globalisation. Quite clearly, he thinks that politics is not about truth or justice. It is about leverage and supremacy.

The UK is learning first-hand that Mr Trump, with his way of dealing and taste for spectacle, is an accidental Foucauldian – using tariffs as tools of loyalty and dominance, even against allies. If the U.S. follows through on Mr Trump’s threat to impose a 20% tariff on all imports, UK growth will suffer. The effect depends on the response. If the UK decided to do nothing that would mean GDP being 0.4% lower this year and 0.6% next. A global trade war would push that to 0.6% and 1%. Either outcome would wipe out the government’s fiscal headroom. The shrinking margins of the UK’s fiscal rules is making policymakers nervous. Trump sees no need to cloak power in objectivity.

His rationale and logic for imposing tariffs is confused. But two things are discernible. One is his self-styled image as the ultimate dealmaker; the man who can turn any situation to his advantage. The other is his view of politics as a means of structuring society to favour one group over another – not just economically, but in terms of legitimacy and who defines reality. Tariffs will probably be lifted if nations accede to Mr Trump’s wishes and, in doing so, reward politically useful constituencies, big tech allies, or his wealthy donors.

All three of these are visible in a paper-thin UK-US “economic deal”, likely to result in the lifting of Trump’s tariffs – if the US signs it. And, if so, that would further open British markets to US agribusiness; end the digital services tax, which applies to companies such as Amazon and Google; and make it difficult to hold AI companies, like those owned by Mr Trump’s ally Elon Musk, liable for harm. The danger is that whenever there’s a grievance, Mr Trump threatens tariffs – then offers to lift them if you do what he wants.

It’s even more blatant with the EU, which is expected to fine Apple and Meta under its digital competition rules. Regulation looks certain to become another front in the trade war. And that is troubling Meta’s Mark Zuckerberg.

What makes Mr Trump’s “Liberation Day” so dangerous is its scale. In 2024, the US ran a $1.2tn trade goods deficit. Just two months into his White House return, Mr Trump has imposed tariffs on goods from Canada, Mexico, China, all steel and aluminium imports, and foreign cars and auto parts. Asia will be next, including Japan, South Korea, Taiwan, India, and Vietnam.

What emerges is less of a trade policy than performance politics – where coercion, loyalty, and theatre converge. This is Foucault philosophy in action: power exercised not through rules, but through disruption and dealmaking that rewards fealty and punishes defiance. Like many others around the world, Britain is navigating a battlefield. Trump is no student of Foucault but he seems to grasp the lesson. For him, war isn’t the alternative to politics. It is politics.

Standard
Britain, Government, Health, NHS, Politics

The abolition of NHS England

HEALTH

Intro: The Labour Government’s shake-up of the NHS in England aims to cut waste and shift resources, but the looming funding gap raises doubts about its impact

THE UK Government’s decision to abolish NHS England – the world’s largest quango – was cast as a bold strike against bureaucracy. The move is designed to cut waste, “shift money to the frontline”, and by placing the NHS in England under direct democratic control. It is a declaration of intent from Sir Keir Starmer who wants Labour not to be the party of bigger government but the party of smarter government. That’s the theory, at least. The reality, as with most things in government, is more complicated.

The announcement happens to be less of a grand health reform and more a strategic positioning exercise. Wes Streeting, the Health Secretary, and the architect of this plan, is engaged in a delicate balancing act: convincing the Treasury that the NHS can stay within budget, while simultaneously lobbying for more money that he knows the health service will inevitably require. The cull of NHS England is a useful and headline-grabbing moment. It is one that will allow Mr Streeting to claim that he is shifting cash from managers to patient care, a necessary concession when preparing to argue for more Treasury investment.

The problem is that the numbers don’t add up. The savings from axing NHS England will be modest. The organisation’s cost to the Treasury is £2bn, a tiny fraction of the NHS’s £183bn budget for 2025/26. Of this, about £400m is spent on staff who work directly with local NHS bodies, and these roles will probably continue in some form. The savings come nowhere near enough to fill next year’s estimated £6.6bn funding gap. At best, it frees up a few hundred million pounds. At worst, it shifts costs elsewhere while causing months of upheaval in an already overstretched system.

The NHS faces mounting pressure to cut costs, with the Chancellor, Rachel Reeves, insisting that it must live within its means. Hospital trusts will need to tighten their belts even further. It does not take a health economist to recognise that when resources are cut, patient demand does not magically disappear – it simply resurfaces elsewhere. If community services shut-down to balance the books, then the pressure on GPs and A&E departments will only intensify. If the health service is told to do more with less, the risk is that it simply ends up doing less with less.

Sir Keir’s embrace of Mr Streeting’s reform agenda is a calculated gamble. The PM is backing an NHS overhaul that may not deliver as promised. His endorsement, however, bolsters Mr Streeting’s standing with the Treasury, which faces a looming fiscal shortfall. With tax rises off the table, and Ms Reeves’ fiscal straitjacket firmly in place, spending cuts after 2025/26 seem an inevitability.

The NHS may have won big in the last budget, but as the Darzi report warned, it remains in “serious trouble”. Years of under-investment and overcrowded hospitals, with no relief from an overstretched social care system, have left it desperately struggling. Without greater funding, it cannot meet the rising demand of an ageing population, let alone expand its workforce. The Health Secretary must keep pressing the Treasury for the resources he needs, cloaking each plea for cash in the fashionable language of “modernising reform”.

Such rhetorical agility is a skill that Westminster normally rewards. Consider, for example, how Universal Credit came into being. But whether he delivers on his three big shifts – moving care out of hospitals, prioritising prevention, and digitising the NHS – remains to be seen. If the health service deteriorates further, the government will soon find that it has not only failed to fix the NHS in England but has taken ownership of its decline.

Standard