It is stark staring obvious what Britain should do in response to Donald Trump’s tariff madness and wider economic sabotage. Get back into the European Union as fast as possible. Then join the European single currency and intensify European economic and security integration as a matter of urgency.
In his economic strategy speech this week, Keir Starmer largely ignored Europe and focused almost entirely on the Trump tariffs and an Aunt Sally of “globalisation”. He argued that “the world as we knew it has gone” in terms of free trade and economic integration. But that isn’t true of our very large part of the globe, because the European Union hasn’t gone anywhere. And it hasn’t been changed by Trump. On the contrary, post-Trump, like pre-Trump, the EU remains the world’s largest free trade zone and its most integrated pan-national economic market, far larger than the United States in population. And the EU is only marginally affected by Trump tariffs since the overwhelming majority of its trade is internal and not with the US.
Crucially, whatever the course of “globalisation”, it is a largely separate issue from European integration because the EU is a zone of prosperous nations, geographically and culturally aligned, which act through the EU as a single economic bloc and are highly integrated in terms of industry and labour force.
The EU’s approach to the other parts of the globe, while increasingly wary in terms of immigration, is not fundamentally hostile in terms of trade. On the contrary, the EU has worked to reduce trade barriers fairly consistently since its creation in 1957, both with developed and developing nations, allowing for concerns about agriculture in particular. And this won’t be changed by Trump unless Britain, France and Germany are taken over by extreme Trumpite populists, which isn’t happening in the foreseeable future.
For all Starmer’s talk of the UK as a “bridge” between the US and Europe, the reality is that Britain is in Europe, not the mid-Atlantic. Britain’s trade is less integrated with the EU than it used to be, but as a result of our 48 years in the EU, and our geographical position, we are still far more integrated with the Europe than with the US. More than 50 per cent of UK imports come from the EU, compared to only 10 per cent from the US, and more than 40 per cent of our exports go to the EU, nearly three times more than go to the US. And this is post-Brexit, the effect of which has been to weaken our trade with Europe without changing its fundamental dynamics. And the value of the lost European trade, estimated at about 4 per cent of GDP, dwarfs the benefit of a lower Trump tariff rate of 10 per cent rather than the EU’s 20 per cent.
Trump is dangerous enough, to our defence and our trade, even without making basic category errors. And the two category errors we must avoid are, first, to believe that the US is more economically important to us than the EU, when the reverse is true by miles; and secondly to assume that Trump’s decision to withdraw from global economic engagement means that “globalisation” is dead. The truth is that European integration is unaffected by Trump and so too Europe’s trade relations with the rest of the world besides the US—unless we choose to make the end of “globalisation” a self-fulfilling prophecy.
Starmer sensibly projects himself as cool and calm in the face of Trump. What is now needed is a cool and calm understanding of the reality that Britain will be fine—economically as well as in its defence—so long as it respects its European geography and invests mightily in European cooperation and integration. That doesn’t mean dissing or ignoring Trump but keeping him in proportion.
So far, Starmer’s European policy has been bold in respect of Ukraine and the Trump threat to Nato, but reticent in respect of Brexit and the Trump threat to trade. Why the difference? Until the Trump tariffs, one could argue that Ukraine required a bold and immediate strategic response, whereas reversing Brexit could be played long. After the Trump tariffs, both defence and the economy are equally compelling reasons for urgent and intensive engagement with our European partners.
What of the “Brexit reset” which is under negotiation with Brussels? This may result in some worthwhile changes, including a veterinary agreement and a new security partnership. But the fundamentals of UK engagement with the European customs union and single market are not part of the negotiation, so the reset is far too limited.
In key respects, UK-EU engagement continues to worsen despite the “reset”. Only this week, new requirements came into force for EU travellers to the UK to secure pre-travel authorisation, a cumbersome and expensive quasi-visa system akin to the ESTA requirement on European travellers to the US. A reciprocal bureaucratic nightmare is soon to be applied to UK travellers to the EU. This is a major impediment to trade and travel which should have been negotiated away by Starmer immediately on taking office, as part of the Brexit reset.
The correct strategy for Britain is clear: reverse Brexit. Building a “bridge” to Trump should be in addition to this, not in place of it. Otherwise the result is likely to be not so much a bridge as a sandwich, in which Britain is squeezed between the US and Europe.
