In these anxious, uncertain times, we can be confident about two things: one, almost the entire world thinks the United States is led by a dangerously deluded imbecile; two, the part of the United Kingdom whose economy is best equipped to withstand his whining, preening malice is London. Take comfort from these things because, in combination, they might fortify the whole country against the shock waves of today and set it on a path to better things tomorrow.
Why the optimism? Have I been watching that Pharrell thing again?
First off, don’t get too happy. I’ve yet to see any assessment of the likely effects of Donald Trump’s trade tariffs on the UK that doesn’t make for unhappy reading. If there is one, it’s probably been written by Liz Truss. Secondly, the assessments I have seen do not indicate that the entire UK’s perennial heavy dependence on London is set to lessen. If anything, the opposite will occur. But dark days demand seizing hope and consolation when we can.
Two reports have estimated how the sales tax the White House weirdo is imposing on his own electorate at everyone’s expense will harm UK exports by city and by region. According to these, their ill effects will be widespread but uneven.
Think tank Centre for Cities has deduced that London won’t be hit too hard because the tariffs are being imposed on exports of goods, not services, and London’s economy is highly service-orientated. For Coventry, Derby, Newport, Hull and many others, it’s a different story. The West Midlands, with its car and machinery production, is found to be the most exposed region. In summary, Trump’s tariffs “will serve to further reinforce the disparities in economic performance that already exist across the country”.
Commissioned by campaigners Best for Britain, economics consultancy Frontier Economics has modelled the various effects of closer UK-EU cooperation and Trump’s hostilities separately and in combinations. It finds that London and, to a smaller extent, the wider South East could actually be better off in terms of economic output thanks to Trump, again due to the large role services play in this part of England. Closer EU alignments in both services and good would help London too. In tandem with US tariffs, London would benefit most of all.
At this point it must again be underlined that London continues to be the UK’s most productive region, generating almost one quarter of all UK economic output and serving as a source of taxes vital to funding public services just about everywhere else. Londoners pay more in tax per head than they receive in public expenditure. That is the important sense in which it is absolutely (albeit politically unmentionably) true that when London does well, the whole country does well, even though Boris Johnson is among those who have said it.
How else might London – and, by extension, the rest of the UK – gain, or at least escape relatively unscathed, from the wrecking tactics of the arse in the Oval Office?
Well, London’s greatest rival as a provider of financial services worldwide continues to be New York, with London tops on insurance and foreign exchange. Put yourself in the position of a big business looking to hire such expertise. All else being equal, would you entrust your interests to a firm located in the capital of a UK with a national government going out of its way – possibly to a fault – to demonstrate its policy stability, or to one in the US that doesn’t know what stunt its madcap national leader is going to pull from one day to the next?
There are other hopeful upsides. Think, for example, about the international students and academics Trump is taking such gormless pleasure in persecuting. As London Higher has long argued, overseas under-graduates and post-graduates alike are vital to the finances of higher education in the capital and of positive benefit to the whole country, thanks to their talent and ambition. As Polly Toynbee has pointed out, the whole of Britain should be wooing academics at all levels, offering a welcome alternative to being hounded in a degenerating Land of the Free. Global London would love to have them.
Trumpism is vain, amoral, fraudulent and catastrophic, and its British imitators should be opposed and exposed at every turn. The British government, meanwhile, is stuck with having to make the best of its dealings with it. But maybe, just maybe, the damage the US President is inflicting on his homeland will give London a chance to limit the damage he wants to do to the UK.
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There is an opportunity for a reset if all parties get on the wagon and not chase low hanging fruit.
You want to invite talented people here then our language has to be welcoming, it has to be positive, it has to talk about aspiration, it has to talk opportunity, it has to talk about safety, it has to be dignified. Cue Mr Farage… Do you see the problem? At every turn you have someone who is either in Mr Trump’s pocket or Mr Putin’s. His supporters are not far behind.