Best Of

Robert Peston
@Peston

Starmer has organised his military coalition of “willing” nations to defend Ukraine against Putin in the event of a peace deal. My conversations with senior government officials, business leaders and economists reveal a hunger for Starmer - or Canada’s Carney, or any elected leader of a sizeable democratic nation - to organise an “economic coalition of the willing”, to champion free trade against Trump and his tariffs.

The concept, half of which I have explained before, is to counter Trump’s bullying trade tactics - tomorrow’s announcement by him of tariffs on all imports to America - by threatening collectively to impose tariffs on America’s exports double or treble whatever his tariff rates turn out to be.

This in itself would terrify American manufacturers and farmers, if it was a collective threat by the UK, Canada, the EU, Switzerland, Japan, South Korea, Mexico and Australia, inter alia.

If simultaneously these countries and the EU also reduced tariffs on trade between themselves - to facilitate less trade friction in an economic area significantly greater than that of the US - the potential damage to American domiciled companies and interests would be even more significant.

The world would then divide between a newly thriving economic area of pretty much all developed democracies apart from the US - the G7 minus one, as it were - and a protectionist and potentially sclerotic America.

Obviously this would look like the mother of all trade wars. Markets might in the short term take serious fright.

But the current response to Trump - each nation or trading region seeking individually to buy or warn Trump off - is massively sub optimal. It allows Trump to divide and rule.

The best chance of him backing down would come if the combined voice of American businesses and banks were a howl of pain at being locked out of the world’s richest economies.

In Trump’s re-ordered multi-polar world where might is right, nations like the UK and even huge economies like the EU’s single market lack the clout individually to face him down.

As I said on ITV’s News at Ten last night, bullies don’t give up once they’ve taken one kid’s dinner money. They surrender when that kid makes common cause with the rest of the school.

https://x.com/Peston/status/1907100050263560302

Trump is now saying, as are others in the US and some financial commentators, that these are the starting point for a negotiation to get rebalanced global trade

Given the US, and the west in general, helped that by seeking low cost country sourcing, they’re trying to solve a problem they caused.

Problem is, even if they get a deal, how do they know this lunatic will stick to it.

A bigger question is what would the deal look like. Reality is most Americans aren't going to be happy paying the market price for items manufactured in the USA rather than imported from China.

MAGA have a simple answer - just go back to 1955. America rules the world. No gays. No latinos. Jim Crow. Always sunny and a BBQ on in the garden where the manly men cook American steaks for their neighbours whilst their women concentrate on
looking pretty.

America used to build everything and it can do again. What’s more, once the might of America is brought then these foreigners will pay for it by means of compensation for ripping off America all this time.

I know, it’s laughable. But You've got to remember that these are just simple farmers. These are people of the land. The common clay of the new West. You know... morons.

History will not be kind to these people

@thetimes

Karoline Leavitt, the White House press secretary, has claimed that President Trump’s tariffs will restore a “golden age of America” during a news briefing today.

“We are focused on restoring the golden age of America, and making America a manufacturing superpower”

https://x.com/thetimes/status/1907113007378764097

Meanwhile this remains the best explanation for what is happening in Trumpski's Whitehouse

And the GOP senators confirmed every last one of them.

Robert Peston
@Peston

Starmer has organised his military coalition of “willing” nations to defend Ukraine against Putin in the event of a peace deal. My conversations with senior government officials, business leaders and economists reveal a hunger for Starmer - or Canada’s Carney, or any elected leader of a sizeable democratic nation - to organise an “economic coalition of the willing”, to champion free trade against Trump and his tariffs.

The concept, half of which I have explained before, is to counter Trump’s bullying trade tactics - tomorrow’s announcement by him of tariffs on all imports to America - by threatening collectively to impose tariffs on America’s exports double or treble whatever his tariff rates turn out to be.

This in itself would terrify American manufacturers and farmers, if it was a collective threat by the UK, Canada, the EU, Switzerland, Japan, South Korea, Mexico and Australia, inter alia.

If simultaneously these countries and the EU also reduced tariffs on trade between themselves - to facilitate less trade friction in an economic area significantly greater than that of the US - the potential damage to American domiciled companies and interests would be even more significant.

The world would then divide between a newly thriving economic area of pretty much all developed democracies apart from the US - the G7 minus one, as it were - and a protectionist and potentially sclerotic America.

Obviously this would look like the mother of all trade wars. Markets might in the short term take serious fright.

But the current response to Trump - each nation or trading region seeking individually to buy or warn Trump off - is massively sub optimal. It allows Trump to divide and rule.

The best chance of him backing down would come if the combined voice of American businesses and banks were a howl of pain at being locked out of the world’s richest economies.

In Trump’s re-ordered multi-polar world where might is right, nations like the UK and even huge economies like the EU’s single market lack the clout individually to face him down.

As I said on ITV’s News at Ten last night, bullies don’t give up once they’ve taken one kid’s dinner money. They surrender when that kid makes common cause with the rest of the school.

https://x.com/Peston/status/1907100050263560302

I really don’t envy Reeves what she inherited. Hunt tiptoed in the right direction on some respects but it was deckchair’s on the Titanic stuff while the bigger picture was that an iceberg of debt was ripping a huge hole in the bow of the ship.
It also didn’t help her that her party was largely composed of delusional fools who thought that austerity was a choice and all that was needed was a bit more spending.
But she has undoubtedly made things worse. The hole in the accounts was not £22bn, it was £120bn and the truth is that Labour knew all about it before they were elected.

We are, to use a technical term, fucked. We have exhausted all of the capital and investments we inherited to entitle one selfish generation to live a life way beyond what they earned.

And tomorrow Trump steps in with tariffs to be implemented on the 3rd April 2025 unless you move your business to the US

The consequences for governments and the populace worldwide is impossible to predict but it is going to damage many economies including Trump's own

I really don’t envy Reeves what she inherited. Hunt tiptoed in the right direction on some respects but it was deckchair’s on the Titanic stuff while the bigger picture was that an iceberg of debt was ripping a huge hole in the bow of the ship.
It also didn’t help her that her party was largely composed of delusional fools who thought that austerity was a choice and all that was needed was a bit more spending.
But she has undoubtedly made things worse. The hole in the accounts was not £22bn, it was £120bn and the truth is that Labour knew all about it before they were elected.

We are, to use a technical term, fucked. We have exhausted all of the capital and investments we inherited to entitle one selfish generation to live a life way beyond what they earned.

And tomorrow Trump steps in with tariffs to be implemented on the 3rd April 2025 unless you move your business to the US



The consequences for governments and the populace worldwide is impossible to predict but it is going to damage many economies including Trump's own

Trump is an ignorant incompetent moron ( yes we have abandoned the idea of going to the States) but an economy that had been run on sustainable lines, like Germany, for example, would have a range of options to offset the damage he is causing by boosting domestic demand.

We don’t have these options because we have been running our economy on an unsustainable basis for several decades, running huge public sector deficits and trade deficits. We have no viable options left. We need to cut spending, increase taxes and increase investment. It’s really going to hurt. Blaming Reeves for this as if it were her fault is simply facile.

The problem for Starmer and Reeves is they are the government responsible for our economy and security and they are about to be hit by an express train

I doubt it. The trains are usually cancelled, and when they do run they're not particularly express.

I really don’t envy Reeves what she inherited. Hunt tiptoed in the right direction on some respects but it was deckchair’s on the Titanic stuff while the bigger picture was that an iceberg of debt was ripping a huge hole in the bow of the ship.
It also didn’t help her that her party was largely composed of delusional fools who thought that austerity was a choice and all that was needed was a bit more spending.
But she has undoubtedly made things worse. The hole in the accounts was not £22bn, it was £120bn and the truth is that Labour knew all about it before they were elected.

We are, to use a technical term, fucked. We have exhausted all of the capital and investments we inherited to entitle one selfish generation to live a life way beyond what they earned.

And tomorrow Trump steps in with tariffs to be implemented on the 3rd April 2025 unless you move your business to the US



The consequences for governments and the populace worldwide is impossible to predict but it is going to damage many economies including Trump's own

Trump is an ignorant incompetent moron ( yes we have abandoned the idea of going to the States) but an economy that had been run on sustainable lines, like Germany, for example, would have a range of options to offset the damage he is causing by boosting domestic demand.

We don’t have these options because we have been running our economy on an unsustainable basis for several decades, running huge public sector deficits and trade deficits. We have no viable options left. We need to cut spending, increase taxes and increase investment. It’s really going to hurt. Blaming Reeves for this as if it were her fault is simply facile.

Until the Treasury is forced to bin the Green Book and a government starts to properly invest in the infrastructure a country with X million more people in it than 20 years ago needs - all Chancellors are going to look useless..

What sort of infrastructure have you in mind?

Its a long list:

Our two great crises are housing and energy - they have collapsed living standards for so many.

We need to build swathes of houses - gut the derelict centres of dead towns and rebuild them. Anywhere that Travelling Turnip has done a video? Compulsory purchase, flatten, rebuild. Can't have the private sector build tiny "executive style" houses at daft prices, build housing association property, set a living rent, screw the rentier market for good.
And where you can't gut and rebuild we go for new towns.
Transport - road and rail connectivity to link all these places up

We don't generate enough power and we're lunatic enough to link the cost of wind energy to gas prices from places we don't buy from. Disconnect as Spain have done. SMR reactors, wind, solar and tidal which is built here. And the power interconnects to transmit the power.

Two major programs which invest to deliver both a return on the investment, and to drive economic growth by smashing the shackles which have chained our economy to the prison wall.