What The Hell America!

Compounding the UK’s trade difficulties is Brexit, the UK’s spectacularly self-destructive decision to depart the European Union, which took effect in 2020. The UK did manage before that breakup to negotiate a free trade deal with the EU, eliminating the risk of tariffs being imposed on its imports or exports to the EU. But even so, the UK’s exports to the EU, which (as a bloc rather than a nation) is the UK’s biggest trading partner, are down by as much as 30 percent compared to where they would be had Brexit never occurred. This has left the UK a bit frantic to cut trade deals elsewhere, and especially with the United States.

Trump’s trade deal with the UK, which exists only in rough outline, makes Prime Minister Keir Starmer’s life somewhat easier. Starmer’s diplomatic strategy has been to flatter Trump at every turn—which can’t have been easy for him—and to get King Charles to invite Trump to visit him at Dumfries House or Balmoral Castle, both situated near Trump golf courses in Scotland. This charm offensive has now been rewarded with a reduction in tariffs, from 27.5 to 10 percent, on Jaguars, Land Rovers, and other British automobiles exported to America, and the complete elimination of tariffs on the UK’s struggling steel industry. In addition, the UK will be permitted to export, tariff-free, up to 13,000 metric tons of beef. All British exports, however, will still be subjected to the same across-the-board 10 percent tariff Trump is imposing on all countries.

In return, the United States receives … not much. Some reductions on agricultural tariffs, including tariffs on American beef, although apparently the UK will continue not to import any beef from cattle that have been fed growth hormones (the Trump White House refers to this as “non-science-based standards that adversely affect U.S. exports”). There is no deal on pharmaceuticals, on which Trump has threatened to impose a 25 percent tariff. There, the United States has a trade deficit of $1.4 billion with the United Kingdom, but the paramount consideration must be to keep it easy to get foreign-made drugs to American patients and American-made drugs to British ones, because human health is more important than political one-upmanship on trade.