Why a US trade deal will likely be humiliating for the UK

That does not add up to much scope for contact in depth between the star visitor and the summit host Boris Johnson – just as well, because the Prime Minister says he does not want any. His spin doctors will be gloomily alert for goons and gaffes that the guest might make while in town, which could easily bring another percentage point drop for the Tory lead in the opinion polls. Boris says he needs no endorsements from the US, the land of his birth, but then he has had them already. The president is on record as calling him “a good man” and a “Britain Trump”. With friends like that, who needs enemies?

Boris Johnson and Donald Trump

First Minister Nicola Sturgeon told us to beware Trump in disguise, and she was right. In his macho double-act with Boris, Trump is in practice the dominant partner, a relationship that will grow clearer if and when Brexit happens. A sign of things to come appeared last Friday, as Boris pledged that in those novel conditions it would be easier for his government to rescue straggling UK companies. There are likely to be a lot of them in the face of a plunging pound and an oncoming recession in 2020. The Prime Minister said that, once his government was free of European rules on state aid, it could intervene much faster against threats from superior foreign competition. He would also enforce buy-British guidelines for procurement in the public sector. If Trump were governing from Downing Street, he would have already done the same, or more.

The last fading voices of old-time Thatcherism protested feebly. The Institute of Directors said all this would “suggest a retreat away from free and open markets”, with clear implications for our ability to negotiate a post-Brexit trade deal with the EU. The Institute of Economic Affairs warned it “would translate into veiled support for cronyism”, in other words, into favours for the Prime Minister’s friends, something we can well believe, especially if they are female lovelies. A regime of glad-handed, palm-greasy back-slapping would be the opposite of the stern economic principles of the 1980s. Is this what it has come to with those buccaneering Brexiteers and their brave talk of Global Britain?

As for Labour, just don’t get me started. The fact is we are reduced to two candidates for Prime Minister who both advocate a protectionist UK. The nearest, most recent European equivalents would be Eamon de Valera’s Ireland, General Franco’s Spain or Kemal Ataturk’s Turkey. All imposed social conformity at the price of economic stagnation, until after several decades they were liberated by opening up to Europe. All still have their problems but would never dream of reversing the process. Trump is Boris’s only hope of a way out. The Foreign Secretary Dominic Raab and the International Trade Secretary Liz Truss have both been to Washington trying to drum up support for an ambitious trade deal. This has been a long-standing fantasy of the Brexiteers. But quite what do they realistically expect to get out of such a deal? This has never been clear.

Foreign Secretary Dominic Raab

Perhaps the UK Government’s main aim will be to win greater access to the American market for Britain’s financial services. There’ll be loads of files in Whitehall on this, because David Cameron tried to get the same thing under the doomed EU-US talks for a Transatlantic Trade and Investment Partnership. At the time, the American side rejected the idea out of hand before the negotiations even started. In Washington, the treasury department and the official regulatory bodies wouldn’t hear of it.

Trade deals in services, especially financial services, are always hard to agree because they may require each side to import risks that domestic regulators have little control over. We may think Wall Street is full of cowboys, but over there they think the City of London is like a tribe of ravening savages who only await their chance to take scalps. Under Boris, they could be right.

Another target for his negotiators might be access to the huge markets for procurement in the US public sector. Funny that he wants to force his own government to buy British, yet persuade the Americans to buy British too.

In fact, Washington already had a buy-America policy, even under the last president, Barack Obama, who flatly refused to relax any of the rules. It is hard to see the Trump of “America First” being a softer touch. The one trade deal he has struck so far, replacing a previously more open agreement with Canada and Mexico, shows his priority is to protect jobs in his own country.

In future, for example, it would be harder to make cars in Texas with imported Mexican components.

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This is forecast to reduce the volume of trade across North America. Trump cares not a fig. Official US guidelines already published show his government is ready to apply the same priority to talks with the UK.

Quite apart from keeping Trump sweet, Boris will need to worry about the state of mind in British business. That is where the decisions will be taken on production and investment, which determine whether his economic policy succeeds or fails.

SO far, he seems to have put the wind up almost everybody. Most businessmen will usually support cutting or even ending tariffs on imports, but a recent official survey revealed an important exception for agriculture.

After 40 years in the Common Agricultural Policy we share the highest standards in the world for food safety, animal welfare, environmental protection and intellectual property rights in nutritional research.

They could be selling points for Brexit Britain too, but not if the standards are undermined by imports of chlorine-washed chicken and the like, courtesy of Trump. Here and elsewhere UK business prefers to maintain alignment with EU standards.

Since the Government in London has spent most of its time since 2016 squabbling over what it wants out of its future relationship with the EU, we can hardly be surprised if it doesn’t know what it wants out of a free-trade deal with the US either.

Indeed, what makes the task so hard is that the three relationships involved all hang together. Surveying this scene, we can begin to understand why unsolved problems of Brexit, such as the Irish backstop, have assumed such overwhelming importance.

The US Democrats, who hold a majority in the House of Representatives, have said they won’t ratify any trade deal that endangers peace in Northern Ireland.

The chances are that a deal, if it comes, will be a humiliating one for the UK. The former US treasury secretary Larry Summers has already brutally pointed out we may grow so desperate as, in the end, to have little choice but to accept something of the kind.

Still, in Scotland we mustn’t gloat. We have a protectionist government too, always eager to bail out corporate failure and only regretting it lacks the powers to do so. But when the election was called I promised I would not break ranks from a prospectively triumphant SNP campaign, and I’m not going to do so now. Just wait till it’s all over.