The US would give us a great trade deal, we were told. This week the president has shown how volatile and untrustworthy he is
Shall we take a gentle amble down memory lane, a nostalgic trip back to the heady days of the referendum campaign of 2016? So many sweet promises were murmured into our ear, it can be hard to remember them all. No talk then of shelling out £33m to settle a legal case with Eurotunnel or ferry contracts for companies with no ferries, or spending billions to prepare for the cataclysm of a no-deal departure. No, back then it was all cash bonanzas of £350m a week and assurances that Brexit would be smooth and seamless – the Europeans needed us more than we needed them, after all – so that, by the time 23 June 2016 came around, voting leave seemed like a painless, risk-free option. Not only was there nothing to lose, there was so much to gain. And top of the list was a big, shiny trade deal with the United States of America.
“Within two years,” vowed the soon-to-be Brexit secretary, David Davis, a few short weeks after the vote, “we can negotiate a free trade area massively larger than the EU.” A deal with the US, along with China, would “give us a trade area almost twice the size of the EU”, he gushed, apparently unaware that, under European law, it was illegal for a Britain that had not formally exited the EU to so much as enter talks with those nations, let alone sign an agreement with them.
A mere detail, as far as Davis and the Brexiters were concerned. They were itching to shake off the shackles of Brussels and run into the embrace of the “Anglosphere”, where our chief trading partners would no longer be those countries on our doorstep, but the English speakers of Australia, New Zealand, Canada and, above all, the US. Who needed those minnow Europeans 22 miles across the Channel, when the largest economy in the world was there waiting for us, just 3,000 miles over the ocean?
Recall the fury of the leave crowd when Barack Obama dared puncture the Anglosphere fantasy by warning that a post-Brexit Britain would, in fact, be at “the back of the queue” for a trade agreement with the US, prompting Boris Johnson to reach for his racist dog-whistle and remind British voters that Obama was “part-Kenyan”. Recall too the needy relief of those same Brexiters when Michael Gove interviewed the newly elected Donald Trump and extracted a not-quite-promise that Britain and the US would “get something done very quickly”.
This week we got a double glimpse into what that “something” might be – and it wasn’t pretty. Most lurid was the sight of Donald Trump, international negotiator. His uselessness in this regard was already evident from his first meeting with Kim Jong-un in June, when North Korea’s leader bagged several major US concessions while Trump got precisely nothing. But the collapse of Wednesday’s meeting in Hanoi demonstrated again the mercurial instability of this US president, the lack of preparedness and basic statecraft by his team and the sheer unpredictability of doing business with Trump’s Washington.
Hanoi offered several warning signs for future UK trade negotiators, all of them blinking red. The obvious one is that Trump is prepared to walk away from talks that don’t go his way. Another is that, notwithstanding the failure in Vietnam, Trump maintains a clear, expressed preference for dictators over democrats. On Thursday he praised Kim as “very sharp” and “a real leader” – approbation he has never extended to, say, Angela Merkel.
Optimists will claim none of that matters too much, since the detail of trade talks will be delegated to officials – rational technocrats who will be much easier to deal with than the volatile showman they work for. But this week I took part in a sobering conversation with two former US state department officials who have had close dealings with the current administration. They made clear that Team Trump does not operate like any of its predecessors, barely drawing on the institutional wisdom of the US government machine, working instead in tight, secretive huddles open only to Trump loyalists.
What’s more, Trump can hardly be said to empower those who conduct trade negotiations on his behalf. Witness this week’s jaw-dropping video of a meeting in which Trump publicly contradicted, and hugely undermined, the US trade representative, Robert Lighthizer, in front of representatives of the Chinese government. Lighthizer said that a memorandum of understanding was a “binding agreement”; Trump said no, such a document “doesn’t mean very much” to him. He didn’t like the term at all. There and then Lighthizer and the Chinese team agreed to call their text something else, which made Trump much happier.
All of which brings us to our second glimpse of the kind of deal a post-Brexit UK might expect from the US. On Thursday Lighthizer released Washington’s “negotiating objectives”, starting with “comprehensive market access for US agricultural goods in the UK”. Translation: they want the right to fill our supermarkets with their chlorinated chicken.
There’s language in there that takes aim at the NHS, specifically at the health service’s power as a bulk purchaser to set prices, paying less for drugs than big pharma would like. The US demand for “procedural fairness” may well be an attempt to break that power, forcing the NHS – and everyone else – to pay more for medicine.
Some of these are demands any US administration would make, but others are Trump innovations. Note the US insistence that, on services, Britain take down all existing barriers to American exporters, while the US be allowed to maintain barriers that keep out British exporters. As Sam Lowe, trade analyst at the Centre for European Reform, puts it: “It’s a laughably one-sided demand.”
More striking is the US attempt to restrict Britain’s ability to sign a deal with a non-market economy such as China. So much for taking back control. If the UK were to sign up to these demands, we’d simply be trading one set of restraints on our sovereignty – restraints agreed by us and 27 other nations in Brussels – for another, dictated by Donald Trump in Washington.
And what would it be for? The government’s own figures estimate that the best we could hope for from a US trade agreement would be a 0.3% boost to GDP – meagre compensation for the hit of between 4% and 8% we’ll take from leaving the EU. Right now, we are part of a bloc big enough to stand up to the demands of an America First Trump administration. After Brexit, we will be a single medium-sized economy standing alone, with much less ability to say no.
The truth is, the goal of a trade deal with the US never made economic sense. It was all about politics – the quest for a trophy that could be presented as a benefit of Brexit when, in fact, there are next to none. It didn’t stack up in June 2016, but it is even more absurd now – abandoning the largest ever free trade area, right where we live, for a dictator-coddling would-be autocrat thousands of miles away, who sees us not as a trusted ally but as prey.
One of the strongest arguments for a new referendum is that the circumstances have changed since the last one: few circumstances have changed more than this. The world is less stable and more dangerous than it was three years ago. Leaving Europe would always have been a mistake. Leaving Europe for the tender mercies of Donald Trump is insane.
• Jonathan Freedland is a Guardian columnist