Sunday Smiles

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Ok, I didn’t see this coming so soon. 

According to The Sunday Times, Kier Starmer is prepared to surrender his attachment to Davos and acknowledge that globalism has failed. 

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GLOBALISM. HAS. FAILED.

Keir Starmer is going to admit that, you know, Trump was sorta right, even though Trump is Bad Orange Man. 

It was not so long ago that Starmer said that if he were forced to choose between his own country’s Parliament running things in Britain or following Davos’ lead, he would choose Davos because democratic limits wouldn’t constrain him. His commitment to globalism and the transnational elite overrode his loyalty to Britain. 

In the wake of Trump’s tariffs and his determination to upend the current world trading regime, Starmer has suddenly realized that the British haven’t been doing so well lately and should perhaps change direction. 

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The prime minister will declare an end to globalisation and admit that it has failed millions of voters as the fallout from President Trump’s tariffs reverberates around the world.

In his first significant intervention since the United States imposed sweeping charges on imports, Sir Keir Starmer will say tomorrow that the seismic global economic effects prove the government must “move further and faster” to boost growth with supply-side reforms.

Later this week he and Rachel Reeves, the chancellor, will make pro-growth announcements, including easing regulations on electric car manufacturers and bringing forward parts of the government’s industrial strategy.

Reeves is due to hold an “economic and financial dialogue” with India on Wednesday to try to hasten a trade deal. Efforts are also being made to secure a new agreement with Australia.

The prime minister will argue that tariffs are the wrong response, but will also say he understands Trump’s economic nationalism and why it is popular with voters who believe they have seen no benefits from free trade and mass immigration.

Starmer is about to go all “Great Britain First,” although his approach will be more in the direction of a national industrial policy than Trump appears to be going. 

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A Downing Street official said: “Trump has done something that we don’t agree with but there’s a reason why people are behind him on this. The world has changed, globalisation is over and we are now in a new era. We’ve got to demonstrate that our approach, a more active Labour government, a more reformist government, can provide the answers for people in every part of this country.”

It’s unclear if Starmer is going to renegotiate trade deals in the way that many countries are with the United States. 

Everybody is scared to death that Trump will spark a worldwide trade war, but as of now, it appears that the result of Trump’s tariff announcement will be a substantial drop in worldwide tariffs, at least in trade relations with the United States. Argentina has already reduced tariffs to zero with us, Vietnam will probably do so, and I would expect that countries will fall all over themselves to remove trade barriers so they can retain access to the US market. 

In effect, Trump could create the opposite of a “beggar thy neighbor” trade war–a massive drop in tariffs, not a long-term increase. 

The other day I suggested that this was one likely outcome, and while we haven’t yet seen it come to fruition, it sure looks like we are headed in that direction. 

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If anything remotely like this happens, the markets will bounce back higher than before and a lot of people will have rotten egg on their faces. 

We’re not there yet but stay tuned. 

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