With Theresa May indicating that Britain’s future lies outside the EU single market and Donald Trump signalling his desire for a quick US-UK trade deal, the likelihood of a future deal with America has shot up the agenda. But, in line with Barack Obama’s warning, the “back of the queue” may be the best place when it comes to a deal with Trump’s America.
Let’s not forget the USA is the UK’s most important “single country” trading partner. In the absence of any deal, the US is already the UK’s largest export partner and second-largest import partner.
But transform this into a “new generation” trade deal similar to the controversial TTIP and CETA pacts, and we risk losing the NHS, triggering another financial crisis, and replacing the European Court of Justice with a dystopian set of secretive, one-way “corporate courts” designed for big businesses to sue governments for lost profits. In one fell swoop, the ancient British principle of “equality before the law” will be destroyed.
But why would a trade deal with the US have anything to do with our public services or the size of big banks? Because today’s trade deals are not what they used to be: trade has expanded from dealing with import/export taxes (“tariffs”) on goods, to take in intellectual property, access to public services markets, and “rights” for corporations investing overseas.
Another key agenda is reducing what trade experts call “non-tariff barriers”, which include our most treasured social, health and environmental protections.
What experts have said about Brexit
What experts have said about Brexit
1/11 Chancellor of the Exchequer Philip Hammond
The Chancellor claims London can still be a world financial hub despite Brexit “One of Britain’s great strengths is the ability to offer and aggregate all of the services the global financial services industry needs” “This has not changed as a result of the EU referendum and I will do everything I can to ensure the City of London retains its position as the world’s leading international financial centre.”
2/11 Yanis Varoufakis
Greece's former finance minister compared the UK relations with the EU bloc with a well-known song by the Eagles: “You can check out any time you like, as the Hotel California song says, but you can't really leave. The proof is Theresa May has not even dared to trigger Article 50. It's like Harrison Ford going into Indiana Jones' castle and the path behind him fragmenting. You can get in, but getting out is not at all clear”
3/11 Michael O’Leary
Ryanair boss says UK will be ‘screwed’ by EU in Brexit trade deals: “I have no faith in the politicians in London going on about how ‘the world will want to trade with us’. The world will want to screw you – that's what happens in trade talks,” he said. “They have no interest in giving the UK a deal on trade”
4/11 Tim Martin
JD Wetherspoon's chairman has said claims that the UK would see serious economic consequences from a Brexit vote were "lurid" and wrong: “We were told it would be Armageddon from the OECD, from the IMF, David Cameron, the chancellor and President Obama who were predicting locusts in the fields and tidal waves in the North Sea"
5/11 Mark Carney
Governor of Bank of England is 'serene' about Bank of England's Brexit stance: “I am absolutely serene about the … judgments made both by the MPC and the FPC”
6/11 Christine Lagarde
IMF chief urges quick Brexit to reduce economic uncertainty: “We want to see clarity sooner rather than later because we think that a lack of clarity feeds uncertainty, which itself undermines investment appetites and decision making”
7/11 Inga Beale
Lloyd’s chief executive says Brexit is a major issue: "Clearly the UK's referendum on its EU membership is a major issue for us to deal with and we are now focusing our attention on having in place the plans that will ensure Lloyd's continues trading across Europe”
8/11 Colm Kelleher
President of US bank Morgan Stanley says City of London ‘will suffer’ as result of the EU referendum: “I do believe, and I said prior to the referendum, that the City of London will suffer as result of Brexit. The issue is how much”
9/11 Richard Branson
Virgin founder believes we've lost a THIRD of our value because of Brexit and cancelled a deal worth 3,000 jobs: We're not any worse than anybody else, but I suspect we've lost a third of our value which is dreadful for people in the workplace.' He continued: "We were about to do a very big deal, we cancelled that deal, that would have involved 3,000 jobs, and that’s happening all over the country"
10/11 Barack Obama
US President believes Britain was wrong to vote to leave the EU: "It is absolutely true that I believed pre-Brexit vote and continue to believe post-Brexit vote that the world benefited enormously from the United Kingdom's participation in the EU. We are fully supportive of a process that is as little disruptive as possible so that people around the world can continue to benefit from economic growth"
11/11 Kristin Forbes
American economist and an external member of the Monetary Policy Committee of the Bank of England argues that the economy had been “less stormy than many expected” following the shock referendum result: “For now…the economy is experiencing some chop, but no tsunami. The adverse winds could quickly pick up – and merit a stronger policy response. But recently they have shifted to a more favourable direction”
Under TTIP and CETA – ahead of the deals even coming into effect – we saw protections sacrificed including dropping legislation on so-called “gender-bending” chemicals, for the first time allowing the entry of meat washed in lactic acid, and diluting climate change legislation to allow tar sands oil to enter Europe.
Under the pro-corporate regimes of Trump and May, we can expect much more of the same – and a similar disdain for scrutiny and transparency, given the government’s willingness to bypass parliamentary scrutiny for CETA and to prevent MPs reading TTIP texts.
Trump’s transition team has pledged to dismantle the Dodd-Frank Act, brought in after the 2008 financial crisis to ensure, among many other issues, that banks cannot be allowed to be “too big to fail”.
Remove Dodd-Frank and, as the architect of these rules argues, you’re “likely to recreate the very conditions that led to the 2008 financial crisis … the financial sector will get a nice sugar high for a few years, and then crash the economy”.
Trump’s criticisms of Obamacare include that it resulted in “less competition and fewer choices”; his proposed remedy is “much-needed free market reforms”.
The 6 reasons why we should be scared of TTIP
The 6 reasons why we should be scared of TTIP
1/6 The NHS
Public services, especially the NHS, are in the firing line. One of the main aims of TTIP is to open up Europe’s public health, education and water services to US companies. This could essentially mean the privatisation of the NHS. The European Commission has claimed that public services will be kept out of TTIP. However, according to the Huffington Post, the UK Trade Minister Lord Livingston has admitted that talks about the NHS were still on the table
2/6 Food and environmental safety
TTIP’s ‘regulatory convergence’ agenda will seek to bring EU standards on food safety and the environment closer to those of the US. But US regulations are much less strict, with 70 per cent of all processed foods sold in US supermarkets now containing genetically modified ingredients. By contrast, the EU allows virtually no GM foods. The US also has far laxer restrictions on the use of pesticides. It also uses growth hormones in its beef which are restricted in Europe due to links to cancer. US farmers have tried to have these restrictions lifted repeatedly in the past through the World Trade Organisation and it is likely that they will use TTIP to do so again
3/6 Banking regulations
TTIP cuts both ways. The UK, under the influence of the all-powerful City of London, is thought to be seeking a loosening of US banking regulations. America’s financial rules are tougher than ours. They were put into place after the financial crisis to directly curb the powers of bankers and avoid a similar crisis happening again. TTIP, it is feared, will remove those restrictions, effectively handing all those powers back to the bankers
Remember ACTA (the Anti-Counterfeiting Trade Agreement)? It was thrown out by a massive majority in the European Parliament in 2012 after a huge public backlash against what was rightly seen as an attack on individual privacy where internet service providers would be required to monitor people’s online activity. Well, it’s feared that TTIP could be bringing back ACTA’s central elements, proving that if the democratic approach doesn’t work, there’s always the back door. An easing of data privacy laws and a restriction of public access to pharmaceutical companies’ clinical trials are also thought to be on the cards
The EU has admitted that TTIP will probably cause unemployment as jobs switch to the US, where labour standards and trade union rights are lower. It has even advised EU members to draw on European support funds to compensate for the expected unemployment. Examples from other similar bi-lateral trade agreements around the world support the case for job losses. The North American Free Trade Agreement (NAFTA) between the US, Canada and Mexico caused the loss of one million US jobs over 12 years, instead of the hundreds of thousands of extra that were promised
Dave Thompson/Getty Images
TTIP’s biggest threat to society is its inherent assault on democracy. One of the main aims of TTIP is the introduction of Investor-State Dispute Settlements (ISDS), which allow companies to sue governments if those governments’ policies cause a loss of profits. In effect it means unelected transnational corporations can dictate the policies of democratically elected governments
This preference for privatisation finds a welcome audience in the May administration. The NHS is already part-privatised and facing “systematic underfunding” – and under any US-UK deal, US big business will demand access to the tendering of health contracts, likely championed as worthy additional “investment” by the May administration.
As shadow health secretary Jon Ashworth rightly warns: “This could be a Trojan horse for NHS privatisation.”
As with everything surrounding Brexit, there are if’s, but’s and maybe’s for any deal with Trump’s administration – chiefly, that it can’t take place until we exit the EU, and what it will include will be determined by any new arrangements agreed with the EU.
While there can be no doubt that any deal between Trump’s US and May’s Brexit Britain will great for big business and elites, the real danger is to our democracy, the NHS, and rules protecting food, the environment and much else besides.