Why would the UK want a US trade deal?
The reporting and online discussion of the Prime Minister’s visit to the United States have been dominated by tedious Brexit gotchas. Desperate to continuously point out how Brexit has diminished the UK, the press, commentators, and social media critics have delighted in pretending that the stalling of UK-US trade talks is fresh news. The same people who said a trade deal won’t happen are now scoffing at the fact it isn’t happening as if that makes them insightful.
This isn’t news, it has been clear for a very long time that a UK-US trade agreement wasn’t going to happen. This is not a case of Biden snubbing Boris. Even under Trump, there were many chapters yet to be discussed, let alone agreed. There are far too many contentious issues for negotiations to be easy or rapid. To facilitate an agreement, the UK would need to roll over and give in to all American demands. It can only be a good thing that we haven’t.
The US downed tools in trade talks some time ago as it focuses on its Pacific strategy and leaves the UK and EU to ease tensions and teething problems with the Northern Ireland protocol. Now Biden is in office and new trade agreements are not a priority. Remainers are revelling in this, but the truth is that not only is a trade agreement with the US not important, it’s something the government should actively avoid.
There are irreconcilable differences in our regulatory culture that make the agreement of a comprehensive trade agreement near impossible. If the UK were to give in to US demands and adopt US standards, it would harm its trade with its other trade partners, not least the EU. The consequence of which would be that the US trade deal would have a net negative economic effect.
The most contentious is probably agrifood. If the UK agreed to adopt US standards the British media and political opposition have a field day reporting on US animal welfare and agricultural standards. Then will come the horror stories about the threats to the NHS. First protest amongst the public grows and then political opposition in the House of Commons brings the whole thing to a halt. It’s an entirely pointless endeavour.
This is not some big prize we have missed out on. A deal with the US would infringe on British sovereignty and would lead to insignificant gains in terms of boost to GDP. The UK and the US already have a significant trade partnership and there are many ways this can be enhanced without an FTA. No doubt anything else we do to boost trade would be belittled by Brexit critics anyway, see the fuss made over the Aukus pact for an immediate example.
The US has not snubbed us, nor is it stalling trade talks out of spite because of Brexit. It’s crucial to note that even without any formal trade agreement in place, the US is Britain’s second biggest trade partner behind the EU. Not only that, the US is the biggest investor in the UK economy and the UK is the third biggest investor in the US economy, ahead of any individual EU member state. There is more to trade and business than Free Trade Agreements.