A reckless embrace of trade protectionism

Last week’s by-election defeats were catastrophic for the Conservatives. Governments often take a hammering mid-term, but the scale of the losses cannot be shrugged off. Tory supporters stayed at home because the Government has disregarded Conservative principles and is operating more like Gordon Brown at his highest and mightiest.

So it is extraordinary that one of the Government’s first major acts is profoundly unConservative and will exacerbate our economic woes. Ministers are expected to impose tariffs on steel imports from certain emerging economies, in a desperate attempt to buttress Tory support in Red Wall seats. This is economically illiterate, almost certainly breaks WTO rules, will push up manufacturing costs here in the UK for miniscule gain, will trigger a damaging retaliation and misreads Red Wall voters entirely.

The countries being targeted by the Government are not threatening our national security, as China increasingly does, or dumping subsidised products to build market share. They are simply producing competitive products and trading fairly, a strategy that Britain should be pursuing. How can this government speak of Global Britain if it behaves in this way? How could ministers who spoke approvingly – and rightly – of WTO rules being a backstop during the Brexit negotiations treat the global trading system in such a cavalier fashion?

This policy conforms to a mindless drive towards protectionism that was accelerated by lockdown. Worse, it is partly justified on the basis that the EU has apparently been doing something similar. Did we really pursue Brexit in order to be more like the rest of Europe?

There is a Conservative reformist agenda that would address our fundamental economic problems and actually help the more deprived parts of Britain. In an interview with this newspaper today, the Welfare Secretary, Therese Coffey, says she wants to tighten up the benefits system in order to encourage more people into work. There are some 5.3 million Britons on out-of-work benefits, an astonishing figure given how many businesses are suffering from a shortage of staff. It is also cruel to condemn people to a lifetime of dependency on the state, so Dr Coffey should be encouraged to go further.

Britain faces one of the greatest economic crises in its history, one that could well end up ejecting the Conservatives from power in two years’ time. They might think it is electorally clever to indulge in asinine trade protectionism. All it will confirm to Tory voters, however, is that the Government has lost its way.