Philip Johnston
Instead of berating the US president, the G7 leaders should have taken up his idea to scrap tariffs
If, like me, you more commonly associate optics with those spirits dispensers behind the bar at the local pub, then you are not up to speed with the jargon of modern diplomacy. Optics was the mot du jour yesterday after Donald Trump’s meeting with Kim Jong-un. In the world of international summitry, optics are what something looks like, and in Singapore everyone agreed the optics were great, even if questions remain over the substance of the agreement to denuclearise the Korean peninsula. The US president was delighted with the staging of the summit and its outcome. To his mind, it showed that his way of doing things worked. “I am great at deals,” he said, with characteristic reticence. “Most politicians aren’t, but I am. It’s what I do.”
The optics in Canada, by contrast, were appalling. At the G7 summit in Quebec, we saw a seated president, arms crossed and stony-faced, being berated by the other leaders, with Angela Merkel, in full Mutti mode, leading the charge. The two sets of optics may come to define a new geopolitical age, one where the American president seems happier in the company of despots and dictators such as Kim, Xi Jinping and Vladimir Putin than with fellow democrats. The former are people who can get things done because they do not have to play by the rules. Mr Trump would like to do the same if he could get away with it.
Indeed, he demonstrated as much in Quebec where his disdain for the conventions of international summitry was evident. True, he is not the first leader to despair at the attitude of fellow attendees at such a gathering. I remember a Commonwealth summit in Kuala Lumpur where Margaret Thatcher disavowed the final communiqué concerning sanctions with South Africa which had even been agreed by her own foreign secretary, then – and briefly – John Major. Asked at a press conference how it felt to be on her own in the 49-member body, she replied: “If it is one against 48, I am very sorry for the 48.”
But while Mrs Thatcher was happy to be isolated if she felt she was right, she still subscribed to the concept of what has come to be known since the Second World War as “the West”. This is less a geographical construct – since it includes Japan and Australia among non-occidental nations – than a comity of shared values. These include a belief in the rule of law, human rights, free trade and democracy.
In the Commons on Monday, Theresa May on several occasions referred to the “rules-based international order” which underpins the modern trading system but which is starting to fray at the edges. Since the General Agreement on Tariffs and Trade (Gatt) came into force in 1948 with the aim of eliminating the protectionism that had contributed to the Great Depression and, arguably, the Second World War, the Americans have been in the vanguard of making it work. Everyone has benefited, as attested by the economic prosperity experienced in the 70 years since – especially in the West. But Mr Trump believes that the Americans have been taken for chumps, its old manufacturing industries wrecked by subsidised imports from countries which then expect Washington to protect them as well.
He certainly has a point about defence spending. Why should the Americans fork out billions to ensure Germany can run up a huge trading surplus under a protective umbrella they are not prepared to pay for? Barack Obama made the same point, calling the EU nations “complacent”, and urging them to increase spending at least to the two per cent of GDP required by Nato, but no one took him seriously. They cannot ignore Mr Trump.
It is on the issue of trade that the global order is most under threat after the US threatened higher tariffs on steel and aluminium imports from its own trading allies as well as China. Indeed, the Americans even objected to the inclusion of any reference to a “rules-based international order” in the official G7 communiqué, which Mr Trump then peremptorily refused to endorse.
Are we witnessing the disintegration of the West as an identifiable political entity, or is this just a blip occasioned by the personality of Mr Trump? The threat of retaliation by Canada and Europe presages a trade war that will hurt everyone, not only by pushing up import prices and risking jobs but also by making the future less certain for businesses and investors.
This has a potential impact on Brexit. Leaving aside the arguments over the form it should take, outside the EU we can negotiate our own trade deals on our own terms. The Government hopes to strike a bespoke agreement with the EU and then do the same with America, India, Australia and the rest. But this relies on everyone playing by the rules; and they no longer are. Trust is essential and it has broken down. This is not a good time to head off into the wide blue yonder to take advantage of globalisation if barriers to trade are going up around the world.
Instead of ganging up on Mr Trump in Quebec, the other G7 leaders – and Mrs May especially – should have listened to what the US president had to say about trade. He invited them to discuss getting rid of tariffs altogether. “No tariffs, no barriers. That’s the way it should be. And no subsidies,” he confirmed later. “I even said, ‘no tariffs’.”
This was a bit like that moment at Reykjavik in 1985 when Ronald Reagan proposed ridding the world of all nuclear weapons if Mikhail Gorbachev agreed. The prospect foundered on the US president’s unwillingness to dismantle his cherished Strategic Defense Initiative; but the summit paved the way to the end of the Cold War.
Amid all the name-calling and blame-gaming, a similar opportunity might have been missed in Quebec. Was this the chance to open up world markets to free trade, something visionary Brexiteers wanted the UK to agree to unilaterally but which is rapidly receding from view? Had Justin Trudeau taken Trump at his word and put the idea on the agenda for discussion, who knows what the optics would have looked like then. That really would have been a deal worth making.