Category: Economy

Tariff Turbulence

Tariffs are back in the daily News again. In fact, they never went away it’s just that more attention getting events have been happening. Tariffs were something specialist trade negotiators talked about before this year started. Now, the word is commonplace.

The simple assumption is always made that everyone knows what the word means. Apparently, the origins of the word are Arabic[1]. Linked to information. Now, it’s a fee that someone must pay. The important bit being “must”. In this context it’s about the import and export of goods. The relations between countries.

A presumption made by politicians, who like these bureaucratic instruments, is that they can help protect a nation’s domestic industry from competition from other countries. Thus, tipping the balance away from investments made abroad to those made at home. This chimes with nationalistic instincts.

If only it were as simple. Globalisation is a reality. Kicking against it has its attractive points, if it weren’t for the overall benefits that it has delivered in recent decades. Much of the technology we take for granted is available at low prices because of where and how it’s manufactured.

One advice given out by banks is to avoid knee-jerk reactions. In other words, the ups and downs and on and offs of changing tariff regimes may seem to demand an immediate response. However, it could be wiser to ride out the turbulence of these early months of 2025. To sit back and let the dust settle.

Politically driven efforts to disrupt global trade are likely to impact both importer and exporter. It doesn’t take more than a few minutes walking around a large warehouse store to see goods originating from all over the world. That is quality goods that are offered for sale at astonishingly low prices. It astounds me that I can easily buy a perfectly good basic kitchen microwave for £50.

I hate to say it, but I don’t think there’s anyway whatsoever that a domestic manufacturer could compete with that electrical product’s price and quality even if there was a 100% tariff placed on its import. The story vacuum cleaners is one of designs emanating from Britain but being made in Asia. Globalisation is a reality.

I will make at least one concession. That’s the environmental one. Shipping vast qualities of raw materials and goods around the globe has a real cost. An environmental cost. So, it would be wise, at least, to investigate if domestic production is a viable prospect before automatically assuming an import is better. This is a matter for both industry and public policy.

Not only this point but for some critical products, say steel and semiconductors, there should be a domestic capability even if it’s only aimed at meeting a fraction of the potential demand. Strategic needs are not trivial.

Are tariffs a good way to shift the global balance sheet? To me the answer depends on adopting either a short-term or long-term perspective. Certainly, in the later tariffs are a foolish measure. My recollections come from the history of subsidised industries in the 1970s and the poor products that resulted. It a sorry saga of designed decline. One quick look at the story of the British Leyland Motor Company (BLMC) is a good lesson.

I know for a liberal I sound Thatcherite but competition brings better outcomes than protectionism. That generally depends on a level playing field. Yes, tariffs are a form domestic protectionism and that’s much like a permanent subsidy. Trouble is that permanence is never permanent.

Trump maybe a part-time socialist. If not by word then by action. For the time being the tariff humbug will continue to command attention. In the longer term – I think not. Relearning what has been learnt in the past.

[1] https://blog.collinsdictionary.com/language-lovers/the-fascinating-journey-of-the-word-tariff/

The Evolution of Travel

Nothing is stationary. As our solar system circulates the milky way and everything we know is in motion. Nature abhors the stationary. Movement is a part of all living things. Even on dead worlds, like Mars, dust devils whiz across barren surfaces to get caught on camera.

The more we move the more we change. History’s long tail shows that the rooting of people to a place is a temporary affair. What’s changed is our means of locomotion. In the stone age great distances were traversed but not in a hurry. Speed is a modern acquisition.

It is modern. Where I live now is, and has been, a route from East to West and vice versa for much more than a thousand years. For most of that time either our feet or horses where the means of locomotion. Time had to be set aside for perilous and uncomfortable journeys

Travel is a wonderful experience. Even if the time spent between A and B is tedious, draining and eventful in an unwanted way. Adventure beckons in a manner that has always overcome the inconvenience. Certain airlines would never have succeeded if comfort was a must.

In the 17th century getting from London to Bath was a major undertaking. A speed of 30 or 40 miles per day on rain-soaked roads of poor repair there was need to rest up and take a journey in stages. It’s these habits that have shaped the view of traditional England. Gone are the toll houses and the highwaymen but the routes and public houses remain. Well, fewer and fewer of them as business is tough[1].

Travel is that perennial hope, that there is a silver lining to every cloud, that good times are only just around the corner. That in travel we will see, hear and experience something new and to our benefit. It’s not a free lunch. Effort must be made to reap this benefit. It’s there in the word. It’s the Norman-French origins of travel. Travail is to work and labour.

Ironically, although there are exceptions, modern society is trying to make travel as little effort as is possible. Even to the extent of automating vehicles when the demand for such innovations is minuscule. It’s not increased comfort or convenience that’s the aim. No, it’s to dissect time into even smaller parts so that people do not “waste” time travelling.

In an age before concrete and steel carved a path through the English countryside, a journey was a venture to be planned and considered with trepidation. A land of fields and meadows, rivers and streams, and notoriously changeable weather.

Comparisons with today do fall by the wayside. Towards the end of the 17th century the population of the whole of the country was only about 5 million. Creeping industrialisation was drawing people into the cities. Change was on the way.

[1] Hard Times of Old England https://www.youtube.com/watch?v=MoWEiq_Z0aw

A Day at the Bath and West Agricultural Show

It’s a part of my childhood. It’s fascinating to see how it has changed over the decades. There’s hardly a year go by when I don’t go to at least one agricultural show in the UK.

Last year, I visited the Lincoln show and the Newbury show for the first time. Most of the summer rural shows in the UK have a long history that is kept going by an Agricultural Society. The bigger ones have dedicated show sites and some permanent buildings. The smaller ones can be a large field that’s set aside for a couple of days a year. Each show reflects the nature of the farming, the crops, the animals, in its region.

This Friday, my day out was a trip to the Bath and West show[1] in Somerset. The show site is large. Spread over a south facing gently sloping hillside. To the south of the town of Shepton Mallet, at the base of Prestleigh Hill.

That’s my family connection. My mother grew-up on a small farm in Prestleigh. It’s not named on the map anymore as a couple of the buildings are now dwellings. Yew Tree Farm was situated on a dangerous bend on the main A371 road where traffic must veer right as it comes down the hill. The alternative being to hit a wall and end up in the farmyard. If I remember correctly, my grandad got free tickets to the Bath and West as they used one of his fields for a car park. As children we would hop over the fence to go straight to the show.

This year, the ground was as hard as rock underfoot. Spring has been unusually dry. There’s more dust than mud. That’s good for the show. There have been years when the wind and rain have swept the exposed show site and blown down tents and made mini rivers. Making welly boots mandatory.

What has changed? Although this annual event is predominantly a showcase for West Country food and farming it’s gone beyond that formula to become an atypical half-term family day trip. It’s no longer a place where local farmers strike deals with machinery salesman or learn about the latest breeds or cropping methods. That post-war image of mucky tractors and trailers turning up in droves is for vintage postcards.

What’s nice is that there’s something for everyone with an interest in the English countryside. Beekeepers, cider markers (and drinkers), cheese makers, traction engine enthusiasts, rare breeds, heavy horses along with tea and cake in the WI tent.

Sheep started big this year. Cattle and pigs less so. Again, the word is enthusiasts. Breeds rare and commercial ones all cleaned up for display and judging. Handlers, young and old, parading their animals for picky judges to prod and score. Then colourful rosettes displayed with pride.

It’s not a cheap day out for townsfolk and county people anymore. Car parking might be free but the price of entry and just about anything on-site can quickly rack up. Everywhere, even in a field, we have become a cashless society. A tap here, a tap there, no longer do we dig into our pockets for loose change.

For the good weather and crowds, I expect this year’s 3-day event will be evaluated as a great success. Keeping the tradition going.

[1] https://www.bathandwest.com/royal-bath-and-west-show

Protecting Green Spaces

Listening to a Labour Minister use the word “streamlining” I reached for the off switch. My morning radio was bubbling away with a spokesperson justifying changes that remined me of that moment when the Earth was about to be demolished in the HHGTTG. I could imagine him saying; houses must be built because houses must be built.

Labour have been in power for less then a year but more and more they sound like the people they displaced. My thought was, with these recent land planning proposals, what’s the difference between what the Conservatives did and what Labour is doing now?

Let’s go back in time. One of the most dreadful planning changes of the past was the selling-off of school playing fields[1]. Green space, often surrounded by dwellings were erased. Countrywide, bricks, concrete and tarmac were prioritised over green spaces, local sports and nature. Not much to guess as to why the national is not as healthy as it should be.

It’s not new to say – what we learn from history is that we don’t learn from history.

Don’t get me wrong. I’m in favour of building more affordable houses where they are needed. It’s eminently reasonable to provide support for small and medium sized housebuilders. There are spaces that can take more dwellings provided the associated infrastructure comes along too.

By law, let’s not tip the balance in a way makes us all poorer. Our natural environment has taken one hell of a bashing in my lifetime. One of the indicators is the bug count. If I travelled any distance in the summer, in the early 1980s, in my bright red Sunbeam Imp, it wouldn’t be long before I’d need to stop to clean the windscreen of dead bugs. Today, drive as far as you like through the English countryside and there’s no such problem to address.

Labour’s Minister doing the morning rounds, spoke from a prepared script. Everything is above board. Government consulted on the proposals. Houses must be built because houses must be built. Consultations are fine. However, doing it and ignoring what people are saying is tantamount to manipulative deception.

Concreting over nature is not the way to go. Especially for small pockets of green spaces that still bring nature into cities, towns and villages. Infill and the eradication of small green spaces is just as bad as the momentous school playing field mistakes. It’s a one way trip. Watering down measures designed to protect nature is not the way to go.

Pushing forward with an aggressive approach to building foregoes long-term benefits for short-term political gain and blinkered treasury wishes. With the lessons learned over decades, priority to protecting our natural environment should not be sacrificed[2]. The Labour Government’s Planning & Infrastructure Bill needs amendment. Let’s hope that happens.

[1] https://www.itv.com/news/update/2012-08-17/how-previous-governments-compare-on-selling-off-playing-fields/

[2] https://www.wildlifetrusts.org/news/planning-bill-breaks-labours-nature-promises-say-wildlife-trusts-and-rspb

Peaceful Border

It’s superfluous to say so. Canada is not the US, and the US is not Canada.

It quickly becomes clear. I’ve been fortunate to visit places east-west and north south. Although not the far snowbound North. The two countries do share geography. Rocky Mountains stretch across the North America. From British Columbia to New Mexico. The Great Plains span North America. A stark contrast to the mountains, as a huge expanse. In the East, the rolling landscape of the Appalachian Mountains runs from Newfoundland to Alabama.

It’s not the same with social and economic geography or history. A profound difference has been forged by Canada’s citizens over a couple of hundred years.

If we look back to the late 17th and early 18th centuries the new world was a hugely different place than it is now. Britain, France, Spain, and their allies were fighting over vast territories. European conflicts translated into competition and trade wars. Eventually, America colonialist brought about a revolution, so there would be no need for royalty, aristocracy, or an imposed church. Rejecting their British masters, even if they did keep their system of laws.

At the start of the 19th century, the US did invade Canada with a couple of conflicts. So, the idea that the US may wish to annex a part, or all of Canada is not entirely new. I’m going to have to read up on the Battle of Stoney Creek of 1813. It seems a namesake of mine played a pivotal role in preventing the US from taking Canada[1]. No relation – I’m (almost) sure. Irish heritage.

My assumption is that US President Trump is doing what he has done times before. Mark out an extreme position from which then to shape future negotiations. That’s not so mad as it might appear. It’s not nice when considering the cordial relationships that have characterised so much of the recent past. Kicking at the sides of an ally.

Stretching over thousands of kilometres (or miles if you prefer), the boarder between the US and Canada is one of the most peaceful in the world. To reignite conflicts of a couple of hundred years ago is not a wise option. I’m sure Canada could call upon a great deal of support if the worst-case scenario were to prevail.

Mutuality may not be fashionable. It needs to be made fashionable, again. The notion of a win-win scenario where both parties benefit, it’s real, it’s not mythical. Both US and Canada are sovereign. It’s best for the world that it stays that way.

[1] https://www.biographi.ca/en/bio/vincent_john_7E.html

Two Centuries

The News can be overwhelming. It’s a constant barrage of terrible calamities, inadequacies, and past failures. I guess, that’s the manner of the daily News cycle. Put out a positive press release and watch it get ignored. Report of catastrophes and every media outlet copies the stories.

It’s as well to remember that within a week a new round of headlines displaces what was there before. It’s as well to step back. Perspective is an interesting phenomenon. It condenses the past, so that we see the major events more clearly. The nitty gritty of the everyday often fades and only the significant happenings remain.

Let’s dabble in the macro and not the micro. What’s the big picture? It’s time to do a simple comparison. Take the first 25-years of the 20th Century and compare with the first 25-years of the 21st Century. Certainly, at the end of this year a complete summing-up could be done.

For now, I’ll do a random sweep across those two generations separated by a century.

Let’s think. There were no powered aeroplanes in 1900[1]. Few had an inkling that a world war was on the way. We were just figuring out what an Atom might be. Even the motor car was mostly for wealthy folk. The railways were king.

In 2000, I remember the optimistic fireworks and the controversy over the millennium dome. The forgotten panic of Y2K now seems strange. The World Wide Web[2] was getting traction amongst geeks. Mobile phones were gaining ground. Few saw the attack of 9/11 coming.

Being a child of the last century it’s easier to appreciate the changes. Let’s face it, today’s 25-year-olds had history lessons about subject that many people lived through. Although, there are a growing number of centenarians, most of them were in inkling in the parents’ eyes or babies pre-1925. Thus, we need to relay on the writers of history.

Here’s a proposition that warrants testing. Compared with the first 25-years of the 20th Century nothing much has happened in the first 25-years of the 21st Century. I know any division in time is an arbitrary matter. The Earth spinning on its axis cares little for human affairs. 24 hours in a day come and go whatever we do. That said, my proposition above does run contrary to the way people may feel about time passing. If indeed it does pass.

In both periods we might measure significance by the impact events have on people. There’s a propensity to say that world wars top the list in any account. That may well be fair. However, if we look at the growth in global population and the general improvements in human health despite that fact, then this is the greatest point to note.

When I say, nothing much has happened between 2000 and 2025, by comparison, it’s more to do with the pivotal moments that led to the creation of the technologies that we all now take for granted. Mastering the elements of science has made the biggest difference.

I’d say, in the public and social field, of politics, philosophy and economics[3] and we are as perhaps foolish as we have ever been. Convince me otherwise.

[1] https://www1.grc.nasa.gov/beginners-guide-to-aeronautics/powered-aircraft/

[2] https://www.w3.org/People/Berners-Lee/Weaving/Overview.html

[3] https://www.theguardian.com/education/2017/feb/23/ppe-oxford-university-degree-that-rules-britain

Relationship with the EU

Monday, Monday[1]. It’s a wonderful 60s song. Harmonies and mood are perfect. I wonder if the harmonies and mood will be perfect for the Prime Minister (PM) on Monday. Already the Sunday Press are setting the stage for Monday’s performance.

Reset, recalibration, reheat, rekindle, re-whatever. It’s a moment when relations between the UK and the European Union (EU) can make realistic progress[2]. In world full of uncertainty (could be a song in that one), for once the direction of travel is a constructive and positive.

I think the word “deal” is getting overplayed. Indications are that there’s no fundamental shift from Brexit meaning Brexit, as one former PM liked to say. In fact, the current PM is being highly cautious in the light of his Party’s reading of the latest opinion polls. For no sane reason I can think of, the swivel-eyed loons of the far-right are making hay.

It’s astonishing me how dim-witted the Conservative Party is in objecting to something when they don’t even know, for sure, what it is. Mind-blowing. And the rum cult of Reform Party doing the same with extra bile. What a load of prehistoric fruit loops.

Brexit supporters are spreading misinformation, again. Saying that UK has no influence. It’s true, the UK doesn’t have votes in the European Council or Parliament, but significant influence can be exercised on standards, and regulatory guidance, nevertheless. A better “deal” can bring much greater influence. Absolutely vital in the digital world, and for the UK, a country with a services-based economy.

Brexit has cost the UK dearly. The UK Treasury would have billions more in its coffers if the 2016 referendum had never taken place. The standard of living of every person in the UK is lower because of Brexit bungling. Ideally, that great mistake is an event to be written up for the history books and then forgotten.

On top of the above, uncharacteristic moves in the US, with Trump tariffs there’s nasty hit at the UK’s future prosperity. There couldn’t be a better time to repair relationships with the UK’s nearest neighbours. The countries with which we share most of our long history.

Even for those on the political right, practically, the EU is never going away, so until the day the UK rejoins the block, it’s wise to have the best possible relationship in all matters. Goods, services and people need to connect as a case of mutual benefit.

It’s time for hope. An optimistic tone should be set. A smile. Let’s hope we are singing Monday, Monday so good to me, Monday morning was all I hoped it would be. Naturally, that there be no crying, come Monday evening.

[1] https://genius.com/The-mamas-and-the-papas-monday-monday-lyrics

[2] https://www.independent.co.uk/news/uk/politics/brexit-uk-eu-reset-trade-deal-starmer-b2752285.html

Sustainable Aviation: Innovations and Challenges

Gas guzzling continues to be one of aviation’s problems. Combustion remains that the heart of most aircraft power plants. Taking large amounts of fossil fuel. Squeezing energy out of every drop of gasoline. Gobbling up more day after day. Pushing out emissions.

As I look out across the garden, I see gliding effortlessly as the warm air rises, a Red Kite[1] gracefully circling. Wings outstretched they hardly move them as they climb. They’re a distinctive small bird of prey, easily spotted because of their forked tail. Now, that’s what I call efficient flying. Using all that nature provides and wasting little energy.

Human attempts at flying are a million miles behind these magnificent birds. There’s still so much to learn about aerial navigation. It’s a matter of control. The sensing of ambient conditions and the precision movements needed to ascend and dive at will.

The search is on for effective change. There’s no pretence that the way commercial aviation operates is unsustainable. It’s true that the gas guzzlers of the air guzzle less gas now than they ever have but the physical facts remain.

None of this is new. I’m about to send a book called “Towards Sustainable Aviation” to a charity shop. It’s not that there’s anything wrong with it. The book is full of pertinent analysis and observations. Trouble is that it’s dated 2003.

I’m led to ask – what’s changed in over 20-years? In answering my own question – quite a lot but not enough. Discourse has moved on from academic quarters to the political sphere. Aircraft have become more fuel efficient. Driven by economic imperatives as much as any concern for the climate. Research initiatives are generously funded to come up with answers. Solutions like hydrogen, electric propulsion, and SAF (sustainable aviation fuel) are slowly moving from theory to practice. A few prototypes are flying. Limited supplies of SAF are flowing.

Unmistakable that’s where the problem lies. For all the hype, policy and government funding the pathway to genuinely sustainable aviation disappears way off into the horizon. There are setbacks too. Gas guzzling is back in fashion. Certainly, in Trump’s America.

We could make a much more of the technology that’s currently available. Yes, there are costs involved. Change is not a free ride. That said, sticking with the status-quo isn’t free either. Legacy costs mount up. One reason why older jets disappeared from fleets so quickly.

The next generation of commercial aircraft must make major steps forward. Since the life of a typical aircraft type can easily extend to 30-years, then change must happen in design now.

Typically, commercial aviation moves with graduated change. There’s an inherent conservatism in the system, as might be expected when safety and security are paramount. Facing this global challenge, there’s a need for a degree more radicalism.

Since high impact disruption is also in fashion, it’s time for airlines and manufacturers to adopt a pioneering spirt. It’s been done before. In the 1960s, that pioneering spirt gave us the Boeing 747, the Jumbo jet. That opened flying to a whole generation.

[1] https://www.rspb.org.uk/birds-and-wildlife/red-kite

Europe Day Highlights the Need for Unity

Keeping the peace is never easy. There’s an irrational propensity to conflict in human nature. Keeping the peace is not a passive task. First, it requires communication and engagement. When those two go, trouble is not far behind. It’s by expressing concerns that each side knows where the other stands. Escalation can come when ignorance and propaganda take over.

After the second world war, institutions were established to ensure that communication and engagement became a non-stop affair. With only a small number of exceptions, the countries of the regions of the world engaged in these institutions. Those measure have contributed to making a more prosperous world.

“Never again” are two words that refer to the atrocities of war. The moto is to remind everyone that the worst can and does happen, and that perpetual effort is needed to ensure that history does not repeat itself. The concept of “lessons learned” is essential for safety and security. This is as much true for micro day to day activities as it is for the macro events that shape the path global ahead. Taking teaching not from narcissistic demigods and snake oil salesman but from the pages of history. Appeasing tyranny is not an option.

This week has been a reminder of the lessons learned from the world wars. For most people it’s been a continuing commitment to ensure such events never happen again in Europe. Sadly, let’s not be coy. Despite an overwhelming desire for peace, conflict in still Europe is a reality. But the lesson is there in black and white, appeasing tyranny never works.

Today, Friday 9th May is Europe Day. That’s because a speech by Robert Schuman[1] changed the course of European history on this day. Five years after the war in Europe had come to an end, he put forward a proposal that would make a future similar conflict impossible. The idea was to create an interdependence that would secure peace, unity and solidarity.

It worked. His proposal led to the creation of a European Coal and Steel Community. That measure lay solid foundation for what would later become the European Union (EU). Behind this is move is the echo of “Never again”. Europe has seen centuries of war. This was a moment in time to bring that to an end.

For now, 75-years on, this has been a success. It’s not a regional project with a defined end, even if it has a defined beginning. Where the EU chooses to go next is in the hands of its Member States and its citizens. Changing the course of European history doesn’t stop because the EU exists. Without the cooperation and dialogue, it provides there’s always a chance that ancient rivalries will be reignited. In fact, unscrupulous right-wing politicians[2] are trying to do that just now.

Sadly, in the UK, we stand on the sidelines, looking across the water at continental Europe. Brexit has done a great deal of damage. But as I have said, nothing is static, the world is entering an ever-uncertain phase. The opportunity for the UK to restore EU relations is open. I see the wisdom in the words of the Governor of the Bank of England. He has said the UK now needs to “rebuild” Britain’s relationship with the EU. Amen to that.

[1] www.europa.eu/!9JbCd9

[2] https://www.politico.eu/article/germany-spy-agency-walk-back-extremist-label-afd/

Finding Balance

Regulation can be a contentious issue. That’s an understatement. A spectrum of views extends from the complete libertarian to the past soviet model. Citizens shouldn’t be encumbered by any restrictions to the State has the right to dictate every aspect of life. Clearly, there are immense downsides to either of these extremes. Luckily, although not everyone will agree, the set of political choices available in the UK covers the wide range from the far-right to the far-left. These labels are deficient when it comes to the detail. Often these two camps are similar in their authoritarian ways and means.

Rejecting the extremes, being a liberal, means finding a balance. That means a minimal number of rules and regulations to achieve the prosperity, safety and security goals that most people happily support.

A pendulum swings in the British political cycle. Never quite sure what the cycle time is on this one. What’s for sure is that our society’s tendency is to go from urges to tighten-up rules and regulations to impulses to eliminate or relax them with gusto. Often, the aim is to tweak or protect economic stability or tweak or promote economic growth. After the banking crisis of 2008 it was the first of these, now it’s the second.

Brexit is a strange oddity. Although, great claims were made for the loosening of the ties that bind us, the reality has been much onshoring of past rules and regulation. The forces of continuity have some good arguments.

It’s reported that Prime Minister Starmer is considering dynamically aligning UK regulations with EU regulations, as if that’s not happening pragmatically and piecemeal already. OK, this is not consistent across every sector of the economy. It’s a mixed bag. Politicians banging the drum but not doing much.

Let’s say the financial services market goes a different way from the technology sector. One has a history as long as your arm the other is being made-up as we speak. Clearly, there are risks in both deregulation and overregulation. Thus, I get back to that notion of finding a balance.

To hardened Brexiters EU and UK rules constrain. To their supporters they enable, facilitate and transform.

Now, what’s difficult to discern is where do Starmer and Reeves stand?

A direction of travel, to encourage investment in the UK, has been touted. That implies alignment rules. Investors rightly seek the largest market on offer. Like it or not, the UK is not the US, or even the EU when it comes to the size of its economy. Maybe, it’s taken Brexit to realise that we align as a matter of common interest. Mutual benefit.

Most of our safety and security goals are not subjects of intense competition. If you fly internationally, why would it make sense to compete on safety or security? The general expectation is that common high levels of safety and security are desirable.

As the weather improves so we are heading towards a year of the Labour Party in power. There’s disappointment and concern about the timidity of their actions. The word “reset” is banded about. A ridiculous word. Press the reset button to restore a past condition. No, choices need to be made. Closer alignment and partnership with the EU are the rational choices.