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How safe is your job?

This has been a year of financial panic, but 2009 will be dominated by unemployment. In a flexible l

The poster that won the 1979 general election was a fake. The "Labour isn't working" dole queue was ac tually composed of 20 fully employed Hendon Conservatives, photo graphed by Saatchi & Saatchi. But there was nothing synthetic about the impact that the poster had on the Labour government of James Callaghan. Never again, Labour resolved, could the party afford to go to the country when the country was out of work. Yet that is what Gordon Brown risks doing, if you believe the spin about him delaying the next general election until 2010.

This was a year of financial panic as oil prices spiked, banks collapsed and stock markets tumbled. But it is likely that 2009 will be the year of the dole. Unemployment, already higher than at any time since Labour came to office in 1997, is expected to climb to almost three million by 2010, according to the Confederation of British Industry. The turnaround in the UK employment market has been astonishing. The pace of job losses, led by the shake-out in the banking sector, has astounded analysts: the Centre for Economic and Business Research (CEBR) has forecast that 300,000 private-sector jobs will have been lost in the six months to the end of this year alone. The CBI's forecast, made only a few days ago, is almost certainly an underestimate, because it is based on Britain's GDP declining by 1.7 per cent in 2009. The Bank of England is now talking about the economy shrinking by 2 per cent next year, as Britain enters the worst recession since the 1980s. Capital Economics has forecast that unemployment will peak at 3.3 million in 2010.

The situation is already worse than the formal statistics suggest. Stephen King, of HSBC, argues that the official International Labour Organisation unemployment figures exclude two million people who are economically inactive but would like a job.

What is undeniable is that British firms are taking advantage of the "flexible" labour market to fire first and think later. Unusually, the region hardest hit is likely to be the one most able to cope: the south-east. The London area alone could lose 650,000 jobs, according to the Local Government Association. This is one of the wealthiest areas on the planet thanks to the financial services sector based in the City. Redundant middle-class professionals might find life a little different on £60-a-week Jobseeker's Allowance, but most can probably look after themselves. The people who will have their lives destroyed first are the legion of temporary and casual workers, many of whom do not figure in the unemployment statistics because of their age or country of origin.

Many of the new redundancies are unavoidable, but there are signs, too, that some firms are reducing their workforce as a message to shareholders, hoping to bolster their equity prices. When BT announced 10,000 redundancies on 13 November it made no attempt to play down the human cost and, according to some analysts, even exaggerated the job losses for effect.

After three decades of losing industries, the UK desperately needs to protect the skills it has left, not allow them to dissipate in the lengthening dole queues

Firms such as Virgin Media, Rolls-Royce, Yell, Wolseley and Citigroup have all announced thousand-plus job cuts in the past few weeks alone. The flexible labour market, inspired by the Tories and realised by new Labour, has allowed contraction to be a first, rather than a last, resort. It is the quickest way for a management in trouble to show that it is doing something.

The problem is that these job losses, rather like the banks' refusal to lend to small business, are enormously destructive to the broader economy. After nearly three decades of losing productive in dustries, the UK desperately needs to protect those skills it has, not allow them to dissipate in the dole queues. But with trade unions weak, employment law liberal and the government compliant, firms are being allowed to throw out the seedcorn of the future.

Only the state would be able to counter the effects of this attrition. In the pre-Budget report, the Chancellor's measures on benefits, pensions and VAT were intended to boost pre-Christmas demand in the high streets. However, the government is severely limited in its ability directly to fill the jobs gap. Yes, the public sector is still hiring, and will have put on 50,000 jobs in the six months to the end of the year, according to the CEBR. But, with public borrowing likely to reach at least £118bn next year, there will have to be a retrenchment in the labour-intensive public sector to get the public finances into some kind of order in the medium term. Make no mistake - the price of this year's fiscal stimulus is likely to be public-sector job losses, even with the Chancellor's heroic, and unrealistic, assumptions about an economic recovery in 2010.

In this instance, the weakness of the pound is unlikely to boost employment in export industries. This is a global recession, perhaps a global depression, and Britain cannot rely on international markets to replace lost domestic demand. There is also likely to be a wave of protectionism, starting in the US, as countries seek to save their own core industries with state subsidies and other anti-competitive tools. The world market may be a tougher place in which to sell in future. Anyway, Britain has lost most of its manufacturing base - down to 14 per cent of GDP.

In recent years, most of our "exports" have been in financial services - "invisibles", the demand for which will be slight for the duration of the credit crunch.

We can be thankful at least that the right man is in the White House at the right time. Alistair Darling has moved some way towards matching Barack Obama’s plan to create 2.5 million jobs over the next two years through public work projects and alternative energy investment. Yet this will not happen quickly and will do little to alter job losses already in train. And, in America, which is 12 to 18 months further advanced into the recession than Britain, life is already desperate for people on the margin.

The US department of agriculture reported on 17 November that the number of children who went hungry in 2007 - the first year of the credit crunch - jumped by 50 per cent to almost 700,000. It said that, overall, 12.2 per cent of Americans, 36.2 million people, "do not have the money or assistance to get enough food to maintain active, healthy lives". It could happen here.

At the very least Britain faces a return to a period of sustained joblessness, and to the destructive psychology that accompanied it. There will be dole queues, of course, but the social composition of the new jobless - led by financial services, property, retail - will be very different from what we saw in the early 1980s. As a recent report from the Chartered Institute of Personnel and Development argued, those at most risk in the coming "redundancy torrent" will be managers, professionals and skilled non-manual workers.

Tens of thousands of jobs are about to eva porate from British banks. Multiply that by all the professional jobs which depended on those middle-class incomes, such as estate agents and lawyers. Certainly, the first to be hit will be those at the bottom. But they are likely to be joined by large numbers of articulate, middle-class individuals shaken out of the financial, media and peripheral service occupations - from aroma therapy to management consultancy - which have grown up during the long boom.

Middle-class workers are not ready for this and it will be a shock to their self-confidence and self-esteem – a social and cultural transformation that could have profound political implications.

In the 1980s, the middle classes were still relatively secure in their career structures in management and the professions. They had homes, occupational pensions, clear employment paths. Certainly, they were a world away from the trade unionists fighting for their jobs in the old industrial heartlands of Britain. Margaret Thatcher relied on the middle classes to support her war on the militants with their braziers - and to blame them for the recession of the 1980s. The braziers are gone and the industrial working class has largely been dismantled. So, too, have the secure middle-class career structures.

Those who will suffer are the children of the baby boomers, who graduate with high debts and higher expectations

In the 1980s, professional and other white- collar jobs were, by and large, jobs for life, with annual pay increments, annual promotion, pension rights and a predictable future. Not any longer. The modern media, for example, are a shifting sea of freelance and contract workers for subcontractors to the large institutions. Even at the BBC, where I started out, there may be a crust of well-paid performers and anonymous executives who earn more than the Prime Minister, but below that is a huge army of irregulars, often on low salaries, coming in and out of the corporation's revolving doors. The commercial sector has been relying on large numbers of underpaid or unpaid "interns" desperate for work. This is the flexible labour market at its most pernicious. Such practices are widespread throughout the British economy.

Deregulation and leveraged buyouts by private equity over the past two decades have left many firms with flattened management structures, often relying on outside consultants to get them through busy periods. Occupational pensions have become a rarity. Promotion has become intensely meritocratic. Companies increasingly "offshore" white-collar functions to countries such as India, where an educated middle class is willing to work for much lower wages. Most of the job losses at BT are among self-employed contract workers in the UK; the firm has not cut any of the jobs it has outsourced to India.

The group hit hardest is the under-35s, sons and daughters of the postwar baby boomers, who have emerged from university with high debts and even higher expectations. These are the young people who have little experience of recession and none of mass unemployment. Neither have many of their parents, who lived through the 1970s and 1980s largely untouched by unemployment or debt. If there is to be a political response to the new depression, it is likely to emerge from this group of déclassé graduates, many of whom face a future without the security they have been brought up to expect. They will not be able to afford houses or establish careers. Indeed, the under-35s have so much personal debt that their net wealth is actually negative. Three-quarters of the under-35s are in the red, according to the Skipton Building Society, owing more than £9,000 on average. They will look to the state for security, but the state will not be able to deliver.

This time there is no trade union menace to blame for economic distress

A Ministry of Defence think tank has made a remarkable forecast about political militancy. The Development, Concepts and Doctrine Centre published a report in April 2007 in which it speculated that in coming years “the world’s middle classes might unite, using access to knowledge, resources and skills to shape transnational processes in their own class interest”. “The middle classes could become a revolutionary class taking the role envisaged for the proletariat by Marx . . . the growing gap between themselves and a small number of highly visible super-rich might fuel disillusion,” the report said.

The idea of a revolution sweeping suburbia is faintly risible, though it was a subject of a recent J G Ballard novel, Kingdom Come. But the MoD may have grasped an important truth about the nature of politics in the new global economy. It is beginning to erode class differentiation and has left many middle-income earners exposed to the kind of insecurities that formerly afflicted only lower-class workers. Clearly, the economic circumstances of management consultants cannot be compared directly with those of retail workers. But when they lose their jobs, they face very similar challenges: mortgage and credit-card debt, catastrophic loss of earnings and the need for retraining.

Part of the difficulty experienced by the Conservative leader, David Cameron, in developing a coherent political response to Gordon Brown's neo-Keynesianism, is that the party of capital has lost its "class enemy": the industrial working class. There is no trade union menace to blame for economic distress and the Conservatives have had to fall back on "fiscal conservatism" - or reduced public spending. This is simply not a priority for an electorate that is looking to the state to protect it from the predations of the market. Equally, new Labour under Brown has been forced almost against its will to become more critical of the plutocracy running the banks, to accept nationalisation and greatly increased government spending. Brown's government has even had to abandon one of the founding principles of new Labour by proposing higher taxes on the rich.

The Conservatives, who have not entirely lost their Thatcherite reflexes, are looking to the middle classes to react against the new profligacy - but they will find it difficult to do so. As un employment mounts among the middle classes, especially among the under-35s, there is going to be a much stronger demand for policies which promote jobs and growth even at the cost of public borrowing. The Tories cannot afford to be on the wrong side in this battle.

As Martin Hutchinson, author of Great Conservatives, has expressed it: "A world in which few if any have security in their livelihood is not conservative, it is anarchist. It is also deeply repugnant to the average voter."

If Labour isn't working, neither are the Conservatives.

This article first appeared in the 01 December 2008 issue of the New Statesman, How safe is your job?

JAVIER MAYORAL. IMAGE MANIPULATION BY DAN MURRELL
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A world unbalanced

Under Trump, the United States could turn away from Europe, leaving the continent exposed and vulnerable. So is it the destiny of the UK alone to stand for collective defence, free trade and fair play in a turbulent age?

Listening to the reading – from St Paul’s letter to the Corinthians – on Remembrance Sunday, the first Sunday after the earthquake of the US election, it seemed that someone, somewhere had a sense of ironic timing. “In a moment, in the twinkling of an eye, at the last trump [sic!],” the passage ran: “for the trumpet shall sound, and the dead shall be raised incorruptible, and we shall be changed.” Whatever the text really means, it brought home the fact that the election of Donald Trump has transformed, and transformed utterly, the world in which we live. We Europeans no longer know where we stand with the most powerful country on Earth, and whether it will deliver on its alliance obligations. Our world is out of balance. A terrible uncertainty has been born.

Looking out over the uniformed members of the congregation – army, RAF and Royal Navy – one couldn’t help thinking that next year they may be all that lies between Vladimir Putin’s Russia and the Baltic states. As our continent boils, the armed forces represent, to borrow the pathos of Dorothy Sayers’s 1940 patriotic verse “The English War”, “the single island, like a tower,/Ringed with an angry host”. If things continue to deteriorate, we may soon see the moment when, as the poem continues, “. . . Europe like a prison door,/Clangs, and the swift enfranchised sea [the Channel]/Runs narrower than a village brook;/And men who love us not yet look/To us for liberty”. It is in times like these, she writes, that “only England stands”.

In recent days, the shock of Trump’s election has started to wear off and the usual reading of tea leaves about the new administration has begun in earnest. Appointments and nominations are being scrutinised for clues to what a Trump presidency might mean for the world. These attempts are understandable, but they are also futile. It is clear that Trump, like all other presidents, is filling positions taking both ideology and party management into account – balancing the appointment as his chief strategist of Stephen Bannon, a leading light of the “alt right”, for instance, with that of Reince Priebus, a stalwart of the Republican establishment. Something similar is visible in the foreign policy sphere, where the two most important choices point in fundamentally different directions on one of the critical challenges facing the administration, namely Russia. General Mike Flynn, Trump’s nominee for national security adviser, is well known for his closeness to Moscow, at least in relation to Syria, while Mike Pompeo, the proposed CIA director, is deeply suspicious of Putin’s ambitions in the Middle East.

To infer from this fudge the future policy of the United States would be unwise. One should not assume that Trump’s lack of detailed knowledge of world affairs, or his rocky relationship with the Republican Party’s national security experts, will increase the influence of professionals in the state department. Nor is it right to expect the new president to fall back on Mike Pence, his vice-president-elect, as an inexperienced George W Bush did with Dick Cheney. Trump knows his own mind, especially on the big strategic challenges, and will not listen to the experts or party grandees. His estimation of Pence became clear when he almost forgot to thank him during his victory speech. Besides, Trump, who has spoken openly of possible candidate appointments as “the finalists”, in the manner of his TV show The Apprentice, can fire as quickly as he hires. There is no guarantee that anybody who is in his cabinet in January 2017 will be there a year or two later.

The speculation is pointless in another respect. We already know what kind of animal Trump is. His world-view is fully formed; his temperament is well known. Behaviourally, Trump is the silverback ­gorilla, the narcissistic peacock, the alpha male, the bull in the china shop. Politically, he is a Bourbon who has learned and forgotten nothing over the past three decades.

Here, it is essential to distinguish between rhetoric recently adopted to wage the election campaign, and long-standing positions that Trump has been espousing for 30 years. The good news for Americans is that most of the divisive language and proposed measures probably fall in the former category. His appalling inflammatory comments – too familiar and numerous to repeat here – were largely instrumental; they do not seem to have featured much in his vocabulary before his candidacy. America is not about to turn fascist. Trump is unlikely seriously to assault the constitution, and if he does so he will be repelled. There may be substantial economic and cultural rebalancing, and some pretty brutal measures against terrorism and illegal immigration, but the United States will probably be fundamentally much the same place in four or even eight years’ time. The bad news for the rest of world is that the beliefs most threatening to us are the ones Trump most genuinely holds, and that he is in the best position to implement. Europe, in particular, will be very different four years from now and it might well be unrecognisable in eight.

 

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The key to understanding Donald Trump is his quest for restoration of national “greatness” for the US, which he sees as having been lost in the retreats and compromises of the Obama years but also the interventionism of George W Bush. Economics is central to this vision, yet it is not the deciding factor. To be sure, re-establishing economic strength is important. It will enable the US to sustain Trump’s prohibitively expensive plans, especially the proposed huge infrastructure programme, his tax cuts, and the vast increase in military spending. The new president believes in not international, but national capitalism, based on construction and manufacturing rather than trade and finance. One may not share Trump’s vision of restoring prosperity and pride to America through civilian work creation, motorways, bridges and armaments, but it is a coherent programme. Unlike free-traders and globalisers, who see all boats rising on the tide of a growing world economy, Trump takes a much darker, mercantilist view. It’s not the economy: it’s the greatness, stupid.

Threatening US greatness, so the Trum­pian critique claims, are not only America’s enemies but America’s friends. Politically, the main threat is radical Islam, which he says the Obama administration refuses to call by its name, and which has been aggravated by a costly, failed “nation-building” project in Iraq. Economically, it is China and Latin America which have, in effect, stolen manufacturing jobs from America after the lowering of tariff barriers. Not much better, however, are America’s allies, such as the Japanese and the Europeans, who are free-riding under the US defence umbrella and taking unfair advantage in trade.

Globally, therefore, Trump’s administration will mark a change in four important respects. First, he will either abandon or ignore the institutions of international governance that the United States has done so much to establish. Trump will pay no heed to the United Nations whatsoever. He will not act against climate change. Here the ­appointment of Myron Ebell to lead the transition team for the Environmental Protection Agency is a straw in the wind: Ebell does not believe in global warming. Trump will press ahead with fracking and drilling on all fronts, not necessarily for economic reasons but in order to guarantee energy security for the US. He is unlikely to pull out of the World Trade Organisation but will abrogate the Trans-Pacific Partnership, “re-negotiate” the North Atlantic Free Trade Agreement and probably drop the Transatlantic Trade and Investment Partnership.

Second, there will be a “pivot” of US foreign policy towards the Middle East and the Mediterranean. In Syria, the new administration will seek co-operation with Russia and the Assad regime against Isis and other Islamist groups, if necessary in return for concessions elsewhere. That will be just the start, however. Trump’s hostility to Obama’s nuclear deal with Iran and to the Iranian regime is a matter of record, and Mike Flynn’s writings have been only slightly less anti-Iranian than they have been anti-Isis. There can be no doubt about it: for the Trump White House, Raqqa in Syria may come first but Tehran is next. How exactly it intends to go about this is not obvious, but it is clear that the planned new, 350-ship navy is needed not just to deal with Isis.

Third, Trump will take on China, at least over trade, not least because it will be critical to his domestic jobs programme. Early steps might include whopping tariffs on Chinese goods and designating China a currency manipulator. In this regard, it may be significant that Trump has expressed enthusiasm for Stefan Halper’s 2010 book, The Beijing Consensus, which takes an understandably dim view of China’s restrictive trade practices, authoritarian proclivities and regional belligerence. That said, economics aside, there is little sign that Trump has a broader political, ideological or military agenda with respect to China. His remarks, both recent and long-standing, suggest that he has little interest in maintaining the alliances with South Korea, Japan and other states keen to contain Beijing.

These plans not only risk failure, thereby causing great human hardship, but could also precipitate a major conflict. Trump fails to understand that, in Syria, most of the Syrian government forces and the vast majority of Russian air strikes are directed against the rebels: that is, the non-Isis Islamists and what is left of the Free Syrian Army. Since his election, he has reiterated his contempt for the Syrian rebels and indicated that we should wish for an Assad victory so that he can concentrate all his fire on Isis. One problem with this strategy is that it will increase the outflow of refugees – most of whom are already fleeing the Syrian regime, its Iranian allies and proxies, as well as the Russians, rather than Isis or the Western bombing. The other, and probably terminal difficulty, is the contradiction of wanting to co-operate with Tehran in Syria yet crush it in the Gulf.

In east Asia, the danger is that a trade war may precipitate another world recession, and also a full-scale military confrontation. China took its time responding to Trump’s victory, and did so with extreme truculence. Beijing vowed to retaliate against any tariffs. If backed into a corner, the Chinese might well try “horizontal escalation”– that is to say, using military demonstrations or even armed attacks to retaliate against US trade measures – in Taiwan or the South China Sea.

Unless Trump is entirely clear about how he will react, and this would require him either to reaffirm the existing strategic architecture of the region or to signal his withdrawal from east Asia, the chances of a catastrophic misunderstanding are high.

 

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By far the greatest risk to the international system, however, is not the wars that Trump will start, but the one he might not fight, and will thus fail to deter. His rallies often featured banners accusing Hillary Clinton of wanting to start “World War III”. These referred to her willingness to honour US commitments under the collective defence provisions of Article 5 of Nato’s charter. Trump, by contrast, has repeatedly questioned whether America should defend those allies that are not spending enough on their own protection. He has even referred to Nato as “obsolete”.

More worryingly, there has been a general whiff of pro-Russianism in the Trump camp. The president-elect makes no secret of his admiration for Vladimir Putin, the man who has annexed Crimea, unleashed a proxy war in eastern Ukraine and threatens Nato’s eastern flank, to say nothing of his other crimes. This summer, one of Trump’s leading backers, Newt Gingrich, described Estonia as a mere “suburb” of St Petersburg. The close Russian connections of many others in Trump’s penumbra are too well known to require repetition. The frightening truth is that, with regard to Russia, there is much more going in the Trump camp than the (entirely understandable) irritation with European free-riding.

All this reflects a much broader, and deeply troubling, “de-Europeanisation” of the American strategic mind, if not in national security circles then in politics and among the population at large. Once upon a time, a strong stance against the Soviet Union united Cold War liberals with the working classes, including many from Poland, Ukraine and the Baltic states. Gerald Ford’s gaffe in a televised election debate against Jimmy Carter in 1976, in which he denied Russian domination of eastern Europe, may have cost him the White House. Likewise, many of the “Reagan Democrats” of the 1980s were working-class “deer hunters” of eastern European origin who wanted him to stand up to the Kremlin.

That constituency is no more, and it is a sign of the times that Gingrich, who had written support for the integration of former Warsaw Pact countries into Nato into his Contract for America two decades ago, should now hold the alliance so cheap. All the same, it has been surprising to see the flippancy and vehemence with which a sixty-year transatlantic bond has been put in question, not reluctantly, but with a whooping rebel yell.

The president-elect poses another, more insidious, but no less fatal menace to Europe. His victory has blown wind into the sails of the European far right. “Their world is falling apart,” Florian Philippot of the French Front National (FN) exulted after the result. “Ours is being built.” France’s presidential election in April and May will be won by either Marine Le Pen’s FN or – more likely – François Fillon of the conservative Républicains; both candidates are pro-Russian. It is also likely that Prime Minister Matteo Renzi will be defeated in Sunday’s referendum on reforming the powers of the Italian parliament. If he resigns, the resulting election may well bring the Eurosceptic right to power. In Germany, Alternative für Deutschland is weaker, but growing.

Given all this, the capacity of the rump European Union to deal with the security, economic and migration challenges ahead will be severely tested. The weakness of mainland Europe is also manifest at a national level. Even its two most important countries, France and Germany, have ceased to exist as separate states in vital areas: neither controls its own currency or borders, and Germany does not even have a nuclear deterrent or (sufficiently credible) conventional capability.

As such, despite the hopes of many, Angela Merkel will be too weak to lead Europe even if she wins Germany’s federal elections next year. To be sure, she has pledged to work together with the new US president only if he respects people regardless of creed, sexual orientation and skin colour. Yet Chancellor Merkel lacks the instrument to protect Europe militarily, because of Germany’s largely pacifist political culture and the EU’s failure to provide itself with anything more than a shadow capability at supranational level. She is also losing ground steadily at home. A Trump-induced fresh wave of Syrian refugees may well finish her off.

 

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In democratic Europe, therefore, only the United Kingdom stands out. Here, the widespread continental European tendency to equate Brexit with Trump misses the point. Despite all the Brexit turmoil, Britain is likely to remain infertile soil for extremism, at least once the separation from the European Union has been completed. Although many of those who voted for Brexit did so for similar reasons to those of the workers who opted for Trump, the political mainstream in Britain, including those who supported leaving the EU, remains strongly in favour of free trade, and strongly committed to Nato. Moreover, the UK is still the world’s fifth-largest economy and a nuclear power, and it retains the principal characteristics of sovereign statehood – her own currency, parliament and control over her borders.

The result of all this will be a fundamental shift in European geopolitics in favour of Britain. The election of Donald Trump has four effects, the first two of which will probably cancel each other out. On the one hand, his protectionist instincts may make him less interested in a trade deal with the UK. On the other hand, he is less likely than a Democratic administration would have been to send Britain to “the back of the queue”. Trump’s impact will be felt elsewhere, however, in the field of geopolitics and global governance. Britain will now be one of the few large economies in favour of free trade. More important still is that, with a large question mark now hanging over Nato, the contribution made by the British armed forces to the defence of Europe as a whole, and to the defence of European values against President Putin, will take on a new significance.

Britain needs to rise to the challenge. Militarily, she may have to hold the line in Europe for at least four years – possibly for eight. Consequently, a full-scale rearmament must begin now, with increased expenditure on ships, aircraft, “heavy metal” for the army, and cyber-defence. The necessary shift is comparable to the one orchestrated by the chief of the imperial general staff Sir Henry Wilson in the early 20th century, when he began to change the military mission from imperial policing and small wars to preparation for war against a major power in Europe.

Politically, Britain urgently needs to clarify its relationship with the rest of the continent. It would have been better if Brexit had never happened, or at least not before the EU had sorted itself out, but now it should be expedited without delay so that we can all concentrate on the bigger challenges. This should be based on a grand bargain in which London retains a free-trading relationship with the EU, reserving the right to restrict immigration in return for our increased commitment to European security through Nato. Britain’s EU budget contribution could be reallocated as increased defence expenditure to help defend the EU in the east. Some continental Europeans, in German business circles as much as in Poland, have already begun to see the connection between the two spheres, and the need for a trade-off.

London thus needs to take two messages, one to the EU and the other to Washington, DC. It is a great pity that the Foreign Secretary did not attend the Trump post-mortem of foreign ministers in Brussels, not to join in the pointless therapy session, but in order to read the Europeans the riot act on Russia. They have already seen that one cannot have a common currency without a common treasury and parliament (in other words, a common state); and that one cannot have a common travel area without a common border – in effect, a common state.

Now they are planning to fill the potential American vacuum with a (much-needed) European army without a European state, something that can only end in more tears. Johnson should have told them that if they wish to survive they need to form a full political union, like that which has linked Scotland and England. If that does not appeal, they must increase their individual national military budgets and, if the Americans withdraw from Nato commitments, they must fall in behind Europe’s principal military power, the United Kingdom.

Rather than supplicating in Washington, Britain should speak to Trump in language that he understands: not of realpolitik, but of real estate. The problem is not so much his belief that diplomacy is “transactional” – all political relationships are – but that he takes a very short-term and narrow view, valuing the quick buck over long-term shareholder value. He should be reminded that the US holds the largest stake in a military consortium that owns the freehold of the property on which the EU is built; the UK is the next largest shareholder, whose interests are materially affected by any change. It is true that many of its tenants are not paying their contribution to the common defence, yet some are. The problem with Trump’s approach is that he has no satisfactory way of punishing the transgressors specifically. If he turns off the heating, everyone will freeze. Besides, some of the worst offenders, in the Mediterranean, live in south-facing apartments, away from the cold Russian wind. They will be the last to feel the drop in temperature.

 

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Donald Trump must be told that the people most affected by his policies, especially those in the Baltic states, are guilty of nothing more than being born in the best property in a terrible part of town. If he withdraws Nato insurance cover, property prices will go down and people will move out. This is because collective security works rather like Bill Bratton’s New York: it depends on zero tolerance, on fixing the windows and apprehending the stone-throwers. The danger is that after four years of Trump, much of eastern Europe will resemble a declining neighbourhood in 1980s America, with broken windows, uncollected rubbish, and demoralised residents huddled around braziers trying not to catch the eye of the criminals stalking their streets.

If that happens, we may soon see a Europe where the Atlantic, once an enfranchised sea connecting America and Europe, has become an unbridgeable ocean culturally and politically; where the United States has left us to our fate; where the channel separating the home island from a turbulent continent once again runs narrower than a village brook; where Italy and France have given way to authoritarian, Russian-leaning populists; where Germany finally buckles under the strain; where the rest of Europe has scattered like minnows; where Putin rules supreme in the east; and only England stands for collective defence, free trade and fair play.

Brendan Simms is an NS contributing writer. His latest book is “Britain’s Europe: a Thousand Years of Conflict and Co-operation” (Allen Lane)

This article first appeared in the 01 December 2016 issue of the New Statesman, Age of outrage