Tag Archives: trade

The British government has been scrambling to keep up with the outrageous behaviour of the rogue superstate which happens to be our main ally and with which we claim to have a ‘special relationship’. Keir Starmer says that he had no warning of the attack on Venezuela which suggests that he has clean hands but no influence. 

A subject much closer to Britain’s long term vital interests are forthcoming negotiations with the Trump Administration on technology. These talks will determine whether Britain is to be a digital and AI colony or retains some vestiges of sovereignty.

They affect our freedom to levy taxes.  They affect our freedom to manage the flow of sewage contained in social media content being defended as ‘free speech’. They complicate any move to realign regulations with the EU. Furthermore, the allegiance of the leading tech companies to the Trump Administration makes any commercial deal highly political. And geo-political too since we are being pressed to choose between the two superpowers.

The pending negotiations build on the Economic Prosperity Deal under which the USA agreed to reduce Trump’s ‘Liberation Day’ tariffs to the baseline 10% (rather than the EU’s 15%) in return for various UK concessions. One concession was accepting a ‘poison pill’ limiting agreements with ‘non-market’ economies (ie China). 

The next stage is a Technology Prosperity Deal which promises more digital infrastructure investment in the UK in return for more UK concessions on policy. The USA objects to the UK 2% digital sales tax and to the UK On-line Safety Act which is said unfairly to constrain US AI companies. Other irritants have included British demands under the Investigatory Powers Act, for Apple to break its end-to-end encryption.

Britain has a high dependence on US tech companies. Britain’s digital economy accounts for around 13% of GDP (manufacturing is around 9%). The digital economy in turn depends largely on the platforms and services of US tech companies.  The new growth area is AI where US companies also dominate.

Dependence stems from the power of the algorithms used by the tech companies which can be manipulated to slant output to serve the interests of owners or the ideological prejudices of the Trump administration. The opaque decision-making processes of AI make subtle manipulation easier. The sheer complexity of AI also makes it easier to lock users into platforms which then become embedded and difficult to replace. 

In principle, users have the option of using competitive alternatives which, in practice, are Chinese: platforms like Alibaba or Deep Seek for AI. But Chinese companies have difficulty meeting privacy regulations; and there are security and geo-political concerns. In any event the UK has already conceded to the USA an effective veto over Chinese involvement.