Trump and British Prime Minister Boris Johnson have said they would like to sign a big trade deal of some description but, now that we have some idea of what that would look like, everyone can rest assured that it will be irrelevant.
The British government recently laid out their expectations for a possible trade deal with the European Union to replace free access to the European customs union and they've now done the same for a possible deal with the United States.
Under a best case scenario outlined by the Johnson administration, a deal with the U.S. would add so little to the economy it would barely even register in economic reports if it does at all.
This week Boris Johnson’s government published a weighty document setting out the U.K.’s objectives for a deal that would bring “better jobs, higher wages, more choice and lower prices for all parts of the U.K.” Donald Trump welcomed the start of talks, enthusing about the “fantastic and big” trade deal the two countries will do. In reality, it will probably be neither.
The overall impact of a trade deal can only be described as modest. In the best of the two scenarios set out in the U.K. paper, a free-trade agreement would add 15.3 billion pounds ($19.8 billion) to the U.K. economy over 15 years, or a 0.16% boost to GDP. For the U.S., the elephant in this negotiation, the rewards require a magnifying glass — the best-case scenario delivers a boost of five-hundredths of a percent of GDP.
Five-hundredths of a percent!
The irrelevance of a possible trade deal with the United States is more consequential, or less, as it were, for the British government than it is for the Trump regime because Boris Johnson and other pro-Brexit forces have spent several years claiming that a trade deal with the U.S. could fill the gap left behind by leaving the European Union.
If the best possible scenario will only add 0.16 percent of value to British GDP over 15 years, a trade deal with the U.S. would not fill the gap left behind by ending free trade with just France or Germany, much less the entire European Union and the 500 million consumers who live in the bloc.
Prime Minister Boris Johnson has promised a lot of things that he will almost certainly never be able to deliver. And even the things he actually delivers will not be anywhere near as consequential as he has promised. In other cases, what Johnson has promised could be far too consequential for all the wrong reasons.