Tariffs and trade: The lessons of Liverpool

Yesterday morning I looked out on the River Mersey as headlines about crashing global markets drew a crowd around the TV screens in my hotel lobby. 

Trying to make sense of what change means for you, me and the world around us is never easy. Liverpool’s recent history contains both a message and a warning for today’s business and political leaders on the human impact when the global economy turns in a different direction.  

In the decades following the Second World War, nine miles of Liverpool docksides employed more than a hundred thousand people. Goods from West Africa, the Far East flowed into the city while textiles and industrial goods from the Northwest of England flowed out to the rest of the world. Transatlantic trade with America was booming. 

The end of Empire, the rise of jet travel and the introduction of containerised shipping freight brought to my home city the kind of disruption and dislocation that results in mass despair. Unemployment brought violence, poverty and drug dependency to blight the lives of a generation.  

On Sunday morning, the Prime Minister told us that “the world as we knew it has gone.” Sir Keir Starmer is not known for dramatic rhetoric, but I think his words ought to resonate with the tens of millions of people here in the UK trying to make sense of Donald’s Trump’s unpredictability. Larry Fink of BlackRock, the world’s biggest asset manager has warned this morning that the ripples from hundred-year high tariffs will be longstanding. 

Whatever the result of this bitter war of words on tariffs, we are witnessing the realignment of decades of trade policy overnight. Donald Trump is polarising the world in a way that means no-one can predict the final outcome. The era of globalisation looks to be at an end.

Half a century on from what one recent history has called the “unmaking of Liverpool”, it’s true to say those scars are healing. Liverpool is finding a new future as a leisure destination and the services economy more generally is expanding. 

The UK is one of the most open trading economies in the world. By one estimate that looks at total UK pensions and savings, half of our wealth is tied up in the US economy. 

No-one should be in any doubt that new barriers to trade will create a world of angry mercantilism and retribution. Let’s not miss the scale of what is at stake for the future wealth and wellbeing of everyone. History has lessons for us all.