Tariffs were enacted April 2, then suspended April 9.
One month ago:
Yesterday:
This morning.
... Trump repeated this inaccurate assertion about three $1.98 states at least three times this week. Then, during a commencement address at the University of Alabama on Thursday night, he used an even lower figure. ...
More.
The Treasury Secretary would know, of course, because he has to report income and outlays every month.
One person who witnessed the dispute said:
It was quite a scene. It was loud. And I mean, loud.
The story is here.
The White House’s push for for expanded presidential power threatens US economic stability
Donald Trump is systematically purging every US government institution, a pattern familiar to anybody who has studied the caudillo regimes of Latin America, or the playbook of today’s Putin-Orbán-Erdoğan prototypes.
It is a racing certainty that he will soon do the same to the Federal Reserve, forcing the central bank to cut interest rates into the teeth of rising inflation, with epic consequences for the world’s dollarised financial system and for €39 trillion (£33 trillion) of offshore dollar debt contracts and swaps.
Late last week he fired the head of the National Security Agency and its top officials at the behest of Laura Loomer, a fringe conspiracy theorist, who whispered into Trump’s ear that they were disloyal to the Maga movement.
He has already fired the heads of the FBI’s intelligence division, its counterterrorism division and criminal investigations division, as well as the heads of the Washington and New York offices.
He has fired the top brass of the US military, starting with a preemptive strike on the chairman of the joint chiefs of staff. An earlier chairman – General Mark Milley – refused to ratify Trump’s attempted coup d’etat on Jan 6 2021.
“We don’t take an oath to a king, or to a tyrant or dictator, and we don’t take an oath to a wannabe dictator. We take an oath to the constitution,” said Milley in his parting shot.
But Trump also fired the three judge advocates general, who are legally independent by Congressional statute and have the authority to decide which military orders should be disobeyed – such as Trump’s order to “just shoot” American protesters, on American soil, during the Black Lives Matter saga.
That obstacle will not recur. Pete Hegseth, the defence secretary, said the three judges had been sacked to stop them posing any “roadblocks to orders given by the commander-in-chief”.
You can go through the list, agency by agency, extending to the universities and private law firms, and even to the muzzled editorials of some of America’s once great newspapers: the purge is Bolshevik in ambition.
Does anybody in their right mind think that Trump will spare the Fed’s Jerome Powell as the two men gear up for an almighty clash over US monetary policy? “CUT INTEREST RATES, JEROME, AND STOP PLAYING POLITICS!” bellowed Trump in capital letters on Truth Social on Friday.
The Fed will indeed cut rates this year but not until it is able to see through the confusing blizzard of tariffs and the ricochet retaliation of an angry world.
Powell told Congress that the tariff shock is much bigger than expected and may set off “persistent” inflation rather than just a one-off jump in the price level. He came close to damning Trumponomics as a recipe for low-growth stagflation. That is a red flag to a bull.
The current debate over whether or not Trump has the legal power to fire Powell entirely misunderstands the character of the Maga revolution. America’s rule of law is for guidance only these days.
You could say it was ever thus. Franklin Roosevelt tried to pack the Supreme Court after it blocked the New Deal. He failed, and unleashed tax investigations to settle scores, as did Richard Nixon. But Trump is an order of magnitude more outrageous.
Powell will not go without a fight. “I will never, ever, ever leave this job voluntarily until my term ends under any circumstances,” he said during Trump 1.0.
Scott Bessent, the Treasury secretary, said the administration could sideline Powell by appointing a “shadow” Fed chairman, who could steer the markets by issuing forward guidance. But this does not overcome resistance from the Fed board and the hawkish regional presidents.
A secretive team of Trump loyalists drew up a 10-page report before the election proposing more radical measures. These include forcing the Fed to “align policy with administration goals” or even to make the president an “acting” member of the Fed board.
Trump could purge members of the seven-strong Fed board one by one until they get the message. The law states that the president can terminate the 14-year term of a Fed governor “for cause”, usually meaning malfeasance or neglect.
But Trump has just abused his tariff powers on an heroic scale by invoking fictitious “emergencies”. He could no doubt stretch the meaning of “for cause” to anything he wants. The Supreme Court has the last say, but Trump-appointed justices have already shown a strong leaning towards an imperial presidency.
In any case, there are other methods to bring the Fed to heel.
Maga vigilantes are intimidating American judges by having pizzas delivered to their homes – a mob tactic to say “we know where you live”. So we can assume that recalcitrant members of the Federal Open Market Committee will face this sort of treatment.
The major US banks are raising their inflation forecasts to 4pc or higher this year. This inflation will hit before the last three price shocks – Covid, the Putin commodity spike and Biden’s overspending – have faded from immediate memory. It is exactly how inflation psychology becomes embedded.
A variant happened in the 1970s. Nixon bullied the Fed into expansionary policies, with some choice language on “the myth of the autonomous Fed” that later surfaced in the Oval Office tapes.
Loose money stoked inflation, so Nixon ordered a freeze on prices and wages in 1971, declaring war on “gougers”. It was very popular. Illiterate policies often are.
If Trump succeeds in extracting rate cuts from the Fed and tax cuts from Congress, the same problem is going to arise. So my assumption is that he will blame the symptoms and will resort to price controls.
The elephantine difference is that US federal debt was 34pc of GDP in 1971. Today it is 122pc on the Fed measure, and galloping upwards. The fiscal deficit is over 6pc as far as the eye can see.
The US does not have the domestic savings to fund this debt appetite. The savings rate has collapsed to 0.6pc of national income. It was 12pc in the 1960s.
Foreign investors have been plugging the gap. This soaks up a large part of the world’s savings – the underlying cause of America’s trade deficit.
If you think the stock market gyrations of the last few days are terrifying, just wait until Trump destroys the credibility of the Fed and of US treasury debt, the anchor of the global system.
He could order a captive Fed to relaunch quantitative easing and buy the bonds, but to do that when inflation is running hot would be seen by the whole world as naked fiscal dominance. It would set off a price spiral and a collapse of the currency – the sort of outcome seen over the decades in Latin America, or Erdoğan’s Turkey.
The end destination is a return to US capital controls to stop foreign funds and US investors from taking their money out of America. A man willing to impose 116pc tariffs – including pre-existing ones – on Chinese goods and shut down the biggest bilateral trade relationship in the world as if it were a TV reality show will stop at nothing.
https://www.telegraph.co.uk/business/2025/04/08/trump-sell-off-is-bad-wait-until-wreck-us-bond-market/
Lesotho's exports to the US in 2024 were valued at $237.3 MILLION lol. Trump now wants 50% of that.
King George III, who also was nuts, was a benevolent king to America compared to this guy.
Trump's biggest tariff was on tiny Lesotho. Here's what to know about the African kingdom.
... Mr. Trump's so-called "Liberation Day" tariffs
included a whopping 50% levy on the small, impoverished nation's
imports, and the Lesotho government quickly said it would send a
delegation to Washington. ...
Lesotho's annual gross domestic product of $2 billion is highly reliant on exports, mostly of textiles, including jeans. ...
The White House claims, by way of [its] formula, that Lesotho imposes 99% tariffs and other barriers on U.S. imports. ...
With an annual gross domestic product of just over $2 billion, Lesotho is largely dependent on South Africa — it biggest trading partner — from which it imports most of its food, selling water in return.
The economy has been heavily reliant on textile exports bound for the United States through the African Growth and Opportunity Act (AGOA) trade deal, which provides duty-free access to the U.S. market for some African products. The Trump administration's imposition of tariffs on African nations has raised questions over how likely the White House is to renew the AGOA pact when it expires in September. ...
In God She Trusts: Karoline Leavitt's Journey to the White House Podium
... "I spend every second that I possibly can with my son when I'm home on weekends and evenings. I try to make it home for bedtime as much as I can throughout the week."
Which doesn't leave too much time for sleep.
"Actually, it's usually about five to six hours a night is what I'm doing, which is all we need. As President Trump says, when you love your job and you love your life, you don't need to sleep much." ...
In the chats, the user identified as Vice President JD Vance expresses concerns about the strikes but ultimately agrees to go along with US Secretary of Defence Pete Hegseth's plan - before adding 'I just hate bailing Europe out again.'
Hegseth responds: 'I fully share your loathing of European free-loading. It's PATHETIC.'
And of course they want to throw Mike Waltz under the bus:
There are claims that Mr Waltz is facing the sack over the saga - as he's believed to have been the official who 'added the editor-in-chief [of The Atlantic] to the group'.
One source told Politico: 'Everyone in the White House can agree on one thing: Mike Waltz is a f***ing idiot.'
The Financial Times reports that privately some German officials are starting to wonder out loud whether the time has come to acquire their own nuclear arsenal.
What a shit show. This guy needs to be fired stat.
This is America under Mad King Ludwig.
Acting Social Security commissioner Leland Dudek threatened Thursday evening to bar Social Security Administration employees from accessing its computer systems in response to a judge’s order blocking the U.S. DOGE Service from accessing sensitive taxpayer data.
Less than 24 hours
later — after the judge rejected his argument and the White House
intervened — Dudek is saying he was “out of line.”...
“[The White House] called me and let me know it’s important to reaffirm to the public that we’re open for business,” he said. “The White House did remind me that I was out of line and so did the judge. And I appreciate that.”...
Dudek first made his threat to close down the agency during a Bloomberg News interview Thursday night. ...
Such a dramatic move to effectively shut down the agency would have been unprecedented in the agency’s history and would immediately begin halting benefit payments for millions of Americans.
“For almost 90 years, Social Security has never missed a paycheck — but 60 days into this administration, Social Security is now on the brink,” Lee Saunders, president of the American Federation of State, County and Municipal Employees, said in a statement. “Acting Commissioner Leland Dudek has proven again that he is in way over his head, compromising the privacy of millions of Americans, shutting down services that senior citizens rely on and planning debilitating layoffs, all in service to Elon Musk’s lies.”
More.
Dreher has succumbed to the abuse of Trump. He lives by lies. He thinks Zelenskyy was the bad guy in the Oval Office.
Sullivan has not succumbed to our "sociopathic president":
... What the world saw last Friday was the same, central Trump dynamic: the leader of a smaller democracy that has withstood three years of brutal attack by a far larger dictatorship ... was still publicly humiliated, because he dared air his concern of no security guarantees against Russia. “Just say thank you,” Vance harangued him. “Have you said thank you once?” I cannot recall any visiting head of state who has ever, ever been thrown out of the White House the way Zelensky was. Why? Because he did not submit.
... The challenge for liberals of all stripes is a familiar one in dystopian democracies and rigid dictatorships: Live not by lies. Keep your grip on reality. Avoid the propaganda now washing down on you like torrential rain. Find a refuge, as I did on Wednesday — a place where eternal truths remain, or where free thinking can endure (Spinoza is a role model, which is why the Dishcast discusses him this week).
Avoid hysteria, which Trump wants and exploits. But avoid also being co-opted by a single one of his lies, to see clearly, and to speak simply. Read those you disagree with; get off most social media; choose doubt over certainty; restraint over impulse; resist this authoritarian and irrational moment by refocusing above all on the simple truth, as best as you can, and fighting all those on both extremes trying to annihilate it. ...
Here.
It's a magnificent essay which everyone should read.
Rod Dreher was a Hillarycon in 2016 because of, wait for it, The Madness of King Donald. And so was J. D. Vance.
In shift, hard-line conservatives signal openness to stopgap to avert shutdown
... For years, members of the House Freedom Caucus have been predictable “no” votes on stopgaps and other spending measures that do not codify their priorities, railing against leaders for failing to approve appropriations bills on time.
But now, many of those members — happy with how the Trump
administration and Department of Government Efficiency (DOGE) is taking a
sledgehammer to the federal government — are being atypically
cooperative and signaling support for Speaker Mike Johnson’s (R-La.)
plan to pass a largely clean continuing resolution (CR) until Sept. 30,
the end of the fiscal year. Trump endorsed the full-year CR last week.
“My bottom line is: It’s a step forward, again, based on the word that we’re being given from the White House, that they will continue to do the work, that the president supports it and wants it, I’m comfortable,” said Rep. Chip Roy (R-Texas), a deficit hawk who is part of the conservative House Freedom Caucus. ...
These bumblebrains really don't get it.
Elon Musk and DOGE have usurped the role of Congress and have made the Congress irrelevant by accomplishing what they never do.
They should just pack it in. Or maybe DOGE should just eliminate them.
After all, they can't list any accomplishments, can they?
US holding secret talks with Hamas on release of Gaza hostages, 'Post' confirms
... US special envoy for hostage affairs Adam Boehler ... met with senior Hamas officials in Doha, Qatar, several times. These meetings, first reported by Barak Ravid on Axios, mark the first known direct dialogue between Hamas and the US administration since the US designated Hamas as a terrorist organization in 1997.
Such talks run counter to long-standing US policy against direct contact with groups that Washington lists as foreign terrorist organizations. ...
The White House said Boehler has the authority to negotiate directly with Hamas.
“When it comes to the negotiations that you’re referring to, first of all, the special envoy who’s engaged in those negotiations does have the authority,” White House press secretary Karoline Leavitt told reporters. ...
Why, is there something bad on the horizon with GDP lol?
These people belong in jail, not in the White House.
Trump official floats new approach on GDP, as economy is poised to slow sharply
Zelensky expresses regret for Oval Office spat with Trump
... "Our meeting in Washington, at the White House on Friday, did not go the
way it was supposed to be. It is regrettable that it happened this way.
It is time to make things right. We would like future cooperation and
communication to be constructive," Zelensky wrote on X. ...
During the 1990 summit, Zoellick says President Gorbachev accepted the idea of German unification within the North Atlantic Treaty Organization, based on the principle that every country should freely choose its own alliances.
“I was in those meetings, and Gorbachev has [also] said there was no promise not to enlarge NATO,” Zoellick recalls. Soviet Foreign Minister, Eduard Shevardnadze, later president of Georgia, concurred, he says. Nor does the treaty on Germany’s unification include a limit on NATO enlargement. Those facts have undermined one of Russian President Vladimir Putin’s justifications for invading Ukraine — that the United States had agreed that former Warsaw Pact nations would never become part of the North Atlantic security alliance.
Zoellick, a former deputy and undersecretary of state, deputy White House chief of staff, U.S. trade representative, and World Bank president, shared his recollections about the Cold War’s end and its ties to the ongoing war in Ukraine as part of a broader conversation with Harvard Law Today about the 75th anniversary of the Truman Doctrine, an American foreign policy aimed at containing Soviet expansion following World War II.
He is the author of “America in the Word: A History of U.S. Diplomacy and Foreign Policy.” An alumnus of both Harvard Law School and Harvard Kennedy School, where he is a senior fellow at the Belfer Center for Science and International Affairs, Zoellick believes Putin’s false claim about NATO enlargement is part of a disinformation campaign by the former KGB agent to mask his true intentions.
Zoellick vividly recalls the White House meeting he attended nearly three decades ago in which Bush asked Gorbachev if he agreed with the Conference on Security and Cooperation in Europe principle that nations are free to ally with others as they see fit. When Gorbachev said yes, he says, the Soviet leader’s “own colleagues at the table visibly separated themselves.”
Sensing the import of the possible breakthrough, he says a colleague at the meeting, Robert Blackwill, sent him a note checking what they had heard and asking if they should ask Bush to repeat the question. “Gorbachev agreed again,” Zoellick recalls, to the principle that Germany could choose to enter NATO.
“The reality was that, in 1989-90, most people, and certainly the Soviets, weren’t focusing on whether the Eastern European countries would become part of NATO,” Zoellick says. Knowing Soviet and Russian diplomacy, he believes Moscow would have demanded assurances in writing if it believed the U.S. had made such a promise. And even in 1996, when President Bill Clinton welcomed former Warsaw Pact nations to join NATO, he says that, “[o]ne of the German diplomats involved told me that as they discussed the enlargement with the Russians, no Russian raised the argument that there had been a promise not to enlarge.”
But if the West never gave the promise Putin has used to explain his decision to invade Ukraine, what does Zoellick think motivates the Russian president’s decision to inflict death and destruction on one of Russia’s nearest neighbors? “Putin does not see Ukraine as an independent and sovereign state,” he says. “He has a view of Russian history where the Rus [the medieval ancestors of the people who came to form Russia, Belarus, and Ukraine] began in Kyiv. He believes that they are all Russians, living in a greater Russia. And I think at age 69, Putin feels that this is a question not only of Russian history, but his place in Russian history.”
Zoellick says that when Putin’s earlier attacks in the Crimea and country’s eastern regions failed to halt Ukraine’s drift towards the West, the Russian leader believed he had no other choice but to invade. “That’s his motivation. And I think we need to be aware that he’s going to double down. The resilience and resolve of the Ukrainian people to resist has been a surprise to him and everybody else. I don’t think he’s going to ultimately be successful. In addition to today’s brutal battles, Russia faces a difficult occupation and insurgency, even if it can seize cities and territory.”
The experienced diplomat also credits Ukrainian President Volodymyr Zelensky with rallying the Ukrainian people by refusing to flee Kyiv and through adept use of social media and language.
“We’re seeing that the skills that he developed as an entertainer and a communicator can be used in different ways, just as Ronald Reagan did,” he says. “It does raise a concern that, if something happens to Zelensky, what will that do to morale? Will he be a martyr or will his loss break the public will?”
Zoellick also notes that, as the war in Ukraine has garnered the world’s attention, many of the questions being asked today about the West’s relationship with Russia are similar to those he had dealt with at the end of the Cold War, including “Russia’s sense of whether it feels like a great power or threatened by NATO … those are the issues that are at very much at play in dealing with Ukraine.”
“Can Russia forge peaceful, constructive ties with the West?” he asks. “Failed economic and political reforms left Russia behind. Its economy depends on energy production. Putin played off public frustrations, but many Russians don’t want war and isolation.”
When thinking about global diplomacy and the factors that might have led to the Russian invasion, Zoellick harkens back to a comment made by his boss for eight years, James Baker, who served both as secretary of state and the treasury, as well as White House chief of staff: “As you address the problems of one era, you’re often planting the seeds for the next set of challenges. History doesn’t stop.”
More than 30 years after the fall of the Berlin Wall, Zoellick says the legacy of decisions made at the end of the Cold War are echoing throughout Europe today: “Would we keep NATO alive? Would it enlarge into Central and Eastern Europe? How far? What would be the effects on Russia of its loss of empire?”
“That leaves the question of whether the U.S. could have avoided Russia’s turn,” he says. The answer, he believes, depended on Russia’s choices. “Certainly, we wouldn’t have wanted East and West Germany to remain divided.” The related questions are many: What if Eastern European countries had been barred from joining NATO and therefore remained, like Ukraine, outside the western security umbrella? And how would they react to the Russian threat and being left again as “lands between” Germany and Russia? The U.S. and Europe, he notes, offered Russia partnerships, but Russia felt humiliated by the loss of its empire.
“I was the U.S. negotiator for German unification,” he says. “We wanted to make sure that a democratic Germany was unified in NATO. I don’t think anybody would think that’s a bad idea today. And if anything, we’re now seeing Germany stepping up to a security role for NATO and the European Union.”
In 1989-90, Zoellick was also focused on the idea that Poland — long subject to invasions by Russia and Germany — should be able to eventually join NATO. He made sure that the treaty on German unification kept that possibility open. “Given Putin’s behavior, can you imagine what the effect would be on Poland today if it weren’t in NATO? I think it’s wise to have Poland and Germany on the same side. The Baltic countries were a tougher choice for NATO, not because they don’t deserve the security, but they’re very hard to defend.” Nevertheless, he adds, because the Baltic states are now NATO members, he believes we must “take serious steps to defend them from both direct and hybrid threats.”
Ultimately, he believes supporting Ukraine economically and supplying arms for self-defense, rather than opening the potential for eventual NATO membership, would have been a better approach than the one the West has taken in recent years.
“If NATO gives a security guarantee, it has to mean it,” he says. “It has to be serious about providing deterrence under Article Five of the North Atlantic Alliance treaty. … I support Ukraine’s economic reforms and its democracy, [but] I doubted that the American people were ultimately willing to fight for Ukraine. The worst thing to do was to suggest Ukraine might join NATO, but without a serious pathway to membership.”
The U.S., he adds, “isn’t going to defend everybody all the time, everywhere in the world; we have to know what we will and won’t defend. Having said that, I think the Obama and Trump administrations erred by not giving more military support to Ukraine. I believe that we should help the Ukrainians defend themselves. But those are the exact issues debated today.”
https://hls.harvard.edu/today/there-was-no-promise-not-to-enlarge-nato/
We are at that moment in Animal Farm when the gentle carthorse Clover looks through the window to see the pigs playing cards and drinking a toast with men.
The pigs are all perfectly at ease and sitting back in chairs around a table, no doubt a rougher surface than the luxurious polished table used to host America’s Marco Rubio and Russia’s Sergei Lavrov in Saudi Arabia this week. The Russian press reports that the meeting was a love-fest of jokes and bonhomie, with a “very tasty lunch”.
George Orwell’s scene was an allegory of the Molotov-Ribbentrop pact, when Europe’s great power alignment suddenly and violently shifted. The liberal democracies woke up on Aug 23 1939 to discover that the Soviet Union had reached a non-aggression deal with Nazi Germany. Days later, Hitler and Stalin carved up Eastern Europe between them. The Nazis could then turn their concentrated fury on France and Britain without having to worry about a second front.
Britain had started to re-arm as early as 1935. Neville Chamberlain hurled money at the Royal Air Force in the late 1930s, with Spitfire squadrons arriving just in time. Defence spending had risen to 9pc of GDP by 1939.
This time, Europe’s democracies have indulged the same pacifist illusions as they did in the run up to 1939 but have milked the peace dividend even longer. Military spending by EU states was 1.9pc of GDP in 2024, a full 17 years after Vladimir Putin declared political war on liberal civilisation and all its works at the Munich Security Conference in 2007 – “a good speech” said one Angela Merkel, audibly, in the front row.
He then set about restoring the tsarist empire to the borders of Catherine the Great with an unswerving consistency. Austria is not even part of Nato and behaves accordingly.
Some are rising to the challenge. Denmark has given its stock of munitions to Ukraine and even the trade unions back a war tax to raise defence spending to 4pc of GDP. “We are in a very, very critical period in world history,” said Lars Løkke Rasmussen, the Danish foreign minister.
Poland’s military budget is already up to 4.7pc. “We’re that afraid,” said his Polish counterpart Radosław Sikorski at last week’s Munich forum.
Lithuania aims for 5pc to 6pc of GDP by next year, alarmed by intelligence warnings that Putin may seize the Suwalki Gap, which runs through its territory from Belarus to the Russian enclave of Kaliningrad.
They all know that Putin has a narrow window of time to attack if the Ukraine war is quickly settled on Russian terms. His advantage is temporary: a greatly enlarged army heading for 1.5m by 2026 and an industrial war economy firing on all cylinders but untenable for much longer.
Fears are growing that Donald Trump will order the US military to pull its Nato tripwire forces out of the Baltics in order to seal the “deal of the century” with the Kremlin. Will he swallow the bait as the smooth McKinsey-trained head of Russia’s investment fund, Kirill Dmitriev, dangles the offer of hydrocarbon riches – real or imagined – in Russian Arctic waters?
The issue runs deeper in any case. Maga America has a greater natural affinity for Putin’s Right-wing cultural Weltanschauung than it does for the liberal democracies. After the battering of the last two weeks, some of us are forced to conclude that Britain and Europe are now the real enemies for this new Washington and, furthermore, that the US is anything but isolationist under Donald Trump.
He will not let us carry on being different. He will force-feed us his Maga ideology. His oil-fracking energy secretary was in London this week describing our renewables as “sinister”. Will we face sanctions for trying to do something about CO2 emissions? Perhaps, yes. Particularly for that.
I do not wish to dissect every post by Trump on Truth Social, or dwell on the speech by JD Vance. I think Britain should repeal all its hate legislation and stop misusing police resources on thought crimes. It should stop dividing us into categories and return to colour-blind liberalism. But one can agree with elements of Vance’s anti-woke critique while entirely rejecting the larger message behind it.
We are told repeatedly by Trump’s circle that he does not really mean what he says, or that we should not overreact to what he is very clearly doing. Let us hope they are right, but it is becoming harder by the day to have confidence in such assurances, or to believe that either Republicans or plutocrats will lift a finger to stop him – and I say this as a defender of Pax Americana for half a century.
Sir Keir Starmer is right to stay calm and try to defuse this terrifying inter-allied crisis on his visit to the White House. But we of The Telegraph parish, readers and writers alike, will all have to look into our souls if, as now seems painfully plausible, Britain is singled out for tariff warfare along with Europe on the pretext of our VAT taxes.
Worse yet if Trump does this while reaching a cosy commodity deal with Putin along with a grand bargain with Xi Jinping to protect Elon Musk’s interests in China. That would test one’s pro-American sympathies to breaking point.
Europe shares much of the blame for the disintegration of the Western alliance system. It failed to re-arm after Russia invaded Ukraine in 2014. Germany rewarded Putin months later by launching the Nord Stream 2 project, which had no purpose other than depriving Kyiv of strategic leverage by re-routing Siberian gas through Baltic pipelines. In return, Germany enjoyed a sweetheart gas deal at sub-market prices.
Britain could have rebuilt its military hardware at ultra-low borrowing costs during the secular stagnation of the 2010s, when it had ample spare capacity. It could have rebuilt its decaying infrastructure and revived its economy at the same time. The multiplier effect would have let us do these things without pushing the debt ratio any faster. Britain pursued austerity instead. Now it faces a greater task, in a hostile bond market.
Europe was even more destructive. Germany cut public investment and military spending to the bone for 15 years. It relied on mercantilist export surpluses of 8pc of GDP to drive growth, a policy that has left Germany in the cross-hairs of Trump’s trade warriors.
The eurozone debt crisis – self-inflicted because the European Central Bank did not then have political approval to back-stop debts – turned into a wider depression because Brussels over-egged austerity and used bailouts to impose drastic spending cuts. There was no exemption for military spending.
Defence as a share of GDP in 2015 was Hungary 0.5pc, Belgium 0.8pc, Germany 1.0pc, Spain 1.0pc, Italy 1.2pc, France 1.8pc –and that was after Russia’s annexation of Crimea. Military budgets crept up slowly thereafter but not enough to prevent further disarmament.
Europe thought it could keep free-riding on Uncle Sucker forever, despite warnings that this would end badly. There was much talk along the way of a European army and endless euro-speak meetings about procedures, modalities and the architecture of EU defence, but never anything real. That is why Europe today finds itself utterly naked.
But nobody expected it to end this badly and this suddenly. To watch an ally of 80 years turn on us with ferocity and blithely team up with our declared enemy really is the end of days.