Veteran HR and employee benefits expert Steve Herbert provides a personal perspective on the latest Trump tariffs.
One of my all-time favourite film quotes is that of Mr Ollivander (played by the late John Hurt) saying to a young Harry Potter: “He who must not be named did great things. Terrible, yes, but great.”
Some misinterpret this quote to suggest that Ollivander thought Lord Voldemort did good things. Instead, the quote is clearly pointing to both the significance of the action and its repellent nature too.
The tariff trauma
This quote keeps cropping up in my mind as I look across the pond to one Donald J Trump and his continuing obsession with tariffs. Trump’s fixation on tariffs reportedly dates back to the mid-1980s yet it is unclear as to what the president of the USA aims to achieve by implementing it.
Is it rapid US economic growth, a stick to beat other economies, a restructuring of US domestic taxation, or merely a rather unsophisticated negotiating tool? Or perhaps some weird (and probably unworkable) combination of all these elements?
No one – possibly including Mr Trump himself – really seems to know.
And the bewildering blizzard of announcements, clarification, and counter-announcements makes the outline of this picture even harder to see.
The end to a free-trade world?
Yet the wider direction of travel – at least for the next four years – does appear to include a world where the greatest proponent of free trade – the USA – is now repositioning itself as the greatest protectionist state. This has essentially thrown the post-war consensus of the developed world under a MAGA bus.
It should be noted that free trade has helped avoid global conflicts, possibly reduced the impact of regional wars, and has certainly coincided with (and possibly led to) a massive boom in living standards for all those who engaged with it (at least in the Western world).
And, of course, the biggest single winner of this approach has been the US itself, a nation that “won” the cold-war, and now boasts a greater economic and military reach and power base than any other nation in the world. The idea that America needs to be made “great” again is, frankly, rather difficult to compute.
What now?
Yet here we are. Trump has, for the moment at least, clarified his tariff regime, and the rest of the world – including the United Kingdom – is now seeking a suitable response.
What this all means for share prices, inflation rates, interest rates, currency values or jobs is uncertain. And what that all means for any one employer, or indeed individual worker, will vary even more dramatically by country, region, and business sector.
But it is fair to say that the economic future here in the UK is now rather worrying.
Impact on the spring statement and next budget
It is worth noting that last week’s spring statement by the chancellor of the exchequer – and the supporting documents from the Office for Budget Responsibility (OBR) – made no specific allowance for the impact of Trump’s proposed tariffs, or for that matter the impact of the Employment Rights Bill announced last year.
We can therefore assume that just a week later the spring statement has been overtaken by events. It follows that the much-reduced UK growth rate of 1 percent in 2025 could well need a further downwards revision.
This in turn may lead to more taxation or spending cuts in the autumn budget statement.
The outlook?
The reality is that whatever the final impact of Trump’s tariffs, the immediate outcome for the wider world is rather uninviting.
Indeed, you only need to look at the price of gold – always seen as a safe haven in difficult economic and political times – to see what the smart money is doing in response to so much uncertainty.
According to the Royal Mint website the price of gold is now at an all-time high. This is no mean feat given that the 2020s have already delivered us many other global and national uncertainties including Brexit, Covid, the Russia/ Ukraine war, a cost-of-living crisis, and the Gaza conflict.
Trump’s tariffs are the final uncertainty cherry on that rather unpleasant looking cake, and many countries, companies, and citizens will be rightly very worried today. Trump is indeed doing great – but terrible – things.
Steve Herbert is Brand Ambassador for Occupational Health Assessment Ltd, a Benefits Unboxed podcast host, and a veteran HR and Employee Benefits commentator.
