The spectre of a full-blown transatlantic trade war loomed over Whitehall today after Donald Trump threatened to impose a 100% tariff on European imports. The former US president, now a dominant force in Republican primary polling, declared that a return to the White House would be followed by punitive measures against European goods, including British exports, unless the UK and EU agree to his terms on trade imbalances.
For working families in Britain’s industrial heartlands, this is not an abstract geopolitical chess move. It is a direct threat to wages, jobs, and the cost of living. The North of England, still recovering from decades of deindustrialisation, would be hit hardest. Steel, cars, and aerospace components – the backbone of the ‘Real Economy’ in places like Sheffield, Sunderland, and Derby – would face tariffs that effectively close the US market.
“This is a gut punch for communities that have already been knocked down,” said Margaret Turner, a shop steward at a Sheffield forging plant that exports high-grade steel to American carmakers. “Our members are terrified. They remember what happened when the last trade war erupted. Orders dried up. Overtime vanished. Then the redundancies came.”
The threat escalates already strained relations between the US and Europe. Trump has long railed against the EU’s trade surplus with America, but his 100% tariff proposal goes far beyond his earlier salvoes. For the UK, which has spent years trying to forge a post-Brexit trade deal with Washington, this represents a catastrophic setback. British exporters are already struggling with higher shipping costs and regulatory barriers since leaving the single market.
The cost-of-living crisis, which has squeezed household budgets for two years, would deepen. The Bank of England has warned that a trade war could reignite inflation, pushing up prices for food, energy, and manufactured goods. “It would be a disaster for the poorest households,” said Dr Helen Rayner, an economist at the University of Manchester. “Tariffs are a tax on consumers. The burden falls heaviest on those who can least afford it: low-income families, pensioners, and young people.”
The government has sought to downplay the threat, insisting that Trump’s remarks are campaign rhetoric. But behind closed doors, officials are scrambling to assess the damage. A leaked Treasury analysis, seen by this paper, estimates that a 100% tariff on UK exports to the US could wipe out £30 billion from the economy and put 200,000 manufacturing jobs at risk. “We are taking this very seriously,” a Whitehall source said. “There is no sugar-coating it. This would be devastating.”
Union leaders are calling for an emergency summit with business groups and the government. Sharon Graham, general secretary of Unite, said: “Our members cannot be collateral damage in a billionaire’s political game. We need guarantees that jobs and livelihoods will be protected. If the government won’t secure those guarantees, we will.”
One possible response is a UK government bailout for affected industries, but that would put further strain on public finances already squeezed by high debt and low growth. Another option is a retaliatory tariff on US goods, but that would hit consumers here. “There is no good outcome from a trade war,” said a former trade negotiator. “It is all about damage limitation.”
For now, workers in the North are watching with apprehension. At the Sheaf Valley steelworks in Sheffield, the mood is grim. “We have been through boom and bust for 40 years,” said plant manager Tom Roper. “We survived closures, offshoring, and the steel crisis of the 1980s. But this feels different. This is not about efficiency or markets. This is political. And politics can be brutal.”
