LONDON — It was a public relations victory beyond Keir Starmer’s wildest dreams.
Grinning beside Britain’s prime minister in the White House in February, Donald Trump accepted an invitation for a state visit, called him a “tough negotiator” and said he could “end up with a real trade deal where the tariffs wouldn’t be necessary. We’ll see.”
It didn’t quite work out.
Britain spent the 35 days since that love-in on a mammoth charm offensive, with more or less daily contact — including some text messages — between Business Secretary Jonathan Reynolds, No. 10 business adviser Varun Chandra and their U.S. counterparts, such as Commerce Secretary Howard Lutnick and Trade Representative Jamieson Greer.
The pair, along with U.K. ambassador to the U.S. Peter Mandelson, won broad agreement in negotiations on an outline plan they hoped would spare Britain from Armageddon. The two nations would deepen ties on technology including artificial intelligence, and Britain would review enforcement of its online safety and digital competition regulations, said two people briefed on the pact — a sweetener to Washington and Big Tech that would go down badly with many Labour MPs.
But it came down to Trump — and he slapped Britain with tariffs along with every other nation.
“It’s not that the talks failed or stuttered or there was a content issue — it was just that the Americans, all of a sudden, became very clear that World Tariff Day meant World Tariff Day,” said one U.K. official.
Like many in the U.S., British ministers had to work out the rate Wednesday night by watching Trump unveil a chart on TV. One U.K. official compared communication with the White House to a “black box” in the final hours.
Despite all this, Britain’s strategy has not changed. Unlike the European Union, the U.K. is not preparing imminent retaliation, though it did launch a four-week consultation on Thursday into what a U.K. retaliation would look like and said all options remain on the table. Starmer said Thursday that he would keep pushing for the economic deal, and that the famed British “cool head” would prevail.
Downing Street officials argue the 10 percent tariff on U.K. exports — the joint-lowest Trump applied to any country — “vindicates” Britain’s approach, and many feared worse, given the U.K.’s Value Added Tax on most sales is 20 percent. The EU, which Britain only left five years ago, was charged 20 percent.
There is a less inspiring reason to continue the charm offensive, though. “They haven’t got any choice,” said Emily Thornberry, the Labour chair of the Commons Foreign Affairs Committee. “It’s not in the [U.K.’s] interests to have a trade war.”
POLITICO spoke to more than a dozen U.K. officials, ministers and industry figures, all granted anonymity to speak frankly, to build a picture of Britain’s so far disappointing search for a tariffs carve-out — and ask whether it could yet pay off.
The special relationship
Downing Street used Starmer’s Feb. 27 White House visit to publicize its push for an economic deal. But the groundwork was laid before that; Reynolds raised the idea with Lutnick around a week earlier, in their first phone call after Lutnick was confirmed by the Senate, to ensure it would not be dead on arrival, one person familiar with the negotiations said.
After Starmer flew home to the U.K., talks began in earnest — generally limited to a circle of fewer than a dozen people.
The talks were formally led by Reynolds but aided heavily by Mandelson and Chandra — both arch-networkers who have navigated the worlds of geopolitical influence and City finance respectively. Chandra joined Reynolds on a March 19 delegation to meet Lutnick and Greer in Washington. Starmer intervened at key moments, though Downing Street has declined to say whether the PM exchanges text messages with Trump.
Details were kept tight, and Britain tried to meet Trump and his allies at their own transactional level. One person with knowledge of the talks said officials had passed around a well-thumbed copy of former U.S. Trade Representative Robert Lighthizer’s 2023 book “No Trade is Free,” which includes a section on the U.K.
One minister said Trump’s infamous Oval Office clash with Ukrainian President Volodymyr Zelenskyy, the day after Starmer flew home, was “very revealing” because it showed exactly how transactional Trump was — even telling the Ukrainian president: “You don’t have the cards.” The minister said: “We need to work out what cards we do have … We have things [the U.S.] want and they have things we want.”
Britain’s relatively newfound status outside the EU was an advantage. A government official said the talks were “very bilateral” between the U.K. and U.S.; a position that would have been impossible if not for Brexit, which was once heavily opposed by Starmer himself.
While Trump’s tariffs on the EU and any retaliation from Brussels will have a heavy knock-on effect on the U.K. — particularly in Northern Ireland, which has a unique trading status after Brexit — Britain largely spoke to Brussels to discuss fallout rather than a deal itself.
A person familiar with the talks said it was hard to overemphasize “the speed and quality of the analysis” and the long hours from officials that went into producing Britain’s offer. “The effort being put in is incredible on economic security, geopolitics, tariff lines,” they said, adding that Trade Minister Douglas Alexander “has an amazing intellectual capacity to understand and absorb these things at pace.”
A team in Britain’s Department for Business and Trade modelled more than 100 scenarios on the economic impact in the meantime, the person added, and received regular diplomatic cables from British officials in Washington.
On hold for Trump’s TV moment
But days before D-Day, it became clear there would be no carve-out — for anyone.
Just over a week before Trump’s April 2 announcement, there was still hope of the U.K. winning a reprieve. One U.K. official said at the time that they were “hoping and working towards a resolution before April 2 and not after.”
What was at stake became clear on Wednesday last week, when U.K. Chancellor Rachel Reeves delivered her spring statement. Modelling from Britain’s economic watchdog said a 20 percent tariff would wipe out all the fiscal “headroom” in her five-year budget.
Hours later, Trump announced he would slap 25 percent tariffs on cars and car parts coming into the U.S. from April 2. British officials were blindsided.
Starmer made his final pitch in a call on Sunday, in which The Sun newspaper reported he offered a visit in June to sign an economic deal. It didn’t work.
On Monday, No. 10 hosed down hope that there would be a last-minute carve-out. The PM’s official spokesperson said he “would expect the U.K. to be impacted by” the tariffs, and that the “constructive discussions” on a wider U.K.-U.S. “economic prosperity deal” would likely continue beyond Wednesday.
Calls between industry groups and the DBT continued on Wednesday hours before the announcement. But ministers had no substantive detail to tell them — instead the focus was on sharing intelligence on the economic impact, said a person briefed on the call.
Reynolds gathered late on Wednesday night with a handful of civil servants and aides to war-game his response from the DBT’s HQ, Old Admiralty Building near Trafalgar Square. There they learned key details by watching Trump on TV.
What next?
On a call with DBT Thursday morning, firms were told Britain’s focus has switched to trying to win a carve-out in the coming days and weeks, said a person briefed on the call.
But bruised by how talks have gone so far, ministers refuse to offer any public timeline. Britain is waiting for Washington’s next move. Reynolds told Times Radio on Thursday that the timing would be “largely in the gift of the U.S.”
The government has also refused to make public many details of what the economic deal would involve — particularly in areas that would water down existing U.K. digital regulation or a digital services tax on tech giants, which will be controversial with many Labour MPs.
One of the two people briefed on the pact, mentioned above, said: “My understanding is that there’s an agreement the people who’ve been negotiating would have been happy to sign, but it’s then gone to the White House and that’s where it’s sitting at the moment.”
But the second person briefed on the pact cautioned that it appeared to be more of a “framework” than a complete deal. “My understanding was it was always about agreeing the terms under which a negotiation would take place … rather than actually here’s an agreement signed, sealed and delivered.”
They also suggested that, while the U.K. had come to the table with a tightly focused proposal, the U.S. had a “much broader ambition” going back to some of the principles that were discussed when Britain was pitching for a full free-trade agreement in 2019.
“The U.K. wanted this to be a discussion on an agreement with a narrow definition of sectors and topics, whereas the U.S. have wanted, effectively, to resume where we left off five years ago,” the second person said.
Hitting wars, pockets — and votes
The evolving response will highlight starkly the difference between the U.K. and EU — one that plays to Starmer’s advantage when Europe is trying to persuade Trump not to back unwise terms of a peace deal between Russia and Ukraine.
While Britain has gone a different way to the bloc on tariffs, when it comes to Ukraine there are still many in Europe who are looking to Starmer as a mediating voice with Trump, said one person who speaks to several EU ambassadors regularly.
A U.K. government official added: “There’s a sense that the U.K. voice is the one that can placate the Americans and prevent them from kicking off.”
A senior industry figure also praised the U.K.’s “pragmatic” approach to the U.S. over tariffs, adding: “If you talk to U.S. officials, the way they talk about the EU versus other countries is in a different place … I think there is no doubt that us being a single country outside the EU is to our advantage at this moment.
“I don’t know whether the special relationship will totally survive, but we are in a different place to some of the other people who are in the line of fire. The sense is that a calm, measured and pragmatic approach is the right approach by the U.K. government.”
But this may win Starmer few plaudits with voters, especially when the effects of tariffs are mostly indirect.
The senior industry figure quoted above added: “In other countries it may play well to domestic audiences to say, ‘I’m being the tough guy, we’re retaliating,’ but the reality is any retaliation we do is probably not going to influence the ultimate outcome from the U.S. side. We are just too small a share of trade for that to be a convincing lever, and no one gains from a trade war — we may inflict more damage on ourselves by doing that.”
This impact on voters’ pockets — in a British economy struggling against the might of superpowers such as China — is the hard reality for Starmer. He and aides know the cost of living is already feeding into Labour’s poor poll ratings, and the PM mentioned the issue in his first response to the tariffs Thursday.
A second U.K. minister said they would expect tariffs to hit different parts of the country very unevenly, with wealthier areas such as London absorbing the shock while left-behind areas suffer worst.
Standing beside Trump 35 days ago, Starmer told the president: “There is a lot that we have in common. We believe it’s not taking part that counts, what counts is winning … And we’re determined to deliver for the working people of Britain and America.”
After Wednesday night’s bombshell in the Rose Garden, whether Starmer manages to pull this off may now lie in the hands of Trump himself.
James Fitzgerald contributed reporting.
The post Donald Trump doesn’t do special relationships. Britain will keep trying anyway. appeared first on Politico.
