…May 2025

May has been another month of mayhem, mostly courtesy of one Donald J Trump but backed up with a supporting cast that includes Vladimir Putin, Benjamin Netanyahu and various other actors searching for a role. The fact that most of these crackpots won power through elections – to varying degrees – suggests that civil governance in some developed nations is not very well developed. 

But at last there is hope that an American leader can bring about some kind of stability. The new Pope, the former cardinal Robert Prevost from Chicago, USA, chose the name Leo 14th to signal that he plans to follow Pope Francis’ lead. He immediately called for ceasefires in all the world’s current conflicts, and has already met the Ukrainian president, even suggesting the Vatican could host talks to broker a ceasefire. He’s even survived a meeting with the US vice president JD Vance. 

However, he is going to have his work cut out when it comes to the rest of the world. The month started with the Victory in Europe celebrations to mark the end of the European phase of World War Two, which were deeply overshadowed by the very real fear of another European war thanks to Trump having rendered NATO no longer fit for purpose. Britain ended the month with a commitment to eventually spend three percent of GDP on defence including £1.5 billion on building six new weapons factories, none of which will help improve the economic gloom. 

Elsewhere the fighting continues in Gaza, and in Sudan and Yemen. Some rare good news from India and Pakistan, which had traded insults and missiles, following a terrorist attack in Kashmir. The conflict escalated rapidly at the start of the month but was stopped in its tracks following pressure from Saudi Arabian diplomats backed by threats from the US, alarmed at the prospect of a nuclear conflict. This has underscored the continuing need for US engagement. 

Elsewhere there is far too much US engagement. Trump has reiterated his plan to take over Greenland, raising again the possibility of using military force. Even to suggest such a thing renders NATO dead in the water as a military alliance since many of its members must now start seriously preparing to defend against an attack from its key member, the USA. These sort of random comments spread panic in European capitals and yet are becoming so common that we barely notice now.

The US defence secretary, Pete Hegseth, has warned that China is the major threat for the pacific region in general and Taiwan in particular and that the US would take action. Victor Gao, vice president of the  thinktank ‘The centre for China and globalisation’ told the BBC that the one-China policy was carved in stone: “Taiwan is part of China and reunification is the mega trend. No one can stop the reunification. The United States will not have the wherewithal or the national commitment to stop China’s peaceful or non-peaceful reunification.”

Hegseth said that America first was not America alone, but that’s exactly where America is headed following its trade war, the vitriolic attacks on its former allies and questioning of NATO. If America truly feared a conflict in the Pacific then it should force an end to the Ukrainian war to avoid having to deal with the two wars at the same time.

May has also seen some European nations break decisively from the US position on foreign affairs. Up to now, most G7 nations have taken their cue from the Americans. But Britain, France and Canada have lost patience with Israel and demanded an end to the blockade around humanitarian aid in Gaza. The EU has also said that it is reviewing its position on trade with Israel. This follows European nations extending sanctions on Russia and demanding ceasefire talks for the war in Ukraine. This is despite Trump’s clear signal that he would be happy to surrender Ukraine to Russia so that he could get back to trading with Russia.

And of course Trump has continued to suggest that the US could take over Canada as its 51st state. In response, the Canadians invited King Charles to open their Parliament, and remind Trump that Canada is already spoken for – even the bits that speak French – as part of the British Empire commonwealth.  Meanwhile, Britain has invited President Macron of France to a state visit in July. This is the diplomatic equivalent of flipping the bird at Trump, who has let it be known that he would like his state visit in September, though Britain has still not set a date. Even Starmer understands that he could not get away with the cost of staging the full pomp and ceremony of a state visit for a man who is still busy roiling the UK economy and undermining its defence. 

Naturally, Trump has continued to sow chaos in the financial markets around the world with his constantly changing tariff policy. The Financial Times has coined the acronym TACO, or Trump Always Chickens Out, to describe how the markets rise and fall on the various tariff announcements. Apart from helping to promote Mexican food, this also suggests that most governments are unlikely to be swayed much by the tariff threat. However, there is plenty of evidence that the tariffs are hitting US imports. They certainly seem to be affecting the financial results and planning for many of the biggest suppliers to the print industry, as American customers follow the TACO logic and delay purchases. 

The latest twist has seen a US court strike down most of the tariffs, claiming that Trump does not have the authority to set such tariffs. Nonetheless, an appeals court has left the tariff policy in place while the issue works through the US legal system. Trump has since further upped the ante by doubling US tariffs on steel imports to 50 percent. 

Meanwhile, the British prime minister Keir Starmer has signed two long elusive trade deals, first with India and then the US, and completed a reset with the EU by renegotiating some of the worst aspects of the Brexit deal. However, the US deal has now been thrown into confusion by the new steel tariffs, which may yet come to nothing. The EU reset comes amid a growing realisation in both the UK and the EU of the need to unite against the bigger problems, namely the international trade war and our common defence needs. Besides, even the most ardent Brexiteers realise that Brexit has not been the success they promised. 

But, while Starmer appears to be enjoying some success on the international stage, the Labour government he leads is not much loved at home, with many polls often putting Labour third or even fourth despite having an enormous majority in parliament. Even relatively good economic news has not done much for the government’s standing. So the gross domestic product – which measures economic activity – has grown 0.7 percent in the first three months of this year, but that doesn’t necessarily mean that more people feel that they have more spending money. 

The International Monetary Fund has also said that it believes an economic recovery is underway in the UK, predicting GDP growth of 1.2 percent. This level of growth is not enough to lift the British economy enough to make a real difference to most people, and the IMF also warned that the UK economy could be further affected by the US trade war.

The improved figures for the first quarter were enough for the Bank of England to cut its base rate to 4.25 percent, which will have taken some pressure off consumers with mortgages and some business borrowing. However, inflation has also risen to 3.5 percent in April, which are the latest figures. This is the highest since February 2024 and has been partly blamed on the increase in national insurance and council tax, as well as a general rise in prices, particularly energy. Economists expect inflation to remain at this level for the next few months but with the possibility that it might drop in the autumn. It means that we’re unlikely to see any further interest rate cuts this summer.

The April figures also revealed that government borrowing had risen to £20.2 billion, an extra £1 billion up on last April, giving the chancellor, Rachel Reeves, another headache. This makes additional tax rises almost inevitable, despite Reeves’ rather foolish earlier promise that there would be no further tax rises. 

All this has allowed Nigel Farage’s right wing Reform party to make hay, with rash promises designed to appeal to more left wing voters. Starmer has deliberately talked up Reform as a serious threat, with its mere five MPs, in a cynical effort to drive a nail into the coffin of the Conservative Party. Nonetheless, Starmer has felt forced to restore some winter fuel payments to some pensioners, which was the first cost cutting measure that Reeves announced last summer. Reeves has also had to rewrite some of her investment rules to free up more capital spending in areas outside the south-east of England – in other words in areas where Labour is rattled that it is losing its traditional vote share. The money will mostly go for improvements to energy and transport infrastructure which are necessary to attract more business investment, and hence jobs, in those areas.

None of this really addresses Starmer’s fundamental problem, which is that his voters don’t understand why he is cutting their benefits and pushing up their taxes instead of raiding the finances of more wealthy people and addressing the massive wealth imbalance in the UK. Starmer’s hope, that he could use economic growth to cover up that wealth imbalance, looks increasingly unrealistic. 

According to the latest annual edition of the Sunday Times Rich List, the 50 wealthiest families in the UK now own more than the poorest 50 percent of the population combined. British newspapers are full of ridiculous PR-planted stories that suggest that the government will actually lose revenue if it attempts to tax the wealthy. In any case, the issue isn’t really about tax; it’s about unlocking that wealth and moving it around the  economy to grow the GDP to benefit millions of Britons and not just the egos of a few. 

With no hint of irony, the British Parliament, which has been a hothouse of artificial intelligence for several centuries, has been debating a new copyright bill and the role of AI. The issue is how can the government give away as much copyrighted work from British creatives and journalists as possible to anyone developing AI technology without being seen to be completely craven to US tech moguls. 

Over in the US, Elon Musk has stepped down from his role as a special government employee though the Department Of Government Efficiency that he set up continues to wreak havoc throughout the federal government. Most of the supposed savings have come from weakening America’s ability to respond to disasters, such as a new pandemic, and its regulatory oversight, including certifications for rocket launches. DOGE estimates that it has saved $140 billion though its figures have previously proven highly optimistic, and this is somewhat short of the $2 trillion that Musk promised to deliver. 

Meanwhile, Trump is now pushing his ‘big beautiful’ tax and spending bill through Congress. This promises tax cuts but all it really does is make small tax cuts for the majority and very large savings for the wealthy. It’s the counterpoint to the slash and burn approach of Musk’s DOGE to federal budgets but will add about $2.3 trillion to the US deficit. The bill is a re-run of Trump’s 2017 Tax cuts and jobs act, which cut corporate taxes. In theory this could have led to more jobs being created, but in practice most companies spent the savings on share buy-backs.

Trump has also attacked the Ivy League university Harvard in an effort to bend the institution to his will. So far Harvard has stood firm despite losing millions of dollars in federal funding. Trump’s latest gambit has been to cut its ability to enrol foreign students, with the 23-year old heir to the Belgian throne, Princess Elisabeth, reportedly caught up in this. 

This wilful attack on Universities will have a long term impact on the US since G7 countries use technological advances to stay ahead of developing nations, but that strategy relies on having the centres of excellence to develop such talent. It’s not for nothing that advanced industries collect around these universities, such as inkjet in Cambridge, and textile printing in Manchester, in the UK. 

The EU fully understands this and is looking at ways to attract researchers and academics to its universities. The bloc has established a €500 million fund, catchily named ‘Choose Europe for Science’ and has announced plans to fast track visas for US researchers. 

And of course Universities such as Harvard are about more than just science. They help train the next generation of leaders, and to establish the principles behind the moral and ethical framework that we need to navigate all the modern threats that we all face now. This is the essence of civil governance and it requires all of us to participate to make it work. Those nations that grasp this will be strong and free while those that don’t will be immeasurably weakened.