Politics

EU defence fiscal holiday will backfire

28 Mar 2025

Brussels wants to freeze Europe’s budget rules for four years to encourage states to boost defence spending. Countries may have added up to $800 bln of military outlays by then and will struggle to return to fiscal discipline. The EU needs reformed rules, not just a time out.

Car investors only take US tariffs semi-seriously

27 Mar 2025

Shares in the likes of BMW and Volkswagen fell after President Donald Trump whacked 25% tariffs on auto imports. Those declines may not be pricing in the worst. Carmakers can soften the blow, and Trump may backtrack. Yet US trade imbalances suggest that may not happen soon.

‘Pro-growth’ M&A policing is a misnomer

27 Mar 2025

The transatlantic trustbusting consensus forged by Lina Khan and Margrethe Vestager is already fraying. In this week’s Viewsroom, Breakingviews columnists discuss if it will lead to mergers involving national champions such as GSK and BP, and in turn remedy some economic ills.

UAE’s bumper US bet is AI access down payment

26 Mar 2025

The Gulf state is to fork out $1.4 trln on American energy and mining over the next decade. Given US economic uncertainties, not all these investments may go well. But if it prompts Washington to grant the UAE access to more advanced chips for AI, it may prove money well spent.

Tax U-turn is UK chancellor’s least bad option

25 Mar 2025

Rachel Reeves needs $19 bln to comfortably meet her own fiscal rules. But cutting spending and welfare may backfire and leave her weak. Raising income tax would be a breach of pre-election promise but can be justified by the Ukraine crisis and offers a more permanent fix.

Donald Trump’s boomerang will hit the US hard

24 Mar 2025

The president’s bullying of allies is damaging international trust. Friendly countries no longer want to depend on a wayward superpower and will seek greater autonomy in defence, technology, energy and finance. Though they will still do deals with the US, the backlash will hurt.

Paul Weiss rewrites art of the deal under duress

21 Mar 2025

A US president vindictively targeting an eminent corporate law firm with $2.6 bln in revenue would typically run into resistance. Instead, Chair Brad Karp settled matters with a $40 mln promise. Clients fearing their own retribution will probably be more impressed than outraged.

Big state backlash may pay biggest dividends in UK

20 Mar 2025

Elected leaders from Argentina to the US are pledging to cut spending, shrink the state, and cut red tape. Despite similar rhetoric their priorities are very different, as are the potential rewards. In the developed world, Britain’s approach has the best chance of success.

Macron lacks the money to put where his mouth is

20 Mar 2025

The French leader wants Europe to boost defence spending. But with debt at 115% of GDP, France can’t easily find the 40 bln euros it needs to cover its share of the burden. The bloc’s strategic plans may be delayed by the fiscal woes of its main military power.

US markets’ exceptionalism goes into reverse

20 Mar 2025

After years of setting the global pace, the S&P 500 Index has dropped 9% from its peak while Hong Kong and Europe benchmarks rise. In this week’s Viewsroom podcast, Breakingviews columnists discuss whether trade wars and threats to the rule of law portend a durable shift.

Oval Office attacks on US law come at a price

19 Mar 2025

The Trump administration’s blitz on judges, independent agencies and contracts destabilizes the governance that underpins investors’ confidence. Even if courts mute some of the tumult, the country’s risk-free status is quickly eroding. A 0% debt premium is no longer warranted.

Erdogan crackdown slams brakes on Turkish recovery

19 Mar 2025

The $1.5 trln economy has gained from more orthodox monetary policy in recent years, which boosted financial assets and has helped tame inflation. Now President Tayyip Erdogan’s arrest of a key political rival has hit the lira, and will unsettle ratesetters and foreign investors.

China has spicy menu of US trade war reprisals

19 Mar 2025

Donald Trump has yet to impose the levies he threatened on the $19 trln economy. Yet the People’s Republic has a banquet of options, from non-tariff barriers and squeezing firms like Tesla to devaluing the yuan and banning rare earth exports. Escalation means indigestion for all.

UK will struggle to sit out Trump’s tariff war

18 Mar 2025

Prime Minister Keir Starmer has eschewed Brussels-style retaliation after the president put import levies on steel. That’s logical, but neutrality will get harder as EU-US tensions rise. His best hope is that tariff damage forces a US U-turn before he has to side with Europe.

Stingy Uncle Sam subverts both suppliers and state

18 Mar 2025

Abrupt spending cuts and pressure to justify existing deals are wreaking havoc on US government contractors from Lockheed to Pfizer. Some $760 bln of annual outlays are at risk, spooking investors. Worse, frugality threatens to impair national strategic capabilities for decades.

Why financial warfare could backfire on the US

18 Mar 2025

Washington has sharpened the dollar and technology into powerful weapons. Now erstwhile allies fear they are targets. In this episode of The Big View podcast Edward Fishman, the author of ‘Chokepoints’, explains how economic interdependence is increasingly at odds with security.

Russia’s economy would struggle to cope with peace

17 Mar 2025

After years of overheating, the $2 trln economy risks a hard landing if President Vladimir Putin ends his Ukraine war. A credit boom presages a default wave, while long-term demographic problems have worsened. All the more reason for Putin to avoid switching off the war machine.

US tariff tantrum threatens pricing progress

12 Mar 2025

Inflation was lower than expected in February, though as a 3.1% annual rise in less-volatile consumer prices shows, it’s only one step back to normality. The White House’s latest salvo of trade levies risks raising costs and undoing even this improvement, pinching households.

US-EU tariffs are a skirmish in riskier trade war

12 Mar 2025

Brussels reacted to Washington’s steel levies with 26 bln euros of measures on bourbon and other exports. The next steps could see Europe thwacking Big Tech, and President Trump targeting member states. Their effect is less predictable, and likely to be more painful for Europe.

How the World Bank can defend itself from Trump

12 Mar 2025

The US president is reviewing Washington’s membership of the global lender. Donald Trump could in theory quit the bank or just block its policies. Yet there’s hope for boss Ajay Banga, who has scope to argue that his work is surprisingly compatible with an ‘America First’ agenda.