I’m looking for a green light from the team. Do we have go to go? Excellent.

Well, my name is Adam Tooze and it’s my very great pleasure to welcome you to this panel on the topic. It could hardly be more topical of the relationship between sovereignty and interconnectedness in the modern world and its relationship to prosperity and to discuss these issues, which I think many of us are living and breathing right now.

We have a really stellar lineup. I’m just going to run down the list. These are all people who are familiar to you, but nevertheless, it’s a great pleasure even on my part to welcome everyone, Howard Lutnick, America’s Commerce Secretary, Rachel Rees, UK Treasury Minister, Sean Mahoney of Canada, Brian Moynihan of Bank of America, and Janet Truncali of EY.

So we have an extraordinary blend of powerhouse expertise in economic policy and private sector as well. I mean, I’m going to start with the public policy issues that are on everyone’s minds right now that bear directly on the issue of sovereignty and interdependence. And I’m going to turn, with your permission, to Secretary Lutnick to give us maybe an insight and explanation.

I think a lot of people are looking at Davos to see and to try and better understand the mindset of the Trump administration. Speaking to you earlier on, it’s the first time I’ve had the privilege of meeting you. I’ve seen you on TV a lot.

In person, the impression is even more overwhelming of, on the one hand, kind of extraordinarily ebullient, dynamic. That was in a nice way, Howard. Dynamic.

These are good words. These are all good. I’m coming to a different tone in a second, but like initially, it’s this just extraordinary ebullience, dynamism.

You’re saying you’ve sealed deals for a trillion and a half in jobs and investment into the United States.

Yes.

And then you said… And this is where the tone shifts. You’ve got to understand, I’m the hammer.

These were your words. I’m the hammer. Because the people I’m dealing with know that unless they deliver the kind of investments I’m looking for, I’m coming with 100% tariffs.

And that duality, I think, between the dynamism, the constructiveness, the forcefulness of the American state, which was, after all, also something many of us saw in the Biden administration, and this element of threat, is what many of Hizalves are actually trying to come to terms with.

Because this is, to say the least, unfamiliar. And when it moves from the zone of economic policy to the question that is directly under the subtitle of our talk today, which is sovereignty, and we’re talking about the territory of Greenland, and it’s coupled so directly to tariffs, it’s a fundamental shock to the system.

You can read it off the faces and the rhetoric of every single European politician and businessperson I’ve spoken to while we’ve been here. And we’re also getting reactions from around the world in similar tones. So I really wanted to ask you to help us understand, not in a sense what your motivations are, because I get it.

Like, you want Greenland. It makes sense. You’re proud Americans.

You’re advocates of President Trump’s policy. What I’ve struggled more with is how you imagine others react to this. I mean, if you put yourself in the position of your Danish counterpart, who’s a proud Dane and a loyal executor of the Danish government’s position, how do you envision this going, this kind of, how does this go down?

Well, I think you should start at a much higher level. Okay. We are in Davos at the World Economic Forum.

And the Trump administration and myself, we are here to make a very clear point. Globalization has failed the West. and the United States of America.

It’s a failed policy. It is what the WEF has stood for, which is export offshore, far shore, find the cheapest labor in the world, and the world is a better place for it. The fact is, it has left America behind.

It has left the American workers behind. And what we are here to say is that America First is a different model, one that we encourage other countries to consider, which is that our workers come first. We can have policies that impact our workers.

Sovereignty is your borders. You’re entitled to have borders. You shouldn’t offshore your medicine.

You shouldn’t offshore your semiconductors. You shouldn’t offshore your entire industrial base and have it be hollowed out beneath you. You should not be dependent for that which is fundamental to your sovereignty on any other nation.

And if you’re going to be dependent on someone, it darn well better be your best allies. And so that is a different way of thinking. It is completely different than the WEF.

I viewed the WEF as not a flagpole in the middle, but in fact, they are the flag. Whichever way the wind blew, so it blew. You should have solar.

You should have wind. Why are you going to do solar and wind? Why would Europe agree to be net zero in 2030 when they don’t make a battery?

They don’t make a battery. So if they go 2030, they are deciding to be subservient to China, who makes the batteries. Why would you do that?

Why would the United States of America, which has oil and natural gas, try to convert to all electricity? China does not have oil and natural gas. Electricity and electric cars make perfect sense to them.

That is practical and logical. So the point I want to make, and I want people to think about, is that America first is the job of our government to take care of our workers, to make sure their lives are better for it. And then, don’t be America alone, right, but be America first, and I would suggest that policy is something for other countries to deeply consider, to take care of their own, and then we will work out wonderful relationships between us.

But I want to point out, when America shines, the world shines. Close your eyes and think of a world without America in it. It becomes pretty dark pretty darn quickly.

When America shines, right, and everyone said, oh, you’re going to do all these tariffs, you’re going to destroy the world. The world’s stock markets are up. Which ones of them?

All of them.

Can I bring you back to Greenland?

No. It’s unnecessary. The Western Hemisphere is vital for the United States of America.

Our national security people are on it, and they care about it, and I’m going to leave it to them to address with our allies, with our friends, and with everyone how they work it out. I think the Western Hemisphere matters to the United States of America, and the United States of America, as I’ve just articulated, really, really matters to the world. When America shines, the world shines, because they all need to make sure America is strong and powerful to take care of them, God forbid.

And so I think America and the Western Hemisphere are vital to America, and I’m going to leave that to my national security people to address.

Right. The rest of us, I think, are finding it harder to make that kind of separation, clearly, and I would be curious to know how the representatives of the UK and… and Canada might want to think about these issues.

Do you see them starkly divided as Secretary Lucknett would like us to have them? Does this logic of what’s good for America is good for the world convince in this extraordinarily strong, extremely eloquent expression that we’ve just heard? You go first.

Thank you. Thanks, Francois-Philippe. We’re friends.

So I’m very struck by and taken by the idea of putting your own country first and considering your own security and resilience. I think it’s about three years ago now that I gave a speech where I coined the term Securonomics, which is all about building security and resilience in your economy, and the days when it didn’t matter where things were made and who made them were in the past.

And that’s become increasingly clear since the pandemic, when we were over-reliant on PPE and medicines from abroad. And then again, when Russia invaded Ukraine, because of what happened to oil and gas prices. I guess for an economy like the UK, the way in which we will pursue our national interest is going to be different from the way in which the US pursues theirs.

You are a much bigger economy and we can’t do everything on our own, and nor should we try to because we’d end up doing nothing well. But we do have real strengths in the UK, in our defence sector, in life sciences, in business and financial services. But we do rely on our allies as well.

And even a country as big and as strong as America also relies on its allies. And I guess the sort of area where I think that we do need to sort of continue that dialogue between countries that share each other’s values is how we can work together in our mutual interests to advance our values in a very unstable and uncertain world.

You know, if you say, could you picture the world without the US and what would the world be like? Yeah, the world would be a lot poorer and it would be a lot scarier. But you’ve also got a lot of allies around the world in the United States.

Britain, I know, I hope, I believe, is your strongest ally, always have been and always will be.

First to do a deal with us when we love you, we do, we do.

Thank you very much. Feeling is mutual, but we do need to think about where the threats are and who our friends are. And I think that’s really more stark for smaller economies, but even for the US, when you think about, oh, I was in the States, as you know, last week for a meeting of G7 plus a few other finance ministers to talk around critical minerals.

Now you do have some reserves of critical minerals, but not everything you need. 90% of your critical minerals at the moment come from the US, from China. You need to wean yourself off those, yeah.

But you won’t be able to do that without the help of Canada and Australia and other countries. And so for all of your strengths, we do also need to think how we can preserve some of the things that the US has benefited from in the NATO alliance and the Western alliance, not because it is the benevolent or the right thing to do, but because I profoundly believe it is in your country’s national interest.

The other thing I just wanted to say, Adam, in terms of sort of building security and resilience, but for my country, it’s about our industrial strategy, where we’re really focusing on these sectors where we are really good.

But we’re not gonna be a semiconductor superpower in the UK, that’s not realistic.

So it seems like biotech.

Yeah, life sciences, biotech, financial services, which is obviously absolutely crucial for financing things like the exploration for critical minerals and the extraction of those critical minerals. We’ve got real strength with the London Metal Exchange in London, for example. But although we have some reserves of lithium and tungsten, we’re not gonna be a big global supplier.

of critical minerals. So we have strengths, defence is another one. And our trade strategy is also around our security and resilience where we are trying, and this is different from the US approach, I absolutely acknowledge that, we are trying to reduce barriers to trade.

You know, we’ve done trade deals this year with you, with India, with Korea, and we’re also reducing trade barriers with the EU. There’s more that we want to do together between the UK and Canada. We regard it in our national interest to reduce the cost of living for people in Britain, but also providing more opportunities for businesses in the UK to then export around the world.

And, you know, energy security is important to us as well. We do have some reserves of North Sea oil and gas, and they will be important for many decades to come, but we are an importer of oil and gas. We do have, because of the shallow waters in our seas, big opportunities around wind technology.

We don’t have what you have in the US, and so we’ve got to find our own way to boost our energy security. And we strongly believe that renewables is a really important part of that mix, as is nuclear. There hasn’t been sufficient investment in nuclear for a long time.

We’ve signed off a Sizewell C, a big nuclear reactor, as well as small modular reactors in North Wales. So, you know, that security for us is around energy security, our security through our industrial strategy and our trade strategy as well. So I think a lot of, you know, shared analysis of what the problem is.

The solution is going to be different in every country, but what I would urge Howard and others in the administration just to think of is how your allies can also help you achieve your objectives, which I think are in your national interest as well as helping all of the Western world to thrive.

Can I begin, Mr.?

Sure. Well, listen, it’s a real pleasure. to be with Howard and obviously Rachel and colleagues.

I like the way Howard started, it’s the worker first and how we rebuild industrialization. And you’re right, you’ve been looking at that. And I think today, and I chaired 10 meetings of the finance minister of the G7 perhaps last year with Rachel and Scott and others to try to figure out the way forward.

And one thing, and goes back to Howard, I think that the world see a better, clearer nexus between food security, energy security, economic security, and national security. I can tell you as finance minister, I’ve never talked as much about national security as we did before, for some of the reason that I was mentioning, you know, we’ve become too reliant and less resilient.

So how do we build resiliency in the system, I think has been a significant thing. And nostalgia is never a good strategy. You know, I keep saying we’re entering the second quarter of the 21st century.

And the next 25 years and beyond is not gonna be like the last 25. So you cannot look at the past to try to chart the future. And I’d say the three S, which I call the speed, scope, and scale of change is quite unprecedented.

You know, some would say you have to go back to 1945, the fall of the Berlin Wall, it’s everything. It’s geoeconomic, geopolitics, supply chain, it’s AI, it’s quantum, it’s a lot of things at the same time. And when you realize that, as we’ve done, is how do we build in partners, allies, and friends?

You look at Canada, I mean, geography has made us partners, allies, and friends. We’ve been blessed by geography. We share the continent, we’ve been trading with each other, we’ve been exchanging.

Actually, we’re one of the biggest customer of the United States. We buy more from the U.S. than China, Japan, and the U.K.

combined. So two thirds of the United States of Canada is their first export market. So we’ve built that integration.

But what Howard was making a point, and Rachel, is that within that, we also need to build more resilience in the system. We had to do, for us, do a step change. how we’re gonna be a major supplier in terms of critical minerals, in terms of energy, the things that will matter for the future.

And what we need now is scope and scale. Because I think what we’re facing now is a rupture point where we need to change the future together. And I would say when I look at Canada, we’re still a big magnet for talent.

I mean, like the United Kingdom, Rachel and I were in Downing Street recently and looking at the talent piece. And if you can attract the right people, you’re gonna have the right economy and you’re gonna have the right strategy, the right prosperity. The second thing I would say, you need strong industries.

And I think that was the point of our word. You need to make cars, you need to make ships, you need to make planes. You need to have this industrial base that is gonna ensure your resiliency, whatever happened in this new world.

I’d say in terms of critical minerals, it’s true with our G7 colleagues. We said we cannot let uncertainty become the new certainty. So how do we make sure that we improve the resilience in the system?

And we’ve seen what other actors have been trying to do on critical minerals. So we need to learn from that. And we’ve said, let’s have an initiative to make sure we’d be more resilient.

And for us, it’s about how can we be the best possible partners to our friends and allies so that no one has a choke point when it comes to that. The fourth thing I would say is around energy. I think that we have been for decades providing energy, but I think now we’re stepping up in a big way.

And I think it’s a good thing because you want, at the point of our word in the United States, they want partners to be resilient. They want partners to be, you know, they’re fighting for their own peace and for their workers, and I like it because we’re all doing that, but we all need to do a bit more. And at the end, I would say when you’re Canada, you know, we have free trade with all the G7 colleagues.

So I think we’re in a unique position to work in a very concrete way to build the resilience in the system that I think going back to the worker, at the point of our word, we’re all gonna be benefited if we’re more resilient.

if we’re more coordinated in what we’re doing and realizing that each ally and partner can bring something to the table. And that’s what we’re trying to build. If you’re looking at the next quarter, that’s really the wake-up call, I think, that we all receive and that we need to act upon.

Can I turn to our representatives from the private sector? Brian, ahead of time, we were talking about how, from your point of view, you think it’s critical for countries to think about attracting foreign business. You were giving me a very interesting analysis of the way in which you thought that countries like Canada or the UK might be well-advised to play this game of attracting foreign capital.

We’ve heard the policy side. And then, Janet, I’d love to turn to you to get your global perspective on this.

So I think one thing Howard didn’t mention also is the U.S. final demand is huge. And so the success of a company coming to the U.S.

and doing something is there’s gonna be a big final demand, Matt. And the U.S. consumer in the first couple weeks of January spent 7% more than they spent last January.

We’ve raised our estimates for U.S. economy from 2.6% GDP to 2.8%. We’re bullish, and we think, that’s net, Howard, so you gotta, but the 5% or 6% grows, frankly, which is a lot of activity.

So we’re bullish on that. But what I was saying earlier is that the tricky thing to figure out, and I’ve had discussions with Rachel and her colleagues over the years, is how you’re the best place, if you’re in England, and she pointed out that financial services is a major industry for them, you have to think about how you’re the best place for firms like ours to operate, who are not running retail banks and not running, so that they can go to the whole world out of that.

And so we have New York, we have London, and then how do we go to the whole world? And the trick for a government is to figure out, I gotta protect my people, I gotta protect my tax base. What I don’t need to do is get myself so involved to where I start to become more and more difficult.

So if you take the environmental rules that have been beaten at for the last five or six years, I’ve had some interesting meetings here where we keep telling these aren’t gonna work, these aren’t gonna work, and the EU, CRDD, and all this stuff.

Our point was not, you just make it. unable to work. And even the capital rules in Basel III, which sound like we’re caught out of the final word, the application of them created misery across the world.

And so the idea, I think, when a country thinks about it, all the, what your colleagues, what our colleagues said here about protecting it, but it’s how do you have the balance between being the best place for multinationals to come do business in our country, at the same time protecting our citizens, and it’s not by saying all the rules apply to the UK multinational that apply to a US multinational.

You’ve got to sit there and say, how do I tailor this thing to make it work? Which is a bit what Howard’s saying. They’re going to bring fabs here.

We’re not saying you have to become a US company to do it. They’re building this major fab. You talk about one up in Syracuse and et cetera.

It’s a foreign company, but they’ve got to put it here so whatever hit the fan, you could cut it off and still own the means of production. That’s because of that thing. There’s other things you don’t have to be quite so ardent about, for lack of a better term.

How does a country balance that sovereignty with that? Data is becoming a real problem. People want to say, if the data’s in my country, it’s okay.

You’re saying, you know what? That just means you’ve taken all this worldwide system, which you want us to give you all these reports, information, and you start slicing it to pieces. There’s no value to the customer in that.

There’s no value to your companies in that. You think there’s incremental value, but let us explain, what do you really want? We can get it to you if you need it.

If you make us run separate systems, you’ve added cost to your people. By the way, the rest of the people are letting us run a common system. It’s data, it’s information, employee practices and all those things.

How do you become the best? How do you think about that? While protecting your citizens from big bad banks or protecting your citizens from taxpayer degradation, things like that.

That’s truly fascinating. Janet, do you want to give us your-

First, I’ll just start with, we’re a global organization, 400,000 people. We operate in about 150 countries and territories. Globalization for us has been there for a long time.

You have to work with, how do you deal with local rules and regulations? It’s no different than the financial services industry. Politics, economies, demographics, all different.

And you’ve got to decide, you know, what do you need to do to operate locally and then continue to be a well-connected global organization. And I think that’s where companies, you know, need more help than ever before. And so I think globalization is not going away.

It’s just becoming more complex. So we look at the landscape and, you know, the geo-strategy of companies has been elevated like, you know, we’ve never seen before in the last two years to be a board-level conversation. Ninety-four percent of our, you know, CEOs that we survey are really investing significant money, you know, to really games, you know, and scenario plan, you know, not one or two, but six or seven different scenarios because of the complexities that we’re talking about here today.

And resiliency, you talked about. I mean, that’s what’s so important for these organizations. And just being here last year, you know, where there was, you know, uncertainty, you know, compared to this year, I think last year we saw a lot of companies kind of wait and see and, you know, we’ll take some time to see, you know, how we pivot.

I think now, you know, our most sophisticated clients, they can’t wait. So they’re going to have to make some bets. They’re going to have to make some investments.

Some will work out, some won’t. But, you know, that paralysis is no longer an option and they’re going to have to move forward.

Can I double down on that and ask both of you from the private sector whether you are seeing already, just expanding on the point you’ve just made, where is this tipping point coming? Like when is the private sector globally or in the U.S., where are you seeing the flows shift? Because I’m, you know, I’m a policy wonk kind of person.

I’m always talking up the story. The politicians have a stake in also, in some sense, talking up the story because you need programs. The visions of the Trump administration are astonishingly bold.

And then what I’m always kind of with my economist hat on, I’m wondering, is this really happening? Like is the shift in the flow really happening? Just think about the ability to get a deal done.

The ability to get a transaction done. The honest advice in, say, 2024 or something like that would have been to somebody offering up a $5 billion plus acquisition. Think twice because this may never get approved and what are you gonna do to your company while you wait?

Okay, that’s completely changed. So the year last year 25 was the second highest investment banking year Deals getting done absent a pandemic recovery year where every debt financing went crazy. So and next year we think it’s bigger That means that you’re unleashing the competitive forces of acquisitions and all the deployments and investments So the the capital markets are open the financings there And so I think if we can keep enough certainty to your point about that it just keep the rules clear enough.

Well These colleagues have to wrestle national security is not unless you’re in the business providing Yes, it’s not something we all depend on but not something we’re gonna add a lot of value to but on the other hand It creates economic activity.

We have to help finance Okay and but the world’s ready to go in a lot of ways and so deals can get done and things like that and what I encourage People is to is to move on the permitting side move on the approval side move on the deregulation So there’s there’s a lot of a lot of fuel going in the tank right now on deregulation stuff There’s still barely coming in the system in across UK and here and other places

You were saying de-emphasize the headline tariff wars thing Focus on the nuts and bolts the non tariff barriers the things which enable stuff to get done

This these these rules which you know, they’re straightening out Hopefully on environmental disclosure required you to do things like and we’re just saying there’s ISSB that accomplish those standards We’re happy to agree with those And those are developed with business The firms the major firms developing so business can do this But if you do a lot more than this because you like X or Y You are just adding barriers to us being able to operate With a facility to help your people get financing and access to capital

John this corresponds to your experience

Absolutely. I mean you look at again financial services regulation regulation of our profession. You know, we’ve got different standards for different companies listing different places, you know, that’s not helpful, right?

You know, we’ve got to get alignment and better consensus again to bring you know, more businesses to market and the like

Do you want to come back in?

Well, I would say it’s not a time to wait, it’s a time to double down. I mean, listen, what we need, we were talking just a minute, the critical minerals, what we need is speed and scale. This is not a time, it’s, but you know what has happened in the world, I think, is forced us as government to be more efficient.

I mean, a lot of what we were saying is how we bring efficiency in our own system. You know, for us, we put a major project office, reducing the time of permitting, matching the offer and demand, looking at long-term offtake with the number of private sector. I think there’s a big role in the United States has been leading in many ways in trying to show us in a way the interaction that you can have.

And honestly, when, you know, there’s things that you see in the public, but you’d be surprised at the amount of discussion and, you know, the background where we’re trying to think to achieve. Because if you look at the real challenges in the world today and the advancement of technology, quantum and AI altogether, cyber, I come back to critical minerals because it’s essential. You know, the microchip, everything we need.

I would say what has happened has made us also more efficient. I look, I can speak for Canada. We have done things in the recent past that, you know, were longstanding that we needed to do.

And Rachel, we’ve been sharing, and our word has been obviously a lot as well in the United States. So I would say from our side, it has made us more efficient because I don’t think that you’ll see change is obviously part of history, but I don’t think the speed and scope and scale of change will relax.

I think you will see that for quite some time. So better adapt to that, be efficient. And like you said, these investments that are waiting, I think we’ve passed the time of waiting now.

It’s the time to act to make sure we can, you know, meet the moment.

I’d love to go out to the audience for some questions. The fate of these panels is that we have too little time, too many great speakers, but I’d really like to open it up. I see three hands here.

I’ll start here with Peter Goodman, I think, at the time.

Yeah, hey, Peter Goodman with the New York Times. Mr. Secretary, I’m wondering where the safeguarding of credibility in the institutions of American governance fits into your vision for America First, and specifically, where do you stand on the importance of Fed independence?

And what are we to make of the fact that we’ve actually seen manufacturing jobs decline over the last year?

I’m going to collect a few. So I’m going to go, I think there was a, let’s see, another gentleman here, and then I’ll go to that. We’ll try and do two rounds.

Thank you. I was going to ask about central bank independence, but not just the Fed, actually, more generally. But actually, I’ll pivot to something else.

So deregulation, which we’ve certainly seen in the US, also in the UK, how do you see those as tailwinds? We definitely see tailwinds in the US from financial services perspective. How do you see it in other markets?

Also, I’ll be here from the Chancellor.

Maybe at the front here, in the grey, we’ll just do the front row for our starter round.

Hi. Mehreen Khan from The Times. Chancellor, you said that it’s very important to understand who our friends are and what the threats are.

Is China a friend to the UK, or is it a threat to the UK? The Prime Minister will be making a visit to China in the next couple of weeks, the first in many years. And Commerce Secretary, would you like to see the UK government taking a position on China that’s much more in line with your administrations?

Well, that’s a great round of questions. Secondly, Latney, we’ve not heard from you in a while.

Clearly, I’d like the UK, who was our great friend and ally, to be aligned with us. That’s clear. With respect to interest rates in America, there’s been a classic policy that when the US economy does well, raise rates and put brakes on it.

When the US economy is doing poorly, cut rates and add gas to it. But basically, define mediocrity one way or the other. And President Trump thinks quite differently.

We have the best credit in the world. Why are we paying a higher rate than all the other credits of the world? It makes no sense.

Our rates are too high. It’s just binary. Our rate should be much lower so that our economy can finally flourish.

I think we’re going to grow more than 5% GDP this quarter, and that’s for the $30 trillion U.S. economy. And if rates were lower, you would see us hit 6%.

What is holding us back is ourselves. We are going to align our economy and our industrial policy with growth and success, and we hope to export that. I hope the U.K.

follows our energy policy, follows our digital policy, so that our great tech companies can invest in the U.K., can invest in Canada, can invest in Europe. But they can’t if they have the Digital Services Act, the Digital Services Act, the Digital Markets Act, the Digital This, the Digital That. Europe has taxed our companies with fines and regulatory attacks more than they’ve earned in taxes on their own technology companies.

Instead of saying, come and build and grow and build data centers here, they tax the heck out of them with fines and regulations that harm them. It’s illogical. There’s a reason the United States has $18 trillion of economic power coming in.

You just watch. I couldn’t say 5%, and I couldn’t say, I think, 6% if we cut interest rates as in the cards, unless that $18 trillion comes to America to build. And let me give you a hint.

It’s coming, and it’s coming fast. Well, thank you for putting me in. It has nothing to do with me, but thank you.

The President of the United States gets to pick the members of the Board of Governors. He will pick the governors that he thinks are the best, and therefore, the outcome will be set by the governors. That is set.

The president has clearly set what he thinks the right answer is, which is lower rates based on our credit, not based on some other nonsense. But he will pick the governors, and the outcomes will be set by the Fed governors.

That I find illuminating in the sense that it’s the sheer drama of your vision of potential American growth that helps us better understand the stakes in the struggle over the Fed. I think that is actually, for me, quite an illuminating answer. It segues very well with the AI discourse as well about the urgency of the current moment, and the coincidence of the AI boom with the first year of the Trump presidency.

As a historian, I think we’ll look back on this as a hugely powerful moment. We had a bunch of really other interesting questions. Maybe, Chancellor Reeves, you would like to pick up the question from Mehring Khan?

Yes, first of all, I’ll say something about central banks, though. In the UK, with this government, we very much believe in the independence of central banks, and indeed, respect for wider economic institutions. It’s only three and a bit years ago that a previous conservative prime minister and chancellor spent months undermining the Bank of England, didn’t allow the independent forecaster to do a budget forecast, combined with a load of unaffordable tax policy, sent interest rates soaring in the UK.

Inflation was unleashed, and pensions were put in peril. And so we very much believe that even though, of course, we would like interest rates to be lower, we have to get inflation down to get interest rates lower, which is why we’re taking £150 off of energy bills for all UK households from April this year, freezing rail fares, freezing prescription charges, to bring down inflation, which is currently at 3.2%.

Bank of England think it will be back at target by late spring, early summer, and that will enable the Bank of England. so not taking shortcuts but enable the bank to cut interest rates. On, well actually on Antonio’s question, I was laughing a little bit when people were talking about deregulation.

Antonio and I, when I became chancellor, would message each other regularly about development, I think in Horsham, was it, in Sussex, where you had some microscopic snails that as a result were stopping any houses being built.

You know, in our regulatory system, we cared more about microscopic snails than we did about young families and first-time buyers getting on the housing ladder. Well, Antonio, I think you can confirm that has changed now. You are building those houses because we’ve changed the rules and regulations.

We’re letting people build stuff in Britain again, whether that is energy infrastructure, transport infrastructure, housing for our people, you name it, the data centres. And you know, Ruth Porat, who’s here this week and others at Google and all of your big US companies are building data centres in Britain because we’re making it easier for them to do so. And we don’t have the regulation that some other countries have, which makes it easier to do business in Britain.

But we absolutely recognise that challenge from business to make it easier to get stuff done. Planning and regulation are being torn up in the UK because we want to make it easier to do business. And finally, on Maureen’s point about China, the trade intensity between the UK and China is lower than between the US and China, lower than Germany and China, lower than France and China.

We don’t want to be an outlier, but we are a bit of an outlier today. And we’ve missed out on opportunities for British businesses to sell into US markets. Brian and Bank of America do business in China.

We want to help British businesses as well to be able to export to those fast-growing markets. That’s in our national interest, but we also need to make sure that we use that relationship to challenge, where necessary, in a whole range of areas, including on areas such as dumping and the lack of respect for some rights of activists like Jimmy Lai, which we raise regularly.

with the Chinese, but you’ve got to be in the room to be able to have those conversations. You’re not always going to be able to agree, but if you refuse to engage, then you’re unable to have those difficult conversations too.

If I may, I’ll go to another round of questions. We’ve got people queuing up in the audience. The gentleman here, smiling at me with a tie, woman here in the checked top, and then gent here in the middle.

Oh, have we got over here? We’ll do four. Okay, where you go?

Joel Hills from ITV News. A question for Mr. Lutnick, if I can, from the UK, Mr.

Lutnick. It is said that President Trump rather likes and admires shows of strength. What will happen if Europe does decide to respond with tariffs?

Lady here in the red checked top.

I was actually going to ask exactly the same one about retaliatory tariffs, so I’ll ask a different one. Isn’t there likely to become a point at which financial markets, this is also one for the Trade Secretary, isn’t there likely to come a point at which financial markets start to become concerned, as they did a couple of years ago in the UK, about the credibility of institutions, about whether the US is a reliable place to do business, whether they can trust the rule of law, whether there’s so much uncertainty about the sort of trade environment and so on that it becomes a riskier place to invest?

I’m going to take two more because this is going so well. Here we go. Gentleman here with the tie, there we go, and then over here, Ravi.

Right, I’m David Rhodes from Sky News in the UK, and my question is actually for EY and Bank America. Secretary Lutnick, you said that globalization had failed the West and failed the United States, and you said it’s left America behind. So I’d be interested to know some of the ways that the Bank of America and EY have been…

left behind in this set of circumstances that you’re describing.

Ravi.

Hi there. Ravi Akbar from Foreign Policy Magazine, Secretary Ludwig. I thought your first answer was illuminating about what America First is, and you framed it partly as an expression of sovereignty.

And I guess my question to you is, what about the sovereignty of other nations? And this is linked to your role, because the threats on Greenland are no longer hypothetical. You’re already proposing economic warfare against eight European countries.

So how does this add up? Does sovereignty matter or not?

So I’ll try to start on this side, which is when we launched our tariff regime on April The world was aflutter with all of these kind of comments. But since then, if you check at the end of 2025, you will see all of the key indicators are up. The UK stock market’s up, Europe’s stock market is up, Japan is up, Korea is up.

They are all up because, as it turns out, there is much more stability in a strong America and a natural and long-term relationship between two countries. I think with respect to the tariff policy, the president uses tariff policy to make sure people are talking and paying attention and not just acting. You have seen him use tariff policy again and again to have outcomes that are reasonable and appropriate.

So the fact that he doesn’t want things to be done without discussion, without consideration, is a way for him to say, hey, you need to talk to us. If you’re our great ally, you need to talk to us. Do I think the trade deals that we’ve set with Europe, with the UK, Are they durable?

I absolutely do. I do not see a model where Europe would decide, I want to blow up the tariff I have on automobiles or on pharmaceuticals or on semiconductors. I’d like to just go back to the way it was in April.

I just don’t see that happening. What I see happening is diplomacy and talking and at the table rather than action, which is something I think the president cares about and is important to the president. And I said, I will leave that to my national security people.

But the president is clear minded and clear of thought. He feels, and he’s talked about this for 30 years, he has felt that the industrial policy of the United States allowed it to be hollowed out and that would be true of Britain and that would be true of Europe.

That all of this has moved to Asia, where they make everything and we just buy it. And that has got to end. We need to produce things in America.

We need to produce things and we encourage the UK to do the same. And you agree. It’s not as if we disagree.

So that’s the history. And sovereignty for America says, we need to have our own steel. We need to have aluminum.

We can have it with great allies, but we cannot have it where we rely on other people that maybe, like we’ve seen in critical minerals, and make no mistake about it, the critical mineral issue was with us a year ago.

Everybody was sleeping through it. Donald Trump ripped the Band-Aid off and the whole world said, oh my God. And that is the intuition and power of Donald Trump’s presidency, is that he’s teaching the world what is wrong and now the world is working together with respect to critical minerals to fix it.

But there are all sorts of things that need to be fixed. one of which is a modification of industrial policy that the United States of America should be a place where you Build things and I would encourage the UK to do the same granted. It can’t be everything to everyone But there are a lot of things same for Canada same for all our allies Well, then we’ll be back to a tit-for-tat Which is how we began and it will end in a very positive conversation between Donald Trump and Ursula von der Leyen Which is what happened last time so you can start with a kerfuffle But in the end right the United States and Europe are great allies the United States and the UK are great allies These are great allies, right?

We are great allies with Canada. We are great allies It doesn’t mean you don’t have an argument It doesn’t mean you don’t disagree, but it doesn’t change the fundamentals of the United States Knows who our allies are and if we’re going to have a kerfuffle, so be it but we know where it’s going to end It’s going to end in a reasonable manner that in our view prior to Donald Trump taking The helm of the United States of America the world was taking the piss out of us Right and we were exporting the power of our economy to the rest of the world in one year of change I just said my expectation is GDP of the United States of America is Over 5% in the first quarter of 2026.

That’s just my opinion But so far in the first quarter if you saw what I said I said I thought the United States would grow 4% and the whole world said you got to be kidding me 4.3% in the third quarter you’re going to see plus 5% from the United States of America the 30 trillion dollar economy Winning and that’s good for the world.

Can I we’re out of time? But I still want to give the final word to our representatives in the private sector because I thought this question That you asked was really quite a fundamental one Does the Secretary’s counter-narrative to the story of globalization, which he quite rightly associates and quite fairly associates with WEF, does that ring true for you?

Or do you see elements that you can agree with, even if perhaps the overall story doesn’t work?

Let’s see what through the pieces, the national security pieces, manufacturing job content as a percentage of all, even though we’re a very services-oriented economy. It’s not that America hasn’t done fine. It’s a question of do we have the pieces today that we need to be successful on the dimensions of defense, national security, dominance of what the next big arc is, which is AI and technology implementation and the power to build that, the power to know you have it.

Rachel mentioned something earlier, which didn’t pick up, which was the supply chain precision and efficiency. We all learned a lesson in COVID when you woke up and you didn’t have personal protective equipment. The idea that all the masks for surgeons to conduct business in every hospital in the world were coming from like two places, and that’s not a sensible way.

Was it 10 cents cheaper, 15 cents cheaper, a dollar cheaper? So I think the question is really job content, which is the workers. I grew up in a small town in Ohio, and so I’ve seen that happen.

It’s job content. It’s also what you need to make sure you really have ownership of. And then the other stuff, the shirt, you can be more flexible on, and that’s the history of the Northeast having the shirt-making industry, the Southeast having the shirt-making industry, and then offshore.

But the designers and the thinking about it, making it wearable, you want that on your shore. And I think, so I think it’s, but our country’s been successful. There’s no question.

The question is can we be successful in the next big arc? That’s the question, and that’s what Howard’s trying to articulate. I think.

I don’t want to put, I would never put words in a hammer’s mouth, but I think that’s what he’s trying to say.

Can I give you the last word?

No, and honestly, from my perspective, I look at what our clients are coming up with. to us on and they want you know greater collaboration across the globe on things that matter them and to impact them and they want us to have a stronger voice to help bring that type of collaboration you know to our clients to make it easier for them to do business you know Brian said it earlier.

Larry Fink asked us in his opening address to kind of raise the tone of the conversation here and to be willing to engage in if necessary quite forthright argument and I think our panel has squarely met that challenge.

I’d like to thank everyone here for contributing and thank you very much for the fantastic questions.