But while the UK is an instructive example, it is not the example MAGA has in mind. Instead of getting carried away with anti-immigration culture wars, Trump and his followers would do better to spend time studying how Britain has struggled with the loss of its global supremacy. No other country’s recent past provides a clearer picture of America’s possible future.
Anglo-American relations have always been fascinating. Since the nineteenth century, the impoverished British political elite and aristocracy often maintained their status by marrying wealthy Americans. The British used the New World to rejuvenate the Old, but were always irritated by their new dependency. The two countries remained allies during World War II and afterward, but their relationship was never free of tension. The British arrogantly viewed themselves as sophisticated Athenians and the Americans as crude successors to the Romans. As the Americans built their new empire, they became resentful of British attempts to hold on to the old order.
The role of currency in dominance
The pound sterling was once the world’s dominant currency and then ceased to be. But even in the 1960s, the U.S. Treasury Department believed that Britain still provided a perimeter defense for the U.S. dollar. Then in 1967 came the devaluation of the pound, which was the beginning of the end of the dollar standard for the rest of the world.
U.S. leaders even borrowed British wording to solve their own currency problems. After British Prime Minister Harold Wilson told television viewers that the devaluation would not affect the value of “the pound in your pocket,” U.S. President Richard Nixon told his constituents: “If you are among the vast majority of Americans who buy American-made products in America, your dollar will be worth the same tomorrow as it is today.” None of these statements were true. The fall in the value of the currency was, in fact, a harbinger of an inflationary crisis to come.
At a time when the rest of the world is looking for alternatives to the US dollar, the UK’s decline offers another parallel. Like the Trump administration, the UK has struggled to find countries that were still willing to cooperate with it politically. After 1945, two such countries were Egypt and Argentina, which had large reserves of sterling but quickly tired of being linked to a waning hegemon. Similarly, Trump is trying to maintain American power through his oddly composed Peace Council (which is mostly made up of authoritarian regimes that see the benefit of flattering the president).
As is often the case, the main vulnerability of a declining power is financial. Just a few years ago, the short-lived Liz Truss government showed how unfunded tax cuts (or spending increases) could shake bond markets, threaten pension funds and lead to unsustainable rises in the cost of government borrowing. Markets are now increasingly worried about the prospect of sustained deficits driving up U.S. borrowing costs.
Americans can also learn lessons from Britain’s protectionism during the stagflationary 1970s. At the time, leftists in the Labor Party (and the economists who supported them) argued that if the government spent more, it would lead to higher investment, higher productivity, and consequently lower inflation, making goods more affordable. This was a complete illusion, leading to faster, not lower, inflation. But now the same argument can be heard from Trump’s advisers, who confidently insist that the artificial intelligence revolution and massive investments in data centers will increase productivity so much that inflation will fall and budget deficits will disappear.
Uncertainty comes at a cost
Again, they would do well to consult economic history. Britain’s decision to leave the European Union ushered in a decade of uncertainty, endless debates about trade policy, rules of origin in a world of complex supply chains, and exemptions for important or irreplaceable goods. The deep and persistent uncertainty caused by Trump’s tariffs could have an even greater and more damaging impact on the U.S. economy than Brexit has had on the U.K. economy.
The British experience also offers policy lessons. The Jeffrey Epstein story has an international reach but, perhaps surprisingly, its effects are most acutely felt in the UK. The scandal threatens to topple both the monarchy – because of the involvement of the then Prince Andrew and the question of who knew about it – and the current prime minister, who appointed a former minister with close ties to a convicted sex offender as ambassador to the United States. So far, American politics, into which Epstein’s tentacles have penetrated deeper, seems less vulnerable. But as with trafficking, this is a scandal whose consequences will only grow with time.
Moreover, this scandal is not just news for the tabloids because it points to a deeper rot. Britain and the US came through the 20th century brilliantly thanks to their two-party political systems. They did not have to deal with the difficult negotiations required in multi-party systems to form coalition governments.
But what happens when both parties lose credibility? In the UK, the scandal has fostered the rise of an outside party that draws its strength from the bankruptcy of the status quo. Now that MAGA has taken over the Republican Party and the Democrats are deeply divided between centrists and leftists, the implosion of the British party system provides a definitive forecast of America’s future.
Harold James
Harold James is a professor of history and international relations at Princeton University and is the author of the recent book Seven Crashes: The Economic Crises That Shaped Globalization(Yale University Press, 2023).
© Project Syndicate, 2026.
www.project-syndicate.org
