Pitlochry dam, my inspiration.

You may think I know a lot to be wanting to write about the impact of yesterday’s tariffs, announced by Trump – I don’t. I write as the majority of Britain’s feel, that we have no idea what this will mean to our lives , what it will do to OBR projections , taxes in future budgets or what it will do to the asset value of our pension pots and the surplus v deficit discussions if DB is what counts.

One view , one that the Prime Minister wants us to take, is that a 10% general levy, is a small price to pay for not being hit by European or ex USA america or Far East products. He would argue that Britain will become a target for others to sell their goods and our inflation might fall as a result.

Another view is that these tariffs won’t help anyone (including US consumers) and this will be reflected in world markets for some time to come. There is clearly some fright in parts of the USA, as can be shown by the first votes for lawyers in places like Wisconsin (not good for Trump).

Neither of these views helps ordinary people who may be looking at their finances and seeing them disappearing as their pension pots shrink, ISAs fall in value and as Britain’s house values remain dormant.

What is needed is some genuine policy about our country getting growth and this cannot be achieved at a retail level. It is too hard to get us to take a stand for Britain with our little piggy banks.

In his contribution to the IFS discussion on income from our pension pots, Paul Todd made a very interesting observation about how it was likely to go for the 13m Nest savers who have – so far – done what Nest’s defaults have told them to do. Paul suggested that the income from people’s pot would be paid as pension with income being secure and solid at its outset and that the outset income would increase depending on the growth in the value of Nest’s overall fund. In short that the fund would pay what it could afford to pay as extra annual income (pay).

This is the question that the pension dashboard will ask, not what he pot will pay day one , but what it will pay in years to come. The pension dashboard won’t have an answer to that as it will show the level pension, assuming no growth in the pension and reflecting the views of many people, that we should be lucky to have something and not hope for any more. It is not what Nest are saying, they are saying they want to pay more, from a growing fund. I think this is enormously important and I will be talking more about this.

But why do I mention this in relation to the attitude we take towards the Trump Tariffs? Well we could capitulate and revise down the projections of OBR and other predictors. Or we can ask ourselves how we can realign ourselves as a nation with a clear approach to how we want to grow.

In my little part of the economy, pensions, I read a lot about how our money can be invested to improve our country’s economy, transfer this into pension terms, I can see Nest and pensions like them, paying more income each year as investments pay off. I see there being enough money to pay the triple-lock to bring the state pension up to a level that gives us all confidence for retirement. I hope that individual decisions around personal pensions and ISAs and similar, will be positive, investing in real assets and not keeping money in cash.

My hope is that Britain will rise to the challenge of the USA’s tariff and set about becoming a formidable nation, small in size and population relative to many others but determined and proud through its history.

Yesterday I spent the morning at the Pitlochry dam which provides power for 15,000 homes and has done since shortly after the end of World War II.  The people who dug through rock and cleared the mess were called Tunnel Tigers and what they did for the local town is clear 75 years on.

We should not think about investment as what happens to today and tomorrow’s market, but what it delivers for decades or in the case of infrastructure like Pitlochry’s Dam, centuries. We should take on the challenge of the USA’s tariffs and get digging like Tigers again.