On 23 July, the United States announced another layer of tariffs covering 60 trading partners. Britain received the lower 10% rate; other economies face 12.5%, with separate arrangements for parts of the European Union, Japan, South Korea, Switzerland and Taiwan. The official reason is that the countries concerned have not all adopted and enforced bans on imports made with forced labour.

The action covers trading partners responsible for 99.4% of US imports, although the list of exemptions is revealing. It excludes products whose taxation could leave the United States without sufficient domestic supply, disrupt the wider economy or affect goods America cannot readily produce elsewhere.

The immediate argument concerns trade. The larger issue concerns power.

Why can Washington impose costs on dozens of governments while most of them negotiate separately for relief? The answer is not that America can live without the rest of the world. It cannot. Its advantage comes from the number of countries and industries that depend on access to American customers, finance, technology and security relationships.

Why governments accept American pressure

The obvious response to a tariff is retaliation. Britain or the European Union could tax American exports, restrict US companies or coordinate action with other affected countries.

Governments hesitate because the damage arrives at home as well as abroad.

Britain wants to protect car plants, pharmaceuticals, aerospace and steel. Germany worries about industrial exports. France has agricultural interests. Canada and Mexico have production lines built around components crossing the US border several times. European governments must also weigh NATO, intelligence sharing, weapons programmes and support for Ukraine.

Britain’s car agreement illustrates the pressure. The US granted a quota allowing 100,000 British vehicles to enter at a 10% tariff instead of the higher automotive rate. The UK also secured special treatment for pharmaceutical exports. Those concessions matter to workers and businesses, but they reward Britain for negotiating its own position rather than building a common response with every country affected.

This is how a coalition fragments. One government is offered relief for cars, another for steel and another for medicine. Each faces immediate pressure to protect its own factories. Washington deals with one state at a time while its trading partners arrive with different industries, elections and security concerns.

How the leverage works

America’s largest and simplest weapon is the American customer. The US bought $4.3338 trillion of foreign goods and services in 2025. Losing part of that market can close a factory long before a replacement buyer appears.

The dollar adds another layer. It represented 57.13% of disclosed foreign-exchange reserves in the first quarter of 2026 and appeared on one side of 89.2% of global foreign-exchange transactions in April 2025. Companies borrow in dollars, governments hold dollar reserves and banks use dollar-based infrastructure to settle international business.

Technology creates a third dependency. American firms hold powerful positions in cloud computing, business software, mobile systems and the tools used to design advanced semiconductors. The OECD reports that US-headquartered firms held 68% of global revenue in electronic-design automation and semiconductor intellectual property in 2022.

These systems are replaceable in principle. Europe can expand its financial markets. Governments can build independent payment systems. Businesses can move between cloud providers. Other countries can develop chip-design tools.

The difficulty is time. A minister facing a factory closure next month gains little comfort from an alternative that may exist in ten years.

America also has vulnerabilities. It imported $4.3338 trillion in goods and services in 2025 while exporting $3.4323 trillion. Its industries rely on foreign medicines, minerals, components, machinery, energy and advanced chip fabrication. The relationship is one of mutual dependence, but the US can act through one federal state while its partners struggle to coordinate dozens of governments.

Why retaliation is only part of the defence

A tariff is paid first by the importer in the country imposing it. The foreign government does not send money to Washington.

The US International Trade Commission found that American importers bore nearly the full cost of the steel, aluminium and China tariffs it examined. Some protected production increased, while businesses that used the affected metals paid more and lost output.

The same problem applies in reverse. A British tariff on American machinery may hurt its manufacturer, but it can also raise costs for the British factory that needs the machine. Restricting an American cloud provider may create leverage while leaving councils, hospitals or businesses with an expensive migration.

Retaliation can still be justified, especially when it targets politically sensitive exports and is coordinated across several countries. It can raise the price of coercion. What it cannot do by itself is remove the dependency that made the original threat effective.

That requires a longer policy: several suppliers instead of one, reserves where interruption would endanger life, domestic capacity where rebuilding would take years, and agreements that prevent countries being isolated one at a time.

Where Britain is exposed

The UK Government’s own critical-import strategy identifies medicines and semiconductors among the goods needed to keep essential services and the economy functioning. It also warns that states may use economic coercion to influence foreign governments and businesses.

Medicines show the practical problem. Britain imports finished products, active ingredients and specialist supplies. Stocks can bridge a short interruption, but a new pharmaceutical source requires equipment, regulatory approval and validated manufacturing. A warehouse buys time; it does not create a factory.

Cloud computing creates a different form of dependence. Public bodies and businesses build data, security procedures and staff knowledge around a small number of large providers. Moving a major system involves far more than changing a subscription. A dispute over access, licensing or price can therefore become a public-service problem.

Semiconductors sit inside cars, medical equipment, communications networks and energy systems. Britain cannot reproduce the complete global chain, and attempting to do so would waste money. It can preserve specialist design skills, support production with European partners, keep critical stocks and avoid relying on a single route or supplier.

Food, fertiliser, fuel and industrial components create similar risks. British manufacturing often looks domestic at the factory gate while depending on materials and parts that have crossed several borders. One unavailable chip or chemical can stop a line containing thousands of otherwise available parts.

Britain often invokes national security in relation to armed forces, borders, intelligence and surveillance. The same test should apply to the systems that keep hospitals, factories and public services operating. If losing one foreign supplier could cause serious national harm before an alternative can be built, that dependency is a national-security risk.

National security is also future planning. Government should identify essential imports before a crisis, record how quickly each could be replaced, maintain alternative suppliers and transport routes, preserve the skills and equipment needed to restart production, hold minimum stocks where necessary and stress-test those arrangements. Waiting until medicines run short or production lines stop is evidence that the planning failed.

That label must not become a blank cheque for secrecy or corporate subsidy. Each intervention should identify the specific risk, create measurable public capacity, attach enforceable obligations to public money and show that dependence has genuinely been reduced rather than moved to another supplier.

This is where dependence reaches politics. A government considering a tax, regulation or foreign-policy decision must also consider whether the response could interrupt medicine, close a plant, disrupt software or weaken defence cooperation. The formal decision remains in Westminster, but the affordable choices have already narrowed.

Russia and Germany show both sides of the argument

Russia responded to Western sanctions by backing import substitution and redirecting trade towards China, India and other countries. Energy found new buyers, while Chinese machinery, vehicles and electronics replaced many Western imports.

That adaptation helped Russia avoid the sudden collapse some observers expected. It also created another dependency. In 2023, China supplied 36.5% of Russia’s goods imports and bought 30.5% of its goods exports. Russia largely sold energy and raw materials while importing machinery, vehicles and electronics. It reduced exposure to Western pressure partly by giving Beijing greater economic leverage.

Interwar Germany is a more dangerous comparison. Germany experienced territorial loss, reparations, military restrictions and a peace settlement widely regarded at home as humiliating. The Great Depression then exposed its reliance on foreign credit and export earnings.

The Nazi government directed trade, expanded synthetic fuel and rubber, and channelled industry towards rearmament. These policies built selected capacities, but internal documents acknowledged that Germany could not supply all its food and raw materials. Nazi leaders connected the remaining shortages to territorial conquest. Autarky became part of preparation for invasion, forced labour and plunder.

Neither case proves that isolation creates sovereignty. Russia shows that a country can survive pressure by adapting, while also replacing one dependency with another. Nazi Germany shows how the language of self-sufficiency can be joined to militarism when a state decides it is entitled to seize what it lacks.

Britain needs options, not isolation

A sensible British response would not attempt to manufacture everything within its borders. Trade brings lower prices, specialist knowledge and products no single country can efficiently make alone.

Protection means knowing which failures would threaten life, public services or national decision-making, then building enough alternatives to withstand them. That includes multiple suppliers, practical reserves, domestic skills, European industrial cooperation, independent payment and digital capacity, and public purchasing that supports strategically important production.

Countries facing the same pressure also need common rules for responding. Separate exemptions may save one factory today while making every government easier to pressure tomorrow. Coordination works only when countries help carry each other’s short-term costs.

Resilience will sometimes cost more than buying from the cheapest supplier. The comparison should include the cost of interruption, emergency subsidy and political submission rather than the purchase price alone.

A country does not lose practical independence only through invasion. It can lose it gradually when another government controls a market, platform, currency or supply that cannot be replaced before serious harm begins.

A state that cannot afford to say no is not fully independent in practice.