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    FTSE 100 breaks through the 9,000-point barrier to reach new record high

    Britain’s blue-chip stock index has risen through the 9,000-point mark to touch a new record high.The FTSE 100 share index hit 9,016.98 points in early trading on Tuesday, taking its gains during 2025 to more than 10%.Analysts said the London stock market had benefited from a range of factors this year, including a move by some investors to diversify away from US shares due to concerns over Donald Trump’s economic policies.The US president’s trade war has also helped UK stocks, as Britain is one of the few countries to have reached a trade deal guaranteeing lower tariffs.The AJ Bell investment analyst Dan Coatsworth said: “With the UK having already reached an agreement on a 10% tariff for trade with the US, with exemptions for certain industries, the country is now seen to have an advantage in terms of trade relations.”In recent years, the London stock market has been derided as a “Jurassic Park” index, due to its reliance on companies in long-established industries and a shortage of fast-growing tech companies. However, that has proved an asset in uncertain times.“The UK stock market is the calming cup of tea and biscuit in an uncertain world. There’s nothing fancy on offer, just reliable names that do their job day in, day out. That’s an underrated characteristic and a reason why investors are finally warming to the UK stock market’s appeal in 2025,” Coatsworth added.However, Trump’s trade war has created choppy conditions in financial markets throughout 2025. The FTSE 100 index fell as low as 7,544 points in early April, when tariff announcements sent shares tumbling. It then recovered sharply, as traders embraced the “Taco trade” – the idea that Trump always chickens out if his policies spook investors.The precious metals producer Fresnillo has been the top riser on the FTSE 100 so far this year, up by 155%. It has benefited from surging prices, with gold hitting several record highs this year and silver trading at a 14-year peak this week.The prospect of higher military spending has pushed up shares in the defence contractor Babcock by 120% this year, with BAE Systems up 66%. The engineering firm Rolls-Royce has gained 75%, as its turnaround plan has yielded results.skip past newsletter promotionafter newsletter promotionJohn Moore, a wealth manager at RBC Brewin Dolphin, said “strong earnings momentum in the banking and defence sectors” had helped push the FTSE 100 to a record high.Moore also credited the UK’s “relative political stability”. “While there may be tax increases to come, which was part of the reason for the sell-off of the pound in early June, the government has a clear mandate and tenure for the next few years.“That compares favourably to other parts of Europe, even, where coalition governments are having a tough time,” he said. More

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    Keir Starmer says good relationship with Donald Trump based on shared family values

    Keir Starmer has spoken about his good relationship with the US president, Donald Trump, and their shared family values.To mark the first anniversary of the Labour government coming to power on Friday, the prime minister spoke to the BBC podcast Political Thinking and said it was “in the national interest” for the two men to connect.“We are different people and we’ve got different political backgrounds and leanings, but we do have a good relationship and that comes from a number of places,” he said.“I think I do understand what anchors the president, what he really cares about. For both of us, we really care about family and there’s a point of connection there.”In the interview, Starmer said he had a “good personal relationship” with Trump, and revealed that the first time they spoke was after the then-presidential candidate was shot at during a campaign rally in July last year.He said Trump had reciprocated with a personal phone call a few days after Starmer’s brother Nick died on Boxing Day.Addressing recent political turmoil, Starmer said he would always “carry the can” as leader after coming under fire over a climbdown on welfare reforms and that he would “always take responsibility” when asked questions.“When things go well … the leader gets the plaudits, but when things don’t go well, it is really important that the leader carries the can – and that’s what I will always do.”Starmer also backed Rachel Reeves and said she would be chancellor “for a very long time to come”, after she was visibly tearful in the House of Commons.The scenes came after the government U-turned on planned welfare changes that put an almost £5bn hole in the chancellor’s plans.skip past newsletter promotionafter newsletter promotionReeves said she had been upset by a “personal matter” before prime minister’s questions on Wednesday.Appearing on broadcast media on Friday, one year to the day since the 2024 general election, the home secretary, Yvette Cooper, was asked on BBC Breakfast to score the government out of 10. “I don’t think it is for cabinet ministers to mark themselves and mark their own homework,” she said. More

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    The Donald laps it up as Nato leaders compete to shower him with sycophancy | John Crace

    Sometimes it pays to be a narcissist. To bend reality to your own worldview. To live almost entirely in the present. Where contradicting yourself is not a problem because two opposing statements can both be true. On the way to Nato you can question article 5. On the way back you can give all the other Nato leaders a patronising pat on the head. And everyone is grateful for it.There again it also helps if you are the most powerful man in the world. Donald Trump is not just tolerated, he is actively indulged. Prime ministers from other countries go out of their way to compete with one another in outright sycophancy. Flattery that started off as contrived now sounds dangerously sincere. Almost as if they genuinely believe it. Thank you Agent Orange for all you have done. We don’t know where we would be without you.And The Donald just laps it up. Feeds on it. At the recent Nato summit he looked like a pig in shit. Living his best life. Whatever sunbed regime he’s on, it’s working for him. If he lost any sleep over his decision to bomb Iran’s nuclear facilities, it doesn’t show. Just repeat after Donald: The mission was a complete and utter success and Iran’s programme has been put back decades. If the Pentagon says otherwise, it’s just fake news. Yet again, reality can be what you want it to be.Even when Trump temporarily loses it, he wins. Swearing is generally a no-no for any leader. A sign that you’ve lost control. But when Donald said Israel and Iran didn’t know what the fuck they were doing, he came out of it smelling of roses. Praised for his authenticity. Applauded for saying what the rest of the world is thinking. The Donald can do no wrong. He looks relaxed. God stand up for narcissists.Keir Starmer is no narcissist. And breathe a sigh of relief for that. The UK tried the narcissist route with Boris Johnson and that didn’t end well. Maybe we just aren’t a powerful enough country to get away with a sociopath in charge. Or, heaven forbid, maybe it was a matter of timing. Boris was the right man at the wrong time. That’s a horrible thought. Most of us would quite happily settle for a period of fairly boring politics. Where the government is serving the country rather than the ego of the person in charge. Where even when they are getting things wrong, they are at least trying to do the right thing.But that level of decency comes with a cost. Your psyche does not reward itself with a free pass. You worry about the consequences of your actions. Your toadying to The Donald. You worry about the people dying in Ukraine, Gaza, Israel and Iran. You worry when your domestic policies look like they are falling apart. Wish you had spent more time reassuring backbenchers. Had explained better the trade-offs you were making. Had not been so quick to take a quick cash-saving win by removing benefits from people who can’t wash themselves before going to work.Keir has tried to keep a lid on all this as leaders always do. Pretend that he’s fully in charge of the situation. That everything is going according to plan. But always the tell-tale signs leak out. Starmer’s eyes betray him. They have a deadness to them, the life squeezed out. His face pasty and pallid. A man desperate for a breather, a moment to relax away from the treadmill.Yet always there is one thing more. Another summit, another speech, another bilat, another crisis at home. This wasn’t how he imagined his first year in Downing Street. The pressure and the pace is relentless. The treadmill going ever faster and there’s no getting off. He aches in the places where he used to play.Just hours after returning from The Hague, Keir was giving a keynote speech to the British Chambers of Commerce. It was one that he and they will quickly forget. A routine, box-ticking affair. An annual date, along with the CBI, in any prime minister’s diary. It wasn’t meant to be this way, mind. Starmer knows better than anyone that Labour has to work twice as hard to show that it is the party of business. But this time he couldn’t fake it to make it. He’s no visionary. He can’t access people’s hearts. Only their reason. And that only intermittently.Keir began by thanking the BCC for all it had done for the country. He knew it had been a tough year and he had asked a lot of business, but the good times were round the corner. Possibly. There was the new infrastructure strategy. Now there was also a new trade strategy which sounded very much like the old one. Which was to keep on doing the trade deals we can, as with the partial deals with the EU, US and India, and try to do some new smaller deals with other nations. The applause from the audience was barely audible. They didn’t sound desperately impressed. They can tell when a speaker is out on his feet and is phoning it in.Just over an hour later and Starmer was in the Commons for a statement on the G7 and Nato summits. Here he was much more like his chipper self. Not so much in his opening remarks about how the west was making a dangerous world safer, but in his reply to Kemi Badenoch.The Tory leader just gets worse and worse. Half-witted, sulky and tone deaf. Kemikaze seemed to think the UK should no longer bother to send its prime minister to these international meetings. That Keir had only gone for the craic and to avoid her at prime minister’s questions. As if. Facing Kemi over the dispatch box was his half an hour of R&R in the week.Starmer dismissed her with barely concealed contempt as neither serious nor credible. An am-dram politician. Even the Tories were aghast. Mark Pritchard openly criticised his leader. He spoke for many on his own benches.Kemi had achieved the seemingly impossible. She had revivified a tired prime minister and united both Labour and opposition MPs against her. There is only one politician who looks a genuine leader in the Commons and it is still Starmer. He may have his hands full with a rebellion over the welfare bill, but as long as Kemi remains the leader of the opposition, he has nothing to fear from the Tories. More

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    David Lammy refuses to say if UK supported US strikes on Iran nuclear facilities

    The UK foreign secretary has repeatedly refused to say if the UK supported the US military strikes on Iran’s nuclear facilities on Saturday or whether they were legal.Interviewed on BBC Radio 4’s Today programme on Monday for the first time since the US launched airstrikes on three Iranian nuclear facilities, David Lammy also sidestepped the question of whether he supported recent social media posts by Donald Trump that seemed to favour regime change in Tehran, saying that in all his discussions in the White House the sole focus had been on military targets.Lammy said western allies were waiting for battlefield assessments of the impact of the strikes, but it was possible Iran still had a stockpile of highly enriched uranium, although the strikes “may also have set back Iran’s nuclear programme by several years”.Ever since the US strikes, senior figures in the Labour government have tried to make their criticism of the action only implicit rather than explicit.Lammy tried to focus on urging Iran to return to the negotiating table, insisting that Iran was in breach of its obligations by enriching uranium at levels of purity as high as 60%.The UK Foreign Office has denied Iranian reports that in a phone call on Sunday with the Iranian foreign minister, Abbas Araghchi, Lammy had expressed regret about the US strikes.Asked if the airstrikes were legal, Lammy said three times it was for Washington to answer such questions.But in the course of a 15-minute interview on BBC Radio 4, he at no point backed the US airstrikes, saying he was not going to get into the issues of whether they conformed with either article 2 or article 51 of the UN charter, clauses that permit military action in self-defence.Saying “there is still an off-ramp for the Iranians”, he admitted discussions with Iran involving France, Germany and the UK last Friday in Geneva had been “very tough”.He said: “Everyone is urging the Iranians to get serious about the negotiations with the E3 and the US.” Iran is currently refusing to talk to the US or Israel while it is under military attack.Lammy said he still believed Iran was engaging in “deception and obfuscation” about its nuclear programme, but added “yes, they [the Iranians] can have a civil nuclear capability that is properly monitored that involves outsiders but they cannot continue to enrich to 60 %”.His remarks left open whether the UK supported the US negotiating position of insisting on zero uranium enrichment inside the country, or whether he was prepared to accept that Iran could enrich to 3.67% level of purity, the maximum allowed in the Iran nuclear deal signed in 2015 and from which the UK, unlike the US, has not withdrawn.skip past newsletter promotionafter newsletter promotionHe also refused to say if he agreed with the latest US intelligence assessment that Iran was close to securing a nuclear weapon, saying instead he relied on the report from the UN nuclear inspectorate, the International Atomic Energy Agency. In its latest reporting, the IAEA said it had no evidence that Iran was seeking a nuclear bomb.He said: “You can only deal with the Iranian nuclear programme diplomatically. If Iran is able to enrich beyond 60%, is able to get a weapon, what we will see is nuclear proliferation across the Middle East.”Asked about Trump’s references to regime change he said: “I recognise there is a discussion about regime change but that is not what is under consideration at this time. The rhetoric is strong but I can tell you, having spoken to the secretary of state, having sat in the White House, that this targeted action is to deal with Iran’s nuclear capability.”When pressed to comment on a claim by Carl Bildt, the former Swedish prime minister, that by “being blind” on the issue of the legality of the US’s action, European leaders undermined their position on Vladimir Putin’s invasion of Russia, Lammy insisted there was no moral equivalence between the Russian invasion of a sovereign country and the actions the US had taken in Iran. More

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    Attorney general warns UK joining war on Iran may be illegal

    Britain’s attorney general has warned ministers that getting involved in Israel’s war against Iran could be illegal beyond offering defensive support, it has emerged.Richard Hermer, the government’s most senior legal officer, is reported to have raised concerns internally about the legality of joining a bombing campaign against Iran.An official who has seen Hermer’s official legal advice told the Spectator, which first reported the story, that “the AG has concerns about the UK playing any role in this except for defending our allies”.Keir Starmer is considering whether to provide the US with military support if Donald Trump decides to bomb Iran, and whether to approve the use of the Diego Garcia base in the Indian Ocean for the attack. Hermer’s advice could limit the degree of UK support for the US.A spokesperson for the attorney general’s office said: “By longstanding convention, reflected in the ministerial code, whether the law officers have been asked to provide legal advice and the content of any advice is not routinely disclosed.“The convention provides the fullest guarantee that government business will be conducted at all times in light of thorough and candid legal advice.”The prime minister chaired an emergency Cobra meeting on Wednesday to discuss a range of scenarios and ongoing diplomatic efforts. David Lammy, the foreign secretary, is to meet his US counterpart, Marco Rubio, in Washington DC on Thursday as the US weighs up its options.Trump has yet to make a final decision on whether to launch strikes against Iran. The Guardian reported that the president had suggested to defence officials it would make sense to do so only if the so-called bunker buster bomb was guaranteed to destroy the country’s critical uranium enrichment facility, which is between 80 and 90 metres inside a mountain at Fordow.Israel and Iran have been exchanging fire for days after Israel launched airstrikes which it said were aimed at preventing Tehran from developing a nuclear weapon. Iranian officials claim the country’s nuclear programme is peaceful and that Israel has caused hundreds of civilian casualties.Taking Fordow offline – either diplomatically or militarily – is seen as central to prevent Iran from acquiring nuclear weapons after the International Atomic Energy Agency found the site had enriched uranium to 83.7% – close to the 90% needed for nuclear weapons.Miatta Fahnbulleh, an energy minister, said Starmer would take any decisions with a “cool, calm head” and be guided by international law.“Legal advice is for the prime minister, and I think that’s where it will stay – and you can understand why I won’t comment on that. But what I will say is that we have a prime minister who is a lawyer and a human rights lawyer, he will obviously do everything that is in accord with international law,” she told Times Radio.“No one wants an escalation. No one wants this to erupt into a major conflict in the region that is hugely destabilising for every country involved, and for us globally. So the most important role that the prime minister can play, and is playing, is to be that cool, calm head to urge all partners around the negotiating table and to find a diplomatic route out of this.”However, the shadow foreign secretary, Priti Patel, said the UK could “hide behind legal advice at a time of crisis”.Asked if she believed Hermer was right to sound a warning, Patel told Times Radio: “I don’t think we can hide behind legal advice at a time of crisis and national security when we have to work alongside our biggest ally in the world, the United States, when they look to us for potentially … setting out operational activities through our own military bases.”The UK had not received a formal request from the US to use Diego Garcia in the south Indian Ocean or any of its other airbases to bomb Iran as of Wednesday night.Diego Garcia was recently the subject of a new 99-year lease agreement with Mauritius that left the UK in full operational control of the military base. In practice, Diego Garcia is mainly used by the US, but the fact that it is ultimately a British base means that Starmer would have to approve its use for an attack on Iran.The US is also thought likely to want to request the use of RAF Akrotiri in Cyprus for its air tankers, used to refuel B-2 bombers. The UK has deployed 14 Typhoon jets at Akrotiri to protect its bases and forces and to help regional allies, such as Cyprus and Oman, if they come under attack. More

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    Trump’s ‘revenge tax’ could threaten foreign investment into US, analysts say

    Foreign investment into the US could be threatened by Donald Trump’s new “revenge” taxes, analysts have warned.A provision within the president’s One Big Beautiful Bill Act will allow the US to apply higher taxes on foreign individuals, businesses and investors connected to jurisdictions that impose “unfair foreign taxes” on US individuals and companies.Companies listed on the London Stock Exchange could choose to avoid the measure by redomiciling in New York.Section 899, as it is called, classes digital service taxes and “diverted profits taxes” as unfair, along with any taxes that target US entities. It would allow US authorities to impose an additional tax starting at 5% and increasing by five percentage points annually, up to 20%.Max Yoeli, a senior research fellow in the US and the Americas programme at Chatham House, says section 899 “threatens to further alienate foreign investors”.It could chill investment into the US by calling into question its “fundamental openness”, he added.The Italian bank UniCredit agrees that section 899 could further damage foreign investor sentiment towards US dollar-denominated assets. It could backfire on the US, it says, given the large amount of domestic assets held by foreigners.“The list of countries that would fall into this category is long and encompasses most European countries, including Italy and Germany,” UniCredit told clients, saying that foreign investors had more than doubled their holdings of US assets over the past decade.“Not only would this additional tax serve to finance corporate tax reductions, but it would also likely be used as a negotiating tool for the US in trade deals, especially as Republicans seem willing to withdraw from the global minimum tax framework.”View image in fullscreenUniCredit also fears the dollar’s safe haven status could be undermined if there are fresh tax disputes between the US and other countries.The One Big Beautiful Bill Act was passed by the US House of Representatives last month. The Senate is yet to approve the bill, with the White House setting a deadline of 4 July.George Saravelos, the global head of FX research at Deutsche Bank, warned last month that section 899 could allow the US administration to transform its trade war into a capital war by “explicitly using taxation on foreign holdings of US assets as leverage to further US economic goals”.UK companies could certainly fall foul of section 899, as Britain operates a digital services tax aimed at tech multinationals, and a diverted profits tax designed to clamp down on tax avoidance by multinationals.skip past newsletter promotionafter newsletter promotionGoldman Sachs has calculated that UK corporates are “particularly exposed” to section 899, as roughly 30% of the revenues of companies listed on the FTSE 100 are generated in the US.However, as companies that are majority-owned by US shareholders are exempt, City bosses may consider moving their stock market listing to New York, to dodge section 899.“This ownership dynamic not only mitigates tax risk but also reinforces the strategic case for relisting in the US, where investor bases are deeper and more aligned with US revenue exposure,” the Goldman Sachs analysts said.According to Goldman, the large UK companies with the most significant exposure to the US, and who are not majority-owned by US investors, are the media group Pearson, the business services group Experian, the pest control business Rentokil and the pharmaceuticals manufacturer Hikma.Ashtead Group, Compass and Melrose also generate a large proportion of their sales stateside, but as they have majority US ownership they should be exempt from section 899.French companies could also be at risk, as Paris operates a digital services tax on the revenues that large tech companies generate in France. More

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    The spirit of Liz Truss, ridiculous but relentless, still stalks British politics | Rafael Behr

    We need to talk about Liz Truss, although there are reasons not to bother. The prime minister who failed faster than any previous holder of the office has much to say about her dismal record, but nothing insightful. She cuts a pitiful spectacle padding out the schedule at rightwing conferences, chasing attention and relevance with an addict’s fervour.Last week, Truss was at the Conservative Political Action Conference (CPAC) in Budapest, sharing the big lesson she learned in government. It was that British institutions have been captured by a leftist doctrine and that they “hate western civilisation”. She couldn’t possibly counter this threat from No 10 because supposedly the real power was wielded by a well-financed “globalist network”, operating through such engines of anti-democratic subterfuge as the International Monetary Fund and the World Health Organization.Truss believes these nefarious forces authored her downfall. They taught her that gradual reform is impossible. Only a “Trump-style revolution” will do. This is her routine spiel. Indeed, it was the theme of her paranoid, self-pitying memoir-cum-manifesto, Ten Years to Save the West, published last year. Her disquisitions on the topic go unreported in her home country. She made more headlines last week from a two-month-old cameo appearance in a promotional video for a whiskey brand launched by a bare-knuckle fighter with a conviction for violent assault. (How that endorsement advances the restoration of western civilisation was unclear.) But a thorough summary of the CPAC speech was dutifully published by Tass, Russia’s main state news agency. Their report led with the claim that “globalists are trying to control the political process across Europe”.It is standard practice for Russian news channels to weave selective quotes from western politicians into tendentious propaganda, except there is no need to take Truss’s words out of context. She narrates the west’s slide into godless decadence without an edit. She provides the frothy conspiracy theories that Kremlin-friendly bots amplify on social media, and hallmarks them with the authority of a former prime minister.A British audience knows the caveats to that status: Truss was ousted within 50 days; a lettuce had more staying power. But the title stands. She really did rise to the top, and not through some freak system malfunction. She played and won the Westminster game by its rules. She had multiple ministerial briefs under three prime ministers. She persuaded a clear majority of members of Britain’s venerable establishment party to make her their leader.Colleagues who suspected (or knew from experience) that Truss was unhinged stayed silent or endorsed her candidacy once her momentum looked unstoppable. Client journalists who had benefited from her notorious indiscretion, and looked forward to ever greater intimacy with power, colluded in the fiction of her fitness to govern.Even now, when the former prime minister’s name is a byword for economic incompetence, Conservatives are euphemistic in contrition. When invited to apologise on behalf of her party for the disastrous mini-budget of September 2022, Kemi Badenoch has said only that she wants to “draw a line” under the episode.The obstacle is not a residue of loyalty but a continuity of belief. The dogmatic engine of Trussonomics – that tax cuts always pay for themselves by stimulating enterprise to generate growth – is still an axiom of mainstream Conservatism. So is Trussite suspicion of the public sector as a redoubt of bureaucratic socialism.Badenoch, like Truss, backs a Maga-style revolution to rip chunks out of the government apparatus. She has spoken enthusiastically about Elon Musk’s Department of Government Efficiency, adding that Doge methods are not “radical enough” for the bloated British state.The fact that Musk’s purgative rampage through Washington has failed to produce the advertised cost savings doesn’t deter imitators. Nigel Farage has announced the creation of a mercenary Doge “unit” to hunt down waste in the councils that Reform UK won in last month’s local elections.This exercise serves a double function. First, Farage will scapegoat any local officials whose duties can be branded under the rubric of diversity, equity and inclusion (DEI). Second, he will overstate the expense of such schemes, generating improbable nationwide savings to justify tax cuts in a Reform manifesto. Trussonomics will be rehabilitated and rearmed with imported US culture war rhetoric.Farage was once a fan of Truss’s economic policy. He praised her fiscal farrago as “the best Conservative budget since 1986”. The year harked back to the heyday of Thatcherism. These days Farage has to be careful about fetishising the Iron Lady. His party’s electoral base lives in Labour’s former heartlands, so he is a convert to the cause of industrial nationalisation. He now shakes his magic money tree to the left as well as the right.The Tories lack such ideological elasticity. In any case, Badenoch doesn’t seem interested in economics. She is more animated by the crusade for free speech. This, like the demonisation of DEI, is a fixation borrowed from the US right. When JD Vance declared that European democracy was more imperilled by censorious liberals than by Russian military aggression, Badenoch admired the US vice-president’s deployment of “truth bombs”. Here, too, she is on the same page as Truss, who told last week’s CPAC audience that free-thinking dissidents from Keir Starmer’s Britain find refuge in Viktor Orbán’s Hungary. (Orbán is Europe’s foremost admirer of Vladimir Putin. He has suffocated independent media and political opposition.)It is hard to know how much of this derangement is conviction and how much is cupidity. There is money to be earned bad-mouthing Britain on the ultra-nationalist lecture circuit, but it is also easy to self-radicalise in that milieu.It is also hard to know how receptive a UK audience is to US conservative manias. Much of the UK right dwells in a US-coded online hallucination of Britain where criminal hordes of migrants have turned city centres into no-go areas and liberal thought police harass law-abiding white Christians.The danger is not that millions of voters will recognise the bleak dystopia as a factual representation of their country, but that it resonates as an allegory of national decline. It is not the complaint that Britain is in bad shape – dilapidation and economic strife are self-evident – but the cultivation of despair by projecting hard problems through a facile, conspiratorial lens. It is the insinuation that existing democratic institutions are not merely failing to make life better but maliciously orchestrating misery.This is the nihilistic cynicism that vaporises trust, corrodes civic culture and makes simple, authoritarian solutions attractive. It is music to Vladimir Putin’s ears and grist to his digital disinformation mills.Perhaps we should be grateful to Liz Truss for playing the archetype of unwitting accomplice to tyranny – the “useful idiot” of cold war parlance – so ineptly. She contaminates any cause she touches.That is why the British right shuns her. But social ostracism isn’t ideological repudiation. The current Tory and Reform leaders are embarrassed by association with Truss, not because they despise what she says but because she looks ridiculous. Her offence was not the grift, but its exposure in ways that might discredit more skilful practitioners. She is not too extreme, only artless in applying the camouflage. She is the crumpled, discarded packaging from a product that, rewrapped, could be delivered once again to Downing Street.

    Rafael Behr is a Guardian columnist

    One year of Labour, with Pippa Crerar, Rafael Behr and more
    On 9 July, join Pippa Crerar, Raf Behr, Frances O’Grady and Salma Shah as they look back at one year of the Labour government and plans for the next four years More

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    The Guardian view on UK military strategy: prepare for a US retreat – or be left gravely exposed | Editorial

    With the prime minister’s Churchillian claims that “the front line is here”, the public might expect a military posture that meets the drama of the moment. Yet the promised rise in defence spending – from 2.3% to 2.5% of gross domestic product by 2027 – suggests something less than full-scale mobilisation. The strategic defence review is systematic and detailed, but it remains an exercise in tightly bounded ambition. It speaks of daily cyber-attacks and undersea sabotage, but proposes no systemic institutional overhaul or acute surge in resilience. Given the developing dangers, it is surprising not to spell out a robust home-front framework.Instead, it is a cautious budget hike in the costume of crisis – signalling emergency while deferring real commitment for military financing. The review suggests that the more ambitious spending target of 3% of GDP, still shy of Nato’s 3.5% goal, is delayed to the next parliament. The plan is not to revive Keynesianism in fatigues. It is a post-austerity military modernisation that is technocratic and geopolitically anxious. It borrows the urgency of the past without inheriting its economic boldness.The review marks a real shift: it warns of “multiple, direct threats” for the first time since the cold war and vows to reverse the “hollowing out” of Britain’s armed forces. But in an age of climate emergencies and democratic drift, UK leadership should rest on multilateralism, not pure militarism. Declaring Russian “nuclear coercion” the central challenge, and that the “future of strategic arms control … does not look promising”, while sinking £15bn into warheads, risks fuelling escalation instead of pursuing arms control.Given the war in Ukraine, there is an ominous warning about changing US “security priorities”. This calls into question the wisdom of being overly reliant on America, which is now internally unstable and dismantling global public goods – such as the atmospheric data that drones rely on for navigation. Left unsaid but clearly underlying the report is the idea that the old defence model is no longer sufficient – for example, when maritime adversaries can weaponise infrastructure by sabotaging undersea cables, or where critical data systems are in commercial hands. It cannot be right that Ukraine’s sovereignty depends on the goodwill of the world’s richest man. But the private satellite network Starlink keeps Ukrainian hospitals, bases and drones online, leaving Kyiv hostage to the whims of its volatile owner, Elon Musk.The menace of hybrid warfare – including disinformation, cyber-attacks, economic pressure, deployment of irregular armed groups and use of regular forces – intensified in the last decade. This should see Britain forge deeper institutional ties with European partners, not just military but in infrastructure and information technologies. This would allow for a sovereign digital strategy for European nations to free them from dependency on mercurial actors.Though the review gestures toward greater societal involvement, it stops short of articulating a whole-of-society doctrine like Norway’s. This, when some analysts say the third world war has already begun with a slow, global breakdown of the post-1945 institutional order. The defence review should be about more than missiles and missions. It must also be about whether the country can keep the lights on, the gas flowing, the internet up and the truth intact. This review sees the threats, but not yet the system needed to confront them. In that gap lies the peril. More