I have been in London for the past week. And what a week it was, with Cabinet resignations in the wake of a proposed soft Brexit plan, then the visit of U.S. President Donald Trump, which triggered mass demonstrations. But the Brits are a resilient bunch, pragmatic and determined; they are muddling through.
Here are some observations from the week:
Prime Minister Theresa May Survives… Barely — Two Cabinet members resigned last week, including Foreign Secretary Boris Johnson, who accused the Prime Minister of seeking to overrule the will of the people on Brexit. The Prime Minister had produced a draft Brexit plan to present to the European Union that would enable the UK to remain involved in a customs union, thereby giving comfort to the business community on supply chain. It is unclear whether the EU will support the Chequers plan or the full Parliament will vote to ratify the plan if the EU does agree, because the Labour Party has many MPs in districts that wanted Brexit. In which case, the Tory government will fall, Prime Minister May will have to compete for the leadership of her party, then the Tory nominee will go to the people against Labour leader Jeremy Corbyn. All of this will play out in the next three-to-six months.
The Trump Visit — On his first day in London on Thursday, President Trump gave an exclusive interview to The Sun, the Rupert Murdoch-owned tabloid. In the piece, the President said that the Chequers plan jeopardized the U.S.-UK bilateral trade pact, that Prime Minister May was not following the will of the people on Brexit, and that Boris Johnson would make a good Prime Minister. The next day, when the President visited with the Prime Minister and then Queen Elizabeth in Windsor Castle, he was more conciliatory, saying that the she had been doing a good job and that the U.S. and UK had to find a way to do a trade deal. On the way back from a business lunch, I walked into the middle of the anti-Trump demonstration in Trafalgar Square, which was peaceful but pointed.
Business of Media — I saw executives from The Guardian, The Economist, CNBC, Wikipedia and Campaign. There is still hope for a recovery in advertising, with a push for quality content and audience. The Guardian’s donation campaign is succeeding, as is Wikipedia, with much of the money coming in $10-20 contributions. The CNBC business is on fire, with the digital product on cellphones the fastest-growing segment and expansion underway in the Middle East. There is a push for more client participation in conferences; for example, CNBC is doing one on technology in China in the fall called East Meets West, hoping to attract American and European tech giants to sit across from their Chinese competitors. I also met with editors from the Financial Times to discuss the findings of our recently released Trust Barometer Special Report: Brands and Social Media. The power of the tabloid press was never more evident than during this most political of weeks, with headlines in the Daily Mail and The Telegraph blaring exclusives from Cabinet dissidents David Davis and Boris Johnson.
The Three Lions — The English football team nearly made it into the finals of the World Cup for the first time since 1966. The squad contained very few big names, mostly young players who had been training together since the juniors. The country went mad for its footballers, until the inevitable occurred, a loss to Croatia in the semifinals. The media was very kind, paying tribute to the players, wishing things had turned out differently. This was a far cry from what I heard from barkeeps and taxi drivers complaining loudly about missed opportunities to score in the first half and lack of necessary confidence in the pinch. So close but yet so far away…and Qatar 2022 beckons.
Wimbledon — I was lucky enough to have tickets for Wednesday’s epic Juan Martin del Potro-Rafael Nadal match, which lasted nearly five hours. The players dove onto the grass for volleys, Nadal pursued one ball into the stands, and made just enough circus shots to win in the fifth set. American manners have made their debut at the British shrine, with calls for “Rafa” or “Delpo” resonating between points. Pimm’s Cups and Rosé flowed at the bar. I went with my wife Claudia and daughter Margot… it was a day to remember.
Christo in the Serpentine — Leave it to Christo to do something perfectly. He took 1,200 used barrels of petroleum, painted them and created a sculpture in the middle of Hyde Park. It will be up for only two weeks. The pigeons and seagulls are contesting for nesting grounds atop the structure. Humans are propelling themselves around it for selfies with their water bicycles. It proved a perfect backdrop for a 1970s revival concert featuring Santana, Eric Clapton and Steve Winwood on Sunday night.
Retail Looking Good — Unlike Manhattan where stores are now shuttered on Broadway and Lord & Taylor is about to become a WeWork headquarters, the shops on Oxford Street were bustling on Saturday. There was little evidence of 50 percent-off sales as in Paris. Foreign tourists are still setting the pace, according to sales clerks. A recent article in the Financial Times suggests that a number of the UK retailers that have thrived have done so by being more personal, local, and flexible, and offering exclusive items.
Business Community Views — There are concerns over the impacts of a possible Labour Government, in particular the nationalization of water, power and trains. There is still belief in a soft Brexit, so that manufacturing for the Continent can be carried out in the UK. There were continuing conversations about the departure of Martin Sorrell from WPP and the growing power of board chairs relative to CEOs.
Melting Pot — Whatever the concerns about future immigration, this is a country that has made diversity work. The workforce is ambitious and hails from all parts of the globe, just to be part of a dynamic city. The food is better, the service is improved and the city throbs with excitement, from art to music to fashion.
I believe that the UK could face a political crisis in the fall because of Brexit. It can be averted only if the Labour MPs vote to ratify a soft Brexit, unlikely given the large pluralities in their districts for Brexit. But for the moment, there could not be a more alluring place to live.