August 21, 2019 / 10:14 AM / in 4 months

Breakingviews - Greenland is not for sale, but the UK might be

Snow covered mountains rise above the harbour and town of Tasiilaq, Greenland, June 15, 2018.

LONDON (Reuters Breakingviews) - Denmark has refused to sate Donald Trump’s thirst for geo-M&A. The U.S. president on Tuesday called off a visit to the European state after its prime minister rebuffed his idea of buying Greenland, an autonomous dependent territory of the kingdom. If he’s looking around for an alternative target, he could do worse than a lob in a bid for the United Kingdom.

It would be expensive. Greenland’s market value, according to a jokey valuation cooked up by FT Alphaville, is $1.1 trillion. A proxy for the UK’s book value – the Office for National Statistics’ most recent net worth figure, is $12.4 trillion, enough for a simple cash offer to push up U.S. government debt from around 80% to nearly 150% of GDP.

Still, Trump could beat that price down, citing ongoing epic mismanagement. And net worth is set to plummet after the UK government’s planned hard Brexit in October. Another idea: instead of cash he could pay in the equivalent of shares – giving Britain a stake in the wider United States by becoming its 51st state. London is 1,000 miles closer to Washington, D.C., than Hawaii.

There are upsides for the United States, starting with the realisation of the vision of the UK as “Airstrip One” in George Orwell’s “1984”. Also, turning the UK into the Brexiters’ nirvana of a hyper low-tax haven – a sort of East Delaware – would give Trump added muscle in negotiating with the European Union.

Clearly, there would be nay-sayers, both among the Brexiters who value sovereignty, and the Remainers who dislike Trump. But the former group would escape what they see as the dead hand of the EU, and appear keen fans of a punitive U.S. trade deal anyway. The latter might be bought off with a “Freedom Dividend” of 590 pounds per person, or the 39 billion pounds currently due to be paid to the EU as an exit fee.   

Trump may still feel this is too much bother. If so, he could restrict his sights to Scotland, which doesn’t want to stay part of a post-hard Brexit UK anyway.

Breakingviews

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