The United States can get away with things financially that other countries simply cannot. Even so, many good judges believe that the United States risks a fiscal crisis at some point. For other countries, such a crisis could come much sooner. Especially if it results in a large stimulus in China, Trump’s fiscal stimulus could raise global real interest rates, making the burden of debt servicing more onerous.

This is going to be particularly difficult for many countries that have extremely high public debt-to-GDP ratios. The UK falls into this camp and if the recent rise in government bond yields continues further as US yields are pushed higher, it will put our Chancellor in a difficult position.

As things stand, she has left very little room to oppose her new budgetary rules. This reserve has probably already been largely exhausted by the rise in bond yields since the budget. If yields were to increase much further, it would find itself in a delicate situation.

We are used to the idea that Italy is facing a serious problem, with a debt-to-GDP ratio of 137%. But France is not far behind. Its debt/GDP ratio is 110%. And its budget deficit exceeds 6% of GDP. This would be a test for any government, but in the French case things are made more difficult by the fact that there is a minority government and there is no really serious political appetite for a deficit reduction program.

Perhaps the greatest impact of President Trump’s victory on other Western countries, including the United Kingdom, will be the demonstration effect and competitive effects of a completely different policy framework. Under Trump, there will be a trend toward lower personal and corporate taxes, deregulation, and a reduction or abandonment of various types of green spending.

Of course, the Trump plan could explode if inflation rises, accompanied by rising interest rates and bond yields. But let’s assume that this package generates strong economic growth. How would we react? This would surely be a powerful factor in pushing the Conservative Party to rediscover its inner Thatcher. It could even pose serious questions for the Labor government if, as I suspect, after the initial boost from the fiscal stimulus fades, UK growth disappoints.