So It's All The Fault Of Liz Truss?
It was drearily predictable that Government Ministers such as Michael Gove would get round to blaming Liz Truss for the disastrous collapse in their electoral support, which has them on the brink of a record breaking defeat at the polls. In doing so, Gove was merely joining legions of other politicians and mainstream media commentators in attributing blame for current economic woes and collapsing public services, despite record high levels of taxation, government borrowing and public expenditure, on a Prime Minister in office for a mere 45 days. A time moreover largely taken up with performing duties as a “national undertaker” as her brief administration coincided with the death and state funeral of the UK’s longest reigning monarch, Queen Elizabeth II.
https://www.independent.co.uk/news/uk/politics/michael-gove-liz-truss-general-election-b2565886.html
Gove asserted that the Truss administration, and particularly the mini budget of her Chancellor Kwasi Kwarteng, had destroyed the Conservative Party’s reputation of being the party for “sound economic management”. Nothing to do with the disastrous eye-watering expense of the covid lockdowns then, the money syphoned off for discredited PPE contracts, paying people to stay at home seemingly forever, instead of working and spending their earnings, businesses paid to shut down and the rest of it. A cost running into the hundreds of billions. Nothing to do with the disastrous destruction being wreaked by the insane commitment to “net zero”. Nothing to do with the destruction of meritocracy that is the direct flip side to the obsession with “Diversity, Equity and Inclusion”. Nothing to do with the own goals caused by the sanctions imposed on Russia since the invasion of Ukraine which have had an immense impact on energy costs across Europe (and benefited the USA which has been turned to as an alternative provider of energy). Nothing to do with the insane levels of mass migration seen during the last few years, placing intolerable burdens on every sector of Public Services, including education, housing, transport and health. No, it’s all down to the 45 days of the Truss administration.
As a disclaimer, I want to make it clear I’m not particularly a Truss admirer (sorry Liz if you should happen to read this). I think she is a bit too lightweight, wooden and lacking in authority to have had much hope of carrying through the much needed reforms the UK economy needs. She could only have survived any length of time by being a Theresa May type figure, merely continuing the Establishment agenda rather than brutally interrupting it. She is no Thatcher, as Peter Hitchens mockingly pointed out on several occasions.
I was immediately alienated when her first Cabinet was announced, with much being made of the fact that her most senior Cabinet posts (herself as Prime Minister, Cleverly at the Foreign Office, Kwarteng as Chancellor and Braverman as Home Secretary) did not contain a single white male, as though the calculated exclusion of 50% of the largest proportion of the population was a good thing in itself. It immediately betrayed one of the underlying weaknesses of all the Conservative led administrations since 2010, their obsession with outflanking the Labour Party by being seen as more radical on social matters at every opportunity.
https://iknowpolitics.org/en/news/world-news/liz-truss-praised-diverse-cabinet
So were the measures in the Truss budget so disastrous, and what did its consequences really betray about how the UK is run?
One of the most discussed measures was the decision to keep Corporation Tax at 19% instead of continuing with existing plans to increase it to 25%. This was criticised widely in very narrow terms by the “commentariat” with the emphasis on revenue lost rather than any consideration that lower taxes could actually lead to more revenue being raised. By comparison, Ireland has benefited from many international businesses basing themselves in Dublin to take advantage of Ireland’s far lower 12% Corporation Tax level. For instance whenever I paid for a Facebook Ad, my payments always went to Facebook Ireland. It was fine for Ireland to have a 12% Corporation Tax level, yet the world was going to fall in if the UK kept its rate at 19% instead of increasing it to 25%. Might not the UK find more businesses would base themselves in the UK thereby leading to increased revenue flows if it matched Ireland’s 12% rate or better still, undercut it? Now there’s a thought. Instead we were treated to absurd remarks such as the Biden administration dismissing the Truss-Kwarteng budget as “voodoo economics”, as ironic a remark as you could get given some of that administration’s absurd measures that upended the prosperity enjoyed during the years of the previous Trump Presidency.
The measures as a whole were doomed from the start as it became apparent they were being undermined from within. The Office For Budgetary Responsibility, the Bank of England and the Treasury were said to be concerned that the measures in the Truss-Kwarteng Budget were not properly funded or costed. Naturally that caused mayhem across the financial markets and panic set in.
https://www.spectator.co.uk/article/was-liz-truss-wrong-or-wronged/
It subsequently turned out that those forecasts of disaster were themselves based on inaccurate figures and forecasts. I wonder if that was deliberate or was just the usual incompetence? The Truss tax cuts, if allowed to continue, would have shaved just £25 billion from £1,100 billion of government receipts (in 2026-27). A minuscule difference compared to the economic carnage of the Lockdown years. And we’ll never know the extent of any economic growth they would have generated, however we’d surely be in a far better place than we are now.
The Office For Budgetary Responsibility has a track record in getting its forecasts wrong and having to issue corrections. Indeed there was an error it admitted to of £9.6 billion for one month alone soon after Truss departed. Compared to the lurid headlines at the time of the budget, this received very little attention. I wonder why? Truss of course by then had conveniently departed. And nobody at the OBR was censored, far less sacked, for this error. Could it be that it was more about ideological opposition to the politics of Truss rather than matters relating purely to taxation and expenditure?
https://obr.uk/explaining-our-correction-to-the-january-2023-monthly-profiles/
The Bank of England also has similar questions to answer over its role at the time of the dramas over the Truss-Kwarteng Budget. On its watch, it had allowed Liability Driven Investment funds to increase without requiring risks to be properly covered. It’s a very technical issue, however it is excellently covered in an article in The Critic by Jon Moynihan.
https://thecritic.co.uk/issues/december-january-2023/how-the-bank-broke-the-government/
After the Budget, the Bank of England belatedly did its job, however the benefits from that belated intervention went to Jeremy Hunt, the man Truss was seemingly browbeaten into appointing as Chancellor to replace Kwarteng, and who immediately resumed Treasury economic orthodoxy of the sort the UK has stagnated with for many years.
Having got their man into number 11, the coup to bring down Truss went into overdrive. Other Prime Ministers and Chancellors have survived economic carnage and carried on in government for years. Harold Wilson survived the 1967 devaluation crisis to continue in office until 1970, which although he lost, he went into as the favourite to win. Jim Callaghan and Denis Healey survived the 1976 run on the pound, requiring International Monetary Fund intervention, limping on until they were brought down in 1979. John Major and Norman Lamont survived the disasters now known as Black Wednesday 1992, Major limping on to 1997. Gordon Brown not only survived the disastrous selling of much of the UK’s gold reserves at a knockdown price and his notorious plundering of the UK’s then flourishing private pensions industry in his early years as Chancellor, his reputation actually flourished and he didn’t leave office until 2010, having also become Prime Minister for the last few years of the 1997 to 2010 Labour Governments.
https://www.theflyingfrisby.com/p/browns-bottom-25-years-on
Truss however was gone in a matter of days. Her difficulty was that her endorsement as party leader came from the party members, not the MPs she relied on to be kept in office at Westminster. These MPs, including senior ones who’d been in Government such as Sunak himself, Sajid Javid, Gove, Zahawi, Shapps and others, had not gone to the lengths they had to remove Boris Johnson as Prime Minister, only to see him replaced by someone not of their choosing such as Liz Truss. Worse she then went on to exclude them and most of their allies from her administration. Having originally come to prominence as a Gove protege, she understood the importance of putting clear water between her and Gove, a man who has been a persistent impediment to any hope of the Conservatives actually putting genuine conservatism into practice.
Despite her continuing popularity with the party members who had elected her in preference to Rishi Sunak, her enemies at Westminster moved quickly to exploit the fallout from the Truss-Kwarteng budget to undermine her.
Truss herself has been very open about it in her book “Ten Years To Save The West”. (I’ve included it with my Amazon affiliate link as I could do with upgrading my clapped out Jag -:). Alternatively your own search for the book title will quickly find it). She has also given interviews to Triggernometry and Connor Tomlinson
The responses to them, particularly the Connor Tomlinson one, have been very revealing. They’ve been more on the lines of “how dare she speak to those people”. Create as much noise as possible to distract people from listening to what she is saying seems to be the strategy, especially as her assessment gives away the extent to which the UK political establishment has been captured and shuts out any dissenting or alternative views, particularly on such “sacred cow” issues as net zero, immigration, diversity, the lockdowns, worship of the European Union and NATO, and general “Big State” control of every aspect of our lives.
The entire Westminster and Whitehall Establishment were in perfect alignment on the need to remove Truss, along with the mainstream media, the chattering classes and all their associated allies who are continually stuffed down our throats at every opportunity. Truss could not be allowed to succeed and shift the direction of the UK’s political, social and economic travel.
https://thecritic.co.uk/the-bizarre-fetish-for-grown-up-politics/
As it all unfolded, we were laughably told “the grown ups are now back in charge” as cover was provided for the Westminster and Whitehall cabal to carry out their coup to overthrow Truss. In the decaying final days of probably the most disastrous General Election campaign by any sitting government ever, that absurd tag has the hollowest of rings to it.