Tuesday 4 October 2022

Liz Truss is a disaster for Brexit

And she has been Prime Minister less than four weeks, half of that time taken up by mourning the Queen. 
Ed Conway in the Sunday Times on the British Government's loss of credibility.
'Once upon a time, Britain’s credibility came from its economic might and its management of the gold standard. Today, it probably derives from boring institutions that went out of fashion years ago: the Bank of England and its boring inflation target, the Treasury and its boring mandarins, the rule of law, a history of creditworthiness, long-dated bonds and boring fiscal rules, as well as bodies such as the OBR. I say “probably” because there is no definitive formula. But somehow this cocktail of components exerts a magical effect upon Britain’s currency and its bond prices, making them worth more than the sum of their parts.

'The best example of this dates back to May 6, 1997, the day Gordon Brown, chancellor at the time, gave the Bank of England independence to set interest rates. In one fell swoop, Britain’s cost of borrowing fell by half a percentage point. That might not sound like much, but it was a financial boost that in hindsight helps explain a decent chunk of Britain’s prosperity ever since. Those lower borrowing costs helped businesses and households invest even more in the coming years. It was a credibility windfall.

'...In practice, it was probably a bit of everything: the scale of the giveaway, the sidelining of the OBR, the firing of experienced Treasury boss Sir Tom Scholar and badmouthing of the Bank of England, the vague promise of more tax cuts over the weekend. Somehow this new government achieved in a few days something that none of its predecessors managed in decades: it inadvertently dismantled the credibility buffer helping to keep the markets aloft.'

The new useless British government did not just lose credibility in the markets but with Parliament and with electors. 

Liz Truss, as we suspected, is another Theresa May, albeit one who likes freedom not regulation. 

She is as much wedded to Carbon Zero and huge pointless increases in defence expenditure as Boris Johnson, just as keen for Ukraine to continue the war with Russia, just as obedient an American vassal, but unlike him she cannot sell. 

She humiliated herself and her country when she met Lavrov (against her officials' advice) and thought Rostov-on-Don was in the Ukraine. 

She humiliated herself and her country again last week. 

Isabel Oakshott said it is sexist to say that she is thick (which is odd and Miss Oakshott has called other women politicians stupid). Most politicians of both sexes are, as Lord Skidelsky said, inhumanly stupid and Liz Truss is certainly no exception, something else she has in common with Theresa May. 

It is a disgrace that her MPs, who knew what she was like and did not vote for her, put up with having La Truss foisted on them by Tory party members. 

They should rebel, just as Labour MPs should have got rid of Corbyn. But the House of Commons has lost its self-belief like every British institution from the monarchy downwards. 

It would be sexist to speak of a lack of virility. 

1 comment:

  1. Doesn’t Theresa May look relatively responsible next to Liz Truss? Whom you accurately predicted would be a disaster, by the way.