A press conference that could have been an email. Dressed in funereal black, Liz Truss stood at the podium for roughly 494 seconds, each more excruciating than the last. She made a brief statement before taking all of four questions. What did we learn?
The prime minister who wanted to be a disruptor, to move fast and break things, was now promising stability. That the tax-cutting, deregulating warrior would in fact be raising taxes. And perhaps most chillingly, that lower public spending – in other words, a return to austerity – was inevitable.
The situation has developed not necessarily to Truss’s advantage. Indeed if the plan was to reassure the markets, it was only a modest success. Sterling, which had recovered this morning on the basis that the £18bn corporation tax cut would be junked, fell 1.2 per cent immediately after the statement.
Before I forget, Jeremy Hunt is the new chancellor. I found out when I read the following headline: “Breaking. UK’s Truss appoints centrist Hunt as new finance minister”.
For what it’s worth, this is a good example of what is often meant by ‘politics as vibes’. The above quote is from a tweet by the AFP News Agency, sent to its 2.4 million followers. Thing is, as a candidate for Tory leader, Jeremy Hunt pledged to cut the rate of corporation tax to 15 per cent. As chancellor, he will see it rise to 25 per cent.
But his appointment should still restore some calm to the markets, because Hunt has a veneer of Treasury orthoxodiness about him. If he were a scratch and sniff, you might expect notes of travellers’ cheques and Werther’s Originals.
A word of warning: despite the U-turns on the 45p rate and corporation tax, Hunt will still have to find tens of billions of pounds to balance the books, hence Truss’s statement that spending will “grow less rapidly”. And current spending plans did not even take into account our presently very high rate of inflation.
Inevitably, questions still remain over the prime minister’s future. It is hard to imagine even her strongest supporters will have been much energised by that performance. Still, Truss remains in place, and possesses sufficient residual power to sack her chancellor and appoint his replacement.
But there’s an obvious, unobfuscatable problem. Kwarteng was carrying out her economic policy. The one she ran on during the leadership election, that she waxed lyrical about in Britannia Unchained all those years ago. The thing she believes in to her core. Live by the markets, die by the markets, I suppose.
In the comment pages, Paul Flynn suggests making cannabis Class A would be truly the stupidest thing we could do. While Culture Editor Nancy Durrant says the BFI London Film Festival was a joy, as ever, and only wishes it lasted the whole month.
And finally, check out your autumn reading list, courtesy of London’s coolest librarian.
Have a lovely weekend.
