Dan Ladden-Hall
Mon, October 3, 2022
Ian Forsyth/Getty
Shortly after making it into the final two for the Tory leadership race in July, Liz Truss sent out a message of thanks to her supporters with an oddly prophetic typo. “I’m ready to hit the ground from day one,” she wrote.
What was once just an amusing typo has turned out to be a well-kept promise. Even with Truss’ first two weeks in office being eclipsed by the death of Queen Elizabeth II, the new regime has already managed to inflict a surprising array of disasters on the country and itself. The so-called “mini-budget” delivered by fledgling finance minister Kwasi Kwarteng on Sept. 23 has been at the heart of the mayhem.
Liz Truss is Britain's New Prime Minister—God Help Her (and Us)
Kwarteng, a longtime Trus ally, is a free-market radical who, like Truss, believes that unfettered economic growth will cure the United Kingdom’s legion of social ills. It may have come as a bit of a surprise when the free market, in turn, had a radically negative reaction to Truss and Kwarteng’s proposals, which represented the biggest cuts in British tax in half a century.
At a time when spiraling energy and food costs threaten to leave millions of Britons choosing between heating or eating this winter, Kwarteng’s flagship financial policies included removing a cap on banker’s bonuses and removing the top 45 percent rate of income tax, which would only benefit those earning over $168,000 a year.
But the breathtaking tax cuts, coupled with a promise to tackle rising energy bills through massive government borrowing, immediately sent the markets into meltdown as confidence in British finances evaporated. The pound fell to an all-time low against the dollar, British stocks and bonds plummeted, and the Bank of England was forced to take emergency action to avoid a potentially catastrophic collapse of pension funds, warning that a “material risk to U.K. financial stability” had been created by the statement.
Members of Truss’ own party reacted with horror. “Liz is fucked,” one former Conservative minister told Sky News after the mini-budget, adding that Tory lawmakers had already started formally requesting a vote of no confidence in her leadership over fears that she would “crash the economy.” And even Conservative party heavyweights Michael Gove and Grant Shapps on Sunday denounced the plans as “tin-eared,” adding that the cuts had “managed to alienate almost everyone, from a large section of the Tory parliamentary party taken by surprise to the City traders who will actually benefit.”
Kwarteng also faced calls to resign for the turmoil—which grew louder when it emerged that he’d attended a champagne reception attended by hedge fund managers who also allegedly benefited from the chaos in the market. But despite the uproar, it looked like for all the world like Truss and Kwarteng would stick to their guns and press ahead with $50 billion of unfunded tax cuts.
On Sunday, Truss was asked during a BBC interview if she was “absolutely committed to abolishing the 45 percent tax rate for the wealthiest people in the country.” She said yes. By Monday morning, that absolute commitment was absolutely dead. “We get it, and we have listened,” Kwarteng wrote in a tweet announcing that the tax cut would no longer go ahead.
The humiliating U-turn was reportedly taken to avoid an even more humiliating open rebellion of Conservative lawmakers in the House of Commons planning to block the tax cut going through. Losing such a sensitive vote so early in an administration would be a disaster for Truss and her allies and their grip on power.
But Conservative lawmakers can already feel their party’s grip on the electorate more broadly slipping away, with fears growing that they will face decimation at the next election. Staggering polling figures published last week put the opposition Labour party 33 points ahead of the Tories—the biggest lead the party has enjoyed in Britain since the 1990s, according to data analytics firm YouGov. Even more alarming for Tory lawmakers was the fact that the mammoth lead was partly explained by an exodus of people who had voted for the Conservatives at the last general election in 2019 switching allegiance to Labour.
With the Conservative party’s annual conference underway this week, Truss will have to find some way to reestablish her credibility within the party. So somber is the mood at the event that even a traditional karaoke event has been canceled. Delegates arriving at the conference have even been subjected to abuse by angry protesters outside the venue. But the message inside is arguably even more upsetting for the Tories’ rank and file. Over the weekend, veteran British pollster Sir John Curtice informed gobsmacked attendees that they were heading for electoral disaster, with Truss now as unpopular as Boris Johnson when he was toppled.
To say she’s only been prime minister for less than a month, that’s a truly incredible achievement.
'Widespread dismay': Ex-Tory minister calls on Liz Truss to call general election
Emily Cleary
Mon, October 3, 2022
Liz Truss smiled as she made her way to the Tory party conference on Tuesday (Getty)
Nadine Dorries has called for Liz Truss to call a general election after accusing her of reneging on a series of policies put in place when Boris Johnson was prime minister.
Dorries, one of Truss's earliest and most vocal supporters during the summer's leadership campaign against Rishi Sunak, revealed her "dismay" at Truss's performance since entering Number 10.
On Monday, Truss and chancellor Kwasi Kwarteng buckled in the face of widespread criticism from the public and Tory MPs and axed her plans to abolish the top rate of income tax that would benefit the most wealthy.
And later, Dorries applied more pressure with criticism of other steps taken by Truss, tweeting: "Widespread dismay at the fact that 3 years of work has effectively been put on hold. No one asked for this.
"C4 sale, online safety, BBC licence feee [sic] review - all signed off by cabinet all ready to go, all stopped."
"If Liz wants a whole new mandate, she must take to the country."
Nadine Dorries has blasted the PM for putting 'on hold' policies she had actioned while culture secretary (Twitter/Nadine Dorries)
Former ally Dorries is just one of a number of senior Tories to criticise Truss's performance since she became PM less than a month ago.
Last week a former Tory minister MP told Sky News the new Prime Minister is "f*****" and the party were already looking to bring her down following the disastrous mini-budget on 23 September.
The unnamed MP said: "They are already putting letters in as think she will crash the economy. The tax cuts don’t matter as all noise anyway - mainly reversing back to the status quo this year.
"The issue is government fiscal policy is opposite to Bank of England monetary policy - so they are fighting each other. What Kwasi [Kwarteng] gives, the Bank takes away."
Nadine Dorries was one of Truss's most vocal supporters during the Tory leadership contest. (Getty)
Another Tory MP told the broadcaster that Friday's announcement - which included reversing a 1.25% hike in National Insurance - had been a "s***show".
They said they weren’t aware of any coordinated plan to vote down government legislation, but added they would not rule it out.
On Monday morning Truss and Kwarteng abandoned their plan to abolish the top rate of income tax.
The pair had planned to scrap the 45% rate on earnings over £150,000 in a move to be paid for by borrowing. But despite defending the policy for more than a week despite widespread criticism from fellow party members as well as financial experts, the proposal was reversed on Monday morning in an embarrassing U-turn.
Kwasi Kwarteng and Liz Truss appeared stony-faced at the Tory party conference after announcing an embarrassing U-turn on tax policies on Monday morning (Getty)
Dorries' call for an election came as Labour pushed further ahead in the polls.
Last week, a YouGov/Times poll placed Labour 33 points ahead of the Conservatives, believed to be the largest lead for Labour in any recorded poll since 1998, when the-then PM Tony Blair was enjoying his "honeymoon period".
By Monday lunchtime almost half a million people had signed a petition calling for a general election. The petition must now be considered for debate in Parliament.
Emily Cleary
Mon, October 3, 2022
Liz Truss smiled as she made her way to the Tory party conference on Tuesday (Getty)
Nadine Dorries has called for Liz Truss to call a general election after accusing her of reneging on a series of policies put in place when Boris Johnson was prime minister.
Dorries, one of Truss's earliest and most vocal supporters during the summer's leadership campaign against Rishi Sunak, revealed her "dismay" at Truss's performance since entering Number 10.
On Monday, Truss and chancellor Kwasi Kwarteng buckled in the face of widespread criticism from the public and Tory MPs and axed her plans to abolish the top rate of income tax that would benefit the most wealthy.
And later, Dorries applied more pressure with criticism of other steps taken by Truss, tweeting: "Widespread dismay at the fact that 3 years of work has effectively been put on hold. No one asked for this.
"C4 sale, online safety, BBC licence feee [sic] review - all signed off by cabinet all ready to go, all stopped."
"If Liz wants a whole new mandate, she must take to the country."
Nadine Dorries has blasted the PM for putting 'on hold' policies she had actioned while culture secretary (Twitter/Nadine Dorries)
Former ally Dorries is just one of a number of senior Tories to criticise Truss's performance since she became PM less than a month ago.
Last week a former Tory minister MP told Sky News the new Prime Minister is "f*****" and the party were already looking to bring her down following the disastrous mini-budget on 23 September.
The unnamed MP said: "They are already putting letters in as think she will crash the economy. The tax cuts don’t matter as all noise anyway - mainly reversing back to the status quo this year.
"The issue is government fiscal policy is opposite to Bank of England monetary policy - so they are fighting each other. What Kwasi [Kwarteng] gives, the Bank takes away."
Nadine Dorries was one of Truss's most vocal supporters during the Tory leadership contest. (Getty)
Another Tory MP told the broadcaster that Friday's announcement - which included reversing a 1.25% hike in National Insurance - had been a "s***show".
They said they weren’t aware of any coordinated plan to vote down government legislation, but added they would not rule it out.
On Monday morning Truss and Kwarteng abandoned their plan to abolish the top rate of income tax.
The pair had planned to scrap the 45% rate on earnings over £150,000 in a move to be paid for by borrowing. But despite defending the policy for more than a week despite widespread criticism from fellow party members as well as financial experts, the proposal was reversed on Monday morning in an embarrassing U-turn.
Kwasi Kwarteng and Liz Truss appeared stony-faced at the Tory party conference after announcing an embarrassing U-turn on tax policies on Monday morning (Getty)
Dorries' call for an election came as Labour pushed further ahead in the polls.
Last week, a YouGov/Times poll placed Labour 33 points ahead of the Conservatives, believed to be the largest lead for Labour in any recorded poll since 1998, when the-then PM Tony Blair was enjoying his "honeymoon period".
By Monday lunchtime almost half a million people had signed a petition calling for a general election. The petition must now be considered for debate in Parliament.
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