Liz Truss’ big choice
The favorite to succeed Boris Johnson has made some
bold pledges. Will she stick to them?
BY ESTHER
WEBBER
AUGUST 25,
2022 4:00 AM
https://www.politico.eu/article/liz-truss-big-choice/
LONDON —
Liz Truss has promised the earth to Conservative Party members on the campaign
trail. The question being asked across Westminster now is whether, assuming she
becomes U.K. prime minister on September 6 as expected, she can possibly
deliver.
The
manifesto for government Truss has unveiled over her six-week leadership
campaign is both ambitious and eye-wateringly expensive — and, critics say,
bordering on impossible, given the increasingly fragile state of the U.K.
economy.
Truss has
made tax cuts “from Day One” her signature offer, a totemic pledge that has
proved music to the ears of members who want to see the party return to its
low-tax, small-state tradition.
But her
stated resistance to offering “handouts” to those in need — even during an
energy bill spike of unprecedented scale — has been abandoned under intense
public pressure, and allies now accept a costly support package for struggling
households will also be required in an emergency budget penciled in for
September 21.
Supporters
and opponents alike are starting to question if the twin pledges are realistic,
as surging U.K. inflation hammers public finances, and the scale of what
households will be facing this winter becomes clear — or whether Truss may have
to pivot away once the battle for members’ hearts has been won.
“She’s got
a choice to make, ” said a senior figure within the opposition Labour Party.
“It’s hard to see how she can possibly afford — or justify — £30 billion of tax
cuts once she’s speaking to the nation and not just 180,000 Tory members. The
whole conversation is going to be about helping households with their bills.
Does she delay? Does she press on? Does she just keep borrowing? We all know
there isn’t any money.”
‘An
extremist’
There is
certainly precedent for U.K. politicians abandoning their once-solemn pledges,
having won the hearts and minds of party members during internal leadership
contests.
Labour
leader Keir Starmer wooed the left of his party in 2020 by promising to adopt
some of predecessor Jeremy Corbyn’s most radical policies — before ditching
them wholesale once in power. Outgoing Prime Minister Boris Johnson told Tory
members in 2019 that he would slash income taxes for middle-earners and deliver
Brexit by October of that year. Neither came to pass.
But those
who have worked closely with Truss insist there is little chance she will
abandon her right-wing instincts if she becomes Tory leader next month.
Unlike
Johnson, whose ideological allegiances were always hard to pin down, Truss
“really believes all this right-wing economic theory, and that will definitely
be guiding her,” said a former Cabinet minister who worked alongside her.
A senior
Conservative MP backing her for leader echoed this, adding: “She’s always been
an extremist in everything she does.”
Asked
whether Truss would implement the tax cuts she’s promised in the fall, another
supportive Tory MP said: “She’s going to have to. She’s got this far by being
someone who sticks to her guns and does what she believes in.”
Comparing
Truss’ approach to that of her heroine, Margaret Thatcher, the supportive MP
added: “I think we could be heading for a 1980s-style culture shock. She’ll
have people around her telling her to do some radical things, and that she has
two years as PM to make a difference before she fights an election.”
Indeed,
last week, Jacob Rees-Mogg, one of Truss’ close allies, wrote a piece for the
Telegraph arguing that Brexit gives the U.K. government an opportunity to carry
out a full rethink of “whether the state should deliver certain functions at
all.”
Red lights
flashing
Truss’
refrain throughout the campaign has been that the U.K. has £30 billion of
headroom within the public finances and that spending the cash on tax cuts will
quickly spark growth. Those forecasts, however, were made in March — since when
the economic outlook has radically changed.
Biden
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The
expectation from Truss’ colleagues is that she will now push Cabinet and civil
servants hard to deliver what she has pledged in the hope of achieving a
scaled-down version.
Nonetheless,
many are already predicting her ambitions will not survive the cold shock of
reality awaiting her in No. 10 Downing Street.
The scale
of financial pressures facing households this winter means her support package
will likely require spending cuts or higher borrowing.
Furthermore,
she must address a severely overburdened National Health Service, with waiting
times for ambulances currently soaring alongside excess deaths. Truss caused
surprise this week by suggesting her solution would be to divert billions of
pounds intended to tackle NHS backlogs into social care, in an effort to free
hospital beds.
A
Conservative councilor for a large local authority said: “My personal issue is
that she’s not been saying what she’s going to take away. If you’re in an area
like ours, which has suffered really badly from cuts to local government,
you’re very acutely aware that there isn’t much else to cut.”
The former
Cabinet minister quoted above said he assumed Truss would ultimately have to
deviate from her current set of pledges.
A
“sensible” government would pause certain areas of planned expenditure, he
predicted, whereas “simply putting it on the credit card and passing it to our
grandchildren and telling them they’ll have to pay for it, that’s not a
responsible solution.”
All eyes on
the Treasury
Truss will
also have to contend with the rigors of the finance ministry, the former
minister added. “The Treasury will remind her, and she’ll see it in practice,
that if you start going off on a completely dangerous tangent, the markets will
intervene.”
Should she
press ahead on a radical path, Truss’ hand would be strengthened by choosing a
chancellor prepared to help realize her vision. Truss’ pick for the Treasury is
widely expected to be the current business secretary, Kwasi Kwarteng. The pair
have a longstanding affiliation as two of the newly-elected Tory MPs who, in
2010, co-authored “Britannia Unchained,” a radical right-wing program for
fostering economic growth.
Henry Hill,
deputy editor of the ConservativeHome website, observed: “Her best shot of
getting stuff over the Treasury will be with a brand new chancellor that she’s
just appointed.”
He added:
“What will be interesting is if we get to, say, six months in and the entire
dashboard is flashing with red lights, will the chancellor stick with her —
ride or die — with a plan that the Treasury doesn’t like, or does he end up
succumbing to the Treasury’s center of gravity?”
All the
contributors who spoke to POLITICO for this article honed in on Truss’
longer-term pledge of increased infrastructure spending as the big ticket item
most likely be sacrificed to guarantee tax cuts, casting doubt on her promise
to northern voters of better rail provisions.
It is only
when Truss begins to confront these choices that the U.K. will find out exactly
what sort of prime minister she intends to be.
Eleni Courea contributed reporting.
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