Sunday July 24, 2022
Case for Liz Truss as prime minister of United Kingdom
Sometimes the only way to test an argument is to write the opposite, as Boris Johnson once did. My prejudice is that Rishi Sunak is better qualified to be prime minister than his rival, so let me try to make the case for Liz Truss.
She has good political instincts. This is important in a democracy because you need to take people with you, first to get elected and then to be re-elected. It is no use Sunak having what economists think is the best plan for public finances and the economy if the Conservative Party wonâ€™t buy it.
Trussâ€™s plan for tax cuts may not be something that her chancellor â€” possibly Simon Clarke, currently chief secretary to the Treasury â€” could actually deliver as a Budget. Giving up tax revenues on the scale she is proposing, and borrowing to fill the gap, would be dangerous, stoking inflation and putting up interest rates.
In practice, chancellor Clarke may say that he will restore part of the rise in national insurance contributions rather than â€œscrappingâ€ the whole â€œhikeâ€ as promised. He may reduce and defer the rise in corporation tax next year. Truss could say that cutting taxes was the important thing: the precise amount always has to be conditional on the state of the public finances at the time.
Just as Sunak has turned out to be wrong to think that unfunded tax cuts would put off Tory members, Keir Starmer may be wrong to think that he will be able to turn â€œtax cuts versus public servicesâ€ to his advantage at the next general election. Tax cuts may be catnip for Tory members, but they are also popular with the wider electorate. As long as Truss can sell low taxes as a symbol of intent rather than a plan to cut public spending, Labour may struggle as Sunak has struggled.
To take one aspect as an illustration of the larger point, Trussâ€™s critics seized yesterday on the admission by Patrick Minford, one of the tiny minority of economists who endorse her plans, that interest rates might rise to 7 per cent. What a brilliant idea, many older people with savings might have said.
Trussâ€™s linked instinct is for change. It is incoherent and unspecific, but it is popular, both with party members and with the electorate. It is something that Sunak failed to offer, portraying his fiscal responsibility as a continuation of what he was doing at the Treasury before he resigned, while Truss has offered change from the â€œorthodoxyâ€ of the past 20 years, even though she remained in government and stayed loyal to the now outgoing prime minister.
You might ask how on earth she does it: a minister for a decade, who voted Remain in 2016, cashing in on the conspiracy theory that Johnson was betrayed while simultaneously offering a clean break with the establishment to which Johnson had presumably surrendered. As I say, she has good political instincts. She was able to sell trade deals copied and pasted from the EU â€” a bureaucratic chore made necessary by Brexit â€” as the buccaneering spirit of a new global Britain. It was rubbish, but it worked. As foreign secretary at the outbreak of land war in Europe, she said it would be a brilliant idea if enthusiastic young Britons wanted to go to Ukraine to fight Russian imperialism. Even her blunders reveal instincts of which most people approve.
None of this means she would be an effective prime minister. But she knows her weaknesses, which is itself a kind of strength. In her leadership campaign video she sold herself on â€œdelivery, delivery, deliveryâ€. Her claim to be able to deliver on delivery rests mainly on those same cut-and-paste trade deals. This ought to be blown out of the water by Sunakâ€™s record of using the might of the Treasury to deliver things that actually matter, from furlough to help with energy bills, but she sails on.