From triumph to trouble: Why British PM Liz Truss is facing revolt in just 6 weeks

Mangalore Today News Network

London, Oct 17, 2022: There’s one question that everyone seems to be asking about British Prime Minister Liz Truss: Will she last till Christmas? And the answer certainly appears not. Truss has been in office for fewer than 40 days but has been forced into a humiliating U-turn on planned tax cuts that formed the key part of her economic programme.

 

In just six weeks, the UK PM’s position in office seems to be turbulent and she is finding it difficult to stay in power. Her proposed plans have failed to calm the inflation-stricken markets or assuage lawmakers’ concerns.

When Liz Truss announced her new cabinet after Boris Johnson tendered his resignation to the Queen of Balmoral, she promised immediate assistance for businesses and households over energy costs. She, however, ruled out a windfall tax on energy firms. She promised she would cut taxes and slash red tape, and would spur Britain’s sluggish economy to grow, reported AP.

However, former Indian British chancellor Rishi Sunak had warned that immediate tax cuts would be of no use amid the economic shockwaves from the coronavirus pandemic and the war in Ukraine.

TAX CUTS, FINANCIAL CRISIS

On September 23, Britain finance minister Kwasi Kwarteng presented his growth plan- dubbed a ’mini-budget’. The plan, having an aim to break the “cycle of stagnation” in the British economy, included
45 billion pounds ($50 billion) in tax cuts -– including an income tax reduction for the highest earners.

But the sweeping tax cuts and energy freeze, which was intended to boost the UK’s troubled economy, did not have the desired effect on the market. The pound fell to an all-time low against the US dollar and the cost of borrowing for the UK rises sharply amid turmoil on financial markets. The Bank of England was forced to intervene to prop up the bond market and stop a wider economic crisis.

Jill Rutter, a senior fellow at the Institute for Government think tank, told AP Truss and Kwarteng made a series of “unforced errors” with their economic package.

The International Monetary Fund (IMF) said on September 27 that it was “closely monitoring” developments and urged the government in London to change tack.

Truss also admitted that she could have done more to ’lay the ground’ for her economic plan. Liz Truss defended her government’s action and argued that the market turbulence following the announcement of planned was a result of global problems due to Ukraine war. She said that it was important that monetary and fiscal policy are coordinated, adding that she would stick to her plan to try to boost growth.

On October 3, Kwarteng announced a U-turn on plans to cut the 45 per cent rate of tax, which was dubbed a tax cut for the rich.

Amid the growing criticism, Truss sacked Britain’s Chancellor of the Exchequer, Kwasi Kwarteng, to save her own skin. She replaced her longtime friend and ally with Jeremy Hunt, who served as health secretary and foreign secretary in the Conservative governments of David Cameron and Theresa May.

She also acknowledged at a press conference that ’parts of our mini-budget went further and faster than markets were expecting.’

TRUSS FACES MUTINY

The prime minister’s libertarian economic policies, multiple U-turns triggered not only a financial crisis but also a political one. A survey conducted by the Times revealed that Conservative party MPs are reportedly discussing to oust Liz Truss and replace her with a joint ticket of Penny Mordaunt and Rishi Sunak.

Truss now faces a mutiny inside the governing Conservative Party that leaves her leadership hanging by a thread. Tory MPs are now mulling about whether to try to replace their leader for a second time this year.

BUTT OF JOKES IN BRITISH TABLOIDS

The UK PM also became the butt of quintessentially British jokes in tabloids- most notably by being compared to a head of lettuce by both ’The Economist’ newspaper and the ’Daily Star’. Daily Star, a tabloid, started a live stream on YouTube of Liz Truss’s photo next to a lettuce to see which one lasts longer, taking the internet by storm.

On Saturday, “#lettuceliz” gained traction on social media as the UK PM became the butt of quintessentially British jokes in tabloids- most notably by being compared to a head of lettuce by both ’The Economist’ newspaper and the ’Daily Star’.

The panicked lawmakers are contemplating a leadership change. The UK MPs are said to be considering a joint team of Rishi Sunak and Penny Mordaunt where the former is the prime minister and the latter his deputy. The other option is for Penny Mordaunt to take the roles of party leader and prime minister with Rishi Sunak as Chancellor.

The name of popular Defense Secretary Ben Wallace has also been mentioned as a potential replacement and former PM Boris Johnson also has supporters.

Courtesy: India Today