The press conference that Liz Truss held on Friday repeated her message about growth – a good one in itself and, for what it’s worth, one that this site has also plugged. But it was so far removed from the circumstances that forced the event that it might as well have been beamed in from another planet.
The Prime Minister could not explain why sacking Kwasi Kwarteng was more likely to bring faster growth. Nor why replacing him with Jeremy Hunt would do the trick either. Nor why she should not herself didn’t resign – since she is, in her own words, an “ideological soulmate” to the former Chancellor, and the two were the main authors of the Government’s growth strategy.
Nor, above all, what remains of that plannow that one of her two main Conservative leadership campaign pledges, reversing the Corporation Tax rise, has itself been reversed. The cut in the top rate of tax has already been abandoned. Some will say that there is more to the strategy than the future of two taxes – in particular, the Prime Minister’s proposed supply-side reforms.
Quite so, but if it was always going to be difficult to get them through both the Lords (because Truss has no mandate for any reform that wasn’t in the last Conservative general election manifesto) and the Commons (because she won a smaller percentage of Tory MPs’ votes in the leadership contest than any previous victor). The challenge now looks even more daunting.
David Cameron, Theresa May, and Boris Johnson were sometimes pusillanimous, sometimes prudent and sometimes both over the sort of ideas that the new Government is floating – whether these are, say, cutting childcare staff ratios or easing conditions for fracking or easing environmental requirements on builders.
But the first and third of those Prime Ministers, and even perhaps the second. had more authority than their successor. Truss was damned if she stuck with the mini-budget and damned if she twisted. She has inevitably gone with the latter, and with the deconstruction of her mini-Budget went the quiddity of her strategy for growth.
All she can now do, on the basis of her last major public appearance, is repeat formulas from her growth script, regardless of the question being asked her, while offering offer no convincing prospect of real change. Nor has she so far been able to tell a story to voters that links higher growth, a good thing in itself, to real improvements in their condition and prospects.
Note, too, that while the theory remains Trussian, at least on paper, the practice is Sunakian. “People across this country rightly want stability,” she said on Friday – a word straight out of the dictionary of “Treasury orthodoxy”. “Parts of our mini budget went further and faster than markets were expecting. So the way we are delivering our mission right now has to change.”
Hence the appointment of Jeremy Hunt as Chancellor. Truss may have been thinking that at least he’s not the man she’s just beaten – and that, since he failed to win enough nominations to stand for the leadership himself, he presents no threat to her position.
Hunt is certainly a team player though, like other members of the Cabinet, he will be considering his future options – now that Truss has resuscitated him from the political dead. At a stroke, Truss has bigged him up and made herself dependent on him for support. When it comes to economic policy and much else he is in a position to dictate terms for as long as she lasts.
No wonder Truss looked more like a ghost than a premier last week. She may have been in Cabinet for the best part of ten years, but she has no real experience of domestic politics at the highest level. And she seems incapable to communicating to a public wider than the Tory base – in other words, nearly all of the wider electorate.
I’m not calling for Truss to go – though I suspect that the 1922 Committee and Tory MPs will take matters into their own hands sooner rather than later, even though there is, as I write, no agreed successor. It may even be that the markets now calm down, Labour’s poll lead lessens, the downturn is brief, the recovery is strong, and Truss wins in 2024.
My point is different – namely that, regardless of what happens next, Trussonomics, and the Truss programme on which she fought and now the leadership election, is over. Her Government will continue where the Energy Price Guarantee left off. Her appointments will do so where Conor Burns’ replacement by Greg Hands, a Sunak supporter in the recent election, pointed.
She is set to run not a radical government promoting individual freedom, but a more conventional one of – dare I call it “Treasury orthodoxy”? It will be much more like the Cameron and May and Johnson governments that she and Kwarteng seem at some deep level to have despised, and which they ran against this summer at least as much as against Labour.
That hostage you see waving at the window is Truss. The unsmiling figures you see behind her are her leadership rivals, Treasury civil servants, big business bigwigs, Bank of England board members, visitors from the Palace – in the words, those that her strongest supporters revile as “the enemies of growth”.
How has it all gone wrong so quickly? Has she bungled the ideas of the libertarian think tanks that were her strongest supporters, or is the lesson that these are impracticable? To what extent is she the author of her own misfortunes, having admitted herself that “mistakes have been made”?
The day will come on which to pin down why – after winning the leadership election less convincingly among the members than was expected. and not among her fellow Conservative MPs at all – she played a hand of twos and threes as though all of them were aces.
Now Hunt, Rishi Sunak, Penny Mordaunt and others strut the stage or wait in the wings. But the most decisive part in the coming days and weeks may not be played by any of them. Truss is no Margaret Thatcher, but might there be a 1990 parallel? Denis Thatcher’s view is said to have been important as a second leadership challenge ballot loomed.
According to John Wakeham, the plain-speaking Thatcher told his wife that ‘you’ve done enough, old girl. You’ve done your share. For God’s sake, don’t go on any longer’.” Truss’s family and friends may not yet have spoken to her in similar terms, but they must be wondering for how long they can put it off.