Voices: Truss and Kwarteng’s mind-boggling madness has not made life easy for pundits

·4-min read

“Hurrah for boring. Three cheers for boring. Boring, as Smash Hits used to say, is back back BACK!”

Can that really be what some idiot by the name of Tom Peck wrote in The Independent barely a fortnight ago? Liz Truss, this absolute clown reckoned, was the perfect antidote to the never-ending crazy of the Johnson years; her carefully honed complete lack of inspiration, he said, was well overdue for a nation crying out for some soporific calm.

Hasn’t quite gone to plan, has it? The death of Her Majesty the Queen is not her fault, but the absolutely wild economic hellride she has already unleashed since it happened is certainly no accident.

The US economist Larry Summers now refers to the UK as a “submerging market” – ie not an emerging market, but one going back to the places from which other developing economies emerge. We are, as a country, undeveloping.

Paul Donovan, the chief economist at UBS, said investors now viewed the Tory party as a “doomsday cult”. These sorts of comments are never made without passing through at least 10 separate PR teams, so we must hope Mr Donovan is not too disappointed by the deliberate insertion of an especially ingenious spelling mistake there.

Truss and Kwarteng’s mind-boggling madness has not made life easy for pundits. Borrowing tens of billions of pounds of public money in order to fund tax cuts that benefit only millionaires, in the middle of a massive cost of living crisis, is so totally absurd and economically illiterate that we have little choice but to assume we haven’t understood it.

Can they really be this bad? Can they really have this little clue what they’re doing? Well, yes, they can. A couple of weeks ago, one of Truss’s favourite economists, Julian Jessop, was absolutely adamant that borrowing money to fund tax cuts wouldn’t trouble the markets. “If tax cuts mean more borrowing in the short term, I’m completely relaxed about that,” he said. “I suspect the markets will be as well.”

So there really isn’t any sort of grand political strategy going on here. It really is that they just don’t have a clue what they’re doing; that they’ve trashed the currency entirely for ideological reasons and really did not see the utterly inevitable consequences coming.

And it’s not even the economic ones. It’s the political ones too. On a personal note, I spoke to a fair few City traders over the weekend, one of whom told me he was genuinely disappointed by the abolition of the additional rate of income tax. He would, he said, make a few quid out of it personally, but the politics of it were so terrible that he couldn’t see how it wouldn’t lead directly to a Labour government, which is not something on which he is overly keen.

And so, then, to the Labour Party conference, which is shaping up to be the greatest open goal-slotting opportunity for years, if not decades. How would they respond to the Conservative Party setting fire to its reputation, admittedly for about the tenth time in the last few years, but certainly in the most spectacular fashion yet?

Up to the lectern strode Rachel Reeves, fresh from responding to Kwasi Kwarteng’s mini-Budget on Friday. Reeves is arguably Labour’s safest pair of hands. She is, admittedly, somewhat boring, but, you know, hurrah for that. She let the mesmerised delegates know that she would be reintroducing the 45p income tax rate and, “with the money”, she’d be doubling places at medical school, creating more midwives and making sure the NHS “has the doctors that it needs”.

Look, only the decidedly ungenerous would point out that reversing a tax cut paid for by borrowing doesn’t necessarily land you with the money you need to create a whole load more NHS staff, not unless you want, like them, to borrow the money to do it.

And when you’re trying to slot the most open of open goals, and show that you, not they, are now the party that can be trusted with the economy, it’s possible this isn’t the kind of thing you want to say.

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But they don’t seem to care. All round Liverpool they’re bouncing up and down with Tiggerish glee in front of the TV cameras, scarcely unable to believe their luck. Peter Mandelson reckons all the division is gone. Yvette Cooper reckons they’re the only party that’s pro growth, pro jobs, pro fairness and so on and so on.

They’ve also passed a few motions to nationalise the railways and the post office, both of which are wildly popular. They’re also extremely difficult and come with absolutely no guarantees whatsoever that services will improve or prices go down, and they certainly don’t make said services less vulnerable to trade union action, which currently shows precisely zero sign of going away.

So it’s possible, just possible, they’re getting ever so slightly ahead of themselves. There’s a very, very long way still to go.