Is Truss for Turning?

And “The Lady” weeps — Margaret Thatcher, that is, in a far better place than the United Kingdom. Reflecting on her birth 97 years ago this week, your Brexit Diarist is thinking of Thatcher’s famous speech at Bruges, where she took aim at the EU superstate.“We have not successfully rolled back the frontiers of the state in Britain,” she declared 34 years ago, “only to see them re-imposed at a European level.” Alas. Were Thatcher to repeat those words in 2022, she’d ruefully note that those “frontiers of the state” have rolled forth again, re-imposed now at Westminster and Whitehall.To think of Thatcher on her birthday can be only sobering for those who had hoped Britain’s latest Tory prime minister, Elizabeth “Liz” Truss, would prove an adequate substitute. I was not one of them — though I do believe she was the best candidate on offer, to replace disgraced Boris Johnson.And for Conservatives who cherish “maximal liberty, minimal government,” it is deeply despairing to see Ms. Truss’s arguments for economic freedom eviscerated, not only by Leftists in the Labor Party and the broadcast media, but among her parliamentary colleagues, too.Was the Brexit promise of independence a sham? An excuse to replace domestic for foreign bureaucrats? Why the focus on tax cuts and silence on overspending? Don’t lose sight of the forest for the trees.It all began with Chancellor Kwasi Kwarteng’s “mini-budget” on the Friday following the queen’s funeral. In addition to scrapping a rise in National Insurance and a moratorium on the Green Levy to fight climate change, there would be a cap on energy increases. Also, the planned rise in corporation taxes would be canceled and the cap on bankers’ bonuses scrapped.Then came the tax cut “too far”: getting rid of the top marginal tax rate of 45 percent in favor of “a single higher rate of income tax of 40 per cent.” (All taxpayers would benefit from a drop of 1 percent in the basic rate of 20 percent.)“After all,” Mr. Kwarteng told the House of Commons, “this only returns us to the same top rate we had for 20 years” — introduced by Thatcher in 1988. As Reuters reports, this would result in £2 billion in overall cuts of £45 billion.What followed was a firestorm of a week of protest. The Labor leader, Sir Keir Starmer, lambasted the “Kami-Kwasi” budget and no less a Tory big beast than Michael Gove called the government “un-Conservative.”On the week-end preceding the Conservative Conference at Birmingham, the Truss Ministry intimated it would reverse the cut in the top rate of tax to 40 percent from 45 percent. The dreaded “u-turn.”When the prime minister addressed delegates mid-week, she acknowledged that it was wrong to spring the unanticipated cut unannounced. Ms. Truss then talked up the other Tory tax cuts, to widespread applause from the assembled audience.I can only charitably describe this as cognitive dissonance. If tax cuts are conducive to economic initiative, why keep the 45 percent rate on wealth creators? Let alone the conservative clichés — no less true for being so — about private property and people knowing better than bureaucrats how to spend their own money.It was, though, all for nought. The damage was done. Word is now that a rise in the corporate tax rate will occur in the spring, though not at the previously contemplated rate of 25 percent. Perhaps the one upside is that it seems certain that welfare benefits will rise in accordance with inflation (9.9 percent) and not with average earnings (5.5 percent), apparently the prime minister’s preferred option.For the past fortnight the talk has all been about Conservatives conspiring with the Labor opposition to thwart Ms. Truss’s tax-cutting agenda. Calls for an early election are heard from the backbenches. Letters of no confidence are rumored to be flooding into Tory party management, the 1922 Committee. The top-of-mind question is, “Can Liz Truss stay on until December?” Opinion is split. Conventional wisdom already consigns the chancellor to removal from his post at the Treasury.Who will benefit from this turmoil? Possibly Ms. Truss’s opponent for the leadership, Rishi Sunak. Possibly even Mr. Johnson, as fanciful as that sounds. The Labor leader, Sir Keir Starmer, definitely.Amid all this flux, it is bittersweet to reflect on one Conservative who had the strength of her convictions in troubled times. “I prefer to believe that certain lessons have been learnt from experience,” Thatcher told the Tory Conference in October 1980, “that we are coming, slowly, painfully to an autumn of understanding, and I hope it will be followed by a winter of common sense.“If it isn’t, we shall not be diverted from our course.” And in a stirring moment that puts this Conservative government and its leader to shame, Thatcher thrust herself into history. “To those waiting with bated breath for that favorite media catchphrase, the ‘U’ turn, I have only one thing to say. ‘You turn if you want to. The lady’s not for turning.’”BrexitDiarist@gmail.com

Is Truss for Turning?

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