Britain has elected the wrong Prime Minister, or rather, the Tories have not chosen their leader wisely. Clearly, the Tories need to change their rules so that the best man or woman wins. This could have been done by giving a certain weightage to the preferences of their MPs, but that was not the case ahead of the Liz Truss-Rishi Sunak leadership contest. When she was sworn in as PM, two-thirds of Britons did not know who Liz Truss was. That’s not a healthy statistic.
Rishi Sunak was right and Liz Truss woefully wrong. Of the two, he is unquestionably superior in intellect, experience and understanding of economics, finance and public policy. He won the hearts and minds of his MPs with verve and perspicacity but failed to swing rich, self-serving Tory party members who allowed themselves to be swayed by Boris Johnson’s histrionics.
Truss, on the other hand, came out as a personality lacking in conviction, not quite in control of her language, and audiences were frequently exposed to her flip-flops on a wide range of issues. Her undiplomatic response to the pointed question whether France was an enemy or a friend was in poor taste, in sharp contrast to the studied rejoinder from President Macron. The former Foreign Secretary of the UK did not know which country Vostok is in. The list is long. She claims that she stands for conservative values but got involved in an affair with a fellow MP whose marriage broke up but hers survived. She praised Boris Johnson by referring to him as “my friend” when most Britons despise his compulsive lying and his breaking the rules his own government had set during the Covid pandemic with relentless partying, and his refusal to make colleagues with dubious reputations accountable.
She also praised Johnson for his policy on Ukraine, and few of those who were present when she did so were impressed. The time is not far when the entire populations of the United Kingdom and Europe will compel their clueless leaders to address their problems first before supporting a war that is not theirs to fight in the first place.
Instead of helping Russia and Ukraine reach a settlement, what Europe, UK and NATO did was to fund a proxy war to destroy the Russian economy by initiating wide-ranging sanctions against Russia that are, in fact, beginning to hurt them more than they are hurting Russia. They have also brought the entire globe on the verge of a food and fertiliser crises, coupled with supply chain disruptions, that have hit the developing world hard.
The latter will take years to recover from the effects of these crises. Britain is in deep crisis, and it is going to be in that state for some time to come. It has to cope with a cost-of-living crisis, an energy crisis, and widespread social unrest fuelled by a weakening Pound and soaring inflation. The UK’s public debt stands in excess of 90% of its GDP.
The ‘mini-budget’ presented by Liz Truss’s Chancellor Kwasi Kwarteng giving a massive tax cut to the rich has invited a sharp retort from the IMF, which warned the UK government that it could fuel unrest and that the policy needed to be reversed immediately. Truss and her government are in serious trouble.
Kwarteng refuses to answer any questions. His ‘mini-budget’ has caused havoc in the market. Unfunded tax cuts worth 45 billion Pounds spooked the markets with the Pound plunging to a historic low against the US Dollar. The Bank of England had to intervene with 65 billion Pounds to arrest the decline. Mortgage rates have risen, gilt yields have gone up, house prices have fallen; shelving plans to increase corporation tax and lifting restraints on bankers’ bonuses have together resulted in fear, confusion and loss of public confidence.
The unions have threatened to go on strike, and it is no idle threat. Stocks have plummeted. Public confidence is at its lowest. The government has all but lost control of the economy, while Truss and her team continue, astonishingly, to defend their policies. Self-criticism, introspection and a willingness to learn from mistakes are in low supply.
Times have dramatically changed. The Conservative Party was once regarded as the bastion of British values (fiscal prudence being at its core), respect for the monarchy, preservation of the British landscape, family values, and celebrating the British way of life). Not anymore. Those values have been replaced by a touching faith in unrestrained free markets whose virtues are being espoused independent of context.
Today, there is a rush toward the free market to sprint towards fast economic growth, irrespective of the widening income disparities. In today’s Britain, it is hard to justify abolishing taxes for high-net-worth individuals earning above 150,000 Pounds a year and refusing to impose a windfall tax on energy companies raking in billions of Pounds in profit, thanks to high energy prices, on the plea that this would somehow magically spur growth, while funding the cap on energy bills through public borrowing and refusing to protect the living standards of the more vulnerable sections of society.
The British economy is on the verge of collapse, and unless these policies are urgently reversed, the consequences will be disastrous.
There are reports that Tory MPs are livid. A recent poll suggests that if an election were to be held today, Labour would prevail and the Tories would lose. The fact that nobody in the government appears to have a clue about what needs to be done compounds the difficulty.
They say leadership is about doing the right thing at the right time in the right place. Or doing things right. It is about creatively responding to a set of contradictory constraints.
Leaders are not judged by pious intentions but by success in delivery. Liz Truss has got almost everything wrong. Fuzzy logic surrounds both the ends and the means she seeks. And there is no sign of a rethink. Britain is staring at recession, inflation and widespread unrest.
(The writer is Distinguished Professor, Flame University, Pune)