Take on the dragons. Make the difficult policy choices. Be damned with the immediate term popularity contests. Those are for next year, as policy begins to pay off.
Whats difficult about borrowing money off Joe Public and giving it directly to your rich backers? Unpopular, naturally, but not difficult.
Take on the dragons. Make the difficult policy choices. Be damned with the immediate term popularity contests. Those are for next year, as policy begins to pay off.
Tories have lost the next GE. They need to focus now on damage limitation and doing what's best for the country in the short term. Happily, both of those objectives align by getting rid of Truss.
By what mechanism?
Under 1922 rules she cannot face a VOC for twelve months.
So either the 1922 change the rules or she resigns.
Johnson resigned when he couldn't form a cabinet - Truss has a cabinet full of her supporters.
Take on the dragons. Make the difficult policy choices. Be damned with the immediate term popularity contests. Those are for next year, as policy begins to pay off.
I guess that's exactly what her spads and chief of staff are whispering in her ear.
Latest opinion polls are devastating for PM Truss. Devastating. I doubt there’s any coming back from this. Especially since the mortgage misery hasn’t even begun. https://twitter.com/afneil/status/1575535640078389268
Latest opinion polls are devastating for PM Truss. Devastating. I doubt there’s any coming back from this. Especially since the mortgage misery hasn’t even begun.
Once mortgage deals were being pulled and mortgage interest rates soared it was all over
So can we never increase interest rates again? The government is supposed to fix your mortgage as well as your heating bill as well as any occasion you can’t get to work?
It’s just delusional. Truss deserves no sympathy but does anyone believe it will be better for SKS ? This country is becoming ungovernable. We all seem to think the world owes us a living.
Truss has directly increased everyone's mortgage rate by 1.5% through her bullshit so, yeah, she deserves opprobrium.
Setting up a flow chart. I think if Ukraine really kicks off soon, we'll get a COVID like situation where Starmer supports Truss as the Royal Navy blockade the GIUK gap etc etc. If a bit later, Wallace in unopposed as PM?
But if Ukraine simmers down, an emergency meeting of '22 and a rule change unless Truss fires Kwarteng tomorrow/next week.
Of course it's an outlier, but outliers only ever stray so far from the underlying levels of public support. The largest outlier in Jeremy Corbyn's favour was either the one that gave Labour a 10% poll lead, or the one that put Labour on 46%. Starmer is some way ahead of either of those, so fair to conclude that the underlying level of public support is consequently more in his favour.
Dominic Cummings @Dominic2306 · 1h before you all die laughing remember this no10 clownshow will tomorrow be sitting in no10 figuring out what to say about *Putin/nuclear weapons* in between devising shit media gimmicks to save their asses
IMO this country desperately needs a dose of libertarianism, whether people like it or not.
And this is likely to discredit it for a long time.
You want to change politics? You've got to put in the hard nine yards and win the argument in public by debate.
Like Thatcher spent years doing.
Ironically the long leadership election was counterproductive because it gave Liz Truss the illusion that she had already communicated her vision and got people on side, but she was just preaching to a captive audience.
Having skipped the Andrew Neil interview during the contest, she should have done it immediately afterwards to set out her view of the state of the nation and what she was planning to do.
Tories have lost the next GE. They need to focus now on damage limitation and doing what's best for the country in the short term. Happily, both of those objectives align by getting rid of Truss.
By what mechanism?
Under 1922 rules she cannot face a VOC for twelve months.
So either the 1922 change the rules or she resigns.
Johnson resigned when he couldn't form a cabinet - Truss has a cabinet full of her supporters.
How?
Vote down the financial statement. She'll probably try and call an election but the 1922 will change the rules and force her out before she can do it.
One reassuring thing about these polls is they show the British electorate is not yet as divided on partisan lines as America. That kind of polling would be impossible there. Only really Scotland (and NI obvs) where the divide is more sticky.
In N Ireland, no one can vote for Liz Truss or her party. The same is true of SKS and the LDs. You can only vote by proxy and a few of those proxies are near certifiable loons of the worst biblical kind.
Which is why very few recent PMs give a d*mn about N Ireland
They get very few votes, but the Tories generally stand in NI these days.
Yes - they get about 0.5% of the votes. So a box ticking exercise if ever there was one...
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
So, if Truss goes, will King-over-the-water Boris return? Are the Tories mad enough to try?
Tactically, it might be their best move. For some inexplicable reason Boris is popular in the country, is a known face to the public and has the advantage of being shoved out of the way for LizT
Boris is not popular in the country. He might be less unpopular than Liz Truss, but that's not saying much.
The most effective means of showing contrition would be for Tory MPs to go crawling in penitence to Rishi, and see if he can at least rescue half of them from the wrath of the electorate.
Downside with Rishi is it looks like they’re saying to the members “yeah, we know you preferred this batshit loon to Rishi, but screw you we need Rishi anyway LOL.”
I appreciate what the members want is not necessarily at the forefront of the Tory Party’s needs right now. But at the same time it’s a delicate balancing act so that they don’t piss even more people off (inc the people who canvass and leaflet etc).
Bluntly put, the members and their canvassing are worth jack shit if your party is going to be wiped out regardless of how many leaflets it puts through doors.
Putting a tiny clique of the nation's most extreme voters in charge of determining the direction of a political party, which needs to appeal to the great mass of the people in order to get anywhere, has been demonstrated to be a somewhat sub-optimal strategy.
Dominic Cummings @Dominic2306 · 1h before you all die laughing remember this no10 clownshow will tomorrow be sitting in no10 figuring out what to say about *Putin/nuclear weapons* in between devising shit media gimmicks to save their asses
And yet it could have been worse.
It could have been him...
And funnier than that, he still thinks it will be him again.
It really does look as though Liz Truss will probably become the shortest PM by in tenure in British political history.
George Canning's 119 day record has stood since 1827!
The Earl of Bath did less than 48 hours.
And the Marquess of Rockingham's second tenure was just 96 days.
However, unless Truss suffers an unfortunate event, the target to beat is 144 days. That's the tenure of Lord Goderich, who was the shortest serving PM who appointed a cabinet and didn't die in office.
Tories have lost the next GE. They need to focus now on damage limitation and doing what's best for the country in the short term. Happily, both of those objectives align by getting rid of Truss.
By what mechanism?
Under 1922 rules she cannot face a VOC for twelve months.
So either the 1922 change the rules or she resigns.
Johnson resigned when he couldn't form a cabinet - Truss has a cabinet full of her supporters.
Dominic Cummings @Dominic2306 · 1h before you all die laughing remember this no10 clownshow will tomorrow be sitting in no10 figuring out what to say about *Putin/nuclear weapons* in between devising shit media gimmicks to save their asses
And yet it could have been worse.
It could have been him...
And funnier than that, he still thinks it will be him again.
He could do with another trip to Barnard Castle if he can't see he's absolutely totalled his career!
Tories have lost the next GE. They need to focus now on damage limitation and doing what's best for the country in the short term. Happily, both of those objectives align by getting rid of Truss.
By what mechanism?
Under 1922 rules she cannot face a VOC for twelve months.
So either the 1922 change the rules or she resigns.
Johnson resigned when he couldn't form a cabinet - Truss has a cabinet full of her supporters.
In an odd coincidence, I've been reading Kwasi Kwarteng's "Ghosts of Empire" (which is really good, highly recommended). One of the repeated themes is the dangers of handing massive discretionary power to inexperienced, out of touch graduates of grand public schools
"individualism, the reliance on individuals to conceive and execute policy, with very little strategic direction...often led to contradictory and self-defeating policies, which in turn brought disaster to millions".
The best thing politically for Truss/Kwarteng might be to adopt the plan a few people on here have suggested of keeping the 45% abolition but raising the higher rate to 43% and increasing the threshold while getting rid of the allowance distortions. That way she could show she was listening without it being a complete humiliation.
That will piss off everyone earning over £50k and would overall be a large increase in taxation. No way they are going to do that.
They should abandon the 45% abolition and say that it is an aspiration.
⚡️At an emergency meeting of the National Security Council tomorrow, fundamental decisions for Ukraine will be made, - Oleksiy Danilov, Secretary of the National Security Council.
It really does look as though Liz Truss will probably become the shortest PM by in tenure in British political history.
George Canning's 119 day record has stood since 1827!
The Earl of Bath did less than 48 hours.
And the Marquess of Rockingham's second tenure was just 96 days.
However, unless Truss suffers an unfortunate event, the target to beat is 144 days. That's the tenure of Lord Goderich, who was the shortest serving PM who appointed a cabinet and didn't die in office.
Funny old world innit. When the Tories had a poll on 50pc. Noone believed it, now Labour is on 54 pc everyone bar me believes this Just saying...
When the Tories had a poll on 50pc - when was that?
The thing is an unexplained outlier is probably an outlier. This poll is entirely explicable in terms of Keir at the funeral, Keir at the conference, Kwasi at the funeral, and Lizzie being Lizzie.
Look up the poll history it was there I think.it was YouGov for the Sun
The best thing politically for Truss/Kwarteng might be to adopt the plan a few people on here have suggested of keeping the 45% abolition but raising the higher rate to 43% and increasing the threshold while getting rid of the allowance distortions. That way she could show she was listening without it being a complete humiliation.
That will piss off everyone earning over £50k and would overall be a large increase in taxation. No way they are going to do that.
They should abandon the 45% abolition and say that it is an aspiration.
They could raise the threshold to the level that would make it revenue neutral.
The best thing politically for Truss/Kwarteng might be to adopt the plan a few people on here have suggested of keeping the 45% abolition but raising the higher rate to 43% and increasing the threshold while getting rid of the allowance distortions. That way she could show she was listening without it being a complete humiliation.
That will piss off everyone earning over £50k and would overall be a large increase in taxation. No way they are going to do that.
They should abandon the 45% abolition and say that it is an aspiration.
I think it’s a typo - the PB plan is 43% from £100,000+ but removing the removal of allowances
Tories have lost the next GE. They need to focus now on damage limitation and doing what's best for the country in the short term. Happily, both of those objectives align by getting rid of Truss.
By what mechanism?
Under 1922 rules she cannot face a VOC for twelve months.
So either the 1922 change the rules or she resigns.
Johnson resigned when he couldn't form a cabinet - Truss has a cabinet full of her supporters.
How?
The cabinet stop being her supporters.
Ok. Possible. Within the short term I'd say that's less that 10% probability. 1922 changing the rules - similar probability. Best hope is she voluntarily jacks it in - before that she'd sack her Chancellor I would have thought.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
Yep, it’s 45p and bankers that has done for her. If she was facing these headwinds because she’d reversed NI and cut the basic rate she’d be getting some flak but she could say she wanted to make things easier for everyday families/workers etc (appreciate that the economics wouldn’t necessarily of borne that out but the man on the street probably wouldn’t have gone into the intricacies of that: they’d just have thought “oh good on her lowering my taxes.”)
As it is it’s just “you’re helping the very rich not me” and she has NO way of countering that.
The best thing politically for Truss/Kwarteng might be to adopt the plan a few people on here have suggested of keeping the 45% abolition but raising the higher rate to 43% and increasing the threshold while getting rid of the allowance distortions. That way she could show she was listening without it being a complete humiliation.
That will piss off everyone earning over £50k and would overall be a large increase in taxation. No way they are going to do that.
They should abandon the 45% abolition and say that it is an aspiration.
I think it’s a typo - the PB plan is 43% from £100,000+ but removing the removal of allowances
Tories have lost the next GE. They need to focus now on damage limitation and doing what's best for the country in the short term. Happily, both of those objectives align by getting rid of Truss.
By what mechanism?
Under 1922 rules she cannot face a VOC for twelve months.
So either the 1922 change the rules or she resigns.
Johnson resigned when he couldn't form a cabinet - Truss has a cabinet full of her supporters.
How?
Vote down the financial statement. She'll probably try and call an election but the 1922 will change the rules and force her out before she can do it.
Any chance we can do away with overuse of 'down'. It's crept into politics speak. We used to 'vote against' things. Just as we used to (or not) 'pay off' not 'pay down' the national debt.
Dan Snow @thehistoryguy · 9h That was the worst provincial campaign of any of our leaders since autumn 1216 when King John, marching about dealing with a rebellion & two invasions, caught dysentery in Norfolk, lost the Crown Jewels in The Wash and died in Nottinghamshire
Tories have lost the next GE. They need to focus now on damage limitation and doing what's best for the country in the short term. Happily, both of those objectives align by getting rid of Truss.
By what mechanism?
Under 1922 rules she cannot face a VOC for twelve months.
So either the 1922 change the rules or she resigns.
Johnson resigned when he couldn't form a cabinet - Truss has a cabinet full of her supporters.
How?
The cabinet stop being her supporters.
Exactly this
Only 50 (out of 358) MPs voted for Trussticles as their first choice
@HankeVela SCOOP: In an unexpected turn of events, the UK today told its EU partners that PM Liz Truss is not only willing to attend the first meeting of the European Political Community in Prague next week, but that she is also offering to host the next summit in London.
According to the two officials, the U.K.’s sherpa also asked to change the name of the club to ‘European Political Forum.’
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
I think you've got this wrong.
@MaxPB had it right when he said there'd been a market reaction to the UK government making £45bn in unfunded tax cuts and bringing into question the state's ability to pay its way.
Truss has almost certainly directly contributed to the pound sinking further and inflation climbing higher than it otherwise would have done, which will cost a lot of people a lot of money.
It really does look as though Liz Truss will probably become the shortest PM by in tenure in British political history.
George Canning's 119 day record has stood since 1827!
The Earl of Bath did less than 48 hours.
And the Marquess of Rockingham's second tenure was just 96 days.
However, unless Truss suffers an unfortunate event, the target to beat is 144 days. That's the tenure of Lord Goderich, who was the shortest serving PM who appointed a cabinet and didn't die in office.
Technically, the Sovereign commissions somebody to form a government. Are they PM from that moment, or from the moment they actually form a government by filling the key ministries - of which you must have at least a Chancellor of the Exchequer, Lord Chancellor, Lord Privy Seal and Lord President of the Council, although these can (and have) been held by the same person all at once?
If the latter, you can't count Bath. If the former, you can.
Equally, in that case you have to include Peel in 1839, Wellington in 1832 and 1835, and Bonar Law in 1916 as short serving PMs. That's without even thinking about it.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
major differences im afraid levels of govt and personal debt were very low at the start of the 1980s..now extremely high asset prices both shares and property were rock bottom at the start of the 1980s...now extremely high social cohesion is now much lower after 4 decades of me me me....we are also a much more diverse society which may cause problems in tough economic times prior bailouts of bankrupt banks has left a loft of residual ill feeling
yes things may eventually improve but even now the country shows no appetite at all for tough decisions if you are looking at a boom like the 80 and 90s im afraid we may all be old and dead before that occurs again...that was a one off debt bubble
@HankeVela SCOOP: In an unexpected turn of events, the UK today told its EU partners that PM Liz Truss is not only willing to attend the first meeting of the European Political Community in Prague next week, but that she is also offering to host the next summit in London.
According to the two officials, the U.K.’s sherpa also asked to change the name of the club to ‘European Political Forum.’
This is going to be the most excruciating Conference in British political history
Yep, and almost bound to make things worse for the party.
Well, I did warn 'em.
It's going to be like a wedding where everyone has discovered the bride has been exuberantly shagging the best man for several months, and only the groom is unaware
I can beat that. A wedding reception was held in a marquee at a local pub by me where the bride got so drunk she hooked up and went home with ... the groom's son. Yes, not a joke or porn story, quite literally her own stepson, on her wedding night.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
Yep, it’s 45p and bankers that has done for her. If she was facing these headwinds because she’d reversed NI and cut the basic rate she’d be getting some flak but she could say she wanted to make things easier for everyday families/workers etc (appreciate that the economics wouldn’t necessarily of borne that out but the man on the street probably wouldn’t have gone into the intricacies of that: they’d just have thought “oh good on her lowering my taxes.”)
As it is it’s just “you’re helping the very rich not me” and she has NO way of countering that.
Back in 1992, I was paying 15% on a flat, whose market value had declined from £80,000 to £42,000. I'd have thought that a 4% mortgage rate was something out of the Arabian Nights.
The best thing politically for Truss/Kwarteng might be to adopt the plan a few people on here have suggested of keeping the 45% abolition but raising the higher rate to 43% and increasing the threshold while getting rid of the allowance distortions. That way she could show she was listening without it being a complete humiliation.
That will piss off everyone earning over £50k and would overall be a large increase in taxation. No way they are going to do that.
They should abandon the 45% abolition and say that it is an aspiration.
They could raise the threshold to the level that would make it revenue neutral.
The real tragedy about this for me, as a Tory, is that she's discredited tax cuts for a long time.
It's not just the policy; it's the mood music.
Kwasi and Truss made it perfectly clear they didn't really care about the deficit and didn't give a shit who knew it.
All very apocalyptic on here this evening. Governments and parties come and go - I'm forever hopeless at backing racehorses. Remember that as a universal constant.
Sterling seems more buoyant against the greenback tonight - I presume there has been some intervention across the Pond as the dollar is down against all currencies. That may mitigate slightly against the rout on the stock markets but again I'd expect a decent bounce either tomorrow or Monday.
"World hasn't ended yet" is all some need to start speculating once again.
It seems for now Truss and Kwarteng are determined to ride out the storm (poor choice of words given events in Florida but apposite) with Kwarteng reminding Conservative MPs of the adage "if we don't hang together we'll all hang separately".
Of course, if the YouGov poll is right, there'll be plenty of room on the Opposition benches for the two Tories to sit next to the five LDs behind Opposition leader Blackford.
Next week will be crucial - doubtless the Conference faithful would applaud even if Truss read extracts from the Manchester phonebook and North Korean-style ovations didn't go well for IDS as I recall. A quieter and more positive week on the markets will calm some nerves in Conservative circles but there's no doubt the new Thatcherites have badly misread the public mood. It isn't 1980 any more.
BREAKING: The Charity Commission has just confirmed it will be investigating the controversial charity, Mermaids, over its “approach to safeguarding young people.”
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
Yep, it’s 45p and bankers that has done for her. If she was facing these headwinds because she’d reversed NI and cut the basic rate she’d be getting some flak but she could say she wanted to make things easier for everyday families/workers etc (appreciate that the economics wouldn’t necessarily of borne that out but the man on the street probably wouldn’t have gone into the intricacies of that: they’d just have thought “oh good on her lowering my taxes.”)
As it is it’s just “you’re helping the very rich not me” and she has NO way of countering that.
Back in 1992, I was paying 15% on a flat, whose market value had declined from £80,000 to £42,000. I'd have thought that a 4% mortgage rate was something out of the Arabian Nights.
Flat? Luxury! I were paying 25% on a shoebox I paid £96,000 for but were only worth tuppence a'penny.
@HankeVela SCOOP: In an unexpected turn of events, the UK today told its EU partners that PM Liz Truss is not only willing to attend the first meeting of the European Political Community in Prague next week, but that she is also offering to host the next summit in London.
According to the two officials, the U.K.’s sherpa also asked to change the name of the club to ‘European Political Forum.’
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
I think you've got this wrong.
@MaxPB had it right when he said there'd been a market reaction to the UK government making £45bn in unfunded tax cuts and bringing into question the state's ability to pay its way.
Truss has almost certainly directly contributed to the pound sinking further and inflation climbing higher than it otherwise would have done, which will cost a lot of people a lot of money.
There was a cost to doing nothing, as well. Had NI rises gone through, along with other tax rises, that would have hurt, too.
The best thing politically for Truss/Kwarteng might be to adopt the plan a few people on here have suggested of keeping the 45% abolition but raising the higher rate to 43% and increasing the threshold while getting rid of the allowance distortions. That way she could show she was listening without it being a complete humiliation.
That will piss off everyone earning over £50k and would overall be a large increase in taxation. No way they are going to do that.
They should abandon the 45% abolition and say that it is an aspiration.
They could raise the threshold to the level that would make it revenue neutral.
The real tragedy about this for me, as a Tory, is that she's discredited tax cuts for a long time.
It's not just the policy; it's the mood music.
Kwasi and Truss made it perfectly clear they didn't really care about the deficit and didn't give a shit who knew it.
Yes, it's also ironic that bypassing the OBR, which Osborne created partly as a trap for Labour, ended up being the thing that discredited a Conservative government.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
I think you've got this wrong.
@MaxPB had it right when he said there'd been a market reaction to the UK government making £45bn in unfunded tax cuts and bringing into question the state's ability to pay its way.
Truss has almost certainly directly contributed to the pound sinking further and inflation climbing higher than it otherwise would have done, which will cost a lot of people a lot of money.
Sorry, but I think you've both got this wrong. There's a hundred and fifty billion potentially in gas/electricity payments going out, and any government would have to do something similar. The notion that 2 billion in additional rate tax or similar is what means the state can't pay its way is just absurd, as is the notion we'd be better off if NI went up on working people while non-working people get a 4% tax cut as Sunak proposed.
The markets are belatedly facing up to reality of just how much spending is going on, and has been going on for years, all around the world. That was inevitably going to happen either way. Truss and Kwasi have shot themselves in the foot politically by allowing this to be phrased as all about tax cuts for the rich, but that's a total sideshow.
Tories have lost the next GE. They need to focus now on damage limitation and doing what's best for the country in the short term. Happily, both of those objectives align by getting rid of Truss.
By what mechanism?
Under 1922 rules she cannot face a VOC for twelve months.
So either the 1922 change the rules or she resigns.
Johnson resigned when he couldn't form a cabinet - Truss has a cabinet full of her supporters.
How?
The cabinet stop being her supporters.
There is no certain way of getting rid of Truss without risking an election, as a VONC is the only constitutionally sound mechanism.
For everyone to start resigning would make the public and world laugh at Westminster - we have only just been through that, and she could just hang on with a skeleton government of Bridgens, Bones and JRMs.
Not fully tested is this: this government loses a VONC and the crown declines an election while it is seen whether a new government (same party new leader) can command the confidence of the house.
Doubtful but not impossible. Not much is impossible when your constitution is vague. As an outcome it feels unfair to Labour but you never know.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
Are you being serious? Government borrowing is high, they have committed to spending additional billions this year due to the energy position and have now a major giveaway without any projections. It's unbelievably reckless and unsurprising that the markets took fright. It's quite possible to raise interest which I agree with in an orderly way that doesn't permanently scar the economy
Funnily enough I think the scrapping of bankers bonuses and the 45p rate were the most defensible things they did. The 45p rate doesn't raise much money and there are others way to regulate banking.
Dan Snow @thehistoryguy · 9h That was the worst provincial campaign of any of our leaders since autumn 1216 when King John, marching about dealing with a rebellion & two invasions, caught dysentery in Norfolk, lost the Crown Jewels in The Wash and died in Nottinghamshire
To be honest BJO the pre-scripted narrative was the same everywhere. She fell over in Lancashire over fracking.
Utterly insane to cram that mini budget in. Could have spent conference talking up a growth strategy, got an OBR forecast and done it next week. Kantar shows where they could have been fighting from. All gone. Its over for them. Idiots. Clueless.
Totally agree. I genuinely still can't quite believe it, it seemed so obviously a bad idea that even now a tiny bit of me thinks "maybe we are all wrong about this." I think when Labour gets its first 40% lead I will start to believe it, my gut instinct was right, and Truss and Kwarteng have made the political blunder of a generation.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
Yep, it’s 45p and bankers that has done for her. If she was facing these headwinds because she’d reversed NI and cut the basic rate she’d be getting some flak but she could say she wanted to make things easier for everyday families/workers etc (appreciate that the economics wouldn’t necessarily of borne that out but the man on the street probably wouldn’t have gone into the intricacies of that: they’d just have thought “oh good on her lowering my taxes.”)
As it is it’s just “you’re helping the very rich not me” and she has NO way of countering that.
Back in 1992, I was paying 15% on a flat, whose market value had declined from £80,000 to £42,000. I'd have thought that a 4% mortgage rate was something out of the Arabian Nights.
And, your view is representative of a lot of Daily Mail readers today.
My mortgage is almost £380k - you'll the principal is 8-10 times than then. For many homes in London and the South-East this will be similar. The alternative I had on the table was not buying a home for my family. No-one is going to do that.
I will thank no-one for any ideological dogma that leads my payments to balloon by over £1,000 pcm and leads me to be forced to sell at a loss and lose my home.
Tories have lost the next GE. They need to focus now on damage limitation and doing what's best for the country in the short term. Happily, both of those objectives align by getting rid of Truss.
By what mechanism?
Under 1922 rules she cannot face a VOC for twelve months.
So either the 1922 change the rules or she resigns.
Johnson resigned when he couldn't form a cabinet - Truss has a cabinet full of her supporters.
How?
Vote down the financial statement. She'll probably try and call an election but the 1922 will change the rules and force her out before she can do it.
Even Thickie Truss isn't stupid enough to try and call an election
All very apocalyptic on here this evening. Governments and parties come and go - I'm forever hopeless at backing racehorses. Remember that as a universal constant.
Sterling seems more buoyant against the greenback tonight - I presume there has been some intervention across the Pond as the dollar is down against all currencies. That may mitigate slightly against the rout on the stock markets but again I'd expect a decent bounce either tomorrow or Monday.
"World hasn't ended yet" is all some need to start speculating once again.
It seems for now Truss and Kwarteng are determined to ride out the storm (poor choice of words given events in Florida but apposite) with Kwarteng reminding Conservative MPs of the adage "if we don't hang together we'll all hang separately".
Of course, if the YouGov poll is right, there'll be plenty of room on the Opposition benches for the two Tories to sit next to the five LDs behind Opposition leader Blackford.
Next week will be crucial - doubtless the Conference faithful would applaud even if Truss read extracts from the Manchester phonebook and North Korean-style ovations didn't go well for IDS as I recall. A quieter and more positive week on the markets will calm some nerves in Conservative circles but there's no doubt the new Thatcherites have badly misread the public mood. It isn't 1980 any more.
Wise words my old china, but I must advise our newer followers that far from being hopeless at backing racehorses, or indeed other creatures, you are one of the Site's more dependable shrewdies.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
I think you've got this wrong.
@MaxPB had it right when he said there'd been a market reaction to the UK government making £45bn in unfunded tax cuts and bringing into question the state's ability to pay its way.
Truss has almost certainly directly contributed to the pound sinking further and inflation climbing higher than it otherwise would have done, which will cost a lot of people a lot of money.
There was a cost to doing nothing, as well. Had NI rises gone through, along with other tax rises, that would have hurt, too.
Investors would know what the plan was. As it stands, they are gambling that their investments won't be subject to random taxes and/or GBP devaluations to pay for the deficit.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
Yep, it’s 45p and bankers that has done for her. If she was facing these headwinds because she’d reversed NI and cut the basic rate she’d be getting some flak but she could say she wanted to make things easier for everyday families/workers etc (appreciate that the economics wouldn’t necessarily of borne that out but the man on the street probably wouldn’t have gone into the intricacies of that: they’d just have thought “oh good on her lowering my taxes.”)
As it is it’s just “you’re helping the very rich not me” and she has NO way of countering that.
Back in 1992, I was paying 15% on a flat, whose market value had declined from £80,000 to £42,000. I'd have thought that a 4% mortgage rate was something out of the Arabian Nights.
Flat? Luxury! I were paying 25% on a shoebox I paid £96,000 for but were only worth tuppence a'penny.
It was really a quite alarming time. A lot of people were just handing back properties to building societies, but I'd no desire to saddle myself with a big unsecured debt. I eventually (2001) came away with a tiny profit.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
Are you being serious? Government borrowing is high, they have committed to spending additional billions this year due to the energy position and have now a major giveaway without any projections. It's unbelievably reckless and unsurprising that the markets took fright. It's quite possible to raise interest which I agree with in an orderly way that doesn't permanently scar the economy
Funnily enough I think the scrapping of bankers bonuses and the 45p rate were the most defensible things they did. The 45p rate doesn't raise much money and there are others way to regulate banking.
If so, that means scrapping bankers bonuses and the 45p tax rate weren't significant enough to do?
You can't have it both ways - say that they didn't raise much money, but HAD to be done
If it's largely immaterial, leave them as they are then
British Intelligence says Russia has massed a large force on the border with Ukraine and about to escalate following tomorrow's speech about annexing 4 regions.
Any chance we can do away with overuse of 'down'. It's crept into politics speak. We used to 'vote against' things. Just as we used to (or not) 'pay off' not 'pay down' the national debt.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
Yep, it’s 45p and bankers that has done for her. If she was facing these headwinds because she’d reversed NI and cut the basic rate she’d be getting some flak but she could say she wanted to make things easier for everyday families/workers etc (appreciate that the economics wouldn’t necessarily of borne that out but the man on the street probably wouldn’t have gone into the intricacies of that: they’d just have thought “oh good on her lowering my taxes.”)
As it is it’s just “you’re helping the very rich not me” and she has NO way of countering that.
Back in 1992, I was paying 15% on a flat, whose market value had declined from £80,000 to £42,000. I'd have thought that a 4% mortgage rate was something out of the Arabian Nights.
And, your view is representative of a lot of Daily Mail readers today.
My mortgage is almost £380k - you'll the principal is 8-10 times than then. For many homes in London and the South-East this will be similar. The alternative I had on the table was not buying a home for my family. No-one is going to do that.
I will thank no-one for any ideological dogma that leads my payments to balloon by over £1,000 pcm and leads me to be forced to sell at a loss and lose my home.
This dilemma is why the previous low interest rate policies were so pernicious. They effectively coerced people into buying into a bubble and loading up on debt.
These polls are funny. But they are also a little scary
This is not a mood shift, it feels more like voter panic. Like the British electorate can sense deep deep trouble ahead. Existential trouble
This is Ask The Audience and the reply is OMFG AAAAAAAGH
The British public are sensing that truss is shit. We all knew it apart from the usual loons on here. Even HFUYD didn’t support her - that should have been a massive red flag
He deserves some credit there, I thought he was being pigheaded, but really he was perceptive, that there were worse options than sticking with Boris.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
I think you've got this wrong.
@MaxPB had it right when he said there'd been a market reaction to the UK government making £45bn in unfunded tax cuts and bringing into question the state's ability to pay its way.
Truss has almost certainly directly contributed to the pound sinking further and inflation climbing higher than it otherwise would have done, which will cost a lot of people a lot of money.
Sorry, but I think you've both got this wrong. There's a hundred and fifty billion potentially in gas/electricity payments going out, and any government would have to do something similar. The notion that 2 billion in additional rate tax or similar is what means the state can't pay its way is just absurd, as is the notion we'd be better off if NI went up on working people while non-working people get a 4% tax cut as Sunak proposed.
The markets are belatedly facing up to reality of just how much spending is going on, and has been going on for years, all around the world. That was inevitably going to happen either way. Truss and Kwasi have shot themselves in the foot politically by allowing this to be phrased as all about tax cuts for the rich, but that's a total sideshow.
I think there may be a misspelling of 'shitshow' in your last line?
OMG I thought he was one of the more sensible Tories?
As I pointed out at the time, he made a big error turning on Boris. Hopefully, after the election he’ll be back on PB and can post freely. I wonder if he regrets it?
Because, you said, Boris was going to stay in power and would punish AB by not sending his constituency any goodies. Which, leaving aside the moral implications of seeing politics as a pork barreling sycophancy game, was not a sensational bit of forecasting.
That’s exactly the game the Tory MPs in the red wall were playing. Pure pork barrel politics. That was surely clear to even the most naive red wall MP.
My moral judgment was that it was bloody reprehensible. But I’m not (wasn’t) a Tory or Boris fan and wouldn’t have voted for @Tissue_Price anyway.
I was simply stating, in his position, his own and his constituents interests were best served by sucking up to Boris. Turning on him would, if Boris stuck it out, put NUL at the back of the queue for pork, or if Boris was forced out, would result in a new PM who was pandering to the interests of the wealthy SE. Levelling up would be dead.
I was right. Everyone else on PB (bar @hyufd) was cheering Aaron on.
Now he’s almost certain to lose his seat. His party is probably out of power for quite some time, its reputation in tatters. Tory libertarian Ideology has been completely trashed in the eyes of the electorate.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
Are you being serious? Government borrowing is high, they have committed to spending additional billions this year due to the energy position and have now a major giveaway without any projections. It's unbelievably reckless and unsurprising that the markets took fright. It's quite possible to raise interest which I agree with in an orderly way that doesn't permanently scar the economy
Funnily enough I think the scrapping of bankers bonuses and the 45p rate were the most defensible things they did. The 45p rate doesn't raise much money and there are others way to regulate banking.
Sure, government borrowing is very high, and is bound to be very high, given the aftermath of Covid, and war in the Ukraine. The tax reductions don't make all that much difference.
Latest opinion polls are devastating for PM Truss. Devastating. I doubt there’s any coming back from this. Especially since the mortgage misery hasn’t even begun. https://twitter.com/afneil/status/1575535640078389268
Latest opinion polls are devastating for PM Truss. Devastating. I doubt there’s any coming back from this. Especially since the mortgage misery hasn’t even begun.
Once mortgage deals were being pulled and mortgage interest rates soared it was all over
So can we never increase interest rates again? The government is supposed to fix your mortgage as well as your heating bill as well as any occasion you can’t get to work?
It’s just delusional. Truss deserves no sympathy but does anyone believe it will be better for SKS ? This country is becoming ungovernable. We all seem to think the world owes us a living.
Rates would have probably crept up to today's levels over the next 12 months. Like boiling a frog. Instead Truss has gone for the full lobster.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
Yep, it’s 45p and bankers that has done for her. If she was facing these headwinds because she’d reversed NI and cut the basic rate she’d be getting some flak but she could say she wanted to make things easier for everyday families/workers etc (appreciate that the economics wouldn’t necessarily of borne that out but the man on the street probably wouldn’t have gone into the intricacies of that: they’d just have thought “oh good on her lowering my taxes.”)
As it is it’s just “you’re helping the very rich not me” and she has NO way of countering that.
Back in 1992, I was paying 15% on a flat, whose market value had declined from £80,000 to £42,000. I'd have thought that a 4% mortgage rate was something out of the Arabian Nights.
And, your view is representative of a lot of Daily Mail readers today.
My mortgage is almost £380k - you'll the principal is 8-10 times than then. For many homes in London and the South-East this will be similar. The alternative I had on the table was not buying a home for my family. No-one is going to do that.
I will thank no-one for any ideological dogma that leads my payments to balloon by over £1,000 pcm and leads me to be forced to sell at a loss and lose my home.
Political differences aside, let's hope it won't come to that my friend.
I am fortunately fully paid up and have been for a while, but at circa 18% back in the early 90s it was a barsteward. Living to work, rather than working to live is not a good place to be.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
Yep, it’s 45p and bankers that has done for her. If she was facing these headwinds because she’d reversed NI and cut the basic rate she’d be getting some flak but she could say she wanted to make things easier for everyday families/workers etc (appreciate that the economics wouldn’t necessarily of borne that out but the man on the street probably wouldn’t have gone into the intricacies of that: they’d just have thought “oh good on her lowering my taxes.”)
As it is it’s just “you’re helping the very rich not me” and she has NO way of countering that.
Back in 1992, I was paying 15% on a flat, whose market value had declined from £80,000 to £42,000. I'd have thought that a 4% mortgage rate was something out of the Arabian Nights.
And, your view is representative of a lot of Daily Mail readers today.
My mortgage is almost £380k - you'll the principal is 8-10 times than then. For many homes in London and the South-East this will be similar. The alternative I had on the table was not buying a home for my family. No-one is going to do that.
I will thank no-one for any ideological dogma that leads my payments to balloon by over £1,000 pcm and leads me to be forced to sell at a loss and lose my home.
This dilemma is why the previous low interest rate policies were so pernicious. They effectively coerced people into buying into a bubble and loading up on debt.
You can certainly make an argument that people are being irresponsible, for example overstretching themselves on a 105-110% mortgage and living beyond their means, but I don't think you can when it applies to virtually anyone who wants to buy and get on who isn't fantastically wealthy.
To course correct from that you can do it but you must do it slowly. Not to quintuple rates inside 18 months because it will blow up the economy.
As a reminder to all, the difficult decisions taken by the incoming Thatcher government in 1979 were:
(a) to immediately raise the rate of VAT to 15%, adding around 5% to prices. (b) to end the double lock on pensions (earnings vs inflation), and move it simply to inflation.
They did these things because they recognised that - while they were unpopular - there were substantial costs associated with allowing the budget deficit to grow ever wider.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
I think you've got this wrong.
@MaxPB had it right when he said there'd been a market reaction to the UK government making £45bn in unfunded tax cuts and bringing into question the state's ability to pay its way.
Truss has almost certainly directly contributed to the pound sinking further and inflation climbing higher than it otherwise would have done, which will cost a lot of people a lot of money.
Max also pointed out that the Dynamic Duo had lost credibilty in the eyes of the financial community. That may not be the be-all and end-all, but it sure doesn't help.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
Yep, it’s 45p and bankers that has done for her. If she was facing these headwinds because she’d reversed NI and cut the basic rate she’d be getting some flak but she could say she wanted to make things easier for everyday families/workers etc (appreciate that the economics wouldn’t necessarily of borne that out but the man on the street probably wouldn’t have gone into the intricacies of that: they’d just have thought “oh good on her lowering my taxes.”)
As it is it’s just “you’re helping the very rich not me” and she has NO way of countering that.
Back in 1992, I was paying 15% on a flat, whose market value had declined from £80,000 to £42,000. I'd have thought that a 4% mortgage rate was something out of the Arabian Nights.
And, your view is representative of a lot of Daily Mail readers today.
My mortgage is almost £380k - you'll the principal is 8-10 times than then. For many homes in London and the South-East this will be similar. The alternative I had on the table was not buying a home for my family. No-one is going to do that.
I will thank no-one for any ideological dogma that leads my payments to balloon by over £1,000 pcm and leads me to be forced to sell at a loss and lose my home.
This dilemma is why the previous low interest rate policies were so pernicious. They effectively coerced people into buying into a bubble and loading up on debt.
You can certainly make an argument that people are being irresponsible, for example overstretching themselves on a 105-110% mortgage and living beyond their means, but I don't think you can when it applies to virtually anyone who wants to buy and get on who isn't fantastically wealthy.
To course correct from that you can do it but you must do it slowly. Not to quintuple rates inside 18 months because it will blow up the economy.
How do you slowly do it though, realistically, given rates were virtually zero even quintupling them is taking them to what should be historically low levels.
Quintupling rates is rather inevitable when rates are virtually nothing since any change from virtually zero is going to be proportionately a high change.
It was unsustainable, and the irresponsibility is the politics of the past that led to this being inevitable which was the irresponsible behaviour, not what is happening now which is just reality catching up.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
Yep, it’s 45p and bankers that has done for her. If she was facing these headwinds because she’d reversed NI and cut the basic rate she’d be getting some flak but she could say she wanted to make things easier for everyday families/workers etc (appreciate that the economics wouldn’t necessarily of borne that out but the man on the street probably wouldn’t have gone into the intricacies of that: they’d just have thought “oh good on her lowering my taxes.”)
As it is it’s just “you’re helping the very rich not me” and she has NO way of countering that.
Back in 1992, I was paying 15% on a flat, whose market value had declined from £80,000 to £42,000. I'd have thought that a 4% mortgage rate was something out of the Arabian Nights.
And, your view is representative of a lot of Daily Mail readers today.
My mortgage is almost £380k - you'll the principal is 8-10 times than then. For many homes in London and the South-East this will be similar. The alternative I had on the table was not buying a home for my family. No-one is going to do that.
I will thank no-one for any ideological dogma that leads my payments to balloon by over £1,000 pcm and leads me to be forced to sell at a loss and lose my home.
This dilemma is why the previous low interest rate policies were so pernicious. They effectively coerced people into buying into a bubble and loading up on debt.
You can certainly make an argument that people are being irresponsible, for example overstretching themselves on a 105-110% mortgage and living beyond their means, but I don't think you can when it applies to virtually anyone who wants to buy and get on who isn't fantastically wealthy.
To course correct from that you can do it but you must do it slowly. Not to quintuple rates inside 18 months because it will blow up the economy.
How do you slowly do it though, realistically, given rates were virtually zero even quintupling them is taking them to what should be historically low levels.
Quintupling rates is rather inevitable when rates are virtually nothing since any change from virtually zero is going to be proportionately a high change.
It was unsustainable, and the irresponsibility is the politics of the past that led to this being inevitable which was the irresponsible behaviour, not what is happening now which is just reality catching up.
And, how do you persuade people to save, when saving yields virtually nothing?
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
I think you've got this wrong.
@MaxPB had it right when he said there'd been a market reaction to the UK government making £45bn in unfunded tax cuts and bringing into question the state's ability to pay its way.
Truss has almost certainly directly contributed to the pound sinking further and inflation climbing higher than it otherwise would have done, which will cost a lot of people a lot of money.
Surely there were two mistakes? The one that created havoc in the markets was the huge unfunded tax cuts. The one that was politically damaging was tax cuts for those with the highest incomes.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
Yep, it’s 45p and bankers that has done for her. If she was facing these headwinds because she’d reversed NI and cut the basic rate she’d be getting some flak but she could say she wanted to make things easier for everyday families/workers etc (appreciate that the economics wouldn’t necessarily of borne that out but the man on the street probably wouldn’t have gone into the intricacies of that: they’d just have thought “oh good on her lowering my taxes.”)
As it is it’s just “you’re helping the very rich not me” and she has NO way of countering that.
Back in 1992, I was paying 15% on a flat, whose market value had declined from £80,000 to £42,000. I'd have thought that a 4% mortgage rate was something out of the Arabian Nights.
And, your view is representative of a lot of Daily Mail readers today.
My mortgage is almost £380k - you'll the principal is 8-10 times than then. For many homes in London and the South-East this will be similar. The alternative I had on the table was not buying a home for my family. No-one is going to do that.
I will thank no-one for any ideological dogma that leads my payments to balloon by over £1,000 pcm and leads me to be forced to sell at a loss and lose my home.
This dilemma is why the previous low interest rate policies were so pernicious. They effectively coerced people into buying into a bubble and loading up on debt.
You can certainly make an argument that people are being irresponsible, for example overstretching themselves on a 105-110% mortgage and living beyond their means, but I don't think you can when it applies to virtually anyone who wants to buy and get on who isn't fantastically wealthy.
That's exactly the point. Successive governments created market conditions where instead of rewarding prudence and hard work, people were almost forced to be reckless if they wanted to live a normal life.
George Osborne's biggest mistake was continuing with policies designed purely to prop up the housing market by getting people to take on levels of debt that would be unaffordable at normal interest rates.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
I think you've got this wrong.
@MaxPB had it right when he said there'd been a market reaction to the UK government making £45bn in unfunded tax cuts and bringing into question the state's ability to pay its way.
Truss has almost certainly directly contributed to the pound sinking further and inflation climbing higher than it otherwise would have done, which will cost a lot of people a lot of money.
There was a cost to doing nothing, as well. Had NI rises gone through, along with other tax rises, that would have hurt, too.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
Yep, it’s 45p and bankers that has done for her. If she was facing these headwinds because she’d reversed NI and cut the basic rate she’d be getting some flak but she could say she wanted to make things easier for everyday families/workers etc (appreciate that the economics wouldn’t necessarily of borne that out but the man on the street probably wouldn’t have gone into the intricacies of that: they’d just have thought “oh good on her lowering my taxes.”)
As it is it’s just “you’re helping the very rich not me” and she has NO way of countering that.
Back in 1992, I was paying 15% on a flat, whose market value had declined from £80,000 to £42,000. I'd have thought that a 4% mortgage rate was something out of the Arabian Nights.
And, your view is representative of a lot of Daily Mail readers today.
My mortgage is almost £380k - you'll the principal is 8-10 times than then. For many homes in London and the South-East this will be similar. The alternative I had on the table was not buying a home for my family. No-one is going to do that.
I will thank no-one for any ideological dogma that leads my payments to balloon by over £1,000 pcm and leads me to be forced to sell at a loss and lose my home.
This dilemma is why the previous low interest rate policies were so pernicious. They effectively coerced people into buying into a bubble and loading up on debt.
You can certainly make an argument that people are being irresponsible, for example overstretching themselves on a 105-110% mortgage and living beyond their means, but I don't think you can when it applies to virtually anyone who wants to buy and get on who isn't fantastically wealthy.
That's exactly the point. Successive governments created market conditions where instead of rewarding prudence and hard work, people were almost forced to be reckless if they wanted to live a normal life.
George Osborne's biggest mistake was continuing with policies designed purely to prop up the housing market by getting people to take on levels of debt that would be unaffordable at normal interest rates.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
Yep, it’s 45p and bankers that has done for her. If she was facing these headwinds because she’d reversed NI and cut the basic rate she’d be getting some flak but she could say she wanted to make things easier for everyday families/workers etc (appreciate that the economics wouldn’t necessarily of borne that out but the man on the street probably wouldn’t have gone into the intricacies of that: they’d just have thought “oh good on her lowering my taxes.”)
As it is it’s just “you’re helping the very rich not me” and she has NO way of countering that.
Back in 1992, I was paying 15% on a flat, whose market value had declined from £80,000 to £42,000. I'd have thought that a 4% mortgage rate was something out of the Arabian Nights.
And, your view is representative of a lot of Daily Mail readers today.
My mortgage is almost £380k - you'll the principal is 8-10 times than then. For many homes in London and the South-East this will be similar. The alternative I had on the table was not buying a home for my family. No-one is going to do that.
I will thank no-one for any ideological dogma that leads my payments to balloon by over £1,000 pcm and leads me to be forced to sell at a loss and lose my home.
This dilemma is why the previous low interest rate policies were so pernicious. They effectively coerced people into buying into a bubble and loading up on debt.
You can certainly make an argument that people are being irresponsible, for example overstretching themselves on a 105-110% mortgage and living beyond their means, but I don't think you can when it applies to virtually anyone who wants to buy and get on who isn't fantastically wealthy.
To course correct from that you can do it but you must do it slowly. Not to quintuple rates inside 18 months because it will blow up the economy.
How do you slowly do it though, realistically, given rates were virtually zero even quintupling them is taking them to what should be historically low levels.
Quintupling rates is rather inevitable when rates are virtually nothing since any change from virtually zero is going to be proportionately a high change.
It was unsustainable, and the irresponsibility is the politics of the past that led to this being inevitable which was the irresponsible behaviour, not what is happening now which is just reality catching up.
And, how do you persuade people to save, when saving yields virtually nothing?
But, if current policies lead to 6% interest on savings whilst inflation remains 8-10%, so it's a real terms loss, and there are mass bankruptcies so no-one has anything to save then what's the point?
uk assets in pension funds as a percent of gdp is 120% a huge number only countries with a larger pension fund industry relative to gdp are Netherlands, Iceland, and Switzerland thats why what happened on wednesday so important
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
Are you being serious? Government borrowing is high, they have committed to spending additional billions this year due to the energy position and have now a major giveaway without any projections. It's unbelievably reckless and unsurprising that the markets took fright. It's quite possible to raise interest which I agree with in an orderly way that doesn't permanently scar the economy
Funnily enough I think the scrapping of bankers bonuses and the 45p rate were the most defensible things they did. The 45p rate doesn't raise much money and there are others way to regulate banking.
Sure, government borrowing is very high, and is bound to be very high, given the aftermath of Covid, and war in the Ukraine. The tax reductions don't make all that much difference.
The real crime of this government is not giving a toss about fiscal stability and market credibility.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
Yep, it’s 45p and bankers that has done for her. If she was facing these headwinds because she’d reversed NI and cut the basic rate she’d be getting some flak but she could say she wanted to make things easier for everyday families/workers etc (appreciate that the economics wouldn’t necessarily of borne that out but the man on the street probably wouldn’t have gone into the intricacies of that: they’d just have thought “oh good on her lowering my taxes.”)
As it is it’s just “you’re helping the very rich not me” and she has NO way of countering that.
Back in 1992, I was paying 15% on a flat, whose market value had declined from £80,000 to £42,000. I'd have thought that a 4% mortgage rate was something out of the Arabian Nights.
And, your view is representative of a lot of Daily Mail readers today.
My mortgage is almost £380k - you'll the principal is 8-10 times than then. For many homes in London and the South-East this will be similar. The alternative I had on the table was not buying a home for my family. No-one is going to do that.
I will thank no-one for any ideological dogma that leads my payments to balloon by over £1,000 pcm and leads me to be forced to sell at a loss and lose my home.
This dilemma is why the previous low interest rate policies were so pernicious. They effectively coerced people into buying into a bubble and loading up on debt.
You can certainly make an argument that people are being irresponsible, for example overstretching themselves on a 105-110% mortgage and living beyond their means, but I don't think you can when it applies to virtually anyone who wants to buy and get on who isn't fantastically wealthy.
That's exactly the point. Successive governments created market conditions where instead of rewarding prudence and hard work, people were almost forced to be reckless if they wanted to live a normal life.
George Osborne's biggest mistake was continuing with policies designed purely to prop up the housing market by getting people to take on levels of debt that would be unaffordable at normal interest rates.
The other problem is that the ratchet has meant that the problem is only allowed to get worse, meaning that when any eventual reckoning comes it would be much worse.
A few of us have recognised for years here that a house price crash was required to get some sanity back in the market, and some here have always reacted with horror at that "but what about negative equity". Well the problem is the bigger the bubble, the more negative equity people will be lumped with when the bubble does eventually burst. The last few years have seen the bubble further inflated with over 10% increases in prices compounding annually, meaning the bubble bursting now is going to be even more painful than if it had previously.
Being on the wrong side of a bubble bursting is never going to be fun, but further inflating the bubble to prevent it bursting just makes the problem and eventual pain worse, not better. It is not a kindness.
Tories have lost the next GE. They need to focus now on damage limitation and doing what's best for the country in the short term. Happily, both of those objectives align by getting rid of Truss.
By what mechanism?
Under 1922 rules she cannot face a VOC for twelve months.
So either the 1922 change the rules or she resigns.
Johnson resigned when he couldn't form a cabinet - Truss has a cabinet full of her supporters.
How?
The story was they told Theresa May they would change the rules. If so, they could do the same again.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
I think you've got this wrong.
@MaxPB had it right when he said there'd been a market reaction to the UK government making £45bn in unfunded tax cuts and bringing into question the state's ability to pay its way.
Truss has almost certainly directly contributed to the pound sinking further and inflation climbing higher than it otherwise would have done, which will cost a lot of people a lot of money.
There was a cost to doing nothing, as well. Had NI rises gone through, along with other tax rises, that would have hurt, too.
I agree with reversing the NI rise and I was never in favour of the rise in the first place. I told my MP as much earlier this year.
But, I still expected a sound money approach overall from a Conservative government.
There seems to have been little mention of the Kantar poll putting the Tories within 4 points of Labour. Did I miss the discussion, or are we just ignoring it?
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
Yep, it’s 45p and bankers that has done for her. If she was facing these headwinds because she’d reversed NI and cut the basic rate she’d be getting some flak but she could say she wanted to make things easier for everyday families/workers etc (appreciate that the economics wouldn’t necessarily of borne that out but the man on the street probably wouldn’t have gone into the intricacies of that: they’d just have thought “oh good on her lowering my taxes.”)
As it is it’s just “you’re helping the very rich not me” and she has NO way of countering that.
Back in 1992, I was paying 15% on a flat, whose market value had declined from £80,000 to £42,000. I'd have thought that a 4% mortgage rate was something out of the Arabian Nights.
And, your view is representative of a lot of Daily Mail readers today.
My mortgage is almost £380k - you'll the principal is 8-10 times than then. For many homes in London and the South-East this will be similar. The alternative I had on the table was not buying a home for my family. No-one is going to do that.
I will thank no-one for any ideological dogma that leads my payments to balloon by over £1,000 pcm and leads me to be forced to sell at a loss and lose my home.
This dilemma is why the previous low interest rate policies were so pernicious. They effectively coerced people into buying into a bubble and loading up on debt.
You can certainly make an argument that people are being irresponsible, for example overstretching themselves on a 105-110% mortgage and living beyond their means, but I don't think you can when it applies to virtually anyone who wants to buy and get on who isn't fantastically wealthy.
That's exactly the point. Successive governments created market conditions where instead of rewarding prudence and hard work, people were almost forced to be reckless if they wanted to live a normal life.
George Osborne's biggest mistake was continuing with policies designed purely to prop up the housing market by getting people to take on levels of debt that would be unaffordable at normal interest rates.
And can you blame people for being desperate to join the property circus at almost any price? What's the alternative, working until you drop down dead of exhaustion to keep paying the rent?
For most households, the most onerous financial burden isn't food or fuel, it's rent or mortgage. Outright owner-occupiers have reached the promised land in this society.
There seems to have been little mention of the Kantar poll putting the Tories within 4 points of Labour. Did I miss the discussion, or are we just ignoring it?
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
I think you've got this wrong.
@MaxPB had it right when he said there'd been a market reaction to the UK government making £45bn in unfunded tax cuts and bringing into question the state's ability to pay its way.
Truss has almost certainly directly contributed to the pound sinking further and inflation climbing higher than it otherwise would have done, which will cost a lot of people a lot of money.
Surely there were two mistakes? The one that created havoc in the markets was the huge unfunded tax cuts. The one that was politically damaging was tax cuts for those with the highest incomes.
The markets also weren’t happy with the latter, because the link between cutting taxes for those on highest incomes & GDP growth is ... tenuous at best. The expected GDP multiplier for this spending was woeful. Maybe sub 1x.
So you have unfunded cuts, combined with claims being made for them that are manifestly either untrue or extremely dubious. It’s that combination that was toxic - it suggested that the government had taken leave of its senses. It suggested that it was a government that might do anything at all. It definitely didn’t suggest that this was a government you’d be happy to lend your money to.
There seems to have been little mention of the Kantar poll putting the Tories within 4 points of Labour. Did I miss the discussion, or are we just ignoring it?
Most fieldwork done before the Special Fiscal Operation.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
Yep, it’s 45p and bankers that has done for her. If she was facing these headwinds because she’d reversed NI and cut the basic rate she’d be getting some flak but she could say she wanted to make things easier for everyday families/workers etc (appreciate that the economics wouldn’t necessarily of borne that out but the man on the street probably wouldn’t have gone into the intricacies of that: they’d just have thought “oh good on her lowering my taxes.”)
As it is it’s just “you’re helping the very rich not me” and she has NO way of countering that.
Back in 1992, I was paying 15% on a flat, whose market value had declined from £80,000 to £42,000. I'd have thought that a 4% mortgage rate was something out of the Arabian Nights.
And, your view is representative of a lot of Daily Mail readers today.
My mortgage is almost £380k - you'll the principal is 8-10 times than then. For many homes in London and the South-East this will be similar. The alternative I had on the table was not buying a home for my family. No-one is going to do that.
I will thank no-one for any ideological dogma that leads my payments to balloon by over £1,000 pcm and leads me to be forced to sell at a loss and lose my home.
This dilemma is why the previous low interest rate policies were so pernicious. They effectively coerced people into buying into a bubble and loading up on debt.
You can certainly make an argument that people are being irresponsible, for example overstretching themselves on a 105-110% mortgage and living beyond their means, but I don't think you can when it applies to virtually anyone who wants to buy and get on who isn't fantastically wealthy.
That's exactly the point. Successive governments created market conditions where instead of rewarding prudence and hard work, people were almost forced to be reckless if they wanted to live a normal life.
George Osborne's biggest mistake was continuing with policies designed purely to prop up the housing market by getting people to take on levels of debt that would be unaffordable at normal interest rates.
george osborne did it after 2012...you may forget the economy was in the doldrums then...osborne with low interest rates and help to buy won the tories the 2015 election...if he hadnt done that the tories would likely have lost in 2015
As a reminder to all, the difficult decisions taken by the incoming Thatcher government in 1979 were:
(a) to immediately raise the rate of VAT to 15%, adding around 5% to prices. (b) to end the double lock on pensions (earnings vs inflation), and move it simply to inflation.
They did these things because they recognised that - while they were unpopular - there were substantial costs associated with allowing the budget deficit to grow ever wider.
A difficult decision taken by the incoming Cameron/Osborne government in 2010 was to replace RPI with the lower CPI measure for calculating inflation for uprating pensions. It turned out to be largely irrelevant that they also restored the link between pensions and earnings because that coincided with a sustained planned squeeze on living standards that almost every year kept earnings increases below one or the other of 2.5% or CPI. Pensions would be higher now if they had simply stuck to the old system they had inherited, rather than the much vaunted triple lock.
And they also got away with repeatedly deferring the state pension age, freezing pension credit uprating along with other benefits, and a new system which has left many unexpectedly short of making sufficient contributions to receive the full state pension.
It wasn't that difficult mind because they managed to pull the wool over peoples' eyes.
As an aside, I think pretty much all governing parties are going to be hit by pretty serious headwinds right now.
Across the developed world - the UK, the US, Germany, Japan, etc. - you are seeing a combination rising energy prices, scarcity of parts for products, and rising interest rates.
It's a cocktail pretty much guaranteed to guaranteed to squeeze disposable incomes and lead to recessions. Even the US, despite being a (slight) energy exporters is likely to see one. While those countries that are large energy importers are being hit even harder.
But you know who's really getting screwed? People in poor countries, which simply can't afford to outbid the West for coal or gas supplies. The riots you are seeing in Pakistan and other places are because that cocktail might make us in the West feel slightly queezy, but it's disastrous for people in poorer places. (And it really doesn't matter how little you rely on Russian energy, the impact is much the same.)
In time, the world will adjust. Either we'll find alternative energy sources to Russia (as we did to OPEC in the 1980s), or Putin will be defeated, and Russian energy (one way or another) will find a way to get into global markets. China will -inevitably and eventually- abandon its ruinous zero Covid strategy.
And the world will be in a better place; quite possibly quite a lot better place.
The Western boom of the 80s and 90s was at least partly a consequence of countries weaning themselves off cheap Saudi oil, and replacing it with North Sea or Alaska or nuclear. Why shouldn't we see similar this time around?
Quite so.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
I think you've got this wrong.
@MaxPB had it right when he said there'd been a market reaction to the UK government making £45bn in unfunded tax cuts and bringing into question the state's ability to pay its way.
Truss has almost certainly directly contributed to the pound sinking further and inflation climbing higher than it otherwise would have done, which will cost a lot of people a lot of money.
Max also pointed out that the Dynamic Duo had lost credibilty in the eyes of the financial community. That may not be the be-all and end-all, but it sure doesn't help.
The government sidelining the OBR was a fundamental mistake when announcing widespread tax cuts and spending increases.
It removed all credibility from the package and so ruined any chance of it succeeding.
Comments
Under 1922 rules she cannot face a VOC for twelve months.
So either the 1922 change the rules or she resigns.
Johnson resigned when he couldn't form a cabinet - Truss has a cabinet full of her supporters.
How?
You want to change politics? You've got to put in the hard nine yards and win the argument in public by debate.
Like Thatcher spent years doing.
But if Ukraine simmers down, an emergency meeting of '22 and a rule change unless Truss fires Kwarteng tomorrow/next week.
It could have been him...
George Canning's 119 day record has stood since 1827!
Having skipped the Andrew Neil interview during the contest, she should have done it immediately afterwards to set out her view of the state of the nation and what she was planning to do.
That mini budget could go down as one of the biggest unforced errors in UK political history.
Truss' mistake was to axe the top tax rate, and the cap on bankers' bonuses.
The rest is basically a lot of hysteria over very little. Interest rates can't remain at 2% or thereabouts, for ever. If you've borrowed money that you can't repay, at normal rates of interest, that's on you, not the government. Not that anyone will think that it's on them.
Putting a tiny clique of the nation's most extreme voters in charge of determining the direction of a political party, which needs to appeal to the great mass of the people in order to get anywhere, has been demonstrated to be a somewhat sub-optimal strategy.
And the Marquess of Rockingham's second tenure was just 96 days.
However, unless Truss suffers an unfortunate event, the target to beat is 144 days. That's the tenure of Lord Goderich, who was the shortest serving PM who appointed a cabinet and didn't die in office.
Most seats: Lab 2/5; Tories 7/4
PM after next election: SKS 4/9; Truss 2/1.
Judging from the hype this week it should be: 1/100; 66/1
1/66; 150/1.
After the ludicrous YouGov poll today, it is worth bearing in mind that the polling could get a good deal better for the Tories.
OTOH 4/9 SKS PM after next election looks tempting.
In an odd coincidence, I've been reading Kwasi Kwarteng's "Ghosts of Empire" (which is really good, highly recommended). One of the repeated themes is the dangers of handing massive discretionary power to inexperienced, out of touch graduates of grand public schools
"individualism, the reliance on individuals to conceive and execute policy, with very little strategic direction...often led to contradictory and self-defeating policies, which in turn brought disaster to millions".
They should abandon the 45% abolition and say that it is an aspiration.
https://en.wikipedia.org/wiki/List_of_prime_ministers_of_the_United_Kingdom_by_length_of_tenure
As it is it’s just “you’re helping the very rich not me” and she has NO way of countering that.
Dan Snow
@thehistoryguy
·
9h
That was the worst provincial campaign of any of our leaders since autumn 1216 when King John, marching about dealing with a rebellion & two invasions, caught dysentery in Norfolk, lost the Crown Jewels in The Wash and died in Nottinghamshire
Only 50 (out of 358) MPs voted for Trussticles as their first choice
SCOOP: In an unexpected turn of events, the UK today told its EU partners that PM Liz Truss is not only willing to attend the first meeting of the European Political Community in Prague next week, but that she is also offering to host the next summit in London.
According to the two officials, the U.K.’s sherpa also asked to change the name of the club to ‘European Political Forum.’
https://twitter.com/HankeVela/status/1575535378869538816
@MaxPB had it right when he said there'd been a market reaction to the UK government making £45bn in unfunded tax cuts and bringing into question the state's ability to pay its way.
Truss has almost certainly directly contributed to the pound sinking further and inflation climbing higher than it otherwise would have done, which will cost a lot of people a lot of money.
Technically, the Sovereign commissions somebody to form a government. Are they PM from that moment, or from the moment they actually form a government by filling the key ministries - of which you must have at least a Chancellor of the Exchequer, Lord Chancellor, Lord Privy Seal and Lord President of the Council, although these can (and have) been held by the same person all at once?
If the latter, you can't count Bath. If the former, you can.
Equally, in that case you have to include Peel in 1839, Wellington in 1832 and 1835, and Bonar Law in 1916 as short serving PMs. That's without even thinking about it.
levels of govt and personal debt were very low at the start of the 1980s..now extremely high
asset prices both shares and property were rock bottom at the start of the 1980s...now extremely high
social cohesion is now much lower after 4 decades of me me me....we are also a much more diverse society which may cause problems in tough economic times
prior bailouts of bankrupt banks has left a loft of residual ill feeling
yes things may eventually improve but even now the country shows no appetite at all for tough decisions
if you are looking at a boom like the 80 and 90s im afraid we may all be old and dead before that occurs again...that was a one off debt bubble
So long as its a talking shop, its OK, not anything with law-making powers.
It's not just the policy; it's the mood music.
Kwasi and Truss made it perfectly clear they didn't really care about the deficit and didn't give a shit who knew it.
All very apocalyptic on here this evening. Governments and parties come and go - I'm forever hopeless at backing racehorses. Remember that as a universal constant.
Sterling seems more buoyant against the greenback tonight - I presume there has been some intervention across the Pond as the dollar is down against all currencies. That may mitigate slightly against the rout on the stock markets but again I'd expect a decent bounce either tomorrow or Monday.
"World hasn't ended yet" is all some need to start speculating once again.
It seems for now Truss and Kwarteng are determined to ride out the storm (poor choice of words given events in Florida but apposite) with Kwarteng reminding Conservative MPs of the adage "if we don't hang together we'll all hang separately".
Of course, if the YouGov poll is right, there'll be plenty of room on the Opposition benches for the two Tories to sit next to the five LDs behind Opposition leader Blackford.
Next week will be crucial - doubtless the Conference faithful would applaud even if Truss read extracts from the Manchester phonebook and North Korean-style ovations didn't go well for IDS as I recall. A quieter and more positive week on the markets will calm some nerves in Conservative circles but there's no doubt the new Thatcherites have badly misread the public mood. It isn't 1980 any more.
BREAKING: The Charity Commission has just confirmed it will be investigating the controversial charity, Mermaids, over its “approach to safeguarding young people.”
https://twitter.com/TimesLucy/status/1575504787587612676
https://twitter.com/ElectionMapsUK/status/1575526882853810192?t=fxQm5WXuMJlvi7rO8V4M1Q&s=09
A fans only poll would be pretty illuminating right now.
Both on indy and on Westminster voting intentions
The markets are belatedly facing up to reality of just how much spending is going on, and has been going on for years, all around the world. That was inevitably going to happen either way. Truss and Kwasi have shot themselves in the foot politically by allowing this to be phrased as all about tax cuts for the rich, but that's a total sideshow.
For everyone to start resigning would make the public and world laugh at Westminster - we have only just been through that, and she could just hang on with a skeleton government of Bridgens, Bones and JRMs.
Not fully tested is this: this government loses a VONC and the crown declines an election while it is seen whether a new government (same party new leader) can command the confidence of the house.
Doubtful but not impossible. Not much is impossible when your constitution is vague. As an outcome it feels unfair to Labour but you never know.
Funnily enough I think the scrapping of bankers bonuses and the 45p rate were the most defensible things they did. The 45p rate doesn't raise much money and there are others way to regulate banking.
My mortgage is almost £380k - you'll the principal is 8-10 times than then. For many homes in London and the South-East this will be similar. The alternative I had on the table was not buying a home for my family. No-one is going to do that.
I will thank no-one for any ideological dogma that leads my payments to balloon by over £1,000 pcm and leads me to be forced to sell at a loss and lose my home.
Shirley?
Can't be having false modesty, Sunshine.
https://twitter.com/DeItaone/status/1575542892210360321?s=20&t=SlJmnN0joV3i_liIBOOeHA
You can't have it both ways - say that they didn't raise much money, but HAD to be done
If it's largely immaterial, leave them as they are then
Unless you have other reasons to want to do it...
https://twitter.com/WarfareReports/status/1575526579069157377?s=20&t=SlJmnN0joV3i_liIBOOeHA
My moral judgment was that it was bloody reprehensible. But I’m not (wasn’t) a Tory or Boris fan and wouldn’t have voted for @Tissue_Price anyway.
I was simply stating, in his position, his own and his constituents interests were best served by sucking up to Boris. Turning on him would, if Boris stuck it out, put NUL at the back of the queue for pork, or if Boris was forced out, would result in a new PM who was pandering to the interests of the wealthy SE. Levelling up would be dead.
I was right. Everyone else on PB (bar @hyufd) was cheering Aaron on.
Now he’s almost certain to lose his seat. His party is probably out of power for quite some time, its reputation in tatters. Tory libertarian Ideology has been completely trashed in the eyes of the electorate.
He made a mistake. A big one.
I am fortunately fully paid up and have been for a while, but at circa 18% back in the early 90s it was a barsteward. Living to work, rather than working to live is not a good place to be.
To course correct from that you can do it but you must do it slowly. Not to quintuple rates inside 18 months because it will blow up the economy.
Quintupling rates is rather inevitable when rates are virtually nothing since any change from virtually zero is going to be proportionately a high change.
It was unsustainable, and the irresponsibility is the politics of the past that led to this being inevitable which was the irresponsible behaviour, not what is happening now which is just reality catching up.
George Osborne's biggest mistake was continuing with policies designed purely to prop up the housing market by getting people to take on levels of debt that would be unaffordable at normal interest rates.
only countries with a larger pension fund industry relative to gdp are Netherlands, Iceland, and Switzerland
thats why what happened on wednesday so important
A few of us have recognised for years here that a house price crash was required to get some sanity back in the market, and some here have always reacted with horror at that "but what about negative equity". Well the problem is the bigger the bubble, the more negative equity people will be lumped with when the bubble does eventually burst. The last few years have seen the bubble further inflated with over 10% increases in prices compounding annually, meaning the bubble bursting now is going to be even more painful than if it had previously.
Being on the wrong side of a bubble bursting is never going to be fun, but further inflating the bubble to prevent it bursting just makes the problem and eventual pain worse, not better. It is not a kindness.
But, I still expected a sound money approach overall from a Conservative government.
For most households, the most onerous financial burden isn't food or fuel, it's rent or mortgage. Outright owner-occupiers have reached the promised land in this society.
So you have unfunded cuts, combined with claims being made for them that are manifestly either untrue or extremely dubious. It’s that combination that was toxic - it suggested that the government had taken leave of its senses. It suggested that it was a government that might do anything at all. It definitely didn’t suggest that this was a government you’d be happy to lend your money to.
🔴 YouGov: Labour 33pt lead
🔴 Survation: Labour 21pt lead
🔴 Deltapoll: Labour 19pt lead
🔴 Redfield & Wilton: Labour 17pt lead
And they also got away with repeatedly deferring the state pension age, freezing pension credit uprating along with other benefits, and a new system which has left many unexpectedly short of making sufficient contributions to receive the full state pension.
It wasn't that difficult mind because they managed to pull the wool over peoples' eyes.
It removed all credibility from the package and so ruined any chance of it succeeding.