The latter is, of course, Liz Truss, whose last vestige of credibility was calmly shredded yesterday morning in less than ten minutes by her Chancellor of only three days, Jeremy Hunt, who left only the National Insurance reduction and cuts in stamp duty from the mini-budget unveiled by Kwasi Kwarteng just three weeks ago. Much of what Mr Hunt announced was well-trailed, like the abandonment of the Income Tax and Corporation Tax cuts, but it was the curtailment of the energy price cap to April which really screwed down the lid on the Prime Minister’s coffin.
Guaranteeing the cap for two years was the one measure she had repeatedly cited to show how her government was helping people for the longer term, and here it was slashed to match Labour’s proposal which she had so derided.
Mr Hunt’s quietly firm delivery was precisely what the banks and bond markets wanted, and while Conservative MPs were said to be more reassured after his subsequent briefing, there is no escaping the fact that Ms Truss is now a puppet Prime Minister, no matter what Mr Hunt or others in the Cabinet might say. And when Prime Minister’s Questions comes around tomorrow the strings will have been cut and she will stand in front of a baying opposition knowing the plan in which her reputation was invested has been cremated.
I voted for Jeremy Hunt to be Prime Minister in the 2019 leadership contest and no-one who did likewise could have predicted that in just over three years, he would achieve his ambition in all but name, a modern day Cardinal Richelieu who keeps the monarch on the throne. Louis XIII reigned for 33 years, but Ms Truss has had to fight to survive 33 days, and even with rallying calls going out last night she’ll be lucky to make it to the end of the week.
She is paying a miserably humiliating price for over-reaching ambition and impatience; recognising there was less than two years to go to an election and an evens chance of defeat, she bet the house that her vision of a low-tax economy could spur a miraculous leap in national productivity in the teeth of a global economic gale which would make spending cuts unnecessary before facing the voters. The markets thought differently and before anyone saw the benefit of the energy cap or the National Insurance and Income Tax cuts, mortgage rates soared, and pension funds came within hours of collapse.
Now, as many on the right have feared, the whole principle of tax cuts is being discredited and from a desire to get tax down, Ms Truss might just have set in motion a chain of events that keeps taxes at their current levels, or higher, for years. Whether out of good intentions or not, the very fact Ms Truss has set back the core Conservative cause of lower taxation, potentially for a decade, should mean meeting the 1922 Committee without coffee before too much longer.
But wrecking the Conservative reputation for sound management of the economy has another consequence, one with direct implications for everyone living in Scotland, which brings me to the other leader, Nicola Sturgeon, and yesterday’s presentation of the third part of the independence prospectus. There was nothing in the paper which hasn’t already been said, but there didn’t need to be because the context has changed beyond all recognition. And despite the obvious differences in approach and content, there was much in common with the philosophy behind the Truss-Kwarteng mini-budget in its belief that somehow everything will work out fine without actually explaining how so.
Because other small countries are apparently doing well, so too will Scotland. Because it’s a windy place with lots of coastline, somehow energy shortages will be history. Because Europe is a big place, somehow a hard commercial border with Scotland’s biggest trading partner won’t matter a jot. Because Scotland will be responsible for its own finances, even without an independent currency and reliant on another country’s central bank setting another country’s interest rates, somehow monetary policy will be better. Because Scotland will cut itself off from one of the world’s biggest financial centres, somehow we’ll be better off. Because it will be a “well-being economy”, somehow everyone will be well, even though average life expectancy under the SNP is Third World.
What we have seen in the last fortnight is living proof of what happens to national finances when future prosperity is based on blind faith without a properly costed plan. Ms Sturgeon’s promise yesterday to move to a Scottish currency “at the appropriate time” was an admission that it could be decades before the new economy was stable enough to sustain such a seismic change, and that she doesn’t know how long that will be. But it was also tacit acceptance that the lure of EU membership, which requires a central bank, an independent currency and track record of stability, is just as far off. Desperation to re-join the EU might actually hasten the introduction of what would be the Scottish version of Confederate dollars based on fantasy economics.
Yet, Ms Sturgeon can now get away with it because as long as the UK Government is led by a Prime Minister whose economic credibility is, as American troops in Vietnam used to say, “fubar”, the counter arguments can just be shouted down. Look at the UK, is all she needs to say and indeed was about the extent of her argument yesterday. The past fortnight has proved beyond all reasonable doubt that the SNP prospectus is a one-way ticket to bankruptcy, but while Ms Truss is Prime Minister the argument is harder to make. For the United Kingdom’s sake, she must resign.