THERE MAY BE TROUBLE AHEAD

She may have sped ahead of her solitary rival in a leadership race for the most select of audiences – and she is indeed fortunate to be up against a man so adept at shooting himself in the foot; but Liz Truss (whose name always sounds like it belongs in the toolbox of a St John’s Ambulance-man) was today confronted by stats that don’t reflect her 26-point lead over Rishi Sunak amongst Tory voters. A survey carried out by Opinium suggests Truss’s much-trumpeted solution to the cost-of-living crisis – tax cuts – has not gone down well with the wider electorate; 34% of those polled believe taxes, as well as spending on public services, should stay exactly where they are, and a further 26% want them raised. The survey appeared in the Observer, so Conservative Party members – in whose hands the decision rests, like so many clandestine cardinals picking a new Pope – were not included. Nevertheless, the chosen 160,000 seem to be favouring the Foreign Secretary over the former Chancellor.

Some wag on Twitter cleverly redubbed Rishi’s Tunbridge Wells boast about redirecting ‘levelling up’ funds from deprived urban areas to wealthy Tory shires with a soundtrack of Alan Partridge during his disastrous stint hosting an open-air country show. It was an apt manipulation of a mistimed moment. Yes, Sunak was preaching to the converted and telling them precisely what they wanted to hear, but he surely must have known someone in that crowd would be recording his speech on their phone and was highly unlikely to keep it to themselves. Whilst not necessarily in the same league as Gordon Brown’s infamous ‘bigoted woman’ comment, it was still something of a cock-up characteristic of a campaign that has oozed surface and has been short on substance. One could argue Rishi’s prime concern at the moment is to capture the faithful on whose votes he is ultimately dependent for the keys to No.10 – hence such crowd-pleasing claims – yet he should be aware as much as his rival that a General Election in a couple of years means he has to reach beyond them too.

However, even those who don’t have a say in this contest – i.e. around 97% of the electorate – haven’t been convinced by Sunak’s slick spiel; Truss is well ahead of Rishi as preferred PM amongst all voters; and, as was pointed out at the beginning of this post, Truss’s lead over Rishi is even more impressive amongst those who voted Conservative at the last General Election. Perhaps equally encouraging for Truss is the fact that the same poll puts her ahead of Keir Starmer as a potential Prime Minister, albeit only by one point – though Sunak is four points behind the Labour leader; maybe the fact Truss is regarded by those polled as being more in touch with ordinary folk is merely because the ex-Chancellor makes David Cameron look like Dennis Skinner. And it’s also worth noting that a larger proportion of the lucky 2000 punters asked for their opinions went for the ‘none of the above’ option, which seems to say more about the contenders and the opposition when it comes to this uninspiring spectacle than any of the other stats such a survey can throw up.

Needless to say, anything remotely approaching a ‘honeymoon period’ that Liz Truss is anticipating probably won’t last very long; she’ll take the reins of power in September and within a month she’ll be expected to do something about the much-publicised, astronomical soar in energy prices that is – according to the MSM – poised to plunge most of us who aren’t Tory Party members into fuel poverty. Oh, and the Bank of England is adding to the beloved Doomsday narrative by forecasting the mother of all recessions. When it comes to the issue of energy prices, the futile pursuit of ‘Net Zero’ is noticeably absent from so many column inches as one of the reasons why energy bills will rise for those least able to pay them. The war in Ukraine is a far more convenient reason – and one guaranteed to receive the thumbs-up; after all, it’s bloody horrible and everyone hates Vlad, so it’s a preferable excuse than one shining a light on the way in which Western Governments have capitulated to the most fanatical zealots of the Green lobby at the expense of plebs already struggling to make ends meet.

As for the other treat we’ve got to look forward to in the autumn – i.e. the impending recession – well, it’s not as if nobody saw this coming, is it? If you completely close down industry for months and give no clear indication as to when all those mothballed businesses can reopen, it’s pretty obvious what’s going to happen. The tax cuts Liz Truss favours over what she calls ‘handouts’ to help people cope is a clear nod to Rishi’s magic money tree during the furlough episode of lockdown, effective benefits for the employed which anyone with half-a-brain knew were glorified loans from the Government usurer that would eventually have to be paid back. Actual benefits in the shape of Universal Credit were unsurprisingly the first to feel the pinch, losing the £20-a-week uplift, and since then benefits haven’t kept up with inflation either. Lib Dem leader Ed Davey is keen on Parliament to be recalled from its summer hols to look as if something is being done – as is former PM Gordon Brown, who instigated a report into the cost-of-living crisis that has just been published.

Brown calls on the two leadership contenders as well as Boris to get their fingers out by delivering a special budget ASAP, and has aired his thoughts on the emergency, which are fittingly bleak for a man not renowned for being the life and soul of the party. But, let’s face it – we’re all now becoming as accustomed to emergencies as Brits back in the 1970s were, so the findings of this report make for the expected gloomy reading. Even before energy regulator Ofgem announces details of the rising price cap on fuel, the report claims many families and individuals in Britain appear to exist solely to pay bills at the moment; and having been in that position in the past, I know how demoralising it is. A grassroots movement encouraging those most terrified of what’s to come to essentially go on strike and refuse to pay their bills is a nice, collectivist concept in the tradition of what happened when the Poll Tax was introduced in 1990, but – like the fruits of Sunak’s magic money tree – it’ll still all have to be paid back in the end, anyway, so it’d only just be kicking the can further into the long grass, alas.

‘We are facing a humanitarian crisis that Britain hasn’t seen in decades,’ says Gordon Brown. ‘As living costs continue to skyrocket, families on the brink of making ends meet cannot bridge the gap. (The next Prime Minister) must ensure that families have enough to live, through this crisis and beyond.’ The author of the report, Professor Donald Hirsch, says even those receiving financial assistance from the Government stand to see their standard of living decline rapidly; Prof. Hirsch’s report states an unemployed couple with two kids will be as much as £1,300 worse off a year. Gordon Brown urges action immediately, and if that fails to happen soon, that failure will be responsible for ‘condemning millions of vulnerable and blameless children and pensioners to a winter of dire poverty’.

I guess many MPs will currently be sunning themselves on some beach that the majority of their constituents will never sun themselves on, and the recent publication of the latest expenses claims by Honourable Members suggests their world remains a parallel universe of privilege to ours. And, smack bang in the middle of this uneasy calm before a dreaded storm, we’re lumbered with a lame duck Prime Minister counting down the days till his eviction and a couple of potential replacements travelling up and down the country, selling themselves to people who are amongst the least threatened by what awaits the rest of us. Doesn’t fill you with much confidence, does it.

© The Editor

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FROM AVARICE TO AUSTERITY

This wet and windy month of August 2017 is, if nothing else, awash in anniversaries – fifty years since the 1967 Sexual Offences Act; forty since Elvis Presley died; twenty since Diana died…and so on. Perhaps the focus on these anniversaries helps distract us from the imminent apocalypse courtesy of Mr Trump and Mr Jong-Un, though one anniversary was highlighted today that is hardly cause for celebration, even if it has not only dictated the global political landscape for the last ten years, but has also impacted upon all our lives in one way or another.

If we cast our minds back a mere decade (easily done when you’re over 21), we find Gordon Brown, the so-called Iron Chancellor as was, finally ascending to the position he always felt his predecessor had promised him during their legendary dinner at an Islington restaurant thirteen years previously. However, it was ironic that a man who supposedly had his fiscal finger on the financial pulse could be so short-sighted when it came to the inevitable bust of the boom he had been happy to take credit for. Perhaps the prospect of finally getting his hands on the key to No.10 was too great a distraction for Gordon Brown in the summer of 2007 and he took his eye off the ball; after all, the US housing market bubble had already burst by the time he succeeded Blair; surely, just as what goes up must come down, a boom must be followed by a bust?

Although he was obviously keen to put his own stamp on the role of Prime Minister, Gordon Brown didn’t initially show that his predecessor’s fondness for dishing out knighthoods and Peerages to prominent financiers was about to be discontinued. The bankers were still the bosom buddies of New Labour; the partnership they had entered into on the eve of the 1997 General Election retained its cosy nature and the likes of Peter Mandelson, poised to return to Government as Brown sought to shore up his fresh-faceless Cabinet with a few experienced old hands, was the embodiment of New Labour’s love affair with the wealthy, forever sighted on the yachts of Russian oligarchs or quaffing champers in the City. Should the Government be accused of giving the bankers too much leeway and allowing them to exercise too much influence over the economy, Labour could simply point to the population and their plentiful status symbols as evidence that affluence was now available for all.

However, the crisis arising from the inevitable collapse of the US subprime mortgage market – with America already borrowing heavily from China (which had saved its pennies as the west was recklessly throwing its own about like bloody confetti) and banks no longer lending to each other – began to seriously affect international finance in the summer of 2007 and the first British casualty was the high-street bank, Northern Rock.

Northern Rock had centred its financial practises on securitisation – borrowing both home and abroad to fund the mortgages it sold before re-selling mortgages in the capital markets internationally; but when investors’ demand for securitised mortgages plummeted, Northern Rock could no longer repay the loans it had acquired around the world when business was booming. Moreover, ever since being caught napping by the dot-com crash, the financial markets had tended to second-guess potential crises, and the ensuing publicity afforded Northern Rock’s shaky foundations only served to bring about the disaster that was being predicted. Northern Rock approached the Bank of England for a liquidity support facility to compensate for the sudden loss of the funds it had previously raised in the markets; this move, reported with sensationalist relish by the British press, triggered the first run on a British bank in over a century.

Further scaremongering reporting from the media as customers queued around the block to empty their accounts before (so they feared) their savings evaporated evoked the panic at George Bailey’s Building and Loan bank in ‘It’s A Wonderful Life’; it seemed as though the collapse of Northern Rock was becoming a self-fulfilling prophesy as the public believed the hype and sought to withdraw every penny they had stored in the bank’s coffers.

This remarkable event should have been anticipated by Gordon Brown; after all, he’d only ceased to be Chancellor for three months before Northern Rock’s dramatic downfall leapt from the financial section of the papers to the front page. But Alistair Darling was now in charge of the nation’s purse-strings and accusations of responsibility for a financial crisis that may have had its genesis on Gordon Brown’s watch were met with an effective ‘It weren’t me, Guv’. The Government observed from the sidelines as two unsuccessful attempts to rescue Northern Rock came to nothing and then belatedly intervened by taking the bank into state ownership. It was ironic that a party that had spent the best part of fifteen years dispensing with the nationalisation programme that had been integral to its constitution since its inception should have to end its days in Government nationalising the one industry that had always prided itself on its independence from the state; but once Northern Rock was pulled back from the precipice by nationalisation, the legacy of living beyond one’s means began to spread.

If Gordon Brown imagined slipping into Tony Blair’s shoes would be achieved without the need for a shoe-horn merely because he’d had his beady eye on those shoes for ten years, then the honeymoon period that had raised his popularity high enough for him to have won the autumn Election he’d baulked at calling was short-lived indeed. The Northern Rock debacle would act as the harbinger of an economic meltdown that would dog Brown throughout what would turn out to be the brief tenure of his premiership. Northern Rock was no one-off drama that could be glossed over as an aberration from the prosperous state of affairs Brown had overseen during his residence at No.11.

The global markets were sliding towards recession in 2007, and Britain, saddled with debts accumulated during the Blair boom years – a boom that had benefitted everyone from the million-pound bonus banker at the top to the designer-clad Chav at the bottom – was poised to pay the price for its reckless dependency on credit. A decade later, with the average British salary the same as the average British consumer debt per person (£28,000), the country is still paying the price.

© The Editor