Putting the country first is only way Tories will survive
IF YOU want to understand how politics may play out over the next few days, you need to be aware of just one key statistic: Labour’s poll lead is now, on average, around 25 per cent. We are, of course, in the middle of an economic crisis. That’s what Jeremy Hunt’s statement yesterday abolishing almost all of Kwasi Kwarteng’s miniBudget was designed to start tackling. But the crisis is as much political as economic.
Tory MPs are well aware that Liz Truss may not only have hurt the economy – she could well have damaged the Conservative Party. If Labour was to win the next election by 25 per cent – who is to say that things will necessarily get better for the Tories over the next two years? – then they could well be reduced to around just 50 seats. In other words, near extinction.
This is the critical part of that statistic. According to psephologists – who analyse polling data – if the Conservatives can somehow reduce the deficit from 25 per cent to around 15 per cent, that would likely mean them winning another 150 seats or so.True, that would still be a Labour landslide, but the Tories would be a functioning party in opposition rather than a rag-bag collection of survivors of oblivion.
THAT is the calculation that will now be uppermost in the minds of Conservative MPs. It is the factor that will govern how they react to Mr Hunt’s unravelling of the mini-Budget and, most importantly, how they decide whether or not to stick with Ms Truss as Prime Minister.
What is certainly true is that Mr Hunt has done the only thing any serious politician could do. We were already in a bad way when Ms Truss became PM last month. But her determination to impose fairytale economics on the country turned a bad situation into a crisis – even a catastrophe for many people with a mortgage.
I am not being wise after the event. Back in July, I wrote: “Economics is brutal: you can’t simply wish problems away or hope for the best. The markets will batter you. It would be appallingly irresponsible simply to cut taxes and hope for the best, arguing that by cutting taxes you’ll spark growth. What if that growth doesn’t come, or doesn’t cover the cost of the tax cuts? You might also have made inflation even worse.”
But important as it is to understand why we are in our current crisis, we are where we are. What matters now is how we recover. In that sense, the political fortunes of Ms Truss or the party are an irrelevance. The country’s needs come first.
Perhaps the only bit of good news in recent weeks is that Mr Hunt appears to understand this completely. He has made no attempt to be anything other than wholly dismissive of Ms Truss’s economic plans, however humiliating this may be for her.
Already some of her remaining supporters are complaining about just that and suggesting the Chancellor is using this as an opportunity to push his own agenda for power.Typically, they miss the point.The only way the Conservative Party, let alone the country, can escape from this crisis is by making it as clear as possible that her plans are dead and buried.The markets have to be convinced that we will stop behaving like a Latin American basket case and start behaving like a serious global power.
This is all a disaster for those of us who believe low taxes and free markets are the best way to grow prosperity – but who also understand (like Baroness Thatcher) that they have to be based on sound money. Ms Truss and Mr Kwarteng’s recklessness has toxified those ideas. So let’s hear no more sniping, please, from Conservative MPs over Mr Hunt’s actions. It does not bear thinking where we would be now without his presence in 11 Downing Street and without his decisive break with the PM’s prescriptions.
AS HAS been repeated ad nauseam, there is nothing wrong with a growth agenda in itself. Rather, it’s how it is pursued. In that context, it is striking that Ms Truss’s original plans contained nothing of consequence about one area where radicalism is urgently needed.We have a genuine housing crisis. In 1991, 78 per cent of those aged 35 to 44 were owner-occupiers. Today, it is just 56 per cent.Among those aged 25 to 34, it’s fallen from 67 per cent to 41 per cent. In London it takes the average worker over 15 years to save for a deposit. Two things are needed: planning reform and more building. Both will fuel economic growth. If the government is looking for something positive to make its new rallying cry, it should look to housing.
Meanwhile, as Mr Hunt’s own appointment from the backbenches shows, nothing can be taken as certain in politics. The next few days will be critical, and we must hope for stability.
‘Markets need convincing we are not a Latin American basket case’