New Haven Register (New Haven, CT)
Liz Truss promised the U.K. a shakeup — was forced out instead
LONDON — Liz Truss became prime minister on a promise to open a new era of growth by shaking up Britain's economy. But the tumult that resulted was not exactly what she had in mind: Markets recoiled, the pound currency dived, her party revolted — and, in the end, she announced her resignation just 45 days after taking office.
Truss, 47, was forced to quit after an ill-conceived economic stimulus plan she drew up caused economic and political chaos and wiped out her support in the Conservative Party.
Truss, a libertarian who fervently believes in small government and free-market economics, came to office on Sept. 6 after 172,000 Conservative Party members voted in an internal leadership contest to pick a successor to the scandal-plagued Boris Johnson.
Truss was in many ways the opposite of the populist, people-pleasing Johnson. Serious and stiff as a public speaker, she called herself a “disruptor," ready to upend existing economic “orthodoxy.” On the campaign trail, Truss, who was then foreign secretary, vowed to slash taxes and red tape “from day one,” boost investment and turn Britain's faltering economy around.
Her views appealed to many Conservatives, who backed her with a 57% majority over rival Rishi Sunak, a former Treasury chief who warned against radical tax cuts. Many saw in her echoes of former Prime Minister Margaret Thatcher, whom Truss admired — and sometimes emulated in her style of dress and poses on Instagram.
In the first days of her premiership,
she gave a taste of things to come when she said she wasn't afraid to make “unpopular” decisions — such as removing a cap on bonuses for bankers — to boost the U.K.'s competitiveness.
On Sept. 23, Treasury chief Kwasi Kwarteng unveiled the Truss government's vision for growth: a huge package of tax cuts worth 45 billion pounds ($50 billion) that the government said would create jobs and improve living standards. But the so-called mini budget didn't explain how the government planned to pay for the tax cuts, leading investors to worry that public borrowing would balloon out of control.
The market's verdict was immediate and devastating.
The pound plunged to a
record low against the U.S. dollar, the cost of government borrowing soared, and the Bank of England was forced to step in to buy government bonds to avert a wider financial crisis.
Many also questioned
Truss' political judgment in slashing taxes for Britain's top earners while millions of people struggled to make ends meet with the cost of everything from heating to groceries soaring.
Truss stuck to her guns — for a while.
Two weeks after her package was unveiled, she insisted that she was determined to deliver her priorities: “Growth, growth and growth.” But party members were incensed about the damage she had
done to their credibility.
By Oct. 14, she had fired Kwarteng, her longtime ally, and reversed course — twice — on her tax-cutting plans. Kwarteng's replacement as Treasury head, Jeremy Hunt, then dumped almost all of Truss' flagship policies. Truss apologized for going “too far and too fast,” but her authority was in tatters, and a growing number of Conservatives openly called for her to go.
She will stay prime minister until the party chooses a replacement in the coming week and will have the dubious distinction of being the shortest-serving British prime minister in history. She topped George Canning, who was prime minister for just 119 days in 1827 before he died.