With their “mini-budget” – in effect, a huge fiscal stimulus for the sole benefit of the wealthiest – British Prime Minister Liz Truss and her Chancellor of the Exchequer (Finance Minister) Kwasi Kwarteng have caused a storm financial, but also a new and deep political crisis. And this, only three weeks after taking office, while the Conservative Party is just recovering from the “partygate” scandal and the humiliating departure of its previous leader, Boris Johnson.
Faced with this spectacular and catastrophic introduction, political commentators are already talking about“suicide operation” for the leader, but also for the Tories: by destroying the economic credibility of the British right, Mme Truss offers a boulevard to Labour, who, after twelve years in opposition, now dream aloud of Downing Street.
On Wednesday, September 28, panic swept through the ranks of Tory MPs, after the Bank of England’s unprecedented intervention to support long-term British government bonds and avoid a “risk to the financial stability of the United Kingdom”. “We thought Boris Johnson’s cabinet was the worst in our history, this one is even worse”according to a Conservative Party heavyweight quoted by Sky News.
The intervention of the Bank of England “is terribly humiliating. Who is going to explain to the British that because of this mini budget, they will have to pay hundreds of pounds more for their mortgages? », reacted a former minister, on the private channel.
“This madness cannot continue”
Among the few to speak publicly, Simon Hoare, elected Tory for North Dorset (south-west of England), openly called on Twitter for the abandonment of tax measures: “These circumstances [la crise financière] are not beyond the control of the government. He himself wrote [le minibudget]. This madness cannot continue. »
And for good reason: the mini-budget is likely to cause a sharp rise in rates and increase the cost of mortgages for Britons already hit hard by inflation and the explosion in energy prices. But it also damages the serious image of the Conservatives in economic matters, which for years has been their best electoral argument.
It is now Keir Starmer, at the head of Labour, who promises the return of the “stability” and of “sound management of public finances”, if his party wins the next general election (probably in 2024). On Wednesday, Mr Starmer called on the government to reconvene ” today ” Parliament (which is in recess until mid-October) and “to give up his decision of economic self-harm”.
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