LONDON — Real Liz Truss-ism has never been tried.
That’s the verdict of Liz Truss, Britain’s shortest-serving prime minister, who launched a robust defense Monday of the economic plan that precipitated U.K. market chaos and prompted her ouster from office just 49 days into the job.
In a video marking the two-year anniversary of her so-called mini budget, Truss laid into the “economic establishment” she continues to blame for her downfall and said Britain’s new Labour government only comes armed with more of the same “failed policies.”
It marks the latest doubling-down from Truss on her free-market agenda — and comes as the Tory Party she once led tries to shrug off a hefty election defeat under her successor Rishi Sunak and pick a new leader.
Truss argued that the mini budget, which offered a host of tax cuts and supply-side reforms but which was not independently scrutinized by Britain’s public spending watchdog, had been a bid to “reverse Britain’s economic decline and to get our country growing again.”
“If the mini budget hadn’t been undermined by the economic establishment, things would be different now,” she argued.
“The economy would be growing. People would be paying lower energy bills, thanks to getting on with fracking,” she said.
Truss added, “Corporations would want to locate in the U.K. because of our relatively low tax rates. The self-employed would be doing more business, thanks to improvements in IR 35 [tax rules]. And we would see a more dynamic, go-getting economy.
“But that didn’t happen because the mini budget was undermined by the economic establishment.”
Doom loop
Debate has continued to rage in the U.K. over Truss’ ill-fated fiscal plan.
The former prime minister has blamed the Bank of England for not informing her of — or taking action to tackle — problems at British pension funds before she unveiled her proposals.
In the event, Truss announced tax cuts for Britain’s wealthiest people and opted not to publish the usual economic forecasts from the Office for Budget Responsibility. The pensions industry nearly collapsed, and the BoE was forced to step in with a £65 billion emergency facility to try to restore calm in the spooked markets.
“Things will only get worse under Labour,” Truss predicted Monday, as the new government’s Chancellor of the Exchequer Rachel Reeves prepared to address the Labour Party conference.
“The only way we’re going to escape this economic doom loop is through supply-side economics, proper monetary policy and cutting taxes,” Truss argued.
“And in order to do that, the economic establishment have to be taken on.”
