Liz Truss is the Real Leader of the ‘Anti-Growth Coalition’
The “enemies of enterprise” over the past decade have actually consisted of a Government presiding over historically low growth and stagnant wages, writes Adam Bienkov
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Liz Truss accused those who fail to support her plans for the country of being part of what she called an “anti-growth coalition” in the UK. There is a broad network of people seeking to prevent her plans to grow the economy and unleash a new era of prosperity, she told her party conference. It was the latest attempt to drive a wedge between the British public and her opponents.
In a somewhat esoteric attempt to define her enemies, she said that these are people who “prefer talking on Twitter to taking tough decisions” and who “taxi from north London townhouses to the BBC studio to dismiss anyone challenging the status quo”.
Asked whether she had ever taken a taxi from her own south London townhouse to a BBC studio, Truss’ spokesperson was unable to say.
However, the list of people who the Prime Minister and her party have identified as the “enemies of enterprise” over the course of the Conservative Party Conference this week is rather long.
By my count, it appears to include anyone who lives in north London, broadcasters, environmentalists, students, the Institute for Fiscal Studies and Bank of England, financial traders, Twitter users and the former Culture Secretary Nadine Dorries.
The fact that Truss’ three Conservative predecessors as prime minister also lived in north London, and the fact that her definition of “enemies of enterprise” would appear to include everyone from Boris Johnson to David Attenborough and the King himself, also suggests that her attempts to find a scapegoat for the current problems facing the country may need some work.
More broadly, the risk she faces is that by continuing to embark on this seemingly endless search for enemies, Truss may soon find that most of the country end up being on the other side of the dividing line she has sought to draw. Because, ultimately, the problem with the Prime Minister trying to identify a common enemy, is that it only works if the public broadly see her as being on their side. All the evidence so far suggests that they don’t.
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One poll on Wednesday found that just 14% of voters now have a favourable view of the Prime Minister, compared to 73% who have an unfavourable view. Another recent poll found that just one third of 2019 Conservative voters thought that Truss was more on the side of people like them than her opponent Labour Leader Keir Starmer.
The Government’s catastrophic mini budget, which triggered the pound to collapse and added hundreds of pounds to individual mortgage payment costs overnight, has succeeded in convincing a broad majority of the British public that Truss and the Conservative Party are instead on the side of a small number of wealthy people at the top of society.
And while the Prime Minister was ultimately forced to abandon her attempt to axe the top rate of tax, the fact that she even tried to push it through will only have further increased this sense among the public of where her priorities really lie.
The Real Enemies of Growth
The real problem with Liz Truss’ attempt to define herself against this supposed “anti-growth coalition” is that the biggest barrier to growth in the UK economy over the past decade has been the Conservative Party itself.
The wave of austerity unleashed by David Cameron’s Coalition Government in the wake of the financial crisis succeeded in turning an economic slump into a prolonged period of anaemic wage growth and economic stagnation.
The latest official figures, released earlier this year, suggest that UK wages last year fell by the largest amount in real terms in 21 years, while soaring inflation looks set to throw at least a million more people into poverty this winter, according to analysis by one conservative think tank.
This period of poor economic performance has also been exacerbated by the decision to hold a referendum on leaving the EU. This decision, which was taken by Cameron as part of a catastrophic attempt at internal party management, is set to make the current economic crisis significantly worse for the UK.
The Government’s own Office for Budget Responsibility estimates that Brexit will likely have a long-term hit to the UK’s economic growth of 4%, which is worse than the impact of the pandemic. Meanwhile, exports and imports are likely to be around 15% lower in the long run compared with if the UK had remained in the EU.
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In many ways, there are few organisations that are more instinctively opposed to initiatives that produce growth than the Conservative Party. Across the country, there is hardly a single major housing or transport infrastructure project that has not received significant opposition at some point from local Conservative representatives.
Indeed, the fact that Truss spent much of her leadership campaign railing against housing targets and promising to clamp down on new solar farms tells you everything you need to know about where her party’s instincts on promoting growth really lie.
Of course it’s not just on instincts, but on concrete policy where the party opposes growth. Most pressingly, Truss’ own reported plans to slash benefits and public spending to pay for her planned tax cuts is only likely to heighten the current economic stagnation. With rising inflation sucking ever more money out of the economy, the last thing the UK needs is millions of people having even less money to spend from their weekly budgets.
While the Prime Minister has said that her plans to balance her tax cuts in favour of the wealthiest people in the country will unleash enterprise, most economists suggest that, unlike low earners, wealthy people tend to simply bank the additional tax savings they receive, rather than spreading the money throughout the wider economy.
So while Truss told the nation that she is in favour of “growth, growth and growth”, the reality is that the real “anti-growth coalition” in the UK is now led by the Prime Minister herself.