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Kemi Badenoch Carries on Liz Truss’Tufton Street Traditions
The International Trade Secretary is due to speak at a Koch-founded libertarian ‘think tank’, reports Sam Bright
International Trade Secretary Kemi Badenoch will tonight deliver one of the first flagship speeches in her new role. Appointed into the role by former Prime Minister Liz Truss and retained by Rishi Sunak, the UK’s new trade chief is widely seen as a darling of the right of the Conservative Party.
Indeed, the choice of host for the event perhaps shows that Liz Truss’ Government legacy is more engrained than suggested by her 50 days in 10 Downing Street.
The event is being hosted by the Cato Institute, a Washington-based ‘think tank’ that says it is “dedicated to the principles of individual liberty, limited government, free markets, and peace”. In other words, as the Cato Institute openly admits, it is committed to “libertarian principles” – which, at their most essential, are a belief in a small state and lower taxes.
Liz Truss attempted to further these libertarian principles through her shock-and-awe ‘mini’ budget of 23 September – announcing a series of radical tax cuts, concentrated among the richest, alongside an attempt to weaken state regulations. Market panic ensued, forcing emergency intervention from the Bank of England and the sacking of her Chancellor Kwasi Kwarteng.
Truss followed Kwarteng out of Government on 25 October, leaving the country with a £30 billion financial ‘black hole’ as a direct result of her libertarian policies – almost all of which have now been reversed. It’s expected that new Chancellor Jeremy Hunt will this week announce up to £60 billion in tax rises and spending cuts, to assuage the concerns of Britain’s financial markets.
However, it appears as though Badenoch is embracing the same libertarian network that orchestrated Truss’ disastrous mini-budget. Infamously, Truss and Kwarteng were nurtured by a nexus of libertarian ‘think tanks’ based in and around Tufton Street in Westminster, whose funding sources are opaque. The chair of tonight’s Badenoch event, the Cato Institute’s R. Evan Scharf Chair for the Public Understanding of Economics, Ryan Bourne, is a graduate of this world – having worked as the head of public policy at the Institute of Economic Affairs (IEA) and the head of economic research at the Centre for Policy Studies (CPS), before making the jump stateside.
The CPS is based in 57 Tufton Street while the IEA is located on the adjacent 2 Lord North Street – considered to be the two core members of the Tufton Street network. IEA director general Mark Littlewood has said that Truss has spoken at IEA events more than “any other politician over the past 12 years”.
For her part, Truss – who herself served as International Trade Secretary from 2019 to 2021 – also has a history of cosy relations with American libertarian groups. On a taxpayer-funded trip to America in September 2018, Truss held a series of meetings with libertarian ‘think tanks’, including the Cato Institute, the Heritage Foundation and Americans for Tax Reform – a group that served as the inspiration for Matthew Elliot, latterly the CEO of the Vote Leave campaign, to set up the TaxPayers’ Alliance, based on Tufton Street.
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The Special Relationship
As Peter Geoghegan explains in Democracy for Sale, there are organisational, financial and ideological overlaps between libertarian groups on both sides of the Atlantic – inspiring the push to divorce Britain from the EU and forge closer ties with the US.
The Cato Institute was co-founded in 1977 by Charles Koch – CEO of Koch Industries, the second largest private company in America, specialising in fossil fuel energy and chemicals. Two lawsuits were filed by Charles Koch and his brother David in 2012 to re-establish their effective control over the Cato Institute, both of which were dropped after an settlement was reached. The brothers have funded hard-right political causes over recent decades to the tune of hundreds of millions of dollars.
In Dark Money, Jane Mayer describes how the brothers created the “Kochtopus” – a “multi-armed” assembly line of anti-tax, anti-regulation politics in the US “from idea creation to policy development to education to grassroots organisations to lobbying to political action”.
Cato Institute records show how the organisation has in recent years received funding from the Sarah Scaife Foundation, established by the heir to an oil and banking dynasty, and the Donors Trust, which contributes substantially to libertarian causes. Both of these organisations have also contributed to the Global Warming Policy Foundation – a Tufton Street outfit dubbed the UK’s “principal climate science denial campaign group” by the investigative site DeSmog.
The IEA, meanwhile, has likewise received money from the Koch-linked National Philanthropic Trust, with its most recent filings revealing a grant of $130,000 in 2020.
What’s more, it appears as though Badenoch will be advised by several Tufton Street figures – another legacy of Truss’ time in the Department for International Trade.
The department’s Strategic Trade Advisory Group, for example, is populated by at least three Tufton Street figures, all appointed by Truss: the IEA’s Mark Littlewood, director of the CPS Robert Colvile, and former deputy director of the Adam Smith Institute, Robert Kilcoyne.
Badenoch will also be advised by Lord Daniel Hannan, appointed by Truss to the Government’s Board of Trade, who runs the Institute for Free Trade think tank, formerly based at 57 Tufton Street.
It will be illuminating to hear the thoughts at Badenoch at tonight’s event, and whether she will mention the fact that – after Brexit – Britain’s balance of trade has fallen to its worst level since records began, in 1955.