According to Politico (itself, right wing in orientation):
Rishi Sunak is braced for a difficult morning broadcast round after his spring statement endured a very rough landing Wednesday. The chancellor is waking up to a clean sweep of hostile front pages and stinging criticism from economics think tanks, Conservative MPs and the opposition. The alarming testimony of LBC radio phone-in callers in distress about their own fuel poverty crises will likely be ringing in his ears, and it's only getting worse: Most papers lead with the devastating blow that living standards will see their biggest fall since records began in the 1950s, just in time for the next general election.
As I told Andrew Marr on LBC last night, my feeling was that he blew this budget as badly as he did his first budget in March 2020. He was back at the Dispatch Box within a fortnight then. I predicted he will have to be back this time too as household poverty escalates to levels much higher than the 2% cost the OBR predicts, itself the worst since records began in the 1950s.
I offered a simple explanation. It was that mothers who cannot feed their children get very angry.
The seat I vacated at LBC at 7 pm was then taken by Rishi Sunak. We shook hands and shared a few words during the changeover. I do not think he anticipated the anger that came his way in the programme that followed. He certainly heard some of what I had to say: he was standing outside by a monitor as I said it.
I am now working on a longer explanation of what is happening. That will be out later. I have other broadcasting commitments this morning. But what is certain is that for Sunak everything has changed. And he might just be the weather vain. Maybe everything has.
What is certain is Sunak has failed.
But maybe the whole of neoliberalism has too, and globalisation with it.
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How can someone at the pinnacle of his career in politics, and after a lifetime of achievement in finance, turn out to be so ineffectual in the face of a tsunami of economic disaster?
You might as well ask how could a general secretary of the Russian Communist Party fail to turn the Soviet Union into a post-war Western Social Democracy.
Democracy needs to build roots. I did read Gorbachev did want to move to a Swedish type model but needed large foreign loans to set it up. The Republican Congress vetoed it. If true it shows that going for ‘complete victory’ and destruction of the opponent, will back fire.
Years of practice.
Because as a tsunami – itself caused by an external shock – causes a surge, those with depth of water beneath them are cushioned from the forces carried by the wave. The hit is taken by those in shallow water.
He certainly missed an opportunity of really helping the working families that flooded over to the conservatives in 2019. They are much worse off due to the massive increase in basic foods. Levelling up is clearly just a slogan and reality is different. As a northern MP he has to take his blinkers off and look after real people. He also has to look at how badly he has controlled the finances in the last two years with the waste and fraudulent claims
“Weather vain?” Inadvertent, but nailed it.
The Spring Statement: sharp-suited swagger when cheered on by the worst cohort of right-wing Conservatvie back-benchers since the 1930s; shiftily uneasy under Rachel Reeves dissection, back to notably cheap (in every sense of the word) bluster in his reply. Yes, a Vain Weather Vane.
Oops, but yes….
Apt indeed, and brings to mind the phrase “don’t piss on my back and tell me it is raining”.
Hopefully the population at large are starting to see through the Tory’s attempt to do just that, and don’t much fancy the impoverishment that will surely follow.
Richard
I have to admire your restraint.
If I’d been that close there would have been a swift knee to the groin of the gentleman concerned.
Although I would have felt like it. PSR, I don’t think I would have gone quite that far, but would have restricted myself to a verbal bludgening, telling him just exactly where he went wrong and why. Maybe including a mini-MMT lecture, though he might not have understood it, so blind does he appear to be.
It was brief!
Well, I’ve always maintained that Richard is a better human being than I am in such circumstances.
When you see the similarities in the backgrounds of those in positions of power – independent school, Oxford PPE followed by a career in finance – is it any wonder that their collective view of what the economy is for is so narrow?
No….
Why don’t you enter politics? Get something done? Instead of just blogging make a difference
I make more of a difference doing this
Politicians rarely have ideas. I create them.
“I make more of a difference doing this..Politicians rarely have ideas. I create them.”
But who with any semblance of decision making authority is taking a blind bit of notice of what you are saying??
Have you noticed how much I have been in the media this week? Do you really think that suggests no one is listening? And if you do think that, how do you think change happens?
I noticed, during his Commons speech, that he congratulated himself on taking advantage of a Brexit opportunity to reduce VAT. The actual reduction will be minimal and incidental, but more interesting than the uselessness of the ‘help’ he was offering was the fact that he congratulated himself on doing something Brexit made possible.
I think the entire statement was to improve his chances of becoming the next leader of his party.
a) The only way increased borrowing is not going to produce an inflationary spiral (already starting) is by suppressing incomes, and Sunak is demonstrating his chops on that front;
b) The national insurance percentage increase is nicely regressive, and vastly bigger than the increase in the allowance;
c) Although he had no answer to the poor woman who rang LBC to say she could see her children’s breath in the freezing atmosphere of her own home, who worked full-time, and in the evenings went out on her bike to deliver for Uber Eats, there are plenty of badly paid jobs the Tories can point to and say the best route out of poverty is by getting people into work, and his speech continued that falsehood;
d) The only mention he made of Brexit was to show how much he approved of it;
e) He stood up to pressure and rejected the prolonging of the Universal Credit uplift, and did absolutely nothing for those on benefits and not in work.
Every one of these decisions was unambiguously Tory. It is possible some MPs will be nervous, but that is only because their constituents will be telling them they were deeply unfair and indeed cruel.
As Professor Murphy points out, these effects will be most keenly felt next year, when Johnson is either being replaced or announcing an election to keep himself in post. Either way, Sunak has torpedoed his own chances.
Sunak announced a cut of the rate of VAT on energy saving materials from 5% to zero, but only for 5 years not permanently. As things stand, the VAT rate will return to 5% in 2027. The papers show it is expected to reduce tax revenues by about £60m a year during that period. Peanuts.
https://www.gov.uk/government/publications/changes-to-the-vat-treatment-of-the-installation-of-energy-saving-materials-in-in-great-britain/the-value-added-tax-installation-of-energy-saving-materials-order-2022
Meanwhile, there is a proposal in the EU (agreed by the Council in December 2021 and going through the EU legislative process) to give member states more freedom to set reduced and zero rates anyway, so in a very short time we could have done this (and permanently) notwithstanding Brexit.
https://www.consilium.europa.eu/en/press/press-releases/2021/12/07/council-reaches-agreement-on-updated-rules-for-vat-rates/
And Northern Ireland can do it permanently as a result.
It should also be bragged that the VAT he is ‘able’ to reduce to zero due to Brexit (solar panels plus other ‘green’ home improvements) is something which the EU is also in the process of legislating for. The commission approved it at the end of last year so, this particular ‘Brexit bonus’ will be only be something which exists for a month or so before EU members will do the same. With Sunak, the question is whether he was being disingenuous about this or was just simply unaware he was talking guff.
Something to benefit the better-off as well, of course. I wouldn’t imagine that the millions in fuel poverty and struggling through with the assistance of food banks are really thinking much about green home improvements.
A commenter on a forum that I’m on, herself a tory voting small business owner, pointed out the obvious fact that SMEs are going to suffer or go to the wall because of the fall in disposable income. (Yes, I know it’s pretty obvious to most of us)
The puzzle for me is, where on earth does Sunak think the money is going to come from to keep these businesses, which are vital to our economy, and to our citizens, afloat? ( Something, I must say, that has puzzled me since 1979..)
The absolute ignorance of how the domestic economy works is mind blowing…
Neither he nor the Treasury realise that one person’s spending is another person’s income in the macroeconomy
That’s second-term, first-year stuff, and they did not get that far
“Edwina Currie just wagered a good meal with me on Radio Ulster, betting I am wrong on the fact we’ll be going into a recession soon. I declined the wager because I would not want a meal with her, or to hear her rotten ideas on balancing the gov’t budget on the back of poverty.”
I don’t have Twitter to be able to reply. If you accepted the wager you could send someone to the meal in your place, someone already experiencing food poverty? Or an anti-poverty campaigner?
She wouldn’t go in that case
Apparently Sunak has nothing to do with the 38,957,096 shares in Infosys (nearly 1%) that his wife is recorded as owning on 31 December 2021.
https://www.infosys.com/investors/reports-filings/quarterly-results/documents/share-holding/clause-35-december31-2021.pdf
The current price is 24.38 USD per share – so that is approaching US$ 1 billion. Nothing to do with him.
(His father in law founded the company; and he and others in the “promoter group” have 551,682,338 shares between them, or about 13%, which is about US$ 13 billion.)
I’m sure Sunak does not personally benefit from this company’s continued operations in Russia. It is not listed in his declaration of interests, after all.
I have given a comment to a national newspaper this morning suggesting that Sunak may not be a fit and proper person to be Chancellor, in my opinion
Richard,
Good to hear that you have broadcasting commitments.
I was off to the Watercress Line near Winchester recently, joining the A303 at Stonehenge before turning on to the Southbound A34.
We were passed by many 4×4’s racing along at 80+, I cant imagine that if you buy something like that and drive it well over the speed limit you bother about the cost of fuel, but you will benefit from the 5p reduction in duty unlike those on more average, or less than average incomes
Nice railway
Nit been for years
My wife has a description for 4x4s, but it’s not polite
It wasn’t a budget speech it was a Hustings speech. Mainly for Party members who will be choosing a new leader soon but also, to some extent, to Tory voters more broadly. Seen through that lens it all makes sense…. well, to him, at least.
In the “it’s all about me” stakes, the Chancellor is learning from the master… who he hopes to replace shortly.
I am sure you are right, but I sense desperation. If the Conservative Party thought he was viable, Johnson would have been ‘toast’ some time ago. Johnson survives only because his peers are Sunak, Patel and Truss. They do not have any genuine, talented leaders – at all; so Johnson remains where he is; a national embarrassment.
Yes – I sense something desperate about it too. It was certainly harking back to the ‘good old days’ of Tory tax breaks and other such ‘gifts’ but it seems to me that it will not hold water in these times. I think Sunak will be back at the dispatch box before long.
But I have yet to be convinced that Neo-liberalism is on its way out. We thought it was on its way out in 2008 and look at us now. I would never underestimate its capacity to stick around.
I feel this is a ruse.
Calculated to cause discontent.
They will then try to be ‘savours’ prior to a general election with a windfall package of little treats for those who might vote for them, blaming the economic fallout of the pandemic and war in Ukraine for dire economic situation and financial woes of the public and SMEs.
Meanwhile the Tories do what they do. Pushing outrageous bills thru parliament, syphoning fresh printed money into associates pockets whilst throttling the economy.. and acting like megalomaniacs of course (a huge majority for a radicalised Tory Party is a grave threat).
Oh and, any culpability for the criminality in the heart of Westminster? Some of us won’t forget that they broke their own laws whilst issuing fines to “civies”.
I remember during the oil crisis of the early 70’s The Government issued Petrol Ration books, although in the event they were not used, my father had his in the car for some time.
I cant imagine that it would be impossible to issue some sort of ‘fuel ration’ card. and I would have thought that there must be some sort of contingency plan to do this.
It would also be very straightforward to increase benefit rates but again this hasnt been done
Och, I remember petrol rationing for my father’s car, in the Suez crisis 1956; nobody does self-inflicted harm like the Conservatives, and nobody does so much harm to the British people quite like the Conservatives: nobody.
Thanks John
I incidentally note you have now passed two thousand comments here….
In the immortal words inspired by DC Thomson: Jings! Crivens! Help ma Boab! Apologies to Dundee, but I need to lie down in a darkened room now.
……… 2,001 …….
Driving tests were suspended during the Suez crisis as the testers were re-directed to handling the problems of petrol rationing. As there were no driving tests there were complaints from businesses that there might not be enough qualified drivers for them to employ. As a result people with provisional licences were allowed to drive unaccompanied. The price of second hand cars fell dramatically and my uncle found he could afford to buy one and learned to drive solo.
John, would you like an aspirin, or rather a paracetamol? After Sunak’s dire performance, I think I need one.
I guess we shall have to wait for the interests of capital to be harmed by the recessionary headwinds before the issues are addressed. And then the interests of capital will be served, of course, the policies merely being sold as for the benefit of workers/consumers/citizens.
As someone unable to work and living on sickness benefit (of £130 / week), I’ve already seen £400bn+ spaffed on Covid (largely to the already better-off) yet not a single penny put my way. Not a penny. So I am not at all surprised by the Government’s approach : – the well-off can easily afford their rising energy costs and food inflation, so what would be the Government’s concern?
It’s ‘less than’ not-even a penny isn’t it – because if you are receiving benefits they will have been frozen, cut, or tracked against an index that doesn’t reflect the true cost of inflation.
The 30% LHA market value rule combined with housing benefits being frozen is a superb tool for gentrification. Combined with these other measures for making people poorer, it does forces disadvantaged claimants out of areas they might know as home – because for example they were born and lived all their lives there.
So you have increasingly unequal areas, and it is cumulative because as a property investor are you going to refurb a flat in a run down area or a property in a well to do village that can attract £1200pm? On the borough level, claiming residents are increasingly priced out of anywhere pleasant and pushed towards run down pockets..
Richard,
Crumbs, 2000 posts but how many were any good?
All of them
… indeed, always enjoy the comments from both Johns.
Agreed.
If what I am seeing on Richard’s Twitter feed is anything to go by, the test is now if the people of this country (and especially the 36% who vote Tory) are going to tolerate waiting outside A&Es in tents.
Snow is forecast in Derbyshire next Thursday.
All I can say is that if we are prepared to tolerate that then we deserve everything we get.
And I’m expecting the Labour party to highlight and make a meal of it this because if they don’t all I can conclude is that they are condoning it.
This is simply unacceptable. This is the arse end of the arse for sure.
This is preparing people for the end of the NHS