An Open Goal?

As Liz and her cabinet take their seats, they face some of the greatest challenges the country has seen in recent times. Amixture of a cost-of-living crisis which includes the cost of energy, real-term incomes falling, energy security, public services from health to the criminal justice creaking under the pressure of demand and the ongoing support for the war in Ukraine and believe me, this is not the entire list.

The Torys have capped energy costs for an average household at £2500.00 for two years which is still twice as high as 2020. This will be paid for by borrowing some £120B, with not a cent coming from energy companies who are expected to make excess profits of £170B over the next two years. This support for households does not include the 10’s billion required to support businesses and caring services that have seen energy costs rise 5-fold.

In addition, Crazy Kwarteng will announce a £30B tax cut in his mini budget which will disproportionately benefit the “HAVES”. The ideological tax cuts and the justifiable and necessary support for families and businesses will see the national debt pass £2.5T with interest payments on that debt, exceeding £100B p.a. The concern is that the proposed £30B tax cuts and the fall in sterling will lead to a further rise in inflation. This in turn will put additional pressure on the Bank of England to raise interest rates. This will suck demand out of the economy, lo and behold we have stagflation. Irrespective, it looks like the Tory path to economic prosperity is to embrace the failed “Trickle Down Economics” of the past which today, makes Liz look like an economic outlier, to be polite. Further evidence of this, is that Kwasi will have the political audacity and stupidity to announce the removal of the banker’s bonus cap. This will go down well with his red wall MP’s. Though to be fair the banker’s bonus cap was stupid, what was needed was an earnings cap. All the bonus cap did was reduce bonuses and increase salaries. The conclusion we can come to is that we are not all in this together.

The idea that cutting taxes and growth have a linear relationship, is unproven. What does improve growth is investments in research, a pivot to green energy and improvement in the quality and quantity of intellectual capital coming out of our education system, on these issues she has said nothing. However, she has banged on about fracking, as our silver bullet to energy security. Nearly forgot, she mustsort out the tricky Protocol problem without starting a trade war with our allies, friends and neighbours which includeFrance, in all three categories.

Liz has surrounded herself by likeminded trickle-down neo-Thatcherites particularly, Kwarteng, Braverman and that caricature of an English twit, Rees Mogg, all of whom will keep her honest regarding her newfound Thatcherite zeal. However, do not underestimate a political shapeshifter like Liz who has travelled from, an anti-monarchy Lib Dem, to a pro-remain Tory then on to a rabid Brexiteer. Though she has discovered her Thatcherite zeal, she will do what it takes to win the next election.

The question is, can Kier Starmer’s Labour stick the proverbial ball into the back of the proverbial net or will they once again, grab electoral defeat from the jaws of victory? Keir has to offer a clear vision of a better future and in public policy terms, this may include the nationalisation of energy companies on the grounds of energy security and the ability to control energy costs, something the electorate would support.If this is not deliverable in the first two years of a Labour Government, then a windfall tax on all energy companies, equal to at least 50% of the cost of the cap. A clear focus on education, skills and training will unlock the country’s potential and improve productivity.

A broader and deeper well of skills and intellectual capital will attract and encourage investment, all of which will improve growth. He also needs to show his unwavering conviction to deal with the climate emergency through an accelerated drive towards renewables. Keir needs to tell the electorate about plans to reverse the crisis of public confidence in policing and how he plans to deal with the crisis in our most venerated institution, the NHS. He also must explain to those former labour voters what his version of levelling up is and how he proposes to deliver it. Most importantly, he must clearly explain how his vision and policies are underpinned by a credible funding strategy and a related timeline, which may not be one electoral cycle. He needs to explain (not mansplain) to the electorate and convince them, that radical does not mean reckless.

Finally, I understand that Kier must tread the political ground carefully in the light of recent defeats but trying to navigatethe middle, a vision it does not make. He may have buried the undeliverable utopia known as Corbynism, but I remain to be convinced that Kier will even deserve an “ism“.

Let me know what you think in the comments below 👇

Suneil Sharma

22nd September 2022