“I now expect the language of free markets and libertarianism to be relegated to the scrap heap for some time. I’m sober and realistic about it,” he said.
“I can briefly laugh at the irony of what happened, but it’s also incredibly frustrating because I remember the UK’s growth prospects for the next decade are pitifully weak.”
In a brief statement of resignation, Truss said she was elected to bring “low taxes, high growth,” but admitted she couldn’t fulfill that mandate.
A poll this week showed his Conservative Party – which has dominated British politics since World War Two – would not even be the Official Opposition if a general election were held now.
Truss had spent her summer leadership campaign complaining about Britain’s sluggish economic growth, productivity and low wages since the 2008 global financial crisis. fifth largest economy in the world to the benefit of India.
His solution was to challenge economic “orthodoxy” and demand faster and more radical action to rouse the economy from its slumber.
Truss and Kwarteng’s speech – deep tax cuts with the promise of deregulation to seize what they called the benefits of Brexit – echoed the policies of 1980s British and American leaders Margaret Thatcher and Ronald Reagan.
Their thinking can be traced to their links with Britain’s free market think tanks, which have advocated similar policies and also urged business and government to seize the opportunities offered by leaving the European Union.
A year after his election to parliament in 2010, Truss founded a group of libertarian conservative lawmakers called the Free Enterprise Group. Kwarteng served as chairman of the right-wing, free-market Bow Group in 2005-6.
Truss’ Downing Street team included former staff from the Institute of Economic Affairs, another free market think tank which said its role was to ‘think the unthinkable’ and Adam Smith Institute.
The Institute of Economic Affairs said of the economic plan: ‘It’s not a trickle down budget – it’s a stimulus budget.
Think tanks have since said the government mishandled the policy announcement, including ignoring the Office for Budget Responsibility, raising fears that the tax cuts could blow up public finances.
The independent oversight body normally issues a verdict alongside budget statements on public finance management.
Andy Mayer, chief operating officer of the Institute of Economic Affairs, said the government had tried to push through too many policies too quickly without explaining the strategy.
Mayer also said he erred in pledging to abolish the 45% income tax rate on top earners, which was unpopular and ended up being a distraction.
“I think they got caught up in the moment of the historic victory over the establishment candidate,” he said, “and decided they could bet on unpopular measures from the start.”
Mayer said Truss and Kwarteng should have focused on supply-side reforms, such as changing the rules that govern the construction of residential and commercial space.
John Longworth, a pro-Brexit businessman who was part of Thatcher’s ‘deregulation task force’ and is now chairman of the Independent Business Network, said Truss might have been able to pull off his plans if she had divided the policies into “little pieces” and presented them. overtime.
But after the Sept. 23 “mini-budget” shook investor confidence, Longworth thinks it will be another decade before those policies can be tried again. He also fears Brexit is in jeopardy.
“I don’t think she killed the philosophy, I think what she did was kill any opportunity to deploy it for a very long time,” he said.
“It is still possible to reap the benefits of Brexit even in this situation. But of course what will and does happen is that joiners use the situation as an excuse to blame Brexit, when in fact it has nothing to do with Brexit.