So Liz Truss is fully in charge now. Her grace period is ended. The Period of National Mourning for Queen Elizabeth II is over, the business of government can resume.
God help us all. The government clearly won’t.
After Liz Truss’ rather inauspicious debut on the world stage, (Australian Media had no idea who she was at the Queen’s Funeral), she has put forth her plans to set the UK economy to rights and re-establish Great Britain as a Global Leader. She has invited the Nations of the world to follow Britain’s policy of Trickle Down Economics to sort out the current financial crisis. The Nations of the World paused, stared at her like she had just suggested a Conga Line at a funeral, and then went back to their conversations.
Trickle Down Economics, also known as Reagenomics and now Trussonomics, is the theory that if you give lots of money to Rich people, they will spend it, it will filter through the marketplace and eventually ‘Trickle down’ to the lower orders, so everyone gets some.
Even if it worked that way on paper, it still wouldn’t work, because what reached the lower orders would only be a trickle, a few meagre pennies, and the lower you were, the less you would get. In reality, it doesn’t work at all because it depends on the rich people spending all their money. And they don’t. Rich people have the stickiest fingers imaginable when it comes to holding onto money. It’s how they stay rich.
Liz Truss’ next moving in solving the problems of the nation was to address the cost of energy crisis. She has capped domestic energy bills at £2500 per year for the next two years. That’s still more than double what some households pay now. And if anyone is worried about the Energy Companies losing out, don’t be. The government will subsidise the difference to them, so their £170 BILLION in projected profits is not affected. Phew, that’s a relief.
Side note: I wonder if we will see a u-turn in the government demands that people stop working from home and go back to the office. While workers will be happier to go to a place where they don’t pay the heating bill, companies may start encouraging WFH so they don’t need to heat the office.
So that’s the energy crisis sorted. A crisis created by the Tories, who lifted the price cap and released the rampant greed of the energy suppliers. They cited the rising cost of energy and the Russia’s interference in the markets as the reason, but since Britain only gets 4% of it’s energy from Russia, and the Energy companies were posting record profits, so I suspect they had other motives.
But there’s more to the cost of living crisis than energy. People are being squeezed in every direction; food, clothing, rent, transportation prices are all rising. Inflation is up 10%and wages are still stagnant, with the average wage increase around 3%. So Liz brings out her Mini-Budget.
First, she has reversed the National Insurance increase that came into affect last April. Post-pandemic, the NHS really needed that money. Actually, they needed it pre-pandemic as well, but now they’ve gone from being a service approaching crisis to a service so far beyond crisis point that they think of crisis with nostalgia. And while no one liked the NI increase, most people did recognise it’s necessity. With this reversal, the Tories are going to starve an essential service that is there for the benefit of everyone, rich and poor alike. Except the rich can afford to go private, so she just screwing the poor.
And as if depriving the poor isn’t enough, she is handing money to the rich by the truckload. She has lifted the cap on Banker’s bonuses. She has abolished they 45% tax bracket, which only applied to people making more that £150,000 per year. That means someone earning £50,000 is in the same tax bracket as a millionaire. Meanwhile, at the other end of the spectrum, Key workers like nurses and teachers will actually end up paying MORE income tax next year. Analysts estimate that unless you earn more than £155,000 per year, you won’t benefit from Truss’ tax cuts in any way.
And how is she going to pay for all this? She’s going to BORROW. She’s going to ignore all the economists who recommend a windfall tax on the Energy companies, or a wealth tax, or some policy that taps into the vast ocean of money being hoarded by the rich. Instead, she’s going to shackle future generation with even more debt.
Liz Truss has ZERO understanding of basic economic principles. Sound economic principles dictate that to stimulate the economy, you take money from the rich, who hoard it, and give it to the poor, who will spend it. Extra money given to the rich will be socked away in an offshore account. Extra money given to the poor will be spent on goods and services, circulating the money.
Liz Truss said she is prepared to be unpopular. She’s just choosing who to be unpopular with. She knows she won’t win over the voters, who have been screwed over by 12 years of Tory misrule. She may have the distinction of screwing them harder than any of her predecessors. She is choosing to be popular with the Bankers, the Energy Bosses, the Corporate overlords; anyone who might give her a job after the next election turfs her out of office.
Providing she’s not executed by the revolution she is working so hard to incite.
So That Happened 