LONDON (AP) \u2014 When Liz Truss was running to lead Britain this summer, an ally predicted her first weeks in office would be turbulent.<\/p>\n\n\n\n
But few were prepared for the scale of the sound and fury -\u2013 least of all Truss herself. In just six weeks, the prime minister\u2019s libertarian economic policies have triggered\u00a0a financial crisis, emergency central bank intervention, multiple U-turns and\u00a0the firing of her Treasury chief.<\/p>\n\n\n\n
Now Truss faces a mutiny inside\u00a0the governing Conservative Party\u00a0that leaves her leadership hanging by a thread.<\/p>\n\n\n\n
Conservative lawmaker Robert Halfon fumed on Sunday that the last few weeks had brought \u201cone horror story after another.\u201d<\/p>\n\n\n\n
\u201cThe government has looked like libertarian jihadists and treated the whole country as kind of laboratory mice on which to carry out ultra, ultra free-market experiments,\u201d he told Sky News.<\/p>\n\n\n\n
It\u2019s not as if the party wasn\u2019t warned. During the summertime contest to lead the Conservatives, Truss called herself a disruptor who would challenge economic \u201corthodoxy.\u201d She promised she would cut taxes and slash red tape, and would spur Britain\u2019s sluggish economy to grow.<\/p>\n\n\n\n
Her rival, former Treasury chief Rishi Sunak, argued that immediate tax cuts would be reckless amid the economic shockwaves from the coronavirus pandemic and the war in Ukraine.<\/p>\n\n\n\n
The 172,000 Conservative Party members -\u2013 who are largely older and affluent — preferred Truss\u2019 boosterish vision. She won 57% of members\u2019 votes to become leader of the governing party on Sept. 5. The next day, she was appointed prime minister by Queen Elizabeth II in one of the monarch\u2019s final acts before her death on Sept. 8.<\/p>\n\n\n\n
Truss\u2019 first days in office were overshadowed by a period of national mourning for the queen. Then on Sept. 23, Treasury chief Kwasi Kwarteng announced the economic plan he and Truss had drawn up. It included 45 billion pounds ($50 billion) in tax cuts -\u2013 including an income tax reduction for the highest earners \u2014 without an accompanying assessment of how the government would pay for them.<\/p>\n\n\n\n
Truss was doing what she and allies said she would. Libertarian think-tank chief Mark Littlewood predicted during the summer there would be \u201cfireworks\u201d as the new prime minister pushed for economic reform at \u201cabsolutely breakneck speed.\u201d<\/p>\n\n\n\n
Still, the scale of the announcement took financial markets, and political experts, by surprise.<\/p>\n\n\n\n
\u201cMany of us, wrongly, expected her to pivot after she won the leadership contest in the way many presidents do after winning the primaries,\u201d said Tim Bale, professor of politics at Queen Mary University of London. \u201cBut she didn\u2019t do that. She actually meant what she said.\u201d<\/p>\n\n\n\n
The pound plunged to a record low against the U.S. dollar and the cost of government borrowing soared. The Bank of England was forced to step in to buy government bonds and prevent the financial crisis from spreading to the wider economy. The central bank also warned that interest rates will have to rise even faster than expected to curb inflation that is running at around 10%, leaving millions of homeowners facing big increases in mortgage payments.<\/p>\n\n\n\n
Jill Rutter, a senior fellow at the Institute for Government think tank, said Truss and Kwarteng made a series of \u201cunforced errors\u201d with their economic package.<\/p>\n\n\n\n
\u201cThey shouldn\u2019t have made their contempt for economic institutions quite so clear,\u201d she said. \u201cI think they could have listened to advice. And I think one of the things that they got very wrong was to announce one part of the package, the tax cuts \u2026 without the spending side of the equation.\u201d<\/p>\n\n\n\n
As the negative reaction grew, Truss began to abandon bits of the package in a bid to reassure her party and the markets. The tax cut for top earners was ditched in the middle of the Conservative Party\u2019s annual conference in early October as the party rebelled.<\/p>\n\n\n\n
It wasn\u2019t enough. On Friday, Truss fired Kwarteng and replaced her longtime friend and ally with Jeremy Hunt, who served as health secretary and foreign secretary in the Conservative governments of David Cameron and Theresa May.<\/p>\n\n\n\n
At a brief, downbeat news conference, the prime minister acknowledged that \u201cparts of our mini budget went further and faster than markets were expecting.\u201d She reversed a planned cut in corporation tax, another pillar of her economic plan, to \u201creassure the markets of our fiscal discipline.\u201d<\/p>\n\n\n\n
Truss is still prime minister in name, but power in government has shifted to Hunt, who has signaled he plans to rip up much of her remaining economic plan when he makes a medium-term budget statement on Oct. 31. He has said tax increases and public spending cuts will be needed to restore the government\u2019s fiscal credibility.<\/p>\n\n\n\n
Still,\u00a0Hunt insisted Sunday: \u201cThe prime minister\u2019s in charge.\u201d<\/p>\n\n\n\n
\u201cShe\u2019s listened. She\u2019s changed. She\u2019s been willing to do that most difficult thing in politics, which is to change tack,\u201d Hunt told the BBC.<\/p>\n\n\n\n
The Conservative Party still commands a large majority in Parliament, and -\u2013 in theory -\u2013 has two years until a national election must be held. Polls suggest an election would be a wipeout for the Tories, with the Labour Party winning a big majority.<\/p>\n\n\n\n
Conservative lawmakers are agonizing about whether to try to replace their leader for a second time this year. In July, the party forced out Prime Minister Boris Johnson, who led them to victory in 2019, when serial ethics scandals ensnared his administration.<\/p>\n\n\n\n
Now many of them have buyer\u2019s remorse about his replacement. Under party rules, Truss is safe from a leadership challenge for a year, but some Conservative legislators believe she can be forced to resign if the party can agree on a successor. Defeated rival Sunak, House of Commons leader Penny Mordaunt and popular Defense Secretary Ben Wallace are among the names being mentioned as potential replacements. Johnson, who remains a lawmaker, still has supporters, too.<\/p>\n\n\n\n
Junior Treasury minister Andrew Griffith argued Sunday that Truss should be given a chance to try to restore order.<\/p>\n\n\n\n
\u201cThis is a time when we need stability,\u201d he told Sky News. \u201cPeople at home are just tearing their hair out at the level of uncertainty. What they want to see is a competent government getting on with (the) job.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
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