Former British Prime Minister Liz Truss says her failure wasn't her fault.
Truss on Sunday blamed a “powerful economic establishment” and internal Conservative Party opposition for the rapid collapse of her government, and said she still believes her tax-cutting policies were the right ones.
Britain’s shortest-serving prime minister resigned in October, six weeks into the job, after her inaugural budget plan sparked market mayhem.
Breaking her post-premiership silence in the Sunday Telegraph newspaper, Truss said she underestimated the resistance her free-market policies would face from “the system.”
“I am not claiming to be blameless in what happened, but fundamentally I was not given a realistic chance to enact my policies by a very powerful economic establishment, coupled with a lack of political support,” she wrote.
Truss took office in September after winning a Conservative Party leadership contest to replace scandal-tarnished Prime Minister Boris Johnson. Her promise to spur economic growth with tax cuts and deregulation enthused Tory members, but a budget containing $54 billion in unfunded tax cuts — including an income tax reduction for the highest earners — spooked the financial markets.
The prospect of more debt and higher inflation sent the pound plunging to its lowest-ever level against the U.S. dollar. The cost of government borrowing soared and the Bank of England had to step in to prop up the bond market and prevent a wider economic meltdown that threatened people’s pensions.
Truss first fired her Treasury chief, Kwasi Kwarteng, then quit herself.
In the article, she claimed her government was made a “scapegoat” for long-brewing instability with liability driven investments, a form of bond market derivatives in which pension funds are heavily invested,
Truss said she still believed her low-tax, small-state agenda “was the right thing to do, but the forces against it were too great.” She claimed “large parts of the media and the wider public sphere” had a left-wing slant, and criticized U.S. President Joe Biden for calling her plan a mistake.
Critics accused the former prime minister of rewriting history and using the populist playbook by blaming the system for her own failures.
Gavin Barwell, a Conservative who was chief of staff to ex-Prime Minister Theresa May, tweeted at Truss: “You were brought down because in a matter of weeks you lost the confidence of the financial markets, the electorate and your own MPs. During a profound cost of living crisis, you thought it was a priority to cut tax for the richest people in the country.”
Cambridge University economist Charles Read said he warned the Treasury in early September that a sudden economic stimulus package “risked financial instability and a financial crisis.
“The mini-budget crisis last autumn was predictable, preventable & avoidable,” he wrote on Twitter.
Truss’ article could put more pressure on Prime Minister Rishi Sunak, a former Treasury chief installed by the Conservatives to calm the markets and steady the government after her departure.
Sunak says tackling double-digit inflation is more important than immediate tax cuts. But with the economy still struggling — the International Monetary Fund says Britain will be the only major economy to contract this year — and the party lagging well behind Labour in opinion polls, some Conservative lawmakers are getting restless.
A faction inside the party is still pushing immediate tax cuts, despite the damage done by “Trussonomics.”
Lawmaker Jake Berry, a former party chair, said that while Truss’ agenda “wasn’t delivered in the right way,” she had the right instincts.
“Her point of, we need to lower taxes, we need to create a growing economy, that’s what people want,” Berry told the BBC.