Thursday 6 October 2022

What Liz Truss must do next


Being a Conservative voter involves one disappointment after another. We vote for free markets, small state, lower public spending, lower taxes and always end up with the opposite.

David Cameron’s major achievement was granting the SNP an independence referendum which led to Scottish nationalism moving from a minority pursuit that could safely be ignored to it being in permanent government.

Theresa May’s major achievement was failing to get the UK out of the EU despite promising to do so, agreeing to the Irish backstop when she didn’t have to, and nearly seeing us ruled by a communist.

Boris Johnson’s major achievement was getting 3 quarters of the UK out of the EU, but leaving Northern Ireland stranded and overseeing the largest expansion of the state in decades. He spent more than Corbyn intended to.

Liz Truss’s major achievement was to blow up her premiership with perhaps the worst Conservative economic shambles since Black Wednesday in 1992.

The consolation of course is that if you are a socialist or a Scottish nationalist your hopes too are likely to be disappointed. We always end up in the social democratic slough of despond even if no one actually votes for the centre.

Labour voters hoping for socialism will face the same economic reality that Conservative governments do. If Labour tries to raise benefits or increase public spending it will have to finance it and the markets will determine what in the end can be done.

The SNP may win most seats in Scotland, but it still has to address how to get Scotland out of the UK without wrecking the Scottish economy. It still has to address how to form a new state when around 50% want to stay in the old one. No one in the world has ever tried to do that. It still has to reconcile being in the EU while the former UK is not in the EU and how this could be reconciled with open borders and free trade with the former UK. Until these problems are addressed and solutions found Scottish nationalists are as liable to be disappointed as the rest of us.

It is likely that Liz Truss will only have two years as Prime Minister. But she must rule both as if this is the case and it is not.

Firstly, the Conservatives must try to do some good for the country in those two years. Even if Labour takes advantage of Conservative decisions that lead to economic growth, we are all British and must do the best for our country rather than our party.

If Truss has a chance, it is that two years from now British voters see signs of prosperity and vote to stay with what might be working.

There is no doubt that lowering public spending and tax will increase growth. There is hardly a serious economic who disagrees with this. Oddly however even after 12 years the Conservatives have never seriously tried to shrink the state. There are just too many vested interests that prevent it and the media goes crazy if you try to emulate some of the more prosperous states that spend a lower proportion of GDP. The horror the horror, we could be like Switzerland.

But the more that Truss can lower public spending and tax, the harder it will be for Labour to raise it. Voters don’t like tax rises even if they pretend to.

One of the keys to lowering tax is to make it transparent to voters. Tax is deliberately baffling so that voters are unaware of how much they earn goes on tax. This bit goes on national insurance, this bit on council tax, this bit on VAT. There are endless rules and regulations which obfuscate what we actually pay.  Tax simplification ought to make it easier for voters to see what proportion of our income goes on tax. If you were told that on average about half of what you earn goes to the government you might be keener to lower the bill.

Truss needs to make as many trade deals with the rest of the world as she can and to get rid of as many EU rules that hinder business. It is unlikely that Labour will be able to get the UK back into the EU. Who will vote for Schengen, the Euro and no rebate? But make it still harder by pointing out that EU membership would mean losing those trade deals with important trading partners.

Get rid of the Northern Irish protocol. It would be impossible for Labour to reintroduce it. It is intolerable that there is an internal border between one part of UK territory and another. No other European country would accept this. Make clear to Ireland that the existence of the Belfast Agreement, the Common Travel Area and friendly relations in the decades to come depend on it ceasing to be quite so irredentist. The UK does not have to buy Irish goods. We could require Irish citizens to have visas if they want to visit. Make clear that friendly relations, open borders and cooperation mean that you don’t try to nab British territory. If you want unfriendly relations, then go for it.

If Labour plans to introduce a form of proportional representation, the Conservatives might try first to introduce a form which would benefit Conservative candidates and which might at the same time allow Pro UK voters in Scotland to vote for all the Pro UK parties, thereby uniting the vote. The Single Transferable Vote would be preferable to other forms of PR that would make a Conservative majority much more difficult in future.

Continue to help Ukraine to defeat Russia. If Russia can be completely defeated in the field leading to the liberation of all of Ukraine including Crimea, then the world will be a much safer place. We have the possibility of regime change, perhaps even breaking up Russia, which will see our main foe since 1945 finally neutralised. This will lead to great defence savings in future. It is worth throwing everything at this. It is a once in a century opportunity.

But Truss must realise that the main threat to our security does not come from Russia but from China. We have since Mao treated China as being not as dangerous and not as bad as Stalin and his successors. The Americans foolishly aided and allied with China in the 1970s. We now have a Chinese version of the Soviet Union, but which has a first-rate economy we have come to depend on. China is much cleverer that Russia ever was. Its people work harder and they are more united. In the decades to come China will be a far greater threat than the Soviet Union ever was, because it has communism that works.

In the next two years Truss must try to do to Labour what Gordon Brown did to the Conservatives. The 50% tax rate Brown introduced in 2009 is a bomb that keeps blowing up in Conservative faces.

If the Conservatives can do something to prevent people arriving in Britain illegally and staying because the courts make it impossible to deport them, it will be very difficult for Labour to reverse this. So, pass an Act, or leave the European Court of Human Rights or repeal or amend the Human Rights Act, but make it possible to deport those who arrive here illegally. Do everything you can to achieve this. This will be the bomb that will blow up in Labour faces if they try to reverse it.

The most important thing that Liz Truss can do for the UK would be to assert by an Act of Parliament that the UK is a single unitary nation state made up of parts that happen to be called countries, but which are not themselves nation states, and that secession by means of a referendum is illegal. This is perfectly possible. Lots of European countries have laws similar to this.

Obviously, this would cause some anger both in Northern Ireland and Scotland and perhaps in Wales too. But point out that Ireland would not allow Munster to secede by referendum and the neither the United States or any other European Union country would allow a part to leave by this means either and you can point out that we are just doing what everyone else does.

It is now politically difficult perhaps impossible to abolish devolution, but devolution should never have been allowed to happen without strengthening the unity of the UK.

If Truss could pass this act alone, she would be a successful Prime Minister remembered forever even if she did nothing else. It would be very difficult for Labour to repeal it even if it was forced into some sort of arrangement with the SNP.

So don’t let’s be despondent. Let’s use the next two years to make the UK more prosperous and secure. This is also our best chance of extending these two years into another five.