‘They are trying to hide the failure of Brexit behind policy stunts.” This observation about the fiasco of the Conservative party’s leadership contest came from an economist friend and neatly sums it up.
Liz Truss, who voted Remain but is now an ardent Brexiter, cannot admit to herself that she was right first time, and that the trade deals she goes on about that are supposed to have made up for our crass departure from the European Union do not amount to a hill of beans.
Sunak, who was always a Brexiter, must surely have learned from his time as chancellor that the Treasury’s hostility to Brexit was right all along. He is an intelligent man but, like Truss, is fantasising about Brexit “opportunities” that the Treasury and other Whitehall departments know are chimerical.
Whichever contender succeeds the worst prime minister in living memory will have to come to terms with two fundamental consequences of Brexit. One is that the Office for Budget Responsibility’s estimate of a 4% annual loss to gross domestic product not only makes the country poorer but severely limits their tax-cutting ambitions – hers now, his later. Foolishly losing tens of billions of potential tax revenues through Brexit is not a good start to either of their ambitions.
The second is the devaluation of the pound by up to 12%, which the financial markets attribute to, yes, Brexit. This has not only made the country poorer but has also severely aggravated the inflation problem the government and Bank of England now face – with price growth running significantly higher than in most other European and G7 nations. » | William Keegan | Sunday, July 24, 2022
