After just a few weeks, British Prime Minister Liz Truss is faced with the shards of her government policy of tax breaks. After several U-turns and the sacking of her confidant and Finance Minister Kwasi Kwarteng, the successor to ex-Prime Minister Boris Johnson appointed Jeremy Hunt, who has experience in government, as the new Chancellor of the Exchequer.
The 55-year-old should become the savior in need - but already indicated at the weekend that Truss' most important plans in tax and budget issues would have to be changed.
This means that the UK finds itself in the next government crisis less than six weeks after the change in Downing Street. At that time, Truss succeeded Johnson, who had become intolerable for his party in the wake of the "Partygate" scandal. Truss had previously prevailed in an internal party election against Rishi Sunak and other top conservative politicians - primarily by promising massive tax breaks.
Jeremy Hunt is said to be the savior in need
However, there was no counter-financing for these tax plans. The financial markets reacted with severe turbulence. As a result, Truss made several U-turns: first she received the abolition of the top tax rate, then on Friday she not only said goodbye to Finance Minister Kwarteng, but also to a planned tax break for corporate tax.
Now former Secretary of State and Health Jeremy Hunt is supposed to pull the coals out of the fire for the ailing Prime Minister. He shares her desire to build a high-growth, low-tax economy, Truss wrote in an opinion piece in The Sun. In his first interview in his new position at Sky News on Saturday, Hunt said it was a great honor to be the new finance secretary. "But I want to be honest with people: we have some very difficult decisions ahead of us."
At the same time, he agreed with his compatriots on further changes to the tax plans of the prime minister. "Some taxes won't go down as fast as people want - some taxes will go up," he told Sky News. However, he has not yet announced any concrete steps. On Sunday afternoon he was with Truss at the Checkers estate for the first time to discuss the economic plans.
Joe Biden also criticizes Truss' tax plans
What is certain is that Hunt must now practically completely realign British economic policy. Ultimately, he could tear down the entire construct that gave Truss the victory over Sunak. The rescuer could thus become a gravedigger - and politically play himself back to the front row. He is already considered in London to be the most powerful politician in government. However, Truss is still in charge, he assured the BBC on Sunday – the fact that the new Chancellor of the Exchequer has to emphasize that already speaks volumes.
In any case, criticism is constantly pouring down on Truss. Even US President Joe Biden seemed to agree. During a visit to the US state of Oregon on Saturday evening (local time), he said he did not agree with the approach of introducing tax breaks for the super-rich in times like these. "I wasn't the only one who thought this was a mistake." However, it is not up to him, but to Great Britain to judge.
The Conservative Tories are already thinking more or less loudly about Truss' downfall. Former Treasury Secretary George Osborne told Channel 4 on Sunday that "it's most likely to fall before Christmas". Tory MP Crispin Blunt was even clearer on the broadcaster: "No, I think the game is over," he said when asked if Truss could survive politically. The question now is how their successor will be arranged.
As the "Observer" reported on Sunday, a group of high-ranking Tory MPs wants to meet on Monday to discuss the future of the head of government. Some want her to throw up in the next few days, others say she holds the office, but not control.
A possible departure from Truss would, however, lead to another, potentially far greater problem for the Conservatives: Should they be chased out of office, an early general election would probably become inevitable. The problem for the Conservatives: In polls they are well behind the opposition Labor Party. So the Truss bailout could in fact become a Tory bailout itself.