Putin is waging an economic war with Europe. Britain’s absurd energy plan plays into his hands
The Brexit libertarians are in control of our destinies for at least the next two years and already the extent of the threat they pose to our wellbeing and security is becoming clear. The prime minister, Liz Truss, may have swallowed her own words of just a month ago that she was against “handouts” to launch the biggest handout in our history, but that was to buy her and her acolytes the political breathing space to launch their programmes. The energy price cap might have been a breathtaking U-turn, but it had a darker purpose.
The intent was betrayed by the chancellor Kwasi Kwarteng’s summary sacking of Sir Tom Scholar, one of our best and most dedicated civil servants, now former permanent secretary to the Treasury. Kwarteng’s thinking was revealed when he blamed “the same old economic managerialism” for leaving Britain “with a stagnating economy and anaemic growth”.
“Bold action,” he suggested, was an imperative to relieve this “toxic combination”: “Cutting taxes, putting money back into people’s pockets and unshackling our businesses from burdensome taxes and unsuitable regulations.” Only thus could investment and growth be unlocked. Better that, he added, than “burying our heads in a redistributive fight over what is left”.
It is unsubstantiated hogwash – ideological faith triumphing over evidence and reason. In these terms, Scholar, exemplar of the alleged old economic managerialism, had to go. We are on an economic fairground ride led by fairies and fools.
Of course, the two-year £2,500 price cap is welcome. It will lift from millions of people the threat of desperate choices over warmth or food. It will also lower the peak inflation rate by up to 4% and so lower debt service costs in a full year by around £20bn – a
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