Just days after Liz Truss announced her resignation outside Number 10 under a cloud of crisis, she told allies: “I lost a battle, but I haven’t lost the war.” In the months since, the former prime minister has tried to revive the principles that inspired her ill-fated tax project with relative regularity, including in a speech to the US-based Heritage Foundation in April.
But yesterday, Trussonomics came home for the launch of the “Growth Commission,” a new collective of economists and pundits who share Truss’s vision of an unchained free-market future.
Nominally, Truss is the “coordinator” of the Commission, with the lucky economists in question assembled under the former prime minister’s leadership. However, it was fundamentally clear that this new grouping was stepping outside the bounds of the doomed Liz Truss Revival Project. In fact, the former prime minister’s name did not appear in any of the Growth Commission’s publications, and the launch of the new free-market vehicle shrewdly skipped any hagiographic account of the lows of the Trussite interregnum.
Rather, Truss sat in the audience for the launch of the Growth Commission’s first report as a patron present, but conspicuously uninvolved. This was the 49-day PM doing his best impression of a senior statesman. But more broadly, it’s a sign that Trussonomics proponents are confidently looking to the future, embracing strategy at the expense of personality. Truss herself told reporters after the launch: “It’s a long game.”
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Still, the former prime minister’s influence is felt deeply in the Commission. Julian Jessop, that high priest of Trussonomics and fellow at the Institute for Economic Affairs, is among the free-market advocates assembled. His presence on the commission, having been so prominent in Truss’s No. 10 economic inner circle, arguably underscores how small free-market circles are in Britain. That Truss has reached out to a group of American economists, primarily connected to the libertarian Mercatus Center, is another example. (The Commission’s transatlantic tilt is no doubt a consequence of Truss’s vigorous jett-setting in recent months.)
With the Growth Commission, therefore, Trussonomics retreats to its intellectual home: the realm of secretive policy institutes and think tanks. The flickering flame of the free market needs to be fed, Truss reckons; In this way, the Commission will function as a chrysalis chamber, in which the message of British libertarianism will be protected, refined and eventually pushed back into mainstream thought.
As for his message, the Growth Commission is dedicated to spreading the belief that Truss specialized in as prime minister: the importance of growing the economy. The group’s 33-page inaugural report, titled “The Growth Challenge,” is itself a mission statement. Addressing the launch yesterday, Tyler Cowen, president of the Mercatus Center, did his best Keir Starmer impression when he told the audience that the standard of living in Poland could surpass that of Britain in a decade.
“Indeed, we live in a world where it is imaginable that in less than 10 years the standard of living in Poland will have surpassed the standard of living in Great Britain,” he conveyed. The report itself warns that the UK “is one of the few international economies where GDP per capita is falling.”
an obr shadow
As for the future plans of the Growth Commission, the overall goal of the grouping is to act as a kind of shadow for “orthodox” institutions, crafting economic models based on fundamentally conflicting ideological assumptions.
The grouping therefore now intends to design models critically different from those currently implemented by the Treasury, the Office for Budgetary Responsibility (OBR) and the International Monetary Fund (IMF), including analysis of the effect of certain policies on 5, 10 and 20 years. the line. (Of course, it’s hard to hide that the more the Commission fixates on the models, the less reliable they will necessarily be, and the more commissioners will be forced to retreat into ideological assumptions.)
Launched in a building directly across from Treasury, this element of the Commission’s self-assuming mandate is especially foreboding.
Of course, the argument that the UK economic model is a major constraint to long-term growth is a central tenet of the Trussite playbook. Truss’s solution to this during her brief tenure as prime minister was to ignore the doomsday OBR by opting for a “mini”, rather than a literal budget, going a stubbornly separate path. Truss did not spend time on an independent assessment of the economic impacts of her proposals; she just managed to scare the markets.
Now, Truss will not circumvent the OBR, but rather compete with it as the Growth Commission seeks to annotate future tax plans through the ideological prism of Trussonomics. The intent is to operate as a drag in an economic landscape so dominated by “Treasury orthodoxy,” chastised by the Trusites as intellectually narrow and economically self-destructive.
Sunak and the ‘Treasury Orthodoxy’
Politically, the Growth Commission project will be seen as a challenge to Rishi Sunak and his way of doing politics.
Since taking over the reins of number 10 from Liz Truss in October, Conservative MPs have consistently accused the prime minister of presiding over a low-growth, high-tax economy. The Growth Commission could now serve as a lightning rod for such discontent. In fact, a host of Sunaksceptic Conservatives attended the launch of the group along with Truss, including former Brexit negotiator Lord David Frost, Liz Truss’s environment secretary Ranil Jayawardena and former Home Secretary Priti Patel.
In the Trusite formulation, former Foreign Minister Rishi Sunak is “Treasury orthodoxy” made flesh. Late last year, it’s no secret that the prime minister presented himself as the antidote to Trussonomics, and his technocratic leanings continue to be criticized for undermining Britain’s long-term growth prospects.
With the prime minister’s political stalemate still defined by fiscal unrest, the Growth Commission will find no shortage of policies to disagree with. Indeed, ahead of the commission’s launch yesterday, Sunak told reporters on his way to the NATO summit in Vilnius that while he wanted to cut taxes, inflation “trumps everything else.”
Strategic Trussism
Liz Truss hasn’t always been known for her strategic sense. The tranche of immediate tax cuts from her in September, before any concerted attempt to prepare the ground, was pursued on ideological rather than tactical lines. In turn, former Brexit secretary David Davis accused then-chancellor Kwasi Kwarteng of committing a “Hail Mary”, while Conservative Simon Hoare criticized “inept folly”.
But with the Commission on Growth, the former prime minister appears to have formulated what could be described as a relatively foolproof plan for promoting her economic principles. And politically, her pronouncements on economic planning could mean some headaches for Rishi Sunak when it comes time for future fiscal events.
The problem for the Commission will be that its longevity may be limited to the time period of the Conservative government. If and when Keir Starmer comes in at No. 10, his influence among a few conservative Tories may mean little. We can probably expect the Commission to extend its mandate to international affairs in the event of a Labor electoral victory.
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