Truss resigns, but UK political and economic turmoil persists | Sotck exchange

LONDON (AP) — British Premier Liz Truss resigned on Thursday after a tumultuous and historically brief tenure marred by economic policies that rattled financial markets and a rebellion within his political party that shattered his authority.

Truss has become the third Tory Prime Minister to be ousted in as many years, prolonging the instability that has rocked Britain since it separated from the European Union and leaving his leadership in limbo as the country faces a cost of living crisis and impending recession.

“I cannot serve the term I was elected to by the Conservative Party,” Truss admitted in a statement made outside his office at 10 Downing Street.

Financial markets breathed a sigh of relief, but Truss leaves a divided ruling party in search of a leader who can unify its warring factions. Truss, who has said she will remain in office until a replacement is chosen, served as Prime Minister for only 45 days and will almost certainly go down as the shortest leader in British history. George Canning died in office in 1827 after 119 days.

The Conservative Party has said it will choose a successor by the end of next week. Potential candidates include: former Treasury chief Rishi Sunak, who lost to Truss in the last leadership contest; Penny Mordaunt, Leader of the House of Commons; Defense Secretary Ben Wallace; and Boris Johnsonthe former Prime Minister ousted in July following a series of ethics scandals.

The low-tax, low-regulation economic policies that got Truss elected by his party proved disastrous in the real world at a time of soaring inflation and weak growth.

His September 23 economic plan included a series of tax cuts – paid for by public borrowing – that investors feared Britain could not afford. This has sent the value of the pound plummeting and the cost of mortgages soaring, causing economic hardship for people and businesses already struggling with an economy that has yet to emerge from the pain of the pandemic.

This financial turmoil led to the replacement of the head of the Treasury of Trussvarious political U-turn and a breakdown of discipline within the ruling Conservative Party.

Truss resigned just a day after swearing to stay in power, saying she was “a fighter not a quitter”. But she couldn’t hold on any longer a high-ranking minister left her government amid a barrage of criticism and a vote in the House of Commons on Wednesday descended into chaos and acrimony.

“It’s time for the prime minister to go,” said Tory lawmaker Miriam Cates, echoing the sentiments of many others.

The pound rose about 1% on Thursday to around $1.13 after Truss stepped down.

It’s unclear where the Conservative Party is headed from here. Its myriad factions – from hard-right Brexiteers to centrist “One Nation” conservatives – are at each other’s throats.

“Nobody has a road map. It’s kind of a day-to-day hand-to-hand combat,” Tory lawmaker Simon Hoare told the BBC on Thursday ahead of Truss’s resignation.

The newspapers that usually support the Conservatives were vitriolic. A Daily Mail op-ed on Thursday was headlined: ‘Wheels have come off Tory clown car.’

Truss’s departure on Thursday sparked jubilation from the Daily Star tabloid, which set up a live broadcast last week with a photo of the Prime Minister next to a head of lettuce to see which would last longer.

“This lettuce survived Liz Truss!” he proclaimed on Thursday.

While many Britons joined the world in laughing at the lettuce joke, Bronwyn Maddox, director of international affairs think tank Chatham House, said “there is no doubt that the UK’s position in the world has been seriously damaged by this episode and by the turning point of the Prime Ministers.

She said Truss’ successor would need to have policies “based on economic stability, but also include a resolution of the relationship with Europe; much of the upheaval represents the bitter consequences of Brexit.

The Conservative Party has said nominations for a new leader will close on Monday. Candidates need the signatures of 100 of the 357 Conservative lawmakers, which means a maximum field of three. Lawmakers will eliminate one of them and ask the 172,000 party members to decide between the two finalists in an online vote. The new leader is expected to be in place by October 28.

Truss’s resignation is the culmination of months of simmering discontent within the Conservative Party, whose polls have plummeted.

Johnson’s government has unraveled after it was revealed he had held a series of parties in government buildings at a time when people in Britain weren’t allowed to mingle with their friends and their families or even to visit dying relatives. The Conservative party spent the summer choosing a replacement as the economy deteriorated amid soaring energy prices triggered by Russia’s invasion of Ukraine.

Whoever succeeds Truss will become the country’s third prime minister this year. A national election is not due to be called until 2024, but opposition parties have demanded an election be held now, saying the government lacks democratic legitimacy.

Opposition Labor Party leader Keir Starmer has accused the Tories of presiding over “utter chaos”.

“It’s hurting our economy and our country’s reputation tremendously,” he said. “We have to have a chance to make a fresh start. We need a general election – now.”

Truss’ political meltdown began after she and her Treasury chief Kwasi Kwarteng unveiled an economic plan with 45 billion pounds ($50 billion) in unfunded tax cuts. who hammered the value of the pound and increased the cost of UK government borrowing. The Bank of England was forced to intervene to prevent the crisis from spreading to the whole economy and endangering pension funds.

Truss then fired Kwarteng and his replacement, Jeremy Hunt, cut almost all of the Truss tax cuts, cut its energy subsidies and abandoned its promise not to cut government spending. He said the government will need to save billions of pounds and there are “many difficult decisions” to make before presenting a medium-term budget plan on October 31.

Addressing lawmakers on Wednesday for the first time since the U-turn, Truss apologized and admitted she had made mistakes, but insisted she would not quit – a resolution that was short-lived. Within hours a cabinet minister, Home Secretary Suella Braverman, resigned, lambasting Truss in her resignation letter, saying she had “concerns about the direction of this government”.

For many Tory lawmakers, the final straw was a Wednesday night vote on fracking for shale gas that produced chaotic scenes in Parliament, with party whips accused of using heavy-handed tactics to win voice.

Chris Bryant, an opposition Labor Party lawmaker, said he “has seen members being physically abused…and intimidated”. Conservative officials have denied this.

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