William Watson: The market eats its biggest fan

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U.K. investors could come to rue their backlash against the tax\u002Dcutting prime minister. Read on

“Everybody” is a bit strong. But we’ve seen in the 24 days between Liz Truss’ first Chancellor of the Exchequer Kwasi Kwarteng bringing in a package of tax cuts and her second Chancellor Jeremy Hunt cancelling virtually all of it Monday that the market’s reach is wide and high. Hunt’s all-but-complete climbdown — only a cut in payroll taxes remains — had markets purring: the pound was up more than one per cent and the yield on U.K. government debt down 42 basis points.

What has been largely missed in the last three weeks of Truss fuss is that the fury of the supposedly hyper-capitalist market has been unleashed against Britain’s most capitalism-friendly prime minister since Margaret Thatcher. And maybe since wellMargaret Thatcher, since a main argument made against the tax-cutting Ms. Truss is that Mrs. Thatcher was fiscally responsible before she was a tax-cutter .

, after abolishing it “Parliament decided that all documents connected with it should be collected, cut into pieces and pulped.” Pierre Poilievre is fond of ancient parliamentary traditions. I wonder if he knows that story.Article content

 

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