Good morning Patrick! Another week, a new British Prime Minister. Will we have the same conversation again in six weeks?
“Well, I think it’s going to take a little longer this time. With Boris Johnson you might have had that, but now it could go well for a few years. Rishi Sunak favors a more moderate course, he is a bit more cautious. This will bring calm to the financial markets.
It is not yet clear what his plans are. He has said he wants to cut spending. The United Kingdom must first get its household book in order. After that, some tax reduction is possible. Liz Truss said he wants to give the economy a blow, Sunak is of bringing the budget under control.
‘You won’t see many scandals with him either. Johnson really was a scandal magnet. Although Sunak has also been discredited a few times. In April, it emerged that his wife, who is Indian, paid taxes on her assets in India, not in England. An arrangement has now been made for this, but it became quite a riot. And he was also fined for attending a lockdown party.’
Boris Johnson also appeared to be running again, but withdrew, despite saying he had enough support from parliamentarians. Why did he do that?
“Johnson took a long time to retire and that was interesting. On Sunday he also said: you can choose Sunak for financial peace, or for me if you want to win the elections in two years.
“What Johnson is doing now is showing that he is sacrificing himself for the party’s interest: I could have done it, but I didn’t, that idea. If he had persisted, his party would have fallen into even greater chaos. The regular members of the party favor him, but he would have ended up in a hostile faction. He has seen that there is a lot of resistance in his party, even among old friends. The time is not yet right for his return.
“But you can never write off Johnson permanently. He says that now is not the right time, but does suggest that this moment may come. New elections will be held by the end of 2024 at the latest. If Sunak loses it, maybe Johnson could try to take his chance again.”
Sunak also participated in the previous leadership elections. He received the most votes among Tory MPs, but Truss won in the vote among all party members. Where does that difference come from?
Members blame Sunak, among other things, for overthrowing Johnson. His resignation in July eventually sparked an avalanche within the party. A day after Johnson announced his departure, he already had a campaign video ready for himself. He had prepared a coup, it sounded.
‘In general, the members of the party are also quite old-fashioned. They see in Sunak a smooth banker and a global citizen. He is of Indian descent, has a green card for America and has said he would like to live in California again. That makes them doubt his loyalty to the country.’
What is the most important thing that awaits Sunak?
In a week, on Halloween, his government will present the budget for the coming year. This is largely already established, but it is nevertheless very important. Where will he cut spending, where will the money come from? It remains to be seen how the financial markets will react to this. Which immediately raises the question in some Tories: who actually rules our country, us or the financial markets?
‘He also has challenges in other areas, such as the war in Ukraine. He won’t change the policy much there. But the most important thing is the economy, which has actually been ailing for ten years.’
Sunak has recently been Minister of Finance. If he didn’t manage to get that ailing economy back on track before, why now as prime minister?
Sunak became finance minister in corona time. You can’t conduct normal economic policies during a pandemic, so that made it very difficult for him.
‘With Sunak, the Tories mainly opt for rest. He is known for his economics knowledge and has worked for hedge funds. He was involved in finance from an early age. His mother owned a pharmacy and the story goes that he did the bookkeeping as a teenager.’
What else is remarkable about Sunak?
“The Tories have had three female prime ministers before. Sunak is the first British Prime Minister with a migration background. The party looks at that with some complacency, that they are a party of emancipation. Labor has never had a female prime minister, let alone one from an ethnic minority.
Tomorrow Sunak will go to Charles, who will be his second prime minister in his short reign. His mother Elizabeth lived through fifteen prime ministers in seventy years. If it continues at this rate, Charles will be on it after two years.’