‘Burnham will destroy Britain!’ Liz Truss unleashes on the PM
The Daily T
Former Prime Minister Liz Truss discusses her belief that the British state has been captured by progressive institutions like the Bank of E
Key takeaways
- Liz Truss claims the Bank of England's quantitative tightening announcement undermined her mini-budget.
- Truss argues that Blair and Brown created an unaccountable system through acts like the Human Rights Act.
Main topics
- Economic policy and the mini-budget
- The role of the Bank of England
Notable quotes
They attack me because I'm right, they wouldn't if I was irrelevant.
Conclusion
The episode provides a deep dive into the ideological fractures within
Transcript preview
Speaker 4 (0:03) The Telegraph. Speaker 3 (0:08) In 2018, a billionaire diamond tycoon accused of one of the world's biggest ever bank frauds went missing. This is the story of the rise and fall of Nirav Modi. And of how we caught him. Speaker 1 (0:23) He was in the news all the time. Where is Nirav Modi? Why can we not find him? Speaker 3 (0:27) He's one of the most sought-after criminals in India. You owe a lot of people a lot of money, Mr Modi. Who Speaker 2 (0:32) would very much like to know where you are. Speaker 3 (0:34) Sorry, no comment. The Diamond King. A new podcast from The Telegraph. Speaker 4 (0:42) She's lampooned by the left and was blamed by Andy Burnham in his big speech of crashing the economy. But Speaker 2 (0:48) Liz Truss hits back and says that Britain is doomed if it believes this socialist conman, who she says is only a five out of ten. I Speaker 5 (0:57) want to see this country rescued. I think we're in serious trouble. I want to see the right win at the next election. But the starting point has to be what the right actually do. Speaker 4 (1:11) We are joined by former Prime Minister Liz Truss on The Daily Tee. Back on The Daily Tee. Good to see you. Good to be here. Shall we discuss Andy Burnham's barnstorming speech, which I'm sure you enjoyed from start to finish, including the very early on jibe where he said, well, I've been in the role for 10 weeks, which is better than some people. Speaker 5 (1:27) What can I say about that? I mean, the longer he's in, the worse it's getting. Every single indicator is worse than when I was in office and the speech was a kind of schmaltz fest. as far as I'm concerned, and not dealing with the country's very, very serious problems. We're about to go into a winter with probable blackouts. The power grid's in a terrible state. We've got the worst debt now that we've had ever in our history. The gilt rates are back up again after Healey and Burnham's speech. He's talking about rejoining the EU and introducing PR. Speaker 5 (2:05) I think the country is in very, very, very serious trouble. Speaker 2 (2:08) What about what he said about reforming the triple lock in order to finance social care? That's one example of reducing spending, right? I think Speaker 5 (2:20) the triple lock does have to go. I think most people recognise it has to go. Otherwise, it will take up the entire British state Speaker 2 (2:27) in Speaker 5 (2:28) due course. But it's a fairly small measure. He's only talking about 2030. We've got the problem now with the fact that the country hasn't run a surplus for 30 years. So I think it's fairly small beer in comparison to the size of the problem. And everything else he's talking about is going to cost more money. Nationalizing industries, the state getting more involved in everything. There's no real solution to Britain's very serious economic problems. Speaker 4 (2:58) You tried to do something radical and it backfired. So when he speaks about successive government failure... To what extent do you accept that argument? I don't think you're going to accept his argument that it's all Thatcher and Brexit's fault. But some of the economic indicators that you've pointed out, low growth, high debt, high spend, high tax, that was a Tory problem and remains a Labour problem, right? See, what Speaker 5 (3:22) happened back in 2022 is the Bank of England caused the crisis. You know, they announced quantitative tightening, which means the selling of government bonds the day before the mini budget. What did they do last week when John Healey's gilt rates had got higher than they had in 2022? They announced the stop of quantitative tightening. So the Bank of England effectively bailed the Labour Party out Speaker 4 (3:47) when Speaker 5 (3:48) they had a problem with the gilt market. Whereas in my case, they put fuel on the fire. And this is answering your question, Camilla, because we have a basic problem with the British state. What did Blair do? He took huge powers away from elected politicians. He gave them to organizations like the Bank of England. He made the judiciary unaccountable. He created a massive quangrocracy. The state is now on autopilot and failing. Why did conservatives not succeed in dealing with immigration, in dealing with the economy? The answer is... Conservatives weren't willing to repeal all of those Blairite laws, the Human Rights Act, the Climate Change Act, the Constitutional Reform Act. And that was our fundamental failing. But the problems of today were created by Blair and Brown. That's what we're still living with. And if you look at what's happened to the British economy since they were in power and created this morass, it's been a disaster. This is why the Brexit thing is such a red herring, because the problems did not start in 2020 when we actually left the EU. They started really seriously after the financial crisis. Speaker 2 (5:06) We don't want to talk too much about the past because we're not Andy Burnham. I think we do need to Speaker 5 (5:11) talk about the past, Tim, because the country does not yet agree on where it went wrong. And until you agree what the problem is, you can't really agree what the solution is. Are Speaker 2 (5:21) you Speaker 5 (5:21) saying Speaker 2 (5:21) the Bank of England deliberately made borrowing more expensive in order to crash your economic program? Speaker 5 (5:26) I'm saying at best they were negligent. Right. And at worst they were deliberately doing it. But they knew we were going to announce our budget on the 23rd of September. Bear in mind, this is the Bank of England that had been printing money for 10 years. They announced the stopping of printing money and the start of quantitative tightening, the selling of government gilts the day before we announced our budget. We didn't know they were going to do that. That had a massive effect on the market. And if you don't think it has an effect on the market, look at the effect it had last week when the Bank of England announced the stop of quantitative tightening. the bond rates went down Speaker 4 (6:07) and John Healey was let off the hook. So you've got an exact Speaker 5 (6:10) counterexample here of a Labour government that are being helped by the Bank of England and a Conservative government that was being hindered. Well, if it wasn't Speaker 2 (6:19) negligence, then it was conspiracy. And if it was conspiracy, why would they do that? Why would they act to undermine the British government? Speaker 5 (6:28) Because we have institutions in Britain who are progressive-minded institutions. The governor of the Bank of England has criticized Brexit. He's advocated for net zero. He's advocated for DEI. The Office of Budget Responsibility last week, or I think it was earlier this week, have apparently said that because migration is too low at the moment, Speaker 4 (6:56) the Speaker 5 (6:57) government headroom is going to be cut by £7 billion. We have ideologically biased people in our institutions. And it's not just the financial institutions. It's also the police. Look what the former chief constable of the West Midlands did. It's in our judiciary. This is a really serious problem. So what Speaker 2 (7:20) was it you were proposing to do that this cabal of progressives were willing to destroy the British economy in order to stop? Speaker 5 (7:27) Well, what they... Speaker 5 (7:30) are believers in is Keynesianism. Speaker 2 (7:33) They Speaker 5 (7:33) believe in government spending generates economic growth. They do not believe that money supply expansion causes inflation. The Bank of England removed money from its equation about inflation in the 1990s. They have a particular worldview. I challenge that worldview. Speaker 5 (7:57) What I know, and I was- You did that with a massive bailout for Speaker 2 (7:59) fuel. I mean, for things like you helped households with energy. I mean, that's classic Keynesianism, right? You bailed out the domestic fuel user. Speaker 5 (8:05) The fuel policy was a separate policy. Speaker 2 (8:09) And Speaker 5 (8:09) by the way, it wasn't reversed after I was pushed out of office. I Speaker 2 (8:14) just don't understand what you were doing that was so controversial to this group of people. Speaker 5 (8:17) I Speaker 2 (8:17) mean, things like reducing the highest rate of tax. I mean, trying to get a bit of fracking. It doesn't sound like it's worth crashing the British economy in order to stop it. I'm not sure your budget was that Speaker 5 (8:27) radical. Speaker 2 (8:27) But I was also Speaker 5 (8:28) challenging their authority. Right. So in the run up during the leadership election, I said, we now have these economic institutions, the OBR, the Bank of England, the two powerful. I want to review their mandate. Maybe it was a mistake to open the challenger authority, Speaker 2 (8:45) but Speaker 5 (8:46) it's certainly the case that they did not like being challenged. And one of the very dysfunctional things about the way the British government works is that the Bank of England didn't tell us what they