Is UK’s Liz Truss a Reincarnation of Guns and Butter US President LBJ?

On September 5, I commented The UK Elected a New Prime Minister, Liz Truss, Now What? (Emphasis added)

Low-Tax Libertarian Liz Truss Succeeds PM Boris Johnson, Britannia Unchained?

As a Libertarian, Truss is starting off on the wrong foot with promises of large-scale state intervention and possibly price caps on natural gas that cannot possibly work.

Still, Truss is better than Sunak who wants tax hikes and would possibly seek to get the UK back into the EU or more likely a customs agreement with the EU, the worst of all worlds. 

Boris Johnson’s Unique Qualities

Boris Johnson had two unique qualities. He was arguably the only person who could get Brexit done. Congrats!

Then he was then uniquely unqualified to lead the way once that happened.

Instead of junking regulations like Truss proposes, Johnson started Covid lockdowns while attending parties himself, then embarked on a nonsensical clean energy pact that was impossible to deliver and fueled inflation.

This brought howls Left and Right.

Libertarian?

https://twitter.com/bertrandous/status/1566857320520359938

Truly Scary Woman

@MishGEA — as discussed by @DA_Stockman and others. A truly scary woman. #LizTruss https://t.co/iiD1AkT9nu

— Mr Ivan Johnson (@MrIvanJohnson) September 5, 2022

Stockman Chimes In

I added Stockman’s Tweet to my post.

Is there a non-war monger to be found anywhere?

— Mike “Mish” Shedlock (@MishGEA) September 5, 2022

On the Pragmatic Side

sigh, perhaps indeed..w/the whirl of Boris its hard to see a centre of the hurricane..but yes,Truss, it’ll interesting to see. the team’s kinda interesting. Often (like Boris w/covid) if the emergencies are in your face you do act.. so she has a lot of that & may shine..who knows

— Berhe Banks (@BanksBerhe) September 5, 2022

Johnson Delivered Brexit

“Many people blame Brexit for the UK’s woes but it was the disastrous policies of Johnson in the wake of Brexit that made the big mess.”

That view is the correct one. Johnson undoubtedly delivered Brexit, a feat many did not think would ever happen. 

But will Brexit be reversed? 

Oh No, Minister

With the above background out of the way, please consider the Eurointelligence article Oh No, Minister (Emphasis mine and “Sir Humphrey” explained following the clips)

The death of a monarch does not usually end a monarchy. But we wonder whether the sacking of Sir Humphrey might constitute the beginning of the end for that other great British institution: the civil service.

The decision by Kwasi Kwarteng, the new UK chancellor, to fire Tom Scholar as permanent secretary to the Treasury, is hugely significant because it constitutes the necessary precondition for a shift in fiscal policy. John Maynard Keynes famously criticised what he called the Treasury View – the pinnacle of economic orthodoxy – that will always seek a restrictive fiscal policy. There is a modern version of the Treasury view, as exemplified by Scholar and other civil servants in his department, the view that got Rishi Sunak to raise national insurance and corporation tax. We see those tax rises as right up in the annals of bad economic policy decisions on par with the early Thatcher government’s excessive monetary and fiscal tightening as the country went into recession.

We keep an open mind on the Truss experiment, the biggest fiscal policy expansion in modern UK history. The energy subsidies are huge. The UK is capping energy bills. We think, and hope, that this move could pay for itself – or technically that its fiscal multiplier will be greater than one – because it will take pressure off the Bank of England and because it will support consumers during the winter. Helping people meet bills and buy essentials is not what drives inflation. It’s the credit-financed car purchases or home improvements that does.

Judging by some of the horrified reactions in the media and the wider civil-service-fan-club, we wonder whether people misjudged the impact of Boris Johnson’s departure. They hated him for delivering Brexit, but Johnson governed in a conventional way. To make Brexit work requires a rebooting of many areas of British life, starting with the civil service. The problem is not that civil servants opposed Brexit, but that the whole system is hardwired to discourage change. The UK sits at the opposite end of the spectrum from the US, where incoming presidents bring thousands of high-level officials to run the administration. There is no such thing as a Sir Humphrey in the US.

The reason why Brexit requires civil service reform is that Brexit requires a re-write of the most important regulations the UK inherited from the EU. The form of Brexit chosen, the hardest version, can only function under a regime of regulatory competition. This is not the form of Brexit we would have chosen. Had the UK accepted Theresa May’s Brexit agreement, the country would been locked in the EU’s internal market for a fairly long time: time enough for a new generation of voters to rethink the decision. 

The Truss administration may not last beyond the next election, but two years is long enough to provide the underpinnings of a workable Brexit: a re-organisation of the civil service, or at least a change in the top tiers, followed by regulatory reforms. The Treasury is the key institution, and Kwarteng is a formidable operator who appears to know what he is doing. The strategy may still fail. But we know that at least it will be attempted.

And if the electorate were to reject this, we would have reason to believe that they would, one day, reject Brexit too. But if there is such a thing as a Brexit strategy, this lot is the one that will deliver it. Or nobody else will.

Sir Humphrey 

Sir Humphrey Appleby is a fictional character in the 1980s British sitcom, Yes Minister.  

Sir Humphrey is a master of obfuscation and manipulation, often making long-winded and periphrastic statements such as, “In view of the somewhat nebulous and inexplicit nature of your remit, and the arguably marginal and peripheral nature of your influence within the central deliberations and decisions within the political process, there could be a case for restructuring their action priorities in such a way as to eliminate your liquidation from their immediate agenda.”. He is committed to maintaining the status quo for the country in general and for the Civil Service in particular, and will stop at nothing to do so — whether that means baffling his opponents with technical jargon, strategically appointing allies to supposedly impartial boards, or setting up an interdepartmental committee to smother his Minister’s proposals in red tape. Throughout the series, he serves as Permanent Secretary under the ministry of Jim Hacker at the Department of Administrative Affairs.

The Eurointelligence title “Oh No, Minister” is a play on the sitcom title.

Eurointelligence complains that a hard Brexit “as delivered by Boris Johnson is not the form of Brexit we would have chosen.“

Indeed. Eurointelligence was against Brexit the whole time. But a hard Brexit was the only Brexit that ever made any sense. 

Theresa May offered the worst of all worlds. The UK would end up in a customs union, bound by idiotic EU policy, with no voting power. 

Guns and Butter?

Lyndon B. Johnson wanted a war on poverty, a Great Society, and unfettered spending on the War in Vietnam. 

The Washington Post commented in 2005, long after Johnson was gone Choose: Guns or Butter. 

On Aug. 3, 1967, President Lyndon B. Johnson sent a message to Congress in which he said that the United States could not continue to fight a war in Vietnam and at the same time continue his Great Society programs without, among other things, raising taxes.

For Johnson, the realization that bills come due came too late. Early on he said, “We can continue the Great Society while we fight in Vietnam,” but he sensed — canny pol that he was — that the American people would pay for the former but not, if they had to choose, the latter. When Johnson finally had to ask for a tax increase, he was on his way out as president. Less than a year after delivering his message about hard facts, he had to face the hardest one himself: He announced he would not seek reelection.

Bush, having won a second term, cannot seek reelection and so he may never become politically accountable for his mismanagement of the nation’s finances. As Johnson initially attempted, Bush is telling the American people they can have both guns and butter — two for the price of one. In Bush’s case, “guns” is the war in Iraq (and Afghanistan) and the “butter” is domestic programs such as enriched Medicare along with the war on terrorism, which Bush himself has characterized as virtually endless. In his case, though, he has not only refused to raise taxes, he has actually lowered them. LBJ could only marvel.

Every US president ever since has been in favor of guns and butter without raising taxes. 

US deficits prove it. 

In the UK, Liz Truss is now embarking on the biggest fiscal policy expansion in modern UK history. 

And unbeknown by me when I wrote my September 5 article, Truss supports UK troops on the ground in Ukraine.

This is her guns and butter moment. 

Guns and butter sums sums up the setup nearly everywhere. Even the EU wants its own army. 

Q: Why? 
A: To have unfettered access to send troops to every war at any time.

Eurointelligence criticizes the “Treasury View”, alleged fiscal restraint. What a hoot. 

Truss, Biden, Trump, and Bush were all guns and butter politicians. Perhaps Truss does something good along the way about the UK’s disastrous civil servants mess. 

Otherwise, it’s all guns and free butter, the same with Biden and nearly everywhere else too. 

This post originated at MishTalk.Com.

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