The Conservative leadership contest is over, and Liz Truss is Prime Minister.
As the cost of living soars and pushes many into poverty, she has declared “it is fair” to give higher earners more money back through tax cuts.
She has also rejected “handouts” as a means of helping people cope with rising costs.
Her government, meanwhile, has given Shell and BP £700 million in handouts for oil and gas production since 2016, despite them making record profits.
The Truss plan to freeze energy bills, whilst welcome is being done in a way that effectively amounts to an energy mortgage, with households expected to pay back their savings over time.
In other words, ordinary people will be expected, yet again, to pay for a crises not of their making.
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Labour, by contrast, is proposing an energy bills freeze is paid for by a further windfall tax on the profits of oil and gas giants – real redistribution in action.
We recognise energy companies can no longer produce energy at a price households and businesses can afford – but that is a failure of the market, not ordinary people who rely upon it.
For all the rhetoric of “levelling up” under the failed Johnson-led administration, it’s a timely reminder the Conservatives always place the interests of profiteers and the super-wealthy above everyone else.
Over a decade of Tory government has seen wages fall in real terms, public services hollowed out and a wealth redistributed from the poor to the rich.
Of course, the Government could make different choices.
During the pandemic, weeks after it was proposed by then-Shadow Chancellor John McDonnell, Rishi Sunak was forced to unveil a furlough scheme to protect incomes.
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After years of misleading the public on the economy, the Tories were forced to admit it was impossible to tackle big economic crises without serious state intervention.
Two years later, we’re at a similar crossroads. Investment firm Goldman Sachs project the inflation rate will hit 20 per cent next year, levels not seen since the post-war period.
The post-war Labour government didn’t shrug its shoulders and cut taxes – it nationalised key industries and built the welfare state.
Meanwhile, the US spent billions on its “Marshall plan” to rebuild western Europe.
Ambition of a similar scale is what now needed.
We should immediately plan a major home insulation programme and expansion of public transport.
We need to see massive investment in renewables and real public ownership of energy so the present crisis isn’t repeated, funded by wealth taxes and windfall taxes on the profiteers.
What’s needed is a vision of hope, not tinkering with a broken system. What’s needed is a general election, to kick the Tories out and a Labour government.
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