Warren Buffett famously said that “when the tide goes out, you see who is swimming naked”. Now that interest rates have risen and the “tide of easy money” has receded, says James Forsyth in The Spectator, the UK has been exposed. Even before the disastrous mini-Budget, the amount the government owed in debt interest alone was over £100bn. This has only worsened, which is “extraordinarily politically painful” because higher interest payments buy nothing: “no new police officers, doctors or hospitals”.
To voters, the GDP growth that Liz Truss obsesses over is an entirely “abstract concept” anyway, says Robert Shrimsley in the FT. But a steep rise in mortgage payments, thanks to increasing interest rates, is “frighteningly real”. This plays on the nerves of “fractious and frightened” Tory MPs, among whom the mood has turned “mutinous”. The reality is that, despite a notional “parliamentary cushion” of 69, Truss has no majority. And the “incontrovertible law of politics” is that whatever their merits, no leader can be effective with “no money, no majority and no mandate”.
At this point, Tory MPs fall broadly into “three camps”, says Fraser Nelson in The Daily Telegraph. Optimists pray the market calms down and some unspecified scandal befalls Labour. A second group says a “visibly humbled” Truss could survive – if only as a “prisoner of her party” – so long as she performed some “act of penance” like her expected corporation tax rise. The rest think “it’s all over” and want a new leader as soon as possible, to make sure Labour’s majority at the next election is closer to 50 seats than 250. Of course, Truss could also give up her entire agenda and stagger on, head of a “pointless” government drained of ideas and political will. “This would be a rare example of a fate worse than political death.”