26 Britain The Economist March 19th 2022
An unappetisingmenu
I
n “the wire”, a crime drama, a former mayor of Baltimore ex
plains the realities of political office to his successor. “The first
day I became mayor, they sit me down at the desk—big chair, dark
wood, lots of beautiful things—I’m thinking: how much better can
it get?” In walks a flunkie carrying a silver bowl. “‘What the hell is
this?’ I said. ‘It looks like shit. What do you want me to do with it?’
He says, ‘Eat it.’” At that point more bowls arrive, a constant flow of
immaculately presented excrement. “That’s what it is. You’re sit
ting eating shit all day long. Day after day, year after year.”
No British politician has a more revolting menu in front of him
than Rishi Sunak, the chancellor. Ahead of a spring statement on
March 23rd, silver platters are coming fast and their contents are
foul. Inflation is near 6% and may hit 10% later this year. Energy
bills are likely to cost British households £38bn ($45bn) extra over
the next 12 months, or the equivalent of raising the marginal rate
of income tax by six percentage points. A 2.5percentagepoint
rise in national insurance, a payroll tax, split between employees
and employers, will kick in from April. The price of diesel may
reach £3 per litre by the end of 2022. Voters are already upset, yet
worse is to come. Bowls are stacking up on the chancellor’s desk.
The experience is new to Mr Sunak, whose political rise has
been smooth and speedy. After attending Winchester, a fancy priv
ate school, and then Oxford University, he embarked on a career in
finance, in which he made pots of money (before marrying the
daughter of a billionaire). When he entered politics in 2015, aged
34, he was given the constituency of Richmond in North York
shire, which contains two national parks, a direct train to London
and the country’s biggest Conservative majority. He was appoint
ed chancellor less than five years after becoming an mp, in Febru
ary 2020, just before Britain’s first lockdown.
Compared with the current crisis, covid19 was politically sim
ple for the chancellor. Almost all economists argued that the gov
ernment had to spend, and almost all politicians agreed. The tem
porary nature of a pandemic meant the Treasury could pump cash
into the economy, with the state’s balancesheet bearing the
brunt, as during wartime. It was most voters’ first sight of Mr Su
nak, who came across as a slick finance guy, even as the prime
minister, Boris Johnson, resembled a clown delivering a eulogy. Aquick way to make voters like you is to give them £400bn. And Mr
Sunak duly became Britain’s most popular politician.
This time, his options are less palatable. Rocketing energy pric
es and inflation constitute a onceinageneration crisis hitting
after a onceinacentury crisis. The Treasury is jittery about
whether the national balancesheet can take more damage. There
is no unanimity on what to do. Advice pours in, calling on Mr Su
nak to delay tax rises or increase benefits or slash tax on fuel, or
perhaps all of the above. Each would leave a nasty taste. Scrapping
the rise in national insurance would make him look inconsistent
and weak. Cutting fuel duty would be popular but difficult to re
verse, slaughtering a government cash cow. It would also increase
demand for oil, precisely when geopolitics requires the opposite.
As for raising benefits, Conservatives dislike nothing so much.
Swallowing the inedible is easier if there is a reason. Those
chancellors who reshaped Britain from 11 Downing Street all had a
clear vision. When they did unappetising things, such as slashing
spending in the case of George Osborne, or holding fast to inherit
ed Conservative spending plans, as Gordon Brown did for New La
bour, it was with a sense of purpose. In a recent lecture Mr Sunak
offered a competent diagnosis of Britain’s economic ills: busi
nesses invest too little, workers lack skills and new technologies
should be more flexibly regulated. But he had less to say about
how to fix these longstanding problems. It was a plea for fewer
bowls, rather than a plan for disposing of them.
Grumbles about Mr Sunak’s political naivety are common
among Conservative mps and advisers. The issue, however, is not
that the 41yearold is relatively young for a chancellor. Mr Os
borne was around the same age when he became chancellor in
2010, but he had been in politics for 16 years, working through the
embers of Sir John Major’s government in the 1990s, New Labour
hegemony in the 2000s and the financial crisis. Although fresh
faced, he was battlescarred. By contrast, Mr Sunak was still a ju
nior minister for local government in the summer of 2019.
Criticism of Mr Sunak’s political nous is overdone. Increasing
national insurance, which is paid by people of working age, to
fund health and social care, which are mainly required by the re
tired, is the closest a Conservative chancellor can come to taxing
Labour voters for the benefit of Tory ones. (Labour won a plurality
of workingage voters in the most recent general election; the
Conservatives won a big majority of the over60s and twothirds
of the over70s.) Likewise, freezing incometax allowances is
about the most politically astute stealth tax imaginable. High in
flation coupled with rigid allowances lets extra cash pour into gov
ernment coffers, without budging the headline rate of tax. Betting
markets still put Mr Sunak as favourite to succeed Mr Johnson as
prime minister. For someone who is “crap at politics”, as one La
bour aide puts it, he is remarkably successful. You’ve never had it so bad
Yet the things that made Mr Sunak popular—in particular, spend
ing lots of money—are the things that the chancellor professes to
dislike. He has consistently called for lower taxes and a smaller
state, even while raising taxes and spending more. Memories of
the state’s largesse during the pandemic have faded. Instead, an
ger is growing at the government’s miserliness when it comes to
the rocketing energy bills. For many Britons, Mr Sunak will be
come the face of economic misery.ForMr Johnson, an expert in al
lowing other people to take theblame,this is no bad thing. For Mr
Sunak, it will be hard to swallow.nBagehot
Does Rishi Sunak have the stomach for what he must swallow?