Politics Explained

Boris Johnson has little scope for tax cuts – they won’t fix the problems he faces

Unlike previous cyclical downturns, Brexit has introduced new structural weaknesses into the economy, writes Sean O’Grady

<p>Boris Johnson’s troubles have only just begun</p>

Boris Johnson’s troubles have only just begun

Although some premiers make it look easy, governing, even in good times, is a difficult, frustrating, endlessly challenging business. In bad economic times, though, it is far more difficult. And so it is proving for Boris Johnson.

Even without Partygate or the Covid-19 pandemic, the weakness of the British economy would surely have led to unpopularity and the kind of economic crisis we are now experiencing – and with it the political price it has exacted from the prime minister and his party. Hence his troubles. Indeed, if he could have cut taxes properly over the past couple of years then he might well never have faced a vote of no confidence. We cannot know for sure, but the next 12 months will, if anything, be as hard as any, with the obvious exception of the lockdowns.

The Organisation for Economic Cooperation and Development is the latest body to predict dismal economic growth for the UK in 2023 – 0 per cent. It is in line with the forecasts from the Bank of England and the Office for Budget Responsibility. It suggests a brush with technical recession (two-quarters of successive “negative growth”), and continuing problems with shortages, high inflation, rising interest rates and mortgage bills. With that come squeezed living standards and strikes, as workers attempt to defend their real wages. It follows another bottom-of-the-G7 growth performance in 2022. None of these factors are usually associated with political success.

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