Originating in Ancient India and brought to the UK in the late 19th century, Snakes and Ladders is a classic board game that most British children will remember playing growing up. The game is simple: roll the dice to move up through the board; land on a ladder and you’ll be propelled upwards towards victory, but land on a snake and you’ll slide downwards, placing you further from the top. It’s a game of volatility— the highest highs and lowest lows.
As of July of 2022, the game is afoot: British economic politics morphed into a traditional snakes and ladders board and Liz Truss held the dice. In a game played against herself, would she find the ladders to the top or tumble down snakes to new lows?
The stage is set — what ensues is the unprecedented and borderline unbelievable story of Liz Truss, Kwasi Kwarteng, and the Great British Pound. Her legacy has undermined Britain’s long-held role as a major economic power.
The Shortest Prime Minister
On October 25th, a few months after the dice was first rolled, I was sitting on the couch listening to the news when I heard the words:
“Liz Truss has officially become the shortest serving Prime Minister of the United Kingdom.”
This was not, as I originally believed, a jab at Truss’s height. Somehow the more unimaginable happened, as after just 44 days as prime minister, she resigned from office. A month and a half. That’s it. To put that in perspective, the next shortest-serving PM, George Canning, was in office for almost three times as long. The devastatingly insignificant reign of Liz Truss has had a very significant impact on the nation even until today.
To truly understand the events that unfurled, the story must begin before Truss even took office, during the Boris Johnson Administration. His three-year stint in office was marred by many scandals, most notably in the summer of 2022 when it was revealed that he had known about and tried to cover up the sexual misconduct of lawmaker Chris Pincher, whom he promoted to a senior government position. (1) After the resignation of 50 members of the government in just the span of two days as a result of this ethical shortcoming (among others during his time as PM), Johnson recognized that after years of narrowly avoiding it, he was finally tumbling down a snake. He resigned on July 7th, leaving the Conservative Party the arduous task of electing their new leader and head of government.
Two leading candidates emerged from the dust of resignations and turmoil: Rishi Sunak and Liz Truss. Sunak, the nation’s former finance minister and among the many officials who resigned in July, touted his ability to manage Britain’s economy but was criticized for having been in office when the nation’s cost of living crisis began. Truss, on the other hand, was deeply devoted to conservative policies and linked her economic proposals with more radical tax cuts. (2) In the end, it was the latter’s perceived determination and strength that gave her a ladder and boosted her to the head of government, winning with 81,326 party votes to 60,399. (3) She stepped into office, confident in her prowess and with the goal of a long-lasting legacy of serving the people of Britain for the better and aiding them through the tough winter.
However, Truss’s unwavering confidence would bring her too close to the sun. The higher up on the board the ladders take you, the more likely you are to cross paths with a snake.
The Kwarteng Kwanundrum
Truss had many unique policy proposals for what she believed would bring about the betterment of Britain, but amidst economic strife, none were so critical to her campaign as those concerning the economy. (4) Trussanomics, as it was dubbed, proposed large-scale tax cuts while also increasing government spending. After an interview with Nick Robinson during her campaign, the opposition expressed concern that Truss struggled to name any economist who backed the plan or any reasonable way to fund it — in fact, the term “Trussanomics” was first a jab at Truss’s overly optimistic view of her economic plan. Once elected, all eyes were on how exactly she was going to make it happen.
Then out of the shadows emerges Kwasi Kwarteng. Being appointed Chancellor of the Exchequer (Finance Minister) under Truss is the second-greatest accomplishment in Kwarteng’s life, after having the coolest name known to man. Kwarteng was given the task of taking all of the idealistic and rhetoric-driven policies and converting them into something realistic. His efforts culminated in something known as a “mini-budget,” the largest tax cut in the nation in fifty years. Here are some key aspects of the mini-budget which, interestingly enough, wasn’t a very mini proposal):
- Elimination of the 45% additional income tax rate for £150,000 and higher earnings, while basic income tax reduced from 20% to 19%
- The price of national insurance, while stated to increase earlier in the year, would stay the same
- Bankers’ bonuses would no longer have any cap
- A proposed business tax increase would be scrapped entirely (5).
Once the plan had been revealed, the main question investors had was: how would the British government fill the hole in its spending budget that was previously occupied by its now-cut tax revenue? The answer: it wouldn’t. In fact, there was an estimated 27.7 billion pounds of the UK’s budget unaccounted for. (6) This, coupled with proposed government provisions for energy costs that winter due to energy crises resulting from the war in Ukraine, greatly disturbed followers of the British economy. The discrepancy would be filled by borrowing, further exacerbating the UK’s already concerning national debt. Kwarteng and the Truss government repeatedly stated that they would not apologize for “economic growth” in the nation, but it wasn’t growth they would have to apologize for.
The snake bit Truss almost immediately.
The British pound plummeted in value to $1.03, the lowest it has ever been valued against the dollar in history. Once considered stable, British government bonds were sold off en masse — so monumentally, in fact, that the Bank of England itself had to buy 65 billion pounds of those bonds just to keep the market from crashing. The International Monetary Fund proclaimed an “astonishing and nearly unprecedented rebuke against the tax cuts,” stressing that the government reconsider. (7) Markets in turmoil. Money’s value volatile. Mounting political tension. Usually, this pressure is what turns coal into diamonds. Unfortunately, Truss had no money in the budget for diamonds.
Then Truss and Kwarteng hit the global economic order with something fairly unforeseen:
The two drew back on significant parts of their proposals. While in hindsight this seems natural in the face of large-scale political backlash, it was genuinely surprising coming from two figures who had been so utterly staunch for weeks, defending the effectiveness of their plan. One thing was made clear above all else: Truss was in the endgame now. She quickly began maneuvering to save face. First, she fired Kwarteng on October 14. Then, she hired Jeremy Hunt to replace him. A few days later, Hunt announced the reversal of Truss’s economic plan — two weeks earlier than expected. (8) Liz Truss was motionless and speechless behind him.
Rishi, Make Us Rich
With no ladders in sight, Truss resigned a few days later on October 25th, her legacy forever tainted by economic havoc. Her successor, the same Rishi Sunak she won against before, is now tasked with stabilizing the economy amid a harsh winter. His allies are hopeful, his opponents are doubtful, but at the very least, he’s lasted more than 44 days.
Already, Rishi has facilitated an economic comeback by returning consumer confidence, something that resulted in a 0.3% growth in January after months of contractions. Darren Morgan from the Office for National Statistics claims that the growth was one of the timely circumstances, pointing to the return of schooling and The Premier League. (9) Yet, Rishi’s impact cannot be understated. In contrast with Truss, he is calm and collected — a seasoned economist and government official who knows not only what works but how and why it works. Though he is the youngest ever Prime Minister, his experience will likely be the final ladder that brings the nation’s economy back. So, what is the future of Britain? Will they ever emerge from the pound’s severe stint? That’s all in his hands now.
Endnotes:
- Press, The Associated. “Embattled UK Prime Minister Boris Johnson Resigns.” NPR,, 7 July 2022, https://www.npr.org/2022/07/07/1110226702/boris-johnson-resignation-prime-minister-uk.
- Kirby, Jen. “The UK’s next Prime Minister Will Be One of These Two People.” Vox, Vox, 20 July 2022, https://www.vox.com/2022/7/20/23271450/uk-conservatives-rishi-sunak-liz-truss.
- Team, The Visual Journalism. “How Liz Truss Won the Conservative Leadership Race.” BBC News, BBC, 5 Sept. 2022, https://www.bbc.com/news/uk-politics-60037657.
- “What Policies Will Liz Truss Pursue as Britain’s New Prime Minister?” The Guardian, Guardian News and Media, 5 Sept. 2022, https://www.theguardian.com/politics/2022/sep/05/what-policies-will-liz-truss-pursue-as-britain-new-prime-minister.
- “Kwasi Kwarteng’s Mini-Budget: Key Points at a Glance.” The Guardian, Guardian News and Media, 23 Sept. 2022, https://www.theguardian.com/uk-news/2022/sep/23/kwasi-kwarteng-mini-budget-key-points-at-a-glance.
- “What Was in the Mini-Budget and What Is the Government’s New Plan?” BBC News, BBC, 17 Oct. 2022, https://www.bbc.com/news/business-62920969.
- Ioanes, Ellen. “Why Liz Truss Was UK Prime Minister for Only Six Weeks.” Vox, Vox, 18 Oct. 2022, https://www.vox.com/world/2022/10/18/23409881/united-kingdom-liz-truss-trussonomics-political-crisis-explained.
- Person, and Kylie Maclellan William Schomberg. “New UK Finance Minister Hunt Reverses Truss’s Economic Plan in Dramatic U-Turn.” Reuters, Thomson Reuters, 17 Oct. 2022, https://www.reuters.com/world/uk/new-uk-finance-minister-faces-market-verdict-after-gutting-trusss-plans-2022-10-16/.
- Jordan, Dearbail. “UK Economy Rebounds as Rishi Sunak Says Confidence Is Returning.” BBC News, BBC, 10 Mar. 2023, https://www.bbc.com/news/business-64904333.
