Joe Biden Calls Liz Truss Tax Cuts a Mistake as Political Fallout Continues – As criticism of her approach continued, Joe Biden labeled Liz Truss’s abandoned economic plan, which sent financial markets into chaos and caused a sharp drop in the value of the pound, a “mistake.” The president of the United States implied that other world leaders felt similarly about her disastrous mini-budget, stating that he wasn’t the only one concerned about the lack of sound policy in other countries.
Biden stated that it was predictable that the new British prime minister would be forced to abandon aggressive tax cuts without specifying how they would be paid for after Truss’ proposal shook global financial markets. His remarks to reporters on Sunday at an ice cream parlor in Oregon were a highly unusual intervention by an American president into the domestic policy decisions of one of the country’s closest allies.
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Labor leapt on the US president’s remarks. The shadow foreign secretary, David Lammy, said: “As well as crashing the economy, Liz Truss’s humiliating U-turns have made Britain’s economy an international punchline.” “President Biden knows the dangerous folly of trickle-down economics. His comments confirm the hit our reputation has taken thanks to the Conservatives.” Before his first bilateral meeting with Truss in New York last month, Biden tweeted that he was “sick and tired” of trickle-down economics, claiming that it had never worked.
Biden’s remarks followed weeks of White House officials refusing to criticize Truss’s plans, while emphasizing that they were closely monitoring the economic fallout. The US president was speaking during an unannounced campaign stop for the Democratic candidate for governor, Tina Kotek. Democrats face a difficult political climate in the United States due to Republican criticism of their economic management.
Biden stated that he was unconcerned about the dollar’s strength, despite the fact that it set a new record against the pound in recent weeks, which benefits imports but makes US exports more expensive to the rest of the world. He asserted that the U.S. economy was “strong as hell” but added, “I’m concerned about the rest of the world. The problem is the lack of economic growth and sound policy in other countries. It’s worldwide inflation, that’s consequential.”
Truss’s new chancellor, Jeremy Hunt, has stated that Truss and his predecessor Kwasi Kwarteng’s mini-budget went “too far, too fast,” signaling the end of the prime minister’s economic vision. “We have to be honest with people and we are going to have to take some very difficult decisions both on spending and on tax to get debt falling, but at the top of our minds when making these decisions will be how to protect and help struggling families, businesses and people.”
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Hunt is expected to announce that plans to reduce the basic rate of income tax next April will be pushed back by a year. The cut to 19% will now take effect at the time previously proposed by Rishi Sunak, the former chancellor who was Truss’s main leadership rival.
