Whether you realise it or not, the political shuffling for the General Election has started……especially if you are an older voter.
There is key context to Rishi’s recent behaviour……in 2019 the Conservatives vote share among the over-65s was more than 60%. Such is the extent of the divide between how the old and the young vote, age has become more important than class. There are over 11 million people over the age of 65 for Rishi to now flirt with……and he’s had his best lippie on this month.
This is obviously good news for those retired, but difficult to justify politically in the wider economic context given the Government’s reluctance to raise civil servant pay and trying to tackle inflation / cost of living. So what does Rishi do……contest the 8% to a lower figure……or honour the triple lock?
Easy……look after the 60% and nurture the voters for next year.
When considering the 60% context, it will come as no surprise that there is strong consideration at No 10 among senior figures about abolishing inheritance tax as the headline tax giveaway next year as a pre-election sweetener.
50% of the population thinks that it is an unfair tax and 31% think that they have sufficient assets to have to pay inheritance tax (source: Institute for Fiscal Studies). Yet the reality is that only 4% of UK deaths a year result in an inheritance tax charge.
Given that Inheritance Tax brings in only £7 billion a year to the Government, it is a pretty cheap way to appeal to the 60%.
There is absolutely no doubt that Rishi is governing the country to appeal to voters rather than what is right and proper. Make no mistake……the General Election has definitely started.
The Numbers
Andrew Bailey, the Governor of the Bank of England, cast significant doubt this month on the need for further interest rate rises as “peak interest rates have been reached”. He also added that the Bank of England is “through with lifting interest rates” and stressed inflation was on course for a “marked” decline.
So there. It’s official. Apparently.
It won’t surprise you that there is some suspicion out there on such bold statements given the recent history of his lack of foresight on inflation, interest rate rises and the length of the pain caused by both.
Bailey at least got one month correct as interest rates were held at 5.25% as the Bank of England voted 5-4 to keep borrowing costs unchanged. It was the first time interest rates remained the same since November 2021 after 14 straight increases.
All eyes will be on 18th October for the next instalment of the inflation game. The latest inflation figure of 6.7% suggests the direction of travel is down……just not a quick enough journey though!
The key statistic of the month showed that average earnings across the economy rose by 7.8%, the highest pace of wage growth recorded in 22 years. It is very difficult to see how inflation can be brought down to 2% when wages are growing by nearly four times this. It makes the prediction of interest rates peaking seem premature.
And that 7.8% will be painful for the Government as September’s measure of the ‘triple lock’ is what the State Pension will now rise by in April……an increase in cost of £11 billion.
The impact of higher interest rates is being felt by UK private sector businesses as the composite Purchasing Managers’ Index (my clear favourite of all of the indices……it’s a cracker) fell from 50.8 to 47.9. This was the worst performance since January 2021 and a below 50 score separates growth from contraction. The downturn hit the services industry hardest and raised the risk of a recession.
Given the level of interest rates, it is perhaps no surprise this month that house prices saw the biggest yearly decline since 2009 at 5.3% lower compared to last year.
And the month also saw the little lady return to school and a new adventure in Year 5.
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Trump of the Month
For the second month in a row, nothing has come close to the absolute absurdity and sheer lunacy of this man’s body of work. September 2023’s Trump of The Month could only be……The Trump
In addition to facing 91 criminal charges for basically acting like a ‘wrong un’ over recent times (see August’s blog), he is also facing civil legal action on the grounds of committing fraud over many years. He essentially inflated the value of his real estate empire to gain preferential terms on insurance and loans.
In one example, The Trump claimed his apartment in Trump Tower was 30,000 square feet. In fact, it is 11,000 square feet. “A discrepancy of this order of magnitude, by a real estate developer sizing up his own living space of decades, can only be considered fraud,” the judge wrote.
The judge ruled this month that the case of defrauding banks and insurers is likely to see The Trump lose the $250 million lawsuit and his licences to trade in New York.
Did The Trump try to argue his case tactfully? Perhaps meet the accusers half way? Come clean and admit to fraud? Not a chance……he took to social media to exclaim:
“It is a POLITICALLY MOTIVATED WITCH HUNT by a Racist Attorney General, and a Deranged, Trump Hating Judge. It is ELECTION INTERFERENCE at a level never seen before.”
Even by The Trumps standards, that’s quite a response. But here’s the thing……The Trump is still red hot favourite to win the Presidential Election next year. The latest poll puts The Trump ahead of Joe B among registered voters by 52% to 42%. A ten point lead!
I scratch my head at The Trump being considered the best candidate amongst a population of 330 million to lead the most powerful country in the world.
We are walking eyes wide open into another four years of this. All of this would be fascinating and funny if it wasn’t true.
Good luck everyone.
Trump Lunacy Rating: 10 / 10
And Finally……
“It is better to offer no excuse than a bad one.”
George Washington
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