Wednesday, 10 August, 2022
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Britain is suffering from a leadership crisis & its political parties are left with second 11

On Tuesday, top British leaders were found guilty of breaking Covid rules that they had set for the common people.

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A  few weeks ago, Rishi Sunak was the heir apparent to a faltering prime minister: a safe pair of hands in a bungle-prone cabinet and a clean slate in a scandal-stained party. Today, he is clinging by his fingertips to his job as chancellor of the exchequer. The Sunday Times claims that he seriously considered resigning last week. There are suggestions that Prime Minister Boris Johnson will force him to swap jobs with the foreign secretary, Liz Truss.

Sunak has been shaken by two bombshell revelations in rapid succession. The first was that his wife, Akshata Murthy, has “non-dom” status — meaning that she does not have to pay U.K. tax on income she earns abroad despite not only living in Britain, but at Number 11 Downing Street. Murthy owns 700 million pounds ($912 million) worth of shares in Infosys Ltd, a giant IT company co-founded by her father, from which she received 11.7 million pounds in dividend income last year.

The second was that Sunak himself held a U.S. green card after becoming chancellor, something that usually requires the holder to be a permanent resident of the country. (Sunak lived in the U.S. for several years during his early career, met his wife while they were both studying at Stanford Business School, and owns an apartment in Santa Monica.) On top of all that, on Tuesday afternoon, both Sunak and Johnson were notified by the police that they will be fined for attending a drinks party during lock-down. In other words, they had been found guilty of breaking the rules that they had set for the little people.

Though Murthy has now rescinded her non-dom status in deference to the British “sense of fairness,” and Sunak has referred himself to the prime minister’s ethics adviser, Christopher Giedt, the damage is done. Taxing and spending is the very essence of the chancellor’s job. Now it looks —however unjustly — as if Sunak is presiding over a regime that imposes one set of rules for the rich and another set for everyone else who are now also being forced to pay higher national insurance contributions.

Sunak earned a reputation as a consummate professional — climbing expertly up the greasy poll, abandoning Treasury ideology in the face of the Covid crisis, sending out heart-tugging Instagrams of his family. But his first experience through the political wringer has left him flailing. He has even been comparing himself to another husband whose wife has been insulted, Will Smith. The Tory MPs who decide on whether to replace Johnson as prime minister are now marking him down not only as a fair-weather politician but also as a hopeless naive. How could he possibly imagine that the question of his wife’s non-dom status and his own green card would not come out? Better to stick with Johnson, the greased piglet who has such expertise in slithering out of trouble, than a neophyte who doesn’t know what has hit him.

The most obvious beneficiary of Sunak’s troubles is the greased piglet himself — hence rumors that the non-dom and green-card revelations are part of a coordinated campaign from Number 10 to put the upstart in his place, allegations a government spokesman has called “categorically untrue.”

This weekend brought contrasting images: the Sunaks moving out of Downing Street so that they can live fulltime in their Kensington Mews house, and Johnson on an unannounced visit to Kyiv, strolling the streets with Volodymyr Zelenskiy, flanked by soldiers and being thanked by grateful Ukrainians (“this is what democracy looks like,” Ukraine’s ministry of defense tweeted, “This is what courage looks like. This is what true friendship between peoples and between nations looks like”).

Other beneficiaries include Truss; Ben Wallace, the low-profile Secretary of State for Defence, who has crept up the Con Home rankings of conservative party favorites; and, perhaps, the former chancellor Sajid Javid, though he has also confessed to having non-dom status and not paying U.K. tax on his overseas earnings in his time as a banker.

But can the Conservative Party as a whole escape from the fallout? This is clearly manna from heaven for a Labour Party desperate to win back its working class heartland by presenting Johnson’s new Tories as nothing more than the old party of the rich in disguise.

Sunak’s personal problems point to two bigger longer-term problems for his party.

The first is the danger a weakening economy poses to the ruling party. This winter could well see widespread protests as inflation soars, food and energy shortages spread, and strikes paralyze large parts of the public sector.

The second is the fragility of the Brexit coalition. The coalition consisted of two very different groups: cosmopolitans who wanted to free Britain from the straightjacket of the European Union in order to pursue buccaneering capitalism on a global scale; and Hobbits who wanted to protect their sandy burrows and quiet ways from a the global maelstrom. For a while it looked as if Sunak had mastered the art of straddling this divide, appearing as a cosmopolitan technocrat to the London elite and a no-nonsense Brexiteer to his constituents in North Yorkshire. Now he is being outed as a “citizen of nowhere,” the husband of a Bangalore billionare who kept his green card in case his political career failed to take off and he decided to return to the country that, even as chancellor of exchequer, he sometimes called “home.”

Sunak’s vertiginous fall over the past few weeks shows how foolish it is to make predictions about political ups-and-downs. Perhaps Johnson will swap Sunak and Truss — and Truss will have to pick up the bill for a lousy economy. Perhaps “partygate” will re-emerge and this week’s Churchill will morph back into Champagne Charlie. Perhaps the Labour Party will regret not holding their fire on Sunak, a man who might have been easier to destroy in the general election than Johnson.

But when it comes to the future as a whole, one political prediction does seem to be in order. Britain is suffering from a general crisis of leadership as able people choose the higher rewards and global opportunities of the private sector and political parties are increasingly left with what might politely be called the second eleven.

Compare the front-bench of today with, say, the front-bench of 1964, which included such heavyweights as Anthony Crosland, Roy Jenkins, Richard Crossman, Jim Callaghan and Denis Healey. Sunak’s recent shellacking, coming after a hitherto golden career, will make it even more difficult in the future to persuade first-eleven people to choose a life in politics.- Bloomberg

Also read: Rishi Sunak requests formal UK probe of financial interests to defuse furor over tax affairs


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