Who wouldn’t be in pain, having just been publicly fired from the job they loved and felt they were born to do? Especially when they’ve made such a big deal about it. Reeves was constantly banging on about how proud she was to be the UK’s first female Chancellor. She proclaimed herself as an inspiration to ambitious little girls everywhere. Completely ignoring the fact that the Conservative Party had already given Britain three female PMs – and whatever Reeves thinks, that’s a much bigger job than Chancellor.
And now she’s out. Sacked after two hellish years. New PM Andy Burnham fired her first chance she got. Reeves rose with Sir Keir Starmer, failed with him, and has departed with him. Yesterday, the two were spotted in a Kentish Town pub, sinking fine ales and wines with their aides. They seemed to be enjoying themselves, in contrast to the rest of the country, which has plunged still deeper into the mire on their watch. Perhaps she’s just relieved that somebody else will have to clear up the mess she left. But could it have been different?
I’ve written what feels like 50 trillion articles explaining how Reeves has been a financial disaster for the nation. She inherited a fiscal fiasco from the Tories, but every step she took made it worse. In fairness, she suffered one piece of ill luck. On February 28, Donald Trump launched his war on Iran just as the UK economy was starting to stabilise after all her errors. Finally, inflation was starting to fall towards the Bank of England 2% target, signalling an end to the cost-of-living crisis.
The war lit a rocket under the oil price, as Iran blockaded crucial supply routes. Crude almost doubled from $60 a barrel at the start of the year to $118 in late April. Instead of falling, consumer price inflation climbed from 3% in February to 3.3% in March, with fears of more to come.
Reeves was incandescent. She picked a public fight with Trump, branding the Iran war a “mistake”, moaning: “This is a war that we did not start. It was a war that we did not want.” We got the war anyway, and it blew up her hopes that inflation would fall this year, which would have boosted the economy by putting more money into the pockets of borrowers and businesses. Reeves can blame Trump for that. The rest was down to her.
In practice, inflation hasn’t been as bad as expected. In May, CPI rose 2.8%, as markets pinned their hopes on a peace deal in the Middle East. And this morning we’ve discovered that inflation fell again in June, to just 2.6%. That figure landed just two days after Andy Burnham swung the axe and replaced Reeves with former defence secretary John Healey. Which must be agony for Reeves. No doubt she’d have taken full credit for it, “because of the decisions I made”…
But her time at Number 11 was a complete disaster. She inherited a tentative recovery from Rishi Sunak’s Tories, and crushed it through her constant tax raids and all-round bungling. Reeves even drove inflation higher, as employers passed her £25 billion “jobs tax” onto consumers in the form of higher prices.
Reeves knows no shame. Incredibly, she left her job boasting how great she was at it. She may even claim today’s figure vindicates her, even though it’s well above target and likely to climb next month. Don’t listen. Her credibility was torpedoed long ago. And she’s the one who sank it.