The United Kingdom has a new Prime Minister after Liz Truss’ resignation. Truss resigned after a historically short tenure of just 44 days. This makes her the shortest-serving prime minister in the UK’s history. Truss resigned on Oct. 20, after growing calls for her to resign from both inside and outside her party. Poll numbers were historically low for both the prime minister and the Conservative Party leading up to Truss’ resignation. One poll put her favorability rate at just 10%.
The key factor leading up to Truss’ resignation was the UK’s economy enduring turmoil as the result of Truss’ catastrophic budget plan. Truss, along with her finance minister Kwasi Kwarteng, announced a new financial plan on Sept. 23 that included massive tax cuts with little explanation of how the budget would be balanced. This immediately triggered a major drop in the stock market, which led to the value of the British pound falling significantly. Mortgage rates skyrocketed and government pension funds were depleted with the market crash. This, combined with high inflation rates and energy costs, along with a British economy suffering after Brexit, caused the British economy to slow down even further. Right now, the pound is nearly equal to the dollar, with one dollar equivalent to about 0.87 pounds.
Truss initially defended her financial plan and her finance minister, but after great pressure from members of her party, she eventually fired him. The new finance minister, Jeremy Hunt, revoked most of the policies Truss had put in place. Unfortunately for Truss, it was not enough, and members of her own party continued to turn against her, calling for her resignation. Additionally, there was immense pressure on the Conservative Party as a whole, which has suffered from declining popularity. Especially compared with the opposition Labor Party, the Conservative Party might not be able to form a majority after another popular vote is taken, which at the latest would take place in Jan. 2025.
Markets almost immediately improved after Truss’ resignation, but that has done little to improve Britain’s damaged economy. Post-Brexit, the country has suffered from high costs of living and increased economic challenges. Controversy had also been brewing after it was revealed that Truss would receive a Prime Minister’s pension of £150,000 per year despite a short and unproductive time as Prime Minister.
Rishi Sunak was nominated by the Conservative Party to assume leadership as Prime Minister on Oct. 25, a leading contender after running for the position this past summer as Boris Johnson’s successor. Sunak was seen as an obvious choice since he opposed Truss’ policies from the beginning. President Biden has also mentioned that he is excited to talk to the new Prime Minister and continue to support the relationship between the US and the UK.
The instability and partisanship are similar to the political situation in the US, along with economic difficulties such as rising inflation. As the US midterm election season comes to a close, both countries will be finding themselves entering a new chapter.