The British government is fully committed to neoliberalism

Finance Minister Kwasi Kwarting.Image Getty Images

Since the 2008 financial crisis, bankers’ bonuses have gained notoriety as they are said to lead to reckless and risky trading. That is why they were dealt with in 2014 by the European Union, of which the British were still members at that time. However, newly appointed British finance minister Kwasi Quarting wants their release completely. It should improve London’s competitiveness compared to New York and Singapore, where bonuses are allowed.

Proponents of reintroduction also argue that bankers would face less risk if they were judged on performance. Unlike in the past, banks will have the option to redeem rewards that are later found to have been incorrectly paid. Minister Kwarteng expects the Treasury to benefit greatly. From Brussels, this decision will be viewed with suspicion, which will further alienate the British from European politics.

too politically sensitive

Soon after being elected Prime Minister, Liz Truss shows that she wants to follow a radically different path in the economic sphere than her predecessor, Boris Johnson. During his emergency budget presentation, Minister Kwarteng on Friday announced the biggest tax cut in 30 years, for both businesses and individuals. The tax on buying a home will also be reduced. The hope is that this gamble will end the recession that began around the financial crisis.

The day before, Economic Affairs Minister Jacob Rees-Mogg announced that the ban on fracking and shale gas extraction would be lifted. The government will consult people who live near drilling sites. He said in the House of Commons that local residents affected by the drilling would be eligible for financial compensation. Hydraulic fracturing should contribute to increased energy independence. Rees-Mogg also wants to redefine exactly what an earthquake means.

Hydraulic fracturing increases earthquake risk and, like bankers’ bonuses, is highly politically sensitive.

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