Money

James Forsyth

Britain’s Russia sanctions are underwhelming

The sanctions that Boris Johnson has just announced in response to Russia’s breach of international law are fairly underwhelming. Five banks are being hit, three rich individuals and those members of the Duma who voted to unilaterally recognise the breakaway republics. They will not make Moscow take notice in the way that the decision end certification of Nord Stream 2 has. Johnson’s defence of the limited nature of these sanctions is that they are the ‘first tranche’ and the UK needs to hold things back to try and deter Russia from further action. But given that the UK, rightly, considers what Russia is up to an invasion of Ukraine, these

Ross Clark

It’s too late to break Europe’s gas reliance on Russia

So, Nord Stream 2 will not be plugged into Germany’s gas grid. A little surprisingly, Chancellor Olaf Scholz has been first out of the blocks this morning in the western economic response to Putin’s recognition of breakaway states in eastern Ukraine. The block is not total: what Scholz says is that the certification process for the pipeline will be halted — leaving open the possibility that it might, after all, be connected if Putin starts to behave himself, or Germany becomes especially desperate for gas. Nevertheless, it is a significant move which will have an economic impact on Russia. But it is astonishing that the project was ever allowed to come

Kate Andrews

Germany’s canning of Nord Stream 2 will hit Putin hard

Vladimir Putin’s threats towards Ukraine have, in part, been an operation in stoking divisions throughout the West. As James Forsyth explains in the magazine’s latest cover piece, it was just weeks ago that Germany was not on the same page as the US and the UK about what actions from Putin might classify as an invasion – and how such actions might trigger western countries to respond. The obvious sticking point for Berlin has been Nord Stream 2: the now-completed gas pipeline running under the Baltics, built to transfer 110 billion cubic metres of gas supplies from Russia to Germany each year and bypass the current pipeline which runs through

Wolfgang Münchau

Sanctions won’t stop Putin

The Lithuanian prime minister, Ingrida Šimonyte, put it well yesterday: ‘the way we respond will define us for the generations to come’. The invasion of Ukraine started last night with Vladimir Putin’s order to send troops into eastern Ukraine. He had earlier recognised the breakaway provinces of Donetsk and Luhansk, which together constitute the Donbas region, as independent republics. The two self-proclaimed states declared their independence — something neither Kiev nor any other third country save Russia has yet recognised — following 2014 following the Maidan revolution. The US, UK and EU say they will announce fresh sanctions as early as today. What we know is that the technicalities have been

Sam Ashworth-Hayes

Britain is trapped in a Boomerocracy

‘If young Americans knew what was good for them’ the historian Niall Ferguson once remarked, ‘they would all be in the Tea party’. In his first Reith Lecture, Ferguson argued that austerity would be a boon for the young; public debt merely allowed ‘the current generation of voters to live at the expense of those as yet too young to vote or as yet unborn.’ It is certainly true that successive generations in Britain have run up an almighty tab while assuming the next group along will be able to foot the bill. The problem Ferguson neglected to account for was which voters would end up delivering a pro-austerity government into

Macron’s energy intervention has seriously backfired

He intervened decisively. He showed the ability of the state to make a difference. And he demonstrated that greedy, self-interested corporations should not be allowed to exploit ordinary consumers. Only a few weeks ago, the French President Emmanuel Macron was being celebrated by left-leaning economists and pundits for forcing the French energy giant EDF to slash the cost of power. But hold on. Now, the government has had to bail-out the company from the inevitable financial hit. It turns out that the government can’t dictate the price of energy after all – and it just creates a bigger mess when it tries to. Even by the standards of French industrial

Lionel Shriver

The looming monetary apocalypse

OK, I finally watched Netflix’s Don’t Look Up. Surprisingly, I enjoyed it — especially before its effective subtitle for us thickos, THIS IS A METAPHOR FOR CLIMATE CHANGE, YOU F-ING MORONS. Otherwise, the film might have playfully dramatised the more general phenom of fiddling with celebrity bodices while Rome burns. The comet at which I’m looking up could arrive far more immediately than perilous global warming. Money is in trouble. I’m not only referring to a cost-of-living crisis. Money itself is in trouble. Let’s contemplate, to coin a phrase, a basket of deplorables. US inflation just hit 7.5 per cent, the highest in 40 years. UK inflation, now 5.5 per

Why ‘Ukraine carnage’ in the markets won’t last

Oil will shoot up to $130 a barrel. The prices of natural gas will double in a few hours, tipping a few more energy companies into bankruptcy. The tech stocks will crash, currency traders will panic, and the bond markets will crater. If Russian tanks do start to roll across the Ukrainian border this week then we can expect carnage in the financial markets. Indeed, they have already fallen sharply in anticipation of a possible war. And yet, the important point is surely this: it won’t last. True, the most serious armed conflict on European soil since the end of world war two is a serious matter. But geopolitical events

Kate Andrews

Who’s in charge of the NHS?

Who runs the NHS? With a £136 billion budget for NHS England and NHS Improvement eating up 17.5 per cent of tax revenue, there should be a clear answer to this. But ministers were left wondering when the time came to announce what the health service would achieve with its extra £12 billion from the tax rise. I write in this week’s magazine about the row over waiting lists and how ministers thought the extra cash would cut it to 5.5 million — only to be told it could possibly hit close to 11 million. But there was a row over another point too: the timeline for cancer care. It’s

It’s time for Rishi Sunak to become a low-tax Tory

This week marks two years since Rishi Sunak was thrust from relative obscurity into the political spotlight as Chancellor of the Exchequer. After less than a month in post, he delivered his first Budget. Weeks later, Britain was in lockdown. How has the ‘Covid Chancellor’ fared in the intervening period? When he was splashing taxpayer cash early on in the pandemic, he was cheered to the rafters. Now, he faces criticism both for holding the line against big spending colleagues, and for presiding over the highest tax burden in several decades. If Sunak were a speech, his opening paragraph would be full of promises. He’s a low-tax Thatcherite who believes

Ross Clark

How high could interest rates go?

The last time that US inflation hit 7.5 per cent, Ronald Reagan was a recently-elected president. And he, older readers might recall, partly owed his election to inflation. He memorably said during his campaign: ‘inflation is as violent as a mugger, as frightening as an armed robber and as deadly as a hitman.’ But what of Britain? Bank of England chief economist Huw Pill gave a speech this morning in which he revealed that the Monetary Policy Committee (MPC) very nearly raised the bank’s base rate to 0.75 per cent this month rather than to 0.5 per cent — there was only one vote in it. Should this, along with the news from

Kate Andrews

Exclusive: Leaked NHS report shows waiting list hitting 9.2 million

Before the pandemic hit, NHS England waiting lists were at a record high of 4.4 million. Three lockdowns later, they’ve risen to six million: an unacceptable figure for a Tory government that has spent years trying to rebrand itself as the ‘party of the NHS’. Boris Johnson’s decision to break his manifesto pledge and raise taxes was directly linked to the idea that the money would first be funnelled into the health service to fix the backlog. So can he now deliver for patients? When Health Secretary Sajid Javid announced his ‘elective recovery plan’ in the House of Commons on Tuesday, he said that the waiting list would start shrinking

Stephen Daisley

Lock them up? Not in Sturgeon’s Scotland

One of the great disappointments of devolution has been the failure of the Scottish parliament to pursue novel ways of fixing political problems. Whether on educational attainment, health indicators, waiting times or economic development, it’s difficult to argue that Scotland under devolution is fundamentally different from how it would have looked had the country voted no in 1997. But one area where that observation is becoming harder to sustain is criminal justice: the SNP has grown in confidence in recent years and a more liberal — or at least a more nuanced — policy is taking shape. The SNP’s justice secretary Keith Brown set out the latest iteration of this

Ross Clark

A windfall tax on oil giants would harm – not help – pensioners

Look up this year’s performance of the shares and bonds which make up your pension fund and you will see that BP and Shell are the rare chinks of light. BP is up 15 per cent and Shell up 20 per cent, with both enjoying bumper profits on the back of high oil and gas prices. Cue, then, for Labour and the Lib Dems to demand a windfall tax in order to confiscate some of these profits. The money ought to be used, Eds Miliband and Davey have said this morning, to help people pay their heating bills. In both their minds ‘dividends’ and ‘shareholders’ are rude words – whereas in

The cost of online safety

Few people in Britain will have heard of the draft Online Safety Bill. Fewer still will oppose it. Protecting children against harm and exploitation online is an entirely rational goal in modern-day society. And when the Culture Secretary is boldly promising, as Nadine Dorries did at the weekend, to ‘bring order to the online world’ and ‘force social media companies to take responsibility for the toxic abuse that floods their platforms,’ it can be quite convincing: painting the web as a virtual Wild West that governments urgently need to regulate. Doubtless, the internet is home to abhorrent abuse that isn’t acceptable in any circumstance. Beyond that, there are instances of

Kirstie Allsopp is wrong about house prices

They could cancel their Netflix subscriptions, stop drinking chai tea or go a little easier on the avocados and the smoothies. And perhaps most of all they could get on their bikes and start searching for some cheaper places to live. Kirstie Allsopp, the presenter of popular TV shows such as Location, Location, Location, probably always knew she was going to stir things up with her comments this weekend. Allsopp said that if young people simply cut back on some self-indulgent luxuries, and explored some alternative areas to live, then they would be able to get on the property ladder in their twenties just the way she did:  ‘I don’t want

Ross Clark

Make capitalism real again

The emergence of Covid provoked a worldwide economic crash. That lasted a mere four weeks. By the time western countries were locking down, a bull market had begun afresh. Through months of lockdowns, soaring case rates and death rates, shares were not just rebounding but marking new highs – firstly involving tech shares and online retailers which had done well from social distancing, but then pretty much anything. The arrival of the first vaccine phase 3 trial results in November 2020 sent shares spinning upwards, yet the emergence of the Alpha and Delta strains didn’t seem to do any harm. And now that economies seem finally to be putting Covid

How Boris can really tackle the cost of living crisis

When it comes to addressing the cost of living crisis, the government has, so far, responded with a range of bad solutions. The energy price cap is being increased by £700 per household, interest rates have gone up for a second month in a row and the Bank of England is forecasting a two per cent drop in household incomes in real terms, the worst since records began in 1990. In response, the Government has announced a package of confusing and ill-targeted measures. This includes council tax rebates, that will extend to some homes valued over £1 million, and a £200 discount on energy bills through loans to energy firms –

John Ferry

Ian Blackford has exposed the SNP’s pensions muddle

Amidst the Downing Street psychodrama, have we missed the moment the reality of Scottish fiscal autonomy finally dawned on the SNP?  This week saw an extraordinary turn of events in London and at Holyrood. First there was an interview the SNP’s Commons leader Ian Blackford gave in which he stated the government of the remaining UK will be responsible for paying the Scottish state pension after a Scottish exit. The next day, Nicola Sturgeon was asked at First Minister’s Questions if the SNP’s position now really was that pensions in an independent Scotland would be paid by English taxpayers. Amazingly, she took the same brazen stance as Blackford. The Scots are going

Kate Andrews

The cost of living crisis has arrived

In recent weeks alleged lockdown parties and suitcases full of wine have been the biggest threat to Boris Johnson’s premiership. But throughout the winter months, another threat has been brewing — one that could, in the longer term, determine the government’s fate. Britain’s cost of living crisis has been steadily worsening as price hikes for essential goods and services (food, transport) continue to outpace predictions. But the worst is still to come, with Ofgem’s announcement this morning that energy bills for the average household will be rising by nearly £700, as the energy price cap is lifted by 54 per cent come April. Enter Rishi Sunak with an emergency package