Joe Biden’s administration has struck Liz Trusseconomic policy as the prime minister’s government grapples with a decline in the value of the pound and a collapse in support for the Tories after last week’s mini-budget. The criticism came at a lecture to the Hamilton Project by US Secretary of Commerce, Gina Raimondo, amid growing reports in Washington DC of increasingly strained relations between the White House and Downing Street.
Last week Kwasi Kwarteng announced a £150bn energy bill to prevent the cost of living from spiraling out of control.
But at the same time, he cut taxes by £105 billion over the next three years, including raising the base rate to 19 pence, the lowest rate in modern history, scrapping the highest rate of 45 pence, reforming stamp duty and canceling planned increases in corporate tax and stamp duty.
Commentators in the US have noted that the path that Liz Truss has chosen is in direct conflict with the path that President Biden has chosen.
And today, as polls show a collapse in support for the Tories, Ms Raimondo criticized the British government’s approach.
She said: “The policy of cutting taxes while increasing spending is not a policy that will fight inflation in the short term, or serve you well for long-term economic growth.
“So it’s a cautionary tale. The markets have plummeted, the pound has plummeted.
“It’s early for that new strategy, but it’s not the one we’re pursuing.”
She added: “I think all we see is a brand new government.
“It was an unexpectedly important step, so it’s hard to say to what extent the market says we’re against that growth or whether we want predictability, we want responsible government, we want stability and we want inflation.
“The other thing is that investors want world leaders to take inflation very seriously.”
READ MORE: Liz Truss Warned Her Biggest Mistake Was Dropping US Trade
He said: “As for the United States, we have sought to increase the resilience of our partners and allies around the world. That includes the UK, so do our allies in the EU and elsewhere.
“We are, of course, acting in concert, and in some cases in coordination with allies and partners, in terms of tapping strategic petroleum reserves in terms of moving supplies of liquefied natural gas (LNG) where it is most needed. And then, of course, executing and devising policies that over time will help reduce dependence on Russian energy, but also on fossil fuels in general, as we move towards renewable energy sources.”
Senior Republicans in Washington this week expressed concerns to Express.co.uk about the Biden administration’s “hostility” towards the UK.
One said: “Most Americans know that Britain is number one, our most important ally. We are all too aware that the [Biden administration] not.”
A diplomatic source suggested to Express.co.uk that Ms Truss’s big problem is that she is an “unknown amount” for Americans and allies to win.
The source said: “She is a totally unknown amount. Nobody has a clue about her.”