US President Joe Biden on Saturday referred to embattled UK Prime Minister Liz Truss’s tax cut agenda, calling it a “mistake” and warning that the lack of “strong policies in other countries” could hold back the United States.
Truss, just weeks into office, is fighting for her political life after proposing — and then being forced to abandon — debt-financed tax cuts for businesses and Britain’s top earners that rattled markets.
Britain’s leader sacked her chief finance minister, Kwasi Kwarteng, on Friday and scrapped a totemic pledge to cut corporate tax.
Speaking at a campaign stop in Oregon, Biden claimed that it was “predictable” that Truss would have to backtrack on his agenda, which was also openly criticized by the International Monetary Fund.
“I wasn’t the only one who thought it was a mistake,” the US president said of Truss’s plans. “I think the idea of cutting taxes on the super rich at a time when […] I don’t agree with the policy, but that’s up to Britain.”
With inflation expected to play a major role in the upcoming US midterm elections, Biden said the US economy remained “strong as hell” but he is “concerned about the rest of the world.”
He added: “The problem is the lack of economic growth and sound politics in other countries. It is world inflation, that is consistent”.
Biden’s jab at Truss’s agenda is an unusual move, given that presidents tend to avoid commenting on allies’ domestic politics.
It came as Truss’s new chancellor, Jeremy Hunt, signaled that more fiscal U-turns could be at stake.
“We have to be honest with people and we are going to have to make some very difficult decisions both in spending and in taxes to reduce debt, but the most important thing in making these decisions will be how to protect and help struggling families and businesses. . and the people,” Hunt said in a statement released overnight.
Truss and Hunt will hold talks on Sunday at the prime minister’s country retreat, Checkers, the BBC reported, ahead of a new economic plan due to be unveiled on Oct. 31.