Washington and London’s incumbents have had a tough time recently. This is a look back at the week’s events.
The greatest witch hunt in history
Fortune favours the brave and for President Trump and his administration, skipping town early Friday morning might give him the much-needed rest bite he needs whilst the greatest witch hunt in history unfolds. That being said, last Wednesday, developed market equities in the States were looking volatile. The Vix, which measures volatility in the markets, reported a significant jump to 15.51 percentage points. To put that into context, its recent ceiling is around 20 percentage points.
The witch hunt is largely a result of President Trump firing FBI Chief Comey along with subsequent allegations of his team being embroiled (no, it’s fake news) in discussions with the Russians on multiple occasions during the 2015/16 election cycle. Collusion with the Russians, alongside “leaking” intelligence to Russian Foreign Minister Sergey Lavrov, has seen numerous calls for President Trump to be impeached. President Trump isn’t going anywhere unlike the Vix.
Closer to home, the past week saw the UK’s main political parties release their June 08 election manifestos.
Prime Minister Theresa May, whilst not coming out and admitting it, not only feels confident but has been tipped to win a landslide election. Her government has been heard shouting “strong and stable” for weeks now. Metaphysically this might change now. When she launched the manifesto on Wednesday, who would have thought that age-related care would feature as prominently as it did?
On the one hand, her government is accepting a tough reality: baby boomers will be retiring en masse over the coming two decades, and with life expectancies for them only edging further up, how can a reduced pool of ‘worker bees’ be expected to pay for age-related ailments? Her response: cap the cost of age-related care (albeit “means tested”) to £100,000. This is going to be achieved via drawing down on savings the patient has accrued during their working life or, and significantly more controversially, the patient pensioner can offset care costs via the increase in their estate’s wealth (house price rise). Wednesday evening saw many boomers anxiously dial into LBC to vent their anger and outrage.
However, let’s take a step back. The Labour leader, Jeremy Corbyn has hailed Prime Minister May’s plan as a “dementia tax”. Nevertheless, now that the weekend is here, let’s take another look. Ultimately, the next five years will be tough as Brexit negotiations get underway. Why would any self-identifying europhile want to jeopardise their chances of winning the Order of Charlemagne medal? Theresa May is too ambitious to go down with a policy that shares more with the fate of the Titanic than typical Tory territory. Sure, she might be moving them to the centre ground but maybe she’s shorting herself? If the dementia tax alienates enough of the older electorate that would be enough for Labour to take the helm, muddle through a dirty exit process, and have multiple MPs loose their careers. Whereas, May places the Tories in a strong position for the next election.
Unlike her America First contemporary, our “strong and stable” leader looks like she wants to avoid a humiliating death on the altar of politics. By alienating the over 50s, perhaps she has done enough to win the election in 2021? That being said, elections are awfully dim affairs. The nonchalant youth never turn up and the greys do! Perhaps this general election will see a new trend take shape? And just in time because the Golden Privet needs a trim.