What Happened Today: October 20, 2022
Truss calls it quits; San Fran’s $1.7 million toilet; investors hoover up single-family homes
The Big Story
After 44 days in office, Prime Minister Liz Truss announced her resignation as the leader of the Conservative Party on Thursday, ending the shortest stint for a prime minister in British history. The spectacular collapse of her administration comes after Truss abandoned her widely criticized tax-cut plan that had promised a radical new future for Britain but ended up roiling financial markets and undermining confidence in her government. “Given the situation, I cannot deliver the mandate on which I was elected by the Conservative Party,” Truss said during a brief press conference outside Downing Street.
Truss becomes the third Conservative Party prime minister to resign in as many years. While opposition leader of the Labour Party, Sir Keir Starmer, is calling for a general election, the Conservative Party’s parliamentary majority likely means its members alone will select Britain’s new leader. The selection process will be as complicated as it will be contentious after Truss said during her press conference that the nomination, which typically occurs over several weeks, will happen in just seven days.
Several contenders are already jockeying for position, including Truss’ predecessor, Boris Johnson. Despite his messy resignation this summer, Johnson already said his participation in the nomination contest is a matter of “national interest,” a claim that might fuel the Labour Party’s calls for a general election.
Before the demise of Truss’ political career, her sister, Francis Truss, had unknowingly foreshadowed the political downfall when she explained her sister’s approach to the game of Monopoly as a child: “She had to win. She would create some special system on how to win, and then if she was losing, she might disappear rather than lose.”
Read More: https://apnews.com/article/liz-truss-europe-economy-business
In the Back Pages: Liz Truss: The Prime Minister of Decline
The Rest
→ At the start of the COVID-19 pandemic in January 2020, stock trades by employees at the Department of Health and Human Services were up 60% over the average from the previous 12 months, according to a Wall Street Journal analysis of senior government officials making financial transactions in the early days of the pandemic. Higher-up officials were trading in volume as well, with then Secretary of Transportation Elaine Chao, wife of Majority Leader Mitch McConnell, investing between $600,000 and $1.2 million in index funds on March 16—less than a week before the market bottomed on March 23. CDC official Stephen Redd sold between $195,000 and $500,000 in stocks and bonds during January and February 2020, but Redd claims he was not aware of the trades ahead of time, which he says were carried out by his financial advisor in his wife’s account. “I don’t know that there’s anything that said, ‘If you think that something bad is going to happen, you shouldn’t trade,’” Redd said. “It’s mostly about disclosure.”
→ Over the weekend, several employees at the Chinese consulate in Manchester, England, attacked protestors who’d gathered there to demonstrate for Hong Kong independence. At a press conference on Wednesday, one protestor, Bob Chan, describes the experience of being pulled passed a security gate where he suffered injuries to his neck and face after allegedly being beaten by a group of five men. Earlier, videos of the aggressive response circulated on social media, showing members of the consulate tearing down protest signs and attacking demonstrators. MP Afzal Khan, who represents the district where the episode took place, said he was “sickened” by the incident. After videos of Chinese Consul-General Zheng Xiyuan pulling Chan’s hair during the encounter began circulating on social media, the diplomat defended the attack, saying it was “his duty” to uphold China’s dignity.
→ Number of the Day: 13%
The percentage of homes purchased annually by institutional investors, though that number is far higher in Sunbelt cities like Charlotte, North Carolina, or Houston, where investors are snatching up as much as 30% of available inventory. By making all-cash bulk purchases of homes at the lower end of the market, corporations and investment firms are taking away properties that would normally provide an affordable first home for working- and middle-class families, making it even harder for most Americans to secure a foothold on the economic ladder. It also pushes more people to the rental market, driving up prices there too. Presently, tax policy favors such investments, as companies can take out huge loans to purchase these single-family homes and deduct the interest payments, which amounts to a lucrative tax write-off.
→ While building costs have risen nationwide in recent years by as much as 30%, San Francisco takes the prize for being the world’s most expensive place to build basically anything. Now San Francisco will have a monument to its own costly ways, as the city prepares to build a brand-new public toilet for the fair price of $1.7 million. Officials have explained that the toilet will need to be planned, modeled, union-built, and reviewed to ensure it fits in with the surrounding architecture, driving up the price. “While this isn’t the cheapest way to build, it reflects San Francisco’s values,” a statement from the city read.
→ Image of the Day:
Elnaz Rekabi, a professional climber from Iran, photographed during a competition in South Korea earlier this week. As women in Iran take to the streets following the murder of a 22-year-old woman in police custody for improperly wearing her hijab, Rekabi climbed without a hair covering during the International Federation of Sport Climbing’s Asian Championships in Seoul on Sunday, a widely seen act of support for what has become one of the largest protest movements in the country since the 1979 revolution. Shortly after her climb, Rekabi took to social media to disavow any political motivation—it was “unintentional,” she said of climbing without a head covering—but she nonetheless received a hero’s welcome upon returning to Iran on Wednesday, greeted by crowds chanting “Rekabi, the Champion” and by Iranian officials who hurried her and her family to a hotel for the day, leading to speculation that she was being disciplined by her government. At least 200 protestors have been killed in recent weeks by Iranian police forces.
→ Hundreds of thousands of U.S. military veterans and their families will now see an abrupt change to how they access their prescription medications.
The military’s TRICARE program, which oversees prescriptions for roughly 9.6 million Americans, recently partnered with Cigna-owned Express Scripts.
This July, TRICARE sent a memo to certain pharmacies in its network, mostly rural ones, saying that effective Jan. 1, 2023, TRICARE would be reducing its reimbursements to the pharmacies, essentially paying them less, and that they had only 14 days to agree to the new contract.
While some took the financial hit, at least 15,000 pharmacies were kicked out of the network, leaving 400,000 affected patients to find a new pharmacy.
For many people, finding a nearby in-network pharmacy would be difficult—luckily, Express Scripts is one of the nations’ largest mail-order pharmacies, and maybe now one of the busiest as it absorbs the influx of displaced pharmacy customers.
→ Quote of the Day:
We’ve been very comfortable with our ability to pass on the increases that we’ve seen at this point, and we would expect that to continue to be the case.
Gary Millerchip, the CFO of supermarket giant Kroger, on how his company has successfully passed along inflationary cost increases to the customer. Or, as the company’s CEO put it, “a little bit of inflation is always good in our business” because “customers don’t overly react” to price increases. Soon Kroger will be able to foist even more “increases” upon the customer, as the company is poised to merge with Albertsons, owner of Safeway, Haggen, Acme, Jewel-Osco, Shaw’s, Pavilions, and Vons, in an almost $25 billion deal that might lead to monopolistic dominance in many parts of the United States.
→ With nuclear threats in the air and a global recession on the horizon, the National Hockey League has taken on one of the more pressing issues of the day and begun to study the hockey league’s racial composition. To no one’s surprise, the task force studying the issue has found that the NHL is predominately white and male—90% of all its players and coaches identify as such. New diversity initiatives are being implemented, both to combat racism within the league and to recruit more diverse cadres of young people into the fold. NHL executive vice president of social impact, growth, and legislative affairs, Kim Davis, acknowledged that a quick fix in hiring won’t create long-term impact—the league has to get more people from underrepresented communities excited about the sport. But some players of color don’t think the NHL is moving fast enough. Nigeria-born player Akim Aliu isn’t happy with the new report and told the Associated Press it’s all just “a lot of patting themselves on the back.”
→ In the vast ecosystem sustained by venture capital’s billion-dollar budgets swims the for-hire tweeter, a new kind of employee who gets paid as much as $10,000 a month to fire off 5 to 10 pithy tweets from the accounts of VC funders. As one of these VC ghost tweeters explained to a reporter, “Funders have to build parasocial relationships with founders. A founder might read a tweet from a VC and say, ‘Wow, he’s a cool guy. He’s in on the joke. I want him on my board.’” Gone are the days when a founder might come to a funder with a perfect elevator pitch, or with a dreamy look in his eye and a billion dollar idea. Now, funders are in a feeding frenzy in search for the next great founder, and “establishing yourself as a funder is no longer a one-to-one format where you’re building meaningful relationships. It’s a one-to-many format. You’re broadcasting.”
→ In what will surely become more fodder for Kanye West’s claims that the Jews control everything, the U.S. Postal Service announced a new Hanukkah stamp during a dedication ceremony at Temple Emanu El in Ohio’s Chagrin Falls (real name). Celebrating the festival of lights, the new first-class forever stamp uses art from an original wall-hanging made of fibers hand-dyed and quilted into an abstract menorah. Stamps are sold in sheets of 20, which make them a perfect gift for the holiday, set to begin at sundown on Dec. 18.
Additional reporting and writing provided by The Scroll’s associate editor, David Sugarman, and Clayton Fox
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The Prime Minister of Decline
By Ross Anderson
Queen Elizabeth II’s 70-year reign on the throne began with her first prime minister—perhaps Britain’s greatest, and most British—Winston Churchill. The queen’s final was the remarkably unimpressive Liz Truss, who is now, after her resignation today, the prime minister with the shortest-ever tenure.
Liz Truss’ assent to fleeting political significance was an odd one. A vocal anti-monarchist during college, and an active member of the Liberal Democrat Party, she then switched to the Conservative Party in 1996. Having run for and lost several elections, she finally secured her first political post as councillor of Eltham South in London. In 2010, she moved up, serving as MP for South West Norfolk.
Her parliamentary career was not one of much note, interest, or courage. In 2016, Britain deluded itself into thinking that an economic response to European macro-national stagnation would be some great, triumphant return to the grand empire that Britain once was. “Rule Britannia!” they cried. But even in this limp act of national spirit, Truss was on the opposing side. Though she occupied several Downing Street ministerial positions after this—notably minister for Women and Equalities and foreign secretary for the scandal-riddled former Johnson administration—she only reached the ears of most Brits when she ran to replace Johnson in the 2022 Conservative leadership election last month.
Her closest opponent, Rishi Sunak, was a former investment banker, and chancellor of the Exchequer under the Johnson administration. He’s regarded by those in the know as one of the most intelligent, knowledgeable bureaucrats to have worked in modern Downing Street: a man with a mind for detail and an intricate knowledge of how the office works. MPs wanted Sunak; but it was Conservative Party members who chose from the final two candidates, and Sunak couldn’t talk culture war. Liz Truss could, and so they chose her. After 44 days, she has resigned, capping off perhaps the most comprehensively disastrous term in the history of the prime ministership.
It’s hard to do much in such a short term, and yet she managed to do everything wrong. She appointed a cabinet as rich in diversity as it was void of quality and competence. Her first—and only—big move was to announce the so-called mini-budget, a scheme so obviously disastrous that the GBP dropped faster than a shady crypto coin. The International Monetary Fund condemned the budget, Larry Summers compared Britain to an “emerging market,” and the Bank of England promised to spend £65 billion buying government bonds to shore up the British economy. Her party’s electoral chances were slashed by 80%. She reached the lowest approval rating for a prime minister on record. The best one can say of Truss was that she was consistent.
Looking to punish the person responsible for the mess, she made a scapegoat of Chancellor of the Exchequer Kwasi Kwarteng, firing him. That solved it. His replacement was Jeremy Hunt, a perennial Cabinet minister who swiftly announced a complete abandonment of everything Truss had advocated for. This slightly stabilized the markets until yesterday, when Home Secretary Suella Braverman resigned, sensing that the ship was sinking and wanting to be the first rat off. And so, the paddling pool that is 10 Downing Street was hit by another tsunami. Americans think their politics are absurd, but Britain has always led the world in humor, and last night was a season finale. Time to go out with a hilarious bang.
Amid all the furor, a fracking bill came up for vote. You needn’t know the details, for most MPs just viewed it as an informal confidence vote on the government—voting for or against it as a Conservative would informally signal support for or opposition to the current government. Cabinet Minister Jacob Rees-Mogg reportedly shouted, “It’s not a confidence vote.” His Conservative colleagues heckled back volleys of “fuck off.” The Deputy Chief Whip Craig Whittaker, an important position in the party, left the Westminster madhouse saying, “I am fucking furious and I don’t give a fuck anymore.” He and his superior, the Chief Whip Wendy Morton, promptly resigned. They then unresigned. Then it all went to shit anyway.
This afternoon, Liz Truss tendered her resignation. Her speech lasted 89 seconds. A successor will be selected within a week, and we will forget she was ever prime minister. At best, Liz Truss will be the answer to an annoying pub quiz question “Who was the shortest-serving prime minister?” and most will get it wrong.
Other than the economic chaos she has wrought, the only lasting, eventful thing to occur under her rule was the death of the queen. As an anti-monarchist in her youth, perhaps, then, she feels she’s accomplished something.