James Forsyth

The year of the three emperors in Prussia changed world history. In 1888, Wilhelm I died and was succeeded by his more liberal son, Friedrich III. However, Friedrich’s reign was cut short by cancer. He died after just 99 days. He was followed by his 29-year-old son Wilhelm II – better known in this country as Kaiser Bill, whose more bellicose approach increased tensions in Europe and led, eventually, to war. If Friedrich had survived, the first world war – and, therefore, the second world war – might never have happened. He was a reformer, an Anglophile (he was married to a British royal) and not motivated by the same militarism that his son was. The year of the three British prime ministers will not have such a dramatic effect on the world.

During the Tory leadership contest this summer, it was frequently said that whoever won would face the most politically difficult winter in a generation. In the end, despite winning the contest, Liz Truss didn’t make it that far. But winter is about to sting her successor.    After the collapse of the Truss premiership, Rishi Sunak needed to steady the ship in his first weeks in No. 10. This has gone reasonably well. The Autumn Statement was given a passing grade by the markets and there is no parliamentary rebellion against it. Westminster is no longer watching nervously to see how the City responds to every cough and splutter from Downing Street.

There are reasons why Labour wants to talk about constitutional reform despite all the other challenges facing the country. First, there is no financial cost to it. At the moment, Labour is severely hemmed in by the fact that it doesn’t want to make new spending commitments as it knows the Tories will immediately ask how they will be paid for. Political reform is one area where Labour can be radical without it costing anything. Second, it punches a Tory bruise. As Gordon Brown said this morning, Labour knows that Boris Johnson’s resignation honours will push the issue back up the agenda and make the current arrangements hard to defend.

Conservative party strategists face nervous days ahead as they wait to see how many Tory MPs will announce they are standing down at the next election. The last two general elections – 2017 and 2019 – were called unexpectedly in the middle of parliament, meaning MPs had next to no time to decide whether or not they were going to stand. This time, with no real prospect of a snap election before 2024, a dozen Tory MPs have already said they won’t fight the next general election. It would be a surprise if more didn’t join them in the coming days, although the mass departures that were predicted a few weeks ago have not yet come to pass ahead of Monday’s deadline.

In many ways, the biggest political development of this week was the Supreme Court ruling that a referendum bill would be outside the competence of the Scottish parliament. This unanimous decision – and the fact that the UK government isn’t budging on a Section 30 order which would allow another referendum – means Nicola Sturgeon is being forced to fall back on her plan to try and turn the next election into a de facto referendum on independence. As I say in the Times today, this is a risky strategy.  But even if Sturgeon falls short of the majority of the vote she is seeking in 2024, unionists will still have questions to answer. How do they reduce support for independence in the medium term? And in what circumstances would they accept another referendum?

It’s not just the government that’s now beholden to forecasts from the Office for Budget Responsibility. Keir Starmer told the BBC that Labour doesn’t ‘quarrel with the number that the OBR put out as a target or trying to get the debt down’. So Starmer accepts that the government needs to find around £50 billion through spending cuts or tax rises to get debt falling as a percentage of GDP in the medium term. This applies not only to the current government, but to any government he may run in the future. Of course, Labour stress that they would make ‘different choices’ to the Tories in how they close a fiscal gap of more than £50 billion.

Amid all the economic gloom at the moment, the unemployment figure is one bright spot. It is just 3.6 per cent, down from 3.8 per cent this year, and close to a historic low. But, as I say in the Times this morning, even this glimmer of hope is tarnished. The low unemployment number disguises how many people have left the labour force: more than 20 per cent of working-age Brits are economically inactive, meaning they are neither in work nor looking for it. More than five million are claiming out-of-work benefits.  Even in the coming recession, unemployment won’t exceed 5 per cent, according to the Office for Budget Responsibility. (Remember how in the 1980s, unemployment went into double digits).

Since the 2008 financial crash, British politics has been moving faster and faster, and becoming less stable. This frenzy reached its apogee with Liz Truss’s 44-day stint in No. 10 which had enough drama for a ten-year premiership. One of the challenges for Rishi Sunak is to calm things down and to return politics to a more normal pace. It will be a good sign for the government if the World Cup dominates newspaper front pages for the next month. However, there is one area where Sunak needs politics to move faster than normal. Jeremy Hunt’s Autumn Statement is the kind of fiscal event that you would expect at the beginning of a parliament. It is about dealing with a difficult fiscal inheritance. It is designed to fix the ‘mistakes’ of the previous administration.

The Biden-Xi meeting at the G20 seems to have been relatively productive, and has at least improved the lines of communication between the two superpowers. The Chinese readout has them declaring that the relationship is ‘not what the international community expects from us’.   The first in-person meeting between Biden and Xi since Biden became president does seem to have moved US-China relations on from the depths they fell to after Nancy Pelosi’s visit to Taiwan. In a sign of the relative détente, the US Secretary of State Antony Blinken is expected to visit China in the New Year. But the aggressive Chinese language about the status of the island is a reminder of how problematic this factor remains to the relationship.

Kwasi Kwarteng is clearly right about one thing in his interview with Talk TV: his departure hastened the end of Liz Truss's premiership. Sacking a Chancellor is a dramatic, and risky, move for a Prime Minister at the best of times. But when the Prime Minister and the Chancellor are known to have been in lockstep, it is particularly risky. Truss could never answer the question of why, if Kwarteng had to go over the mini-Budget, she did not.   What is also right is that Kwarteng was more prepared to talk about spending cuts than Truss was.

Soon after Kwasi Kwarteng’s not-so-mini-Budget, I found myself in conversation with former aides to David Cameron and Boris Johnson respectively. They were both irritated by the way Liz Truss was being praised as a ‘true Tory’ in some Conservative circles, compared with her more cautious predecessors. One of them remarked, as the other nodded, that people will soon ‘find out there’s a reason why we didn’t do those things’. Sure enough, the mini-Budget collapsed spectacularly and cost Truss her premiership. One of her mistakes had been simply to reject what had gone before, rather than to try to understand why compromises had been made. Her year-zero approach was one of the things that led to her being ejected from office so quickly.

Rishi Sunak is back from his first overseas trip as Prime Minister. Despite Downing Street having initially said he wouldn’t go, Sunak did travel to Cop27, the international climate change summit in Egypt.   Given the UK has had three prime ministers this year, his non-attendance would have raised question marks The problem with Sunak not going was not only that the UK was handing over the Cop presidency to the Egyptians. Given the UK has had three prime ministers this year, his non-attendance would also have raised question marks over the UK’s commitment to this climate change agenda.

Immigration is now at the top of the political agenda in a way that it hasn’t been since the vote to leave the European Union in 2016. Two factors have propelled it up the list, one very real (the small boats arriving across the Channel) and the other theoretical (economic modelling). The market reaction to Kwasi Kwarteng’s mini-Budget made the Office for Budget Responsibility’s next forecast all the more important. In an attempt to increase economic growth, Liz Truss wanted to formalise a more liberal immigration policy. She wanted to show the OBR that her policies would produce decent growth, but her tax cuts would not be enough to do this. So she thought more immigration would help to increase GDP figures, as it had in the Labour years.

It is the most remarkable turnaround in recent political history. On 5 September, Rishi Sunak lost the Tory leadership race to Liz Truss with 43 per cent of the vote. He was written off as another politician with a brilliant future behind him. Seven weeks later, the former Chancellor – whom, I should say, I have been friends with for many years – walked through the door of No. 10. His political resurrection was made possible by the economy. He spent the summer warning of the risk of slashing taxes without having a grip on inflation and controlling spending. When Truss followed through on her tax-cutting campaign pledges – adding a few more surprise tax cuts and an energy subsidy for good measure – the markets were spooked.

Rishi Sunak has been elected leader of the Tory party and will be the next prime minister after Penny Mordaunt pulled out of the race. By the 2 m. deadline, 197 Tory MPs – half of the party – had come out for him. Just 27 had gone public for Mordaunt: her team said that anonymous endorsements took this to 97. Given that only Sunak qualified, the final numbers will never be known. He speaks to Tory MPs at 2.30 m.in private. It is a remarkable turnaround for Sunak It is a remarkable turnaround for Sunak. Last month, he lost the Tory leadership election to Liz Truss. But the vindication of his economic warnings has changed the political landscape.

Boris Johnson’s decision to pull out of the Tory leadership contest averts a nightmare scenario where he had got the support of less than a third of the parliamentary party and was then returned to Downing Street by the member’s vote (though, I think the result of that ballot was becoming less and less certain). This would have been a recipe for instability. Can you really lead a party in parliament if the vast majority of the MPs wanted someone else?   Even allies of Johnson were saying today that they hoped that he wouldn’t run. They feared that if he did he would be remembered as the man who broke the Tory party rather than as the man who delivered Brexit, won the 2019 general election with a majority and was right about Ukraine.