Now on bbc news, dateline london. Hello and welcome to dateline london. Im ben brown. Were looking at two of the weeks big stories whats happening in russia as men flee the country after president putins call up of reservists to fight in ukraine and his threat to use Nuclear Weapons, and also the british governments announcement of sweeping tax cuts the most far reaching for half a century. Well, im joined to discuss all this with polly toynbee, columnist from the guardian, Stephanie Baker of bloomberg news, and Latika Bourke of the sydney morning herald. So, cuts to income tax, corporation tax, National Insurance and stamp duty and removing the cap on bankers� bonuses. It will cost tens of billions of pounds. The government says it will boost growth, the labour party say it will reward the rich. Stephanie, lets start off with you. This is being called a gamble for growth. Is it a gamble thats going to pay off, do you think . Well, its certainly a gamble. I have real doubts about whether it will pay off. Kwasi kwarteng has said that he wants to boost growth by 2. 5 and certainly what hes outlined will temper the economic slowdown that we are experiencing right now. But thats delivering a bit of a sugar rush and im not sure that will be sustained over the long term. Some people have compared this to hitting the accelerator and slamming on the brakes at the same time because what you have is on the one hand, the Bank Of England trying to control inflation, cool demand by hiking Interest Rates, while the treasurys Pumping Money into the economy with this huge. Yeah, they seem contradictory. Theyre working at cross purposes. And so, i think that could portend a bit of a stand off as the time goes on and these two work at cross purposes. I mean, we already saw the proposals failing if you look at the markets. The pound crashed. Its now at 1. 08 thats a 37 year low. And bond yields have risen, which is incredibly worrying because hes planning on this 45 billion tax cut, unfunded, through borrowing. So its going to cost the government more if the market is charging them more to borrow. And i think he said today that the markets will do what they do, but i think the lesson of history is you ignore markets at your peril, if youre trying if youre so reliant, if the uk is so reliant on International Investors to fund this plan, i think that hes going to encounter real problems. And i think it looks to me that were going to end up with higher Interest Rates for longer as a result of this plan and, of course, theres been much talk that its skewed towards the rich and that its not really going to therefore deliver the type of Economic Growth he wants. If you give a huge tax break to someone on £200,000, theyre going to go out or bankers theyre going and, you know, buy an expensive italian Light Fixture and import it from italy, rather than spend it in the local economy. 0k. Polly, whats your view . Because what Kwasi Kwarteng is really saying is that growth in this country has been anaemic for years. He says these tax cuts are central to solving the riddle of growth and he wants to turn the vicious cycle of stagnation into a Virtuous Cycle of growth. Do you think he might succeed with this . Its the dream of every government. Its the aim of every government, right, left or centre everybody wants growth so thats completely uncontroversial. Whats controversial is whether you can get it by effectively destroying the economy. The pound plummeting, ftse index plummeting. It doesnt feel like the path to growth. But those might be temporary reactions. The markets, the pound and so on. Yes, the market the markets are quite scary if they turn against you. You do have to listen to them. I mean, labour has known that because labour has been there in the past for doing much less radical things than this. And he was warned, you know they said markets wont like it and he says, markets will do what markets do. Well, you know, Markets Trample all over you if youre going to borrow huge sums of money and youre not you know, it might be sensible to borrow huge sums of money if it was for serious investment. If it was to have a real green Energy Policy to make sure that we can be self sufficient in energy, something of that sort that has real yields for the future, instead of which, as stephanie said, its money into the pockets of the very rich who will use it on extra holidays and buyin things from abroad. If you give it to people in the middle or lower down, each pound rolls through the economy over and over and over again, through the local economy, and takes much longer before it gets sent abroad. We have a terrible balance of payments as it is. Giving lots of money to the rich will only make that worse. 0k. Latika bourke of the sydney morning herald, not exactly ringing endorsements from these two. Whats your take on this . Theres a crazy brave element to this. You have to give liz truss credit for coming into government and doing something that very few Prime Ministers find the guts and the daring to do, which is lay it all on the table. And go for broke. Now, im the sort of poker. Player that lays all my cards on the table in the first round and then sits the rest of the game out, watching Everybody Else continue to play because ive lost the first hand. I i really hope for britain l that this doesnt turn out the same way but it does have a sense to this that| to the theres a couple of teenagers have turned up to the parents house, found it abandoned, long looted, and flicked on the lights and | gone, yeah, its party time. The party we always wanted to have. I so, i do think this. Is the ultimate test of whether these economics really work. We are about to find out. Just poor british people will be caught in the middle of this experiment. Stephanie, one of the things thats interesting about this is it is so radical and it feels like a new government has just come in after a general election with a brand new policy, but actually, liz truss has been in government for many years. I know. Its such a Radical Change from the days of David Cameron and george osborne. I mean, to go from austerity, we must balance the budget to borisjohnson, where he was favouring spending. Now weve got her going for broke in terms of spending huge amounts on helping to cap energy bills, and i think that makes sense. The question is how they fund it. And the fact that she wants to go to go for this trickle down approach, shes going to cut taxes but shes not going to cut spending or tax any Energy Companies for their windfall profits, so i think its this disconnect. Its very ideological but shes actually pursuing Trickle Down Economics with a bit of keynesianism mixed in. Its very its a real experiment and i dont know how its going to turn out. Polly, we heard some of this during the conservative leadership campaign, but not all of it. So, people have been surprised by this. She always said she wanted to cut taxes she talked about that a lot but a lot of people thought thats just to soften up the Conservative Party so she gets elected and when she gets there, shell pivot. Surely, she will. Surely, she wont do anything so socially unjust. Because already, Opinion Polls snap polls today showing a very large number of people, including a very large number of conservative voters, think its unfair, dont think it will produce growth. Although Kwasi Kwarteng says tax cuts for everybody, so he says it is fair. Well, yes, if you those at the bottom get a tiny bit and those at the top get walloping great tens of thousands. Yeah, i think its150 for someone on £20,000 and 5000 something on for someone on 200,000. Yeah, 150 a year. And the danger for the government, though, is that the real test at the end of this come election time in two and a bit years is actually not much tax they have | to pay every month. Its going to be, did my wages grow . And if you see bankers i wages growing, if you see millionaires wages growing in a real sense and yours didnt, thats where this is really problematic for the government. The other thing i would add i is theres a really good litmus test for this in what happened in australia in 2007, where a very old right government, they had four terms and the centre right government that had made a huge mantra for itself in selling Fiscal Responsibility to the public ended up going on an absolute spending spree a couple of years before the election. Theyre very unpopular by this point. And the labor Opposition Leader who then becamej the Prime Minister won that election by saying this reckless spending must stop, and i think theres a real moment for keir starmer here to come in here and say, actually, im going to be the responsible guy in the room. Its very likely that labour will win the next election because on the whole, if you look at all the history, no government that has been in control, whether you say its their fault or not, through such an economic crisis as this has ever been re elected. But it leaves labour with a quandary because what they inherit, we dont know yet. How bad it will be, how far the pound will plunge and all the rest of it. But it leaves the traditional Labour Position of generosity very, very difficult. As you say, they may find themselves in a reversed role. But also, are they going to deliver the tax cuts . | are they going to reverse them . I think thats clearly the political positioning the tories are setting up here. Are you, keir starmer,j going to go to the next election saying youre actually going to increase taxes on everyone, not just the big Energy Companies . Thats a very different scenario. But people. Well, theyd certainly put the taxes back on the rich. I mean, its quite extraordinary. Its symbolic. 45 rate that the top, you know, that the people who earn most are going to have 5 tax cuts. I think labour will have no trouble saying, well certainly put that top rate back. But people say that liz truss is trying to model herself on margaret thatcher. Is that electorally going to be a way for her to win the next election, potentially . Well, the remarkable thing is how much they are willing to take the hit politically for things that dont deliver that much in terms of economic gain. I mean, that, ifind shocking. So, the banker bonuses, lifting the cap on banker bonuses, for instance politically unpopular. In reality, it doesnt really change things much. Its not a game changer. Its not going to result in a huge reversal of the exodus of bankers from london to the continent as a result of brexit. It might make the uk more competitive versus new york. Its probably a good thing, but its not going to really deliver much in terms of Economic Growth. Likewise, the move for him to require people on benefits to try to show that theyre looking for more work and adding more hours, its a hugely unpopular move. But liz truss has said. But its a tiny number of people. Liz truss has said shes prepared to be unpopular. And so, in that sense, i think shes trying to be like maggie thatcher, that shes going to go for these unpopular policies that are highly ideological, betting that people will actually side with her in the end. But youre right about the irrelevance of the things shes picked on, because thatcher picked her battles. They were things she really cared about. I mean, she massively privatised all of the utilities. These were great big things. As you said, bankers bonuses or, you know, tormenting a few of the people who are part time workers, these are absolute small beer. Its not big stuff. So, her battles are very peculiar. High unpopularity for very little gain. Whats your take on that . Will this make her unpopular or popular . Well, i wasjust going to add that if youre trying to cosplay margaret thatcher, its one thing to fund all these tax cuts and set yourself as singapore upon thames from a position of surplus. I its quite another to do it i when your debt to gdp ratio is already nearly 100 . 0k, were going to leave tax cuts and the british economy and were going to turn our attention now to the war in ukraine, because the us President Joe Biden said this week that russias invasion had breached the core tenets of the United Nations charter. President putin, though, seems to be doubling down on the war hes mobilising another 300,000 reservists with the result that many men eligible for the call up are fleeing from russia. Meanwhile, the kremlin are organising self styled referendums in four regions of ukraine, seeking to annexe them all as russian territory. And if the west doesnt like it, well, weve had another dire warning from mr putin this week threatening to retaliate with Nuclear Weapons if necessary. And he said this is not a bluff. Latika, is it a bluff . Do you worry that this war in ukraine could escalate . Yes, absolutely. I mean, its startling to see someone have to tell everybody that theyre notjoking. You only normally say that. If you think everyone is taking you for a joke. But i think we should takel what he says very seriously because hes acting in a very different scenario to the rest of us. Hes clearly panickingl and i think he realises that this war is not hes not having the effect he wanted on the west. And indeed, in the last few weeks, weve seen some i of russias allies start to put pressure on russia. China, in particular, china had their first Foreign Ministers meeting on the sidelines at unga today, j i think thats really significant. And also indias starting to complain to russia i about the war. So, yes, i think we should take very seriously what putin says, j primarily because hes feeling the pressure. I but take it seriously and should we then stop supplying weapons to ukraine, for example . No, i mean, obviously the goal is for ukraine to win this war. I and theyve staged remarkable victories in the last few weeks. So the momentum is with ukraine. I i think every expert would agree this ends in a very protracted stalemate rather than a quick victory on ukraines side. But no, i think the resolve from the west should only be stronger. Its interesting, polly, seeing the reaction in russia. Russian men trying to flee from the country. Huge queues at the border. People clamouring to get onto planes. The price of Plane Tickets out of russia going sky high. It seems as if putin still has backing from the majority, but it also seems as if its slipping quite fast. People are more and more afraid and horrified. They dont want to send their sons. I think there is a debate going on quietly about giving your enemy a retreat. What do we do to let him retreat in any way thats remotely plausible . What could we do . Giving him an off ramp. I dont know if there is one, but it certainly something to hold in the back of ones mind that its better to let the enemy run away if you can. A long stalemate eventually, something, somewhere has to give. Maybe we just sit there hoping that somebody deposes him, but i think that seems. But if he says he would end the war if he could keep the territory he has now, ukraine would never agree. And it would be for us to say its up to them to decide. But i dont know if there are other terms and intermediaries who might come in. China and india are now backing off of it, whether there is some way of softening. We dont look anywhere near that at this point. I said in a way, putin is doubling down. Weve got these referendums which, are they sham referendums . Thats what everybody in the west is saying. A bit like crimea in 2014. Is this a way of putin saying this is definitely part of russia and if you try and stop us, thats when we could up the ante and potentially use Weapons Of Mass Destruction . It seems like a blatant attempt to extend the russias Nuclear Umbrella to those eastern territories so that he raises the stakes for the us and the uk. Because he says they are part of russia. So dont continue to supply ukrainians with. Theres been an incredible influx of High Precision weaponry that has changed the game on the ground. And i think hes betting that will make them think twice before continuing to send equipment. But i think youll probably also see in response a doubling down on the sanctions, and of course, theyre pushing ahead with this idea of a price cap on russian oil to try to undermine putins ability to fund his war machine. We will see how that works out. Theres a real division as to whether or not that will result in higher or Lower Oil Prices and whether india and china will play along. So that remains to be seen, but they can go further on sanctions. But you look at the additional troops being mobilised. The real question in my mind is, how will that change the situation on the ground . It seems unlikely to change it in any substantial way. It probably will lengthen the war. We dont know how many of these troops he will successfully recruit, and theres now talk of potentially martial law being called in russia. As a way of forcing it through. How much danger do you think that puts putin in himself, personally . We talk about the possible give someone deposing him. But in a sense, hes a creature of the elite. Yes, i think weve always been hoping that something might. Happen in the kremlin. Maybe that would be the moment someone in the kremlin would prevail in that point. Untilthen, ithink. That the real test is what the ordinary. Russian people do. Weve seen this extraordinary flight. Weve seen some very. Brave russian protesting and being arrested and drafted. Which must be horrific. We also see these calls from ukraine to ban russian tourism. A lot of russians ar