I wouldn’t trust the Labour chancellor to run my local Tesco Express, yet somehow she’s in charge of the entire UK economy. And she hasn’t got a clue. She’s taxed us all to death, then wonders why businesses are closing, unemployment is rising and consumers are out of cash. Her response is to drone on about how she’s “fixed the foundations”, while pretending she has a plan when she has all the strategic ability of a headless chicken. It shows how broken our political system is that she holds the most important financial job in the country.

Her constant bungling also risks blinding us to the muppets lurking elsewhere in Britain’s financial elite, notably Bank of England (BoE) governor Andrew Bailey. I’ve written about Bailey’s shortcomings before. The only reason I stopped is that Reeves is such a car crash it’s hard to look away. But now Bailey is about to surface again to inflict his usual havoc.

Reeves is already in meltdown as the economy flatlined in January, with zero growth. Now the Iran war looks set to drive the oil price sky-high, and blow her “plan” to bits. Britain faces stagflation or recession, and Bailey is about to make a terrible situation even worse. Because that’s what Bailey does.

Two years ago Bailey was torn to shred by renowned American central banker Ben Bernanke, who criticised the BoE for “significant shortcomings” and forecasting “deficiencies”. Bailey’s response? To dismiss the criticism by loftily claiming: “We don’t do hindsight.” That didn’t surprise me. I wrote at the time that there are many things Bailey doesn’t do. Foresight being the most obvious one.

The BoE previously established itself as the Michael Fish of forecasters for failing to predict the devastating 2008 financial crisis. Afterwards, it held interest rates near zero for far too long, wiping out savers and sending house prices to the stars, triggering today’s affordability crisis. When the inflationary shock was clear to see in 2021, Bailey loftily dismissed the threat as “transitory” and was slow to cut rates. Soon after, inflation hit double digits.

Stung by the criticism, he’s been slow to cut them over the last 18 months. I can’t place all the blame on Bailey, because Reeves has done her best to keep inflation simmering with her jobs tax and price-busting public sector pay rises. Now Bailey and his rate-setters are lining up another mistake. Possibly their biggest of all.

As the oil price rockets, inflation will duly follow. The BoE is expected to respond by holding interest rates at 3.75% at next Thursday’s meeting, instead of cutting. Terrifyingly, Bailey’s merry band of monetary muppets might even hike them.

Higher interest rates won’t bring the oil price down. They’ll simply squeeze households and businesses even harder while draining spending power from the wider economy. We need a cut. A big one. Possibly as much as 1% to send a signal. But Bailey and the BoE haven’t got the guts or gumption.

Reeves has killed the UK economy. War in Iran has doused it in petrol. Now Bailey is reaching for the matches. The only consolation is that the chancellor’s reputation will go up in flames too. Unfortunately, so will we.