Thatcher And Thatcherism Essay
Thatcher and Thatcherism
It is now twenty years since Margaret Thatcher was elected Prime
Minister of Great Britain, and over eight years since she left office.
So this seems a good opportunity to look back at what Thatcher and
Thatcherism may have achieved, and what may be the lessons for today.
I must start with a disclaimer. I'm the British High Commissioner and
normally speak on behalf of the British Government in Australia. But I
hope you will realise that in addressing a subject such as this I am
speaking in a personal capacity. I am not quite sure what the Foreign
Office would say if I asked them for the official line on Thatcherism.
Given some of their run-ins with her on foreign policy, and on Europe
in particular, it's perhaps as well that I haven't tried.
I've had limited personal contact with Mrs Thatcher. I first met her
at a swimming pool, in 1966, during my school speech day. I was at
school with her son Mark. I can't say the encounter made a deep
impression on me, except for the way my father and she engaged in deep
political conversation, while my mother gossiped to Dennis and I did
my best to chat up Mark's sister Carol.
My next encounter was at somewhat greater distance. In 1971, Margaret
Thatcher was Secretary of State for Education in Ted Heath's
Government and I was a student at Cambridge University. She was
speaking in a debate at the Cambridge Union and I was one of those
outside, demonstrating against Government cuts in university funding.
I suppose it was probably just as well for my future career that she
wouldn't have recognised me under the long hair and the beard I had in
I have met her a few times later on during my civil service
career-when she has always been unfailingly polite and willing to
listen to what a quite junior official had to say if she thought they
had a point to make. But the bulk of my career was in fact working for
Ministers who-to a greater or lesser extent-fell out with her. Nigel
Lawson, who was Chancellor of the Exchequer, and in many ways one of
those who most closely shared her philosophy on freeing markets and on
cutting spending and taxes. But who disagreed with her strongly on
exchange rate policy and on the poll tax, leading eventually to his
And then I worked for John Major, when he was Prime Minister, and in
effect her anointed successor. But who found it hard sometimes to cope
with the 'voices off' from Mrs Thatcher or her friends criticising him
for not following her policies or her advice.
So I welcome this opportunity to step back and reflect on Thatcher and
By any standard, she is a remarkable figure. The longest serving
British Prime Minister this century. The only one to have won three
successive General Elections-and indeed she was never defeated at a
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The era of post-war consensus and “stagnation” that had reigned for 30 years over Britain clearly ended with the fall of the Labour government and the election of Margaret Thatcher in 1979. By 1979, Britain’s high levels of unemployment, industrial unrest and inflation led it to gain the nickname as the “sick man” of Europe; radical change was therefore needed. Indeed, the election of Margaret Thatcher in 1979 led to fundamental reforms in all areas of society. The fundamental reforms in British society led many historians referring to Thatcher’s time in office as the “Thatcher revolution”. Despite this widespread view, one cannot solely say that Thatcher solely revolutionised Britain, certain events such as the Falkland’s War and the discovery of North Sea Oil evidently helped Thatcher reform Britain. Even though Thatcher was lucky and opportunistic the extensiveness of Thatcher’s reforms means that one cannot qualify the whole of the Thatcher revolution as a myth.
The Thatcher government has been referred to as a revolution by many historians, indeed in her 11 years in office Britain’s economy changed significantly and the consensus politics that had operated since 1945 ended. Regarding Thatcher’s political reforms, her attack on consensus politics formed a key part of her policy.Thatcher regarded consensus politics as “an attempt to satisfy people holding no particular views about nothing” and felt that Britain’s inefficiency and low growth was a direct result of this policy. For this reason, during her term in office Thatcher embarked on a policy of radical change and reform which aimed to return initiative and accountability to the individual. Thatcher’s radical change of political policy from the consensus politics of the previous 30 years means that one can regard 1979-1990 as the Thatcher revolution. So as to move away from consensus politics and reduce the role of the state, Thatcher implemented a variety of economic reforms.
One of the major economic reforms of Thatcherism was the privatisation of many industries. By returning most state-owned industries to private ownership, Thatcher aimed to eliminate state socialism and increase “popular capitalism” by giving more ordinary people the chance to become shareholders. From a conservative and economic point of view Thatcher’s policy of privatisation was extremely successful. Indeed between 1988 and 1989 the British government derived over £7 billion from privatisation, which dramatically improved Britain’s economic situation. Thatcher’s privatisation programme, which brought a large amount of money to an economically struggling Britain, was a major change in policy from governments of 1945-1979 one can thus call the Thatcher government a revolution.
Thatcherism’s second major reform and perhaps its greatest economic legacy was its success in weakening the power of the trade unions. The trade unions, set up to protect the weak against the strong, had become, by the 1970s, enemies of economic progress and a massive force of social conservatism. By the 1970s the trade unions had gained such a political force that Edward Health even questioned “who governs Britain?” Unlike governments preceding Thatcher’s, the Thatcher government had a much harsher stance against the militancy of the trade unions. Thatcher’s ability to curb the power of the trade unions economically improved Britain since fewer working days were lost due to strike (by 1983 the number of days lost was the lowest since the war). The fall in trade union power also gave more power to the Thatcher government to continue reforming Britain; one can thus consider the curb of trade union power as part of the “Thatcher revolution”.
When claiming that the Thatcher revolution was a myth many look at Thatcher’s first years in government when unemployment and economic output rose significantly and claim that Thatcher did little to cope with Britain economic problems. However when assessing the Thatcher government’s economic legacy one also has to remember that during the same period inflation also dropped significantly: down to 4.6% by 1983. Thatcher’s economic reforms were in fact in line with Milton Friedman economic theory of monetarism whereby inflation, not unemployment was the main thing that stopped an economy from developing. Monetarism, an untested policy outside the military dictatorship of Chile, was an example of Thatcher’s “economic shock therapy”. Monetarism was a revolutionary policy that despite causing a short-term economic downturn allowed Britain’s economy to escape the “stop and go” cycle which was a key cause of Britain economic decline in the 1960s and 1970s.
One of the strongest arguments in defence of the “Thatcher revolution” is Britain economic changes throughout the Thatcher years. Despite early economic troubles during the Thatcher governments which led to an 11% drop in output and a significant rise in unemployment (up to 3 million by the end of 1980), during Thatcher’s later years Britain saw an economic boom and a rise in consumerism. Thatcher’s policies of liberalisation and privatisation allowed for a significant grow in Britain service industry which compensated for the “de-industrialisation” of Britain’s old industry. Unlike all of the previous post-war prime minister’s, Thatcher was able to bring Britain out of the “stop and go” economy. Thatcher therefore revolutionised Britain’s economy which allowed for a lasting economic boom and growth in consumerism.
It would be difficult to ignore the vast economic changes of Britain between 1979 and 1990; however these economic changes cannot solely be attributed to the Thatcher government. Various events that Thatcher had no or little control over helped Thatcher revolutionise Britain. For example the discovery of North Sea Oil in the early 1980s was extremely helpful to the Thatcher government as it gave Britain an alternative energy source replace Britain’s ineffective and uncompetitive coal industry. The discovery of North Sea Oil was incredibly “lucky” for Thatcher and significantly attributed to her success in revolutionising Britain, nevertheless one still cannot stay that the 1980s “revolution” was not largely thanks to Thatcherism. Other events, such as the Iranian Embassy Siege, Britain’s victory in the Falkland’s War (1982) and the end of the Cold War (1989); also significantly helped the Thatcher government in gaining popularity and thus revolutionising modern Britain. Despite the fact that Thatcher was certainly lucky and opportunistic one cannot attributer the extensiveness of her economic success to these factors: the 1980s revolution was truly a “Thatcher revolution”.
Another argument against the idea of a “Thatcher revolution” is the idea that Thatcher’s policies were not revolutionary but merely a continuation of developments that begun under the Callaghan government. One could argue that Thatcher’s policy of bringing Britain’seconomy out of decline was no different from any of the other post-war prime minister (with the possible exception of Attlee). As Dennis Kavanagh points out in 1976 “Mr Callaghan’s famous speech [...] admitted could not spend their way into full employment” but that a squeeze in public spending and privatisation was necessary; this policy outlined by Callaghan appears extremely similar to the Thatcherist policies of monetarism and privatisation. Despite this it is important to note that unlike Thatcher, Callaghan did little to implement these policies and therefore the economy continued on its steady decline. It was only when Thatcher came to power in 1979 that drastic changes to the economy were made, we can therefore qualify the Thatcher government as a “revolution” in British politics.
Thatcher transformed Britain more radically than any prime minister since the Second World War. Despite being lucky and opportunistic Margaret Thatcher’s strength of character which is encapsulated in the famous quote “You turn if you want to. The lady's not for turning”, was the ultimate cause of the economic revolution of the 1980s. The Thatcher’s revolution was by no means a “myth” but transformed Britain from economic decline to economic boom.