Thatcher S Britain: Politics 1979-97

Thatcher’s Britain: Politics 1979-97.

Robert Saunders, St John’s

Thatcherism:

Became leader in 1975: a time of crisis for the Conservative party.

Had lost 3 out of 4 elections, and fallen from nearly 50% of the vote in 1955 to 36% in 1974.

Running third among first time voters.

Thatcher: ‘The Old Testament Prophets did not come out of the wilderness and say, “People of Israel. We must have a consensus”. They said, “This is what I passionately believe. If you believe it too, come with me”’.

Her politics defined by what she was against: socialism, strikes and the Soviet Union.

MT: ‘Socialism is what socialists do, and socialists do more or less the same, as the opportunity permits. [The] GULAG was the consequence of socialism’.

‘the real case against Socialism is not its economic inefficiency, though there is evidence on all sides of that. Much more fundamental is its basic immorality’.

‘I came into politics because of the conflict between good and evil’.

‘Economics is the method; the object is to change the heart and soul’.

1979-81: British manufacturing shrank by 25%. Interest rates hit 17%; inflation 18%. Unemployment above 3 million.

364 economists wrote to The Times, demanding a change of course.

But Thatcherism about psychological change, not a short term economic recovery.

Policies:

More than a million council houses sold to their tenants, raising £17 billion for government.

MT on council estates: ‘council estates bring together people who are out of work but enjoy security of tenure at subsidized rents. They not only have every incentive to stay where they are: they mutually reinforce each other’s passivity and undermine each other’s initiative. Thus a culture grows up in which the unemployed are content to remain living mainly on the state with little will to move and find work’ (The Downing Street Years).

Privatisation: raises more than £19 billion over the 1980s.

MT: ‘Privatisation … was fundamental to improving Britain’s economic performance. But for me it was … far more than that: it was one of the central means of reversing the corrosive and corrupting effects of socialism. … Privatisation is at the centre of any programme of reclaiming territory for freedom’.

Trade union reform: six Trade Union Acts, 1979-97.

Norman Tebbit on the miners’ strike (1984-85): ‘It broke not just a strike, but a spell’.

But the government’s opinion poll ratings fell to 24% by August 1985.

Problems: Council house sales and easing of credit restrictions led to significant rise in personal debt.

1978: £6 billion paid out in mortgages. 1988: £63 billion.

Makes low interest rates a much bigger political priority – even if inflation rising.

When MT resigned, in November 1990, interest rates were at 15%.

Europe: MT had seen the EC as a useful bulwark against socialism; but that changed with the ending of the Cold War and the demise of socialism in Britain.

By 1990, seemed a vehicle for German influence, rather than a bulwark against the Soviets.

John Major:

Governed for nearly 7 years, and won more electoral votes in 1992 than any other party in British history.

But took office during a white-collar recession, hitting Tory voters in the South.

1984: 23,000 homes repossessed. 1992, 62,000.

Reputation for economic competence shattered by British exit from the ERM on ‘Black Wednesday’, 16 September 1992.

Tiny majority after 1992, so vulnerable to small groups of rebels.

Scotland and Wales:

Privatisation intended as an alternative to devolution:

‘Not devolution to politicians and bureaucrats – but devolution to the Scottish people themselves. Devolution of housing, devolution of education, devolution of share-ownership and devolution of state-run industries to individuals … Nationalisation took companies out of Scottish hands and into Whitehall; privatisation will hand them back to Scotland’ (MT)

Yet support for Scottish independence up from 14% in 1979 to 33% in 1987. No Conservative MPs elected in Scotland or Wales in 1997.

Some Statistics

ELECTIONS:

1979:Conservatives (44%); Labour (37%); Liberals (14%)Majority: 43

1983:Conservatives (42.5%); Labour (27.5%); Liberal-SDP Alliance (25.5%)Majority: 144

1987:Conservatives (42.3%); Labour (31%); Alliance (22.5%)Majority: 102

1992:Conservatives (42%); Labour (34.5%); Lib Dems (18%)Majority: 21

1997: Conservatives (31%); Labour (43%); Lib Dems (17%)Majority: 179

FIGURES:

1979 to 1981: 25% of Britain’s manufacturing capacity shut down.

Inflation peaked at 18%; interest rates at 17% in 1980.

Jan 1982, more than 3 million unemployed – the highest level in relative terms since the 1930s.

Stayed above 3 million until 1987, dropping to 1.8 million by 1990.

Standard rate of income tax down from 33% (1979) to 25% (1990) to 23% (1997).

Top rate of income tax down from 83% (179) to 40% (1988).

However, overall tax burden – direct and indirect – up from 31.1% (1979) to 37.2% (1996).

More than a million council houses sold, raising raising £17,580 million (1979-89).

Privatisation raised about £19 billion (1979-87).

Housing loans up from £6 billion to £63 billion.

Mortgage Interest Tax Relief up from £1,639 million (1979) to £5,500 million (1989).

MAJOR TRADE UNION LEGISLATION:

1980 Employment Act: provided public funds for strike ballots

1982 Employment Act: provided for compensation from public funds for employees dismissed under ‘closed shop’ arrangements.

1984 Trade Union Act: required ballots before strikes, and ten yearly votes on the continuation of political funds.

1988 Employment Act: legislated against dismissal for non-membership of a trade union; made it illegal for trade unions to dicipline members for crossing picket lines or refusing to strike.

1990 Employment Act: banned the pre-entry ‘closed shop’ and made it illegal to refuse employment to someone for belonging or not belonging to a trade union. Removed legal immunity of trade unions from civil lawsuits claiming damages for secondary action.

1993 Trade Union Reform and Unemployment Rights Act: restricted union deductions from employees wages, tightened rules on strike ballots, abolished wages councils and gave workers the right to join any union, even if not organised in their workplace.

[Source: Twentieth Century British Political Facts, 1900-2000]