I’ve been hanging back a bit on the topic of Margaret Thatcher’s death for a couple of reasons. One is the straightforward John Donne idea that anyone’s death diminishes us – ask not for whom the bell tolls and all that. My wife and I attended a friend’s sixtieth birthday party a few years ago, and one part of the evening included a group gleefully singing how happy they would be when Maggie Thatcher dies. We are both Labour Party members, worked in the public sector in the north of England and saw the damage, were passed by convoys of police during the miners’ strike, and opposed Thatcherism and all its doings, but we both felt a bit sour about the show. The other reason for my hesitance is my unwillingness to be drawn into the two major camps. Camp one – the Joan of Arc tendency – claims that Margaret Thatcher saved the country from becoming an economic basket-case, in thrall to trade union demagogues and foreign governments. The Sunday Times printed an extraordinary cover to its Thatcher Tribute, with the lady dressed as a medieval knight (eerily similar to a Nazi Hitler poster). Some rich men astonishingly suggested a minute’s silence at national sporting events. Camp Two – Margaret Thatcher was a vicious class warrior who closed down manufacturing and mining, and whose policies were aimed at the destruction of the welfare state and the transfer of money from poor to rich. I suppose the posh word for my view of Thatcher is that it is ‘nuanced’: you may feel ‘confused’ is closer to the mark, but then, you would. And one reason to write is to find out what you think.
And I’m not sure I believe either. Here goes:
- I think it’s a mistake to regard Thatcher’s economic policies as having saved Britain. Economic growth was actually slower after she came to power than before. To some extent that reflects something that happened the world over, as the era of cheap energy came to an end, but it is still something that the Times, Express, Telegraph, Mail (and even the BBC) have not acknowledged. Even those who presented a balanced view said she saved the economy at the expense of society; well, er, up to a point, because …
- … we must not forget the enormous bonus of North Sea Oil which came ashore just as she took power. I remember attending a campaign meeting in 1979, where Shirley Williams – then Labour Education Minister – predicted that whoever won the election would be in power for fifteen years, because of the oil wealth. At its peak, oil was supplying 16% of government revenues, and that (and the coming of floating exchange rates) meant an end to the exchange rate/balance of payments crises that had dominated 1960s politics.
- But oil wealth is a double edged sword. It provides government tax income – funding a reduction in income tax at the top from 83% to 40%, and at the lower rate from 35% to 20%. Maybe it would have been better for the government to keep its hands on the money, Norway style, to build up investments for the future, but then, we could have done that ourselves with our tax breaks, couldn’t we ? We could have bought shares and bonds, rather than Japanese and German cars. The down side of oil wealth is that it keeps your exchange rate higher than it would have been, making it harder for other industries to compete with cheaper foreign imports and raising the price of our exports. At least part of the decline of manufacturing for which she is blamed was due to this.
- The decline of manufacturing was replicated in other countries (such as the USA – see the Rust Belt). Given the rise of the Asian manufacturing superpowers, maybe this wasn’t a bad thing. Did we really want to be competing with low cost Chinese manufactures in the 2000s ? Wasn’t finance and services the sensible way to go ? I think the main criticism of Thatcher’s government – and others, before and after – was that there was insufficient consistent support for the high tech, high skill industries that would have been part of a balanced economy. Technical education was neglected then attacked (academic education was better funded throughout), university science ignored then cut, and government support for technology was patchy.
- The relation with the trade unions is an area where the Thatcher government plainly and decisively broke with a post-war consensus where unions were regarded as a significant national interest. They were routinely consulted and involved in economic policy, because it was felt that they represented the working people, or at least could cause trouble if they were not involved in such discussions. I think this is things should be – if employers are consulted, why not worker organisations.The problem came in a couple of areas. One was the ability of some unions to threaten, and even deliver, strike action without ballots – as seen most acutely by Scargill’s NUM death-throe. This was generally done in order to support the power of the union bureaucracy – to make employers obey the wishes of shop stewards and regional/local officials. This power-play – and I speak as a former chief executive but also a former union secretary and known leftie – became tiresome and worked against the members’ real interests. I arrived at a college known for its militancy. On one occasion it looked like being the only college on strike in the whole country (the members had, of course, been told that everyone else was on strike and they had to support them). On another, I asked why the strike was being called and what I had to do to prevent it: I was told “it’s not as simple as that”. This all led to the second problem, of unions being blind to the needs of the efficient running of the business. Hence the end of the British-owned car industry. (However, please note that Vauxhall had far, far, fewer strikes than Ford – maybe good management has something to do with rank-and-file militancy).
Something had to be done to restore the balance. Those with long memories will recall “In Place Of Strife”, proposals from Barbara Castle when she was Secretary of State for Employment under Harold Wilson’s government. The unions, in cahoots with James Callaghan, torpedoed this modest reform. More fools them – they got ‘reform’ a decade later, doubled in spades. Conservatives often acknowledge that the way to maintain something (monarchy, marriage, House of Lords etc) is to accept modest changes. Pity that the 1970 trade union leaders couldn’t see that.
- Privatisation was a major change. I can remember writing an economics textbook in the 1970s that had a chapter on the management of the nationalised industries. The change has been adopted internationally, partly because of the pro-capitalist ideology that everything is better done by the private sector, partly because sell-offs give governments lots of cash, and partly because it takes worries of their back. Ministers can take a lofty tone when questioned about water wastage or electricity bills now – they will not lose their job if it doesn’t work well. And, to be fair, politicians are not trained to run major businesses, and some businesses are nothing to do with government. I remember arguing with a Labour MP who was fighting to keep British Airways in the public sector: asking why should taxpayers subsidise those who want to do business or take holidays abroad ? It was not a popular line in the Labour Party of the 70s. Thatcher may not have made the trains run on time, but she made changes that got you a phone on time. Whether governments have yet mastered the business of managing businesses – remember that the train companies charge more than British Rail ever did, and get bigger government subsidies – is a matter for debate. After the 2008 crash and the revelations about tax evasion, we are beginning to understand that government need to be on the side of the people, not the corporate world, and it is a slow dawning realization.
- It’s now a long enough distance to say that Thatcher seems to have been an unpleasant person. She was denied a research post at ICI because the interviewers were worried she was too over bearing. A retired journalist friend remembers her as Secretary of State for Education replying to a reasonable question “I didn’t come here to answer stupid questions from stupid people like you”. (The question was to ask why she was the first Secretary of State to be booed by a teacher conference.) Cabinet colleagues speak of her habit of humiliating people who disagreed with her. Right wing papers discovered some former colleagues with stories of her kindness are there, but they were mighty thin on the ground. Let’s not forget that she did not retire graciously: she was fired because of policy errors (Poll Tax anyone ?), because her colleagues couldn’t face working with her any more, and because she was very unpopular with the public.
So, what’s the verdict ? She was a competent and hardworking Prime Minister with a right wing agenda, saved for a second term by a quirk of history – the Falklands War – and for a third term by a quirk of geology – North Sea Oil. I hope we never get her on our bank-notes, and don’t think we will. There was hostility and delight at her passing in some places, but many young people has little idea who she was, and the main reaction was indifference. A tweeter said it all, really: that for most of the length of her funeral procession, the crowds stood one deep.