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Thatcherism describes the conviction politics, economic and social policy, and political style of the British Conservative politician Margaret Thatcher, who was leader of her party from 1975 to 1990. It has also been used by some to describe the ideology and wider political culture of the British government while Thatcher was Prime Minister between May 1979 and November 1990, and beyond into the governments of John Major, Tony Blair, Gordon Brown and David Cameron.[1]
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Thatcherism claims to promote low inflation, the small state and free markets through tight control of the money supply, privatisation and constraints on the labour movement. It is often compared with Reaganomics in the United States, Rogernomics in New Zealand and Economic Rationalism in Australia as a key part of the worldwide neoliberal movement. Nigel Lawson, Thatcher's Chancellor of the Exchequer from 1983 to 1989, listed the Thatcherite ideals as:
Free markets, financial discipline, firm control over public expenditure, tax cuts, nationalism, 'Victorian values' (of the Samuel Smiles self-help variety), privatisation and a dash of populism.[2]
Thatcherism is thus often compared to classical liberalism. Milton Friedman claimed that "the thing that people do not recognise is that Margaret Thatcher is not in terms of belief a Tory. She is a nineteenth-century Liberal."[3] Thatcher herself stated in 1983: "I would not mind betting that if Mr Gladstone were alive today he would apply to join the Conservative Party".[4] In the 1996 Keith Joseph memorial lecture Mrs. Thatcher argued that "The kind of Conservatism which he and I...favoured would be best described as ‘liberal’, in the old-fashioned sense. And I mean the liberalism of Mr. Gladstone, not of the latter day collectivists".[5] Thatcher once told Friedrich Hayek: "I know you want me to become a Whig; no, I am a Tory". Hayek believed "she has felt this very clearly".[6]
But the relationship between Thatcherism and liberalism is complicated. Thatcher's former Defence Secretary John Nott claimed that "it is a complete misreading of her beliefs to depict her as a nineteenth-century Liberal".[7] As Ellen Meiksins Wood has argued, Thatcherite capitalism was compatible with old-fashioned conservative political institutions. As Prime Minister, Thatcher challenged, not ancient bodies like the monarchy and the House of Lords, but some of the most recent additions to British politics: the trade unions.[8] Indeed, many leading Thatcherites, including Thatcher herself, went on to join the House of Lords: an honour which Gladstone, for instance, had declined.[9]
Thinkers closely associated with Thatcherism include Keith Joseph, Enoch Powell, Friedrich Hayek and Milton Friedman. In an interview with Simon Heffer in 1996 Thatcher stated that the two greatest influences on her as Conservative leader had been Joseph and Powell, "both of them very great men".[10]
A number of commentators have traced the origins of Thatcherism in post-war British politics. The late historian Ewen Green identified a strain of resentment to the inflation, taxation and the limited constraints on the labour movement associated with the so-called Buttskellite consensus in the decades before Thatcher herself came to prominence. Although the Conservative leadership accommodated itself to the Attlee government's post-war reforms, there was continuous right-wing opposition in the lower ranks of the party, in right-wing pressure groups like the Middle Class Alliance and the People's League for the Defence of Freedom, and later in think tanks like the Centre for Policy Studies. For example, in 1945 the Conservative Party Chairman Ralph Assheton had wanted 12,000 abridged copies of The Road to Serfdom (a book by the anti-socialist economist Friedrich von Hayek later closely associated with Thatcherism),[11] taking up one-and-a-half tons of the party's paper ration, distributed as election propaganda.[12]
Thatcherism is often described as a libertarian ideology. Thatcher saw herself as creating a libertarian movement,[13][14] rejecting traditional Toryism.[15] Thatcherism is associated with libertarianism within the Conservative Party,[16] albeit one of libertarian ends achieved by using strong and sometimes authoritarian leadership.[17] Andrew Marr has called libertarianism the 'dominant, if unofficial, characteristic of Thatcherism'.[18] However, whereas some of her heirs, notably Michael Portillo and Alan Duncan, embraced this libertarianism, others in the Thatcherite movement, such as John Redwood, became more populist.[19][20]
However, some commentators have argued that Thatcherism should not be considered properly libertarian. Noting the tendency towards strong central government in matters concerning the trade unions and local authorities, Andrew Gamble summarised Thatcherism as 'the free economy and the strong state'.[21] Simon Jenkins accused the Thatcher government of carrying out a 'nationalisation' of Britain.[22]
Thatcherism is associated with the economic theory of monetarism. In contrast to previous government policy, monetarism placed a priority on controlling inflation over controlling unemployment. According to monetarist theory, inflation is the result of there being too much money in the economy. Thus the government should control the money supply to control inflation. However, by 1979 it was not only the Thatcherites who were arguing for stricter control of inflation. The Labour Chancellor Denis Healey had already adopted some monetarist policies, such as reducing public spending and selling off the government's shares in BP.
Moreover, it has been argued that the Thatcherites themselves were not strictly monetarist in practice. A common theme centres on the Medium Term Financial Strategy. The Strategy, issued in the 1980 Budget, consisted of targets for reducing the growth of the money supply in the following years. After overshooting many of these targets, the Thatcher government revised the targets upwards in 1982. Analysts have interpreted this as an admission of defeat in the battle to control the money supply. The economist C. F. Pratten claimed:
Since 1984, behind a veil of rhetoric, the government has lost any faith it had in technical monetarism. The money supply, as measured by £M3, has been allowed to grow erratically, while calculation of the PSBR is held down by the ruse of subtracting the proceeds of privatisation as well as taxes from government expenditure. The principles of monetarism have been abandoned.[23]
Thatcherism is also associated with supply-side economics. Whereas Keynesian economics holds that the government should stimulate economic growth by increasing demand through increased credit and public spending, supply-side economists argue that the government should instead intervene only to create a free market by lowering taxes, privatizing state industries and increasing restraints on trade unionism.
Reduction in the power of the trades unions was made gradually, unlike the approach of the Heath Government, and the greatest single confrontation with the unions was the NUM strike of 1984 to 1985, in which the union eventually had to concede.
Thatcherism is associated with a conservative stance on morality. The sociologist and founder of the New Left Review, Stuart Hall, for example, argued that Thatcherism should be viewed as an ideological project promoting "authoritarian populism", since it is known for its reverence of "Victorian values". David Marquand expressed the "authoritarian populist" sentiment in 1970s Britain that Thatcherism supposedly exploited: "Go back, you flower people, back where you came from, wash your hair, get dressed properly, get to work on time and stop all this whingeing and moaning."[24] Norman Tebbit, a close ally of Thatcher, laid out in a 1985 lecture what he thought to be the permissive society that conservatives should oppose:
Bad art was as good as good art. Grammar and spelling were no longer important. To be clean was no better than to be filthy. Good manners were no better than bad. Family life was derided as a outdated bourgeois concept. Criminals deserved as much sympathy as their victims. Many homes and classrooms became disorderly - if there was neither right nor wrong there could be no bases for punishment or reward. Violence and soft pornography became accepted in the media. Thus was sown the wind; and we are now reaping the whirlwind.[25]
Examples of this conservative morality in practice include the video nasties scare, where, in reaction to a moral panic over the availability of a number of provocatively named horror films on video cassette, Thatcher introduced state regulation of the British video market for the first time.
Thatcher is generally characterised as having being opposed to gay rights. At the 1987 Conservative Conference, she said “Children… are being taught that they have an inalienable right to be gay”.[26]
In May 1988 Thatcher gave an address to the General Assembly of the Church of Scotland. In the address, Thatcher offered a theological justification for her ideas on capitalism and the market economy. She claimed "Christianity is about spiritual redemption, not social reform" and she quoted St Paul by saying "If a man will not work he shall not eat". 'Choice' played a significant part in Thatcherite reforms and Thatcher claimed choice was also Christian by stating that Christ chose to lay down his life and that all individuals have the God-given right to choose between good and evil.
Towards the end of the 1980s Margaret Thatcher, and so Thatcherism, became increasingly vocal in its opposition to allowing the European Union to supersede British sovereignty. In her famous 1988 Bruges speech, Thatcher declared that "We have not successfully rolled back the frontiers of the state in Britain, only to see them reimposed at a European level, with a European superstate exercising a new dominance from Brussels".
While euro-scepticism has for many become a characteristic of "Thatcherism", Margaret Thatcher was far from consistent on the issue, only becoming truly Eurosceptic in the last years of her time as Prime Minister. Thatcher supported Britain's entry into the European Economic Community in 1973, campaigned for a yes vote in the 1975 referendum[27] and signed the Single European Act in 1986.[28]
Another important aspect of Thatcherism is the style of governance. Britain in the 1970s was often referred to as "ungovernable". Mrs Thatcher attempted to redress this by centralising a great deal of power to herself, as the Prime Minister, often bypassing traditional cabinet structures (such as cabinet committees). This personal approach also became identified with a certain toughness at times such as the Falklands War, the IRA bomb at the Conservative conference and the Miner's Strike.
Sir Charles Powell, the Foreign Affairs Private Secretary to the Prime Minister (1984–91, 96) described her style thus, "I've always thought there was something Leninist about Mrs. Thatcher which came through in the style of government — the absolute determination, the belief that there's a vanguard which is right and if you keep that small, tightly knit team together, they will drive things through ... there's no doubt that in the 1980s, No. 10 could beat the bushes of Whitehall pretty violently. They could go out and really confront people, lay down the law, bully a bit".[29]
It is often claimed that the word "Thatcherism" was coined by cultural theorist Stuart Hall in a 1979 Marxism Today article,[30][31] although the term had in fact been widely used before then.[32] However, not all social critics have accepted the term as valid, with the High Tory journalist T. E. Utley believing that "There is no such thing as Thatcherism."[33] Utley contended that the term was a creation of Mrs. Thatcher's enemies who wished to damage her by claiming that she had an inflexible devotion to a certain set of principles and also by some of her friends who, "for cultural and sometimes ethnic reasons" had little sympathy with what he described as the "English political tradition." Thatcher was not an ideologue, Utley further argued, but a pragmatic politician; giving examples of her refusal to radically reform the welfare state and the need to avoid a miners' strike in 1981 at a time when the Government was not ready to handle it.
On another hand some claim that Thatcherism was moved actually by pure ideology and that her policies marked a turning point in economic policies which were dictated more by reasons of political power and interests than actually by economic reasons:
Rather than by any specific logic of capitalism, the reversal was brought about by voluntary reductions in social expenditures, higher taxes on low incomes and the lowering of taxes on higher incomes. This is the reason why in Great Britain in the mid 1980s the members of the top decile possessed more than a half of all the wealth (Giddens 1993, 233). To justify this by means of economic "objectivities" would be an ideology. What is at play here are interests and power.[34]
The Conservative historian of Peterhouse, Maurice Cowling, also questioned the uniqueness of "Thatcherism". Cowling claimed that Mrs. Thatcher used "radical variations on that patriotic conjunction of freedom, authority, inequality, individualism and average decency and respectability, which had been the Conservative Party's theme since at least 1886." Cowling further contended that the "Conservative Party under Mrs. Thatcher has used a radical rhetoric to give intellectual respectability to what the Conservative Party has always wanted."[35]
Critics of Thatcherism claim that its successes were obtained only at the expense of great social costs to the British population. Industrial production fell sharply during Thatcher's government, which critics believe was the reason for increased unemployment during her early years as prime minister. There were nearly 3.3million unemployed in Britain in 1984, compared to 1.5million when she first came to power in 1979, though that figure had fallen to some 1.6million by the end of 1989.
When she resigned in 1990, 28% of the children in Great Britain were considered to be below the poverty line, a number that kept rising to reach a peak of 30% in 1994 during the Conservative government of John Major, who succeeded Thatcher.[36]
While credited with reviving Britain's economy, Mrs. Thatcher also was blamed for spurring a doubling in the poverty rate. Britain's childhood-poverty rate in 1997 was the highest in Europe.[36]
During her government Britain's Gini coefficient reflected this growing difference, going from 0.25 in 1979 to 0.34 in 1990.[37]
The extent to which one can say 'Thatcherism' has a continuing influence on British political and economic life is unclear. In 2002, Peter Mandelson, a Member of Parliament belonging to the British Labour Party closely associated with Tony Blair, famously declared that "we are all Thatcherites now."[38]
In reference to contemporary British political culture, it could be said that a "post-Thatcherite consensus" exists, especially in regards to economic policy. In the 1980s, the now defunct Social Democratic Party adhered to a "tough and tender" approach in which Thatcherite reforms were coupled with extra welfare provision. Neil Kinnock, leader of the Labour Party from 1983–1992, initiated Labour's rightward shift across the political spectrum by largely concurring with the economic policies of the Thatcher governments. The New Labour governments of Tony Blair and Gordon Brown were described as "neo-Thatcherite" by some, since many of their economic policies mimicked those of Thatcher.[39]
Most of the major British political parties today accept the anti-trade union legislation, privatisations and general free market approach to government that Thatcher's governments installed. No major political party in the UK, at present, is committed to reversing the Thatcher government's reforms of the economy. Such a convergence of policy is one reason that the British electorate perceive few apparent differences in policy between the major political parties.
Moreover, the UK's comparative macroeconomic performance has improved since the implementation of Thatcherite economic policies. Since Thatcher resigned as British Prime Minister in 1990, UK economic growth was on average higher than the other large EU economies (i.e. Germany, France and Italy). Additionally, since the beginning of the 2000s, the UK has also possessed lower unemployment, by comparison with the other big EU economies. Such an enhancement in relative macroeconomic performance is perhaps another reason for the apparent "Blatcherite" economic consensus, which has been present in modern UK politics for a number of years.
Tony Blair wrote in his 2010 autobiography A Journey that "Britain needed the industrial and economic reforms of the Thatcher period". He described Thatcher's efforts as "ideological, sometimes unnecessarily so" while also stating that "much of what she wanted to do in the 1980s was inevitable, a consequence not of ideology but of social and economic change."[40]
On the occasion of the 25th anniversary of Thatcher's inauguration, BBC conducted a survey of opinions which opened with the following comments:
To her supporters, she was a revolutionary figure who transformed Britain's stagnant economy, tamed the unions and re-established the country as a world power.Together with US presidents Reagan and Bush, she helped bring about the end of the Cold War.
But her 11-year premiership was also marked by social unrest, industrial strife and high unemployment.
Her critics claim British society is still feeling the effect of her divisive economic policies and the culture of greed and selfishness they allegedly promoted.[41]
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