It is the centenary year of Margaret Thatcher’s birth. Born Margaret Hilda Roberts on October 13, 1925, in Grantham, Lincolnshire, she is truly one of the great figures of our era. I would surmise that if Sir Winston Churchill was writing his book Great Contemporaries today, Baroness Thatcher would receive an essay. Moreover, it is also the 50th anniversary of Mrs. Thatcher becoming the Leader of the Conservative Party. Just four years later in 1979, she would become the first woman to hold the office of Prime Minister. The Conservative Party under Thatcher’s leadership proceeded to win two further elections in 1983 and 1987 (both with landslides), and thus she became Britain’s longest continuously serving prime minister since 1827. To learn lessons from Mrs. Thatcher and the “neoliberal era,” one could turn to her Downing Street Years, both empirically and autobiographically, but there are good reasons to look more closely at her earlier career.
As I have written before for this online magazine, the West is purportedly undergoing a “political realignment,” and numerous thinkers from the political right have attempted to reassess the meaning of conservatism. Thus, as Phillip Blond and I have written in the introduction of The Post-Liberal Turn and the Future of Conservatism:
The conservative moral imagination and the content of conservatism is being seriously questioned from numerous perspectives. Perhaps, this is for the first time since Margaret Thatcher became the leader of the Conservative Party on Tuesday the 11th of February 1975. Indeed, the role of the state, public religion, the nation-state, free markets, the very metaphysics of Conservatism, the place of individualism, conservatism’s relationship with liberalism, and family policy are all being debated at an intensity and level not seen since the 1970s.
As a consequence, Terrence Casey’s new book on Margaret Thatcher’s rise during that decade is most welcome and timely. As Casey rightly points out, “The 1970s were the last great era of transformation.” In Forging the Iron Lady, Casey offers Thatcher’s “origin story” and writes that her election win was the “Normandy landing of the global neoliberal advance.”
How does Casey understand “neoliberalism”? In a section on the topic, he provides a brief history of the term and its lineage, tracing it “back to the classical liberalism of the 19th century” but he also points to events that were important, such as the Walter Lippmann Colloquium, and organizations, such as the Mont Pèlerin Society for support for free market ideas. Indeed, Thatcher and Reagan did not invent free market ideas. They had been “floated around postwar British politics for decades” but according to Casey, “bien pensant opinion considered liberal voices hopelessly boorish and retrograde.”
Conservatives need to address the cultural and social problems of today and not fight the economic problems of the past.
Things changed in the 1970s. Casey describes the first meeting of Ronald Reagan and Mrs. Thatcher as a “minor” meeting “at the time yet hugely consequential later.” Reagan “had recently finished his second term as Governor of California” and he was on a trip to Britain to “bolster his thin foreign policy credentials.” The Labour administration was not that interested in meeting with Reagan as he was not seen as a “serious contender” for the presidency of the United States. Justin Dart, who was friends with both Thatcher and Reagan, suggested a meeting. On April 9, 1975, they met in her Leader of the Opposition’s room in the House of Commons. They got on swimmingly, and the meeting ran to twice the length of the scheduled time. Reagan said of the meeting that he “liked her immediately” and to him “it was evident from our first words that we were soul mates when it came to reducing government and expanding economic freedom.” Indeed, the feelings were mutual between the two political “soul mates.” They went on to achieve great things. Casey argues that an events-driven rather than a narrative-driven account is the right way to understand the forging of the Iron Lady. Indeed, free market ideas “only gained political traction as a result of the events of the 1970s, which lent support for the veracity of this approach.” Casey is right to state the fact that this change in economic approach was not “easy” or “quick” in Britain. Administrations of both colors during the 1970s “struggled to manage these crises with the existing tool kit,” which was the postwar consensus based on Keynesian economics. Failure after failure after failure of the political class and the premierships of Harold Wilson, James Callaghan, and Edward Heath ensured that the general public became open to a new economic approach. Indeed, what became known as Thatcherism “was a specific response to the ailments afflicting Britain” at the time.
Events, Dear Boy, Events
Debacles and failure have their roots in the past, as Casey reminds us. Accordingly, it is rather useful to “interrogate the past to inform the present.” To understand the shift in British political economy post-1970s, Casey provides us with a framework—the six “Ps”:
- poor economic performance;
- a widespread recognition of policy failure;
- well-developed alternative possibilities for reform;
- key personalities to push these ideas to the forefront;
- control of a major party; and
- favorable political conditions.
During the 1970s, there was talk of the “British Disease” and “Britain’s Decline,” which referred collectively to slowing economic growth levels, rising inflation, and of course, the oil crisis. These economic issues were also facing other countries, including the incumbents of the White House. The British government spending was “well above half of GDP by the mid-1970s,” and Milton Friedman argued that this amount of government spending “cannot help but distort the efficient distribution of resources.” Casey correctly writes that:
The core malady, the thing that was the “British disease,” was low productivity embedded on the supply side of the economy, which combined with other problems left Britain uniquely vulnerable to the main symptom that emerged in the 1970s: inflation.
Indeed, how to address inflation and debates around income policies became a core debating point in British politics. Ted Heath’s administration was attached to the concept that cost-push inflation was a core driver of inflation in Britain. There were other crises too, as there were five State of Emergencies under Heath, “The Three Day Order” (cutting electricity supply to major electricity users and industry limited to three days a week of operation), trade union militancy, and strikes. In the same year as when Thatcher and Reagan met, inflation was at 26.6 percent, under the premiership of Labour’s Harold Wilson. However, the real clincher was The Winter of Discontent (1978/1979), which “created the space in which Thatcher could achieve her historic victory.” Right then, we have the favorable political conditions, the poor economic performance, and the recognition of policy failure. The key personalities were reasonably in place for the neoliberal ascent after gaining control of a major party—The Conservative Party.
Thatcher-led Conservative Party in Opposition
What did the Thatcher-led Conservative Party stand for during the forging of the Iron Lady? Answering this question collectivity was a great difficultly as there were at least two broad groups within the party. They had overlapping ideas to a certain extent, but they also differed, especially on the key issues of the day, which were inflation and incomes policy. Casey argues that the Heathites and Thatcherites fought themselves to a draw on these core issues. Thatcher “saw politics as a battle between competing philosophies.” This was “in contrast with Tory pragmatists who saw dogma as vice.” Relatedly, according to Casey, “Thatcher embraced the work of intellectuals, viewing them with approval rather than irony and recognizing the political utility to which ideas could be deployed.” One of “Thatcher’s repeated refrains to her advisors” during the period was “Don’t tell me what. I know what. Tell me how.”
As Casey’s “fat” book (to use Russell Kirk’s technical term) demonstrates, Mrs. Thatcher was not at her personal best during her time as the Leader of Conservative Party in Opposition. The Situational Leadership theory tells us that a leader has to embrace a different leadership style to suit one’s followers. Thatcher did this as her Shadow Cabinet was filled with those who were also in Heath’s Cabinet. Hence, she had to compromise and amend her style of leadership due to being in an ideological minority, despite being the leader of the party. She had to sell a fudge during this time, a fudge that can be seen in the party’s policy documents, The Right Approach and The Right Approach to the Economy. In these main policy papers, the core issues of the day were lacking in detailed substance, and Thatcher had not imposed her own policy preferences in these documents. So much so that there was even a discussion of whether to publish them at all or to publish them as non-party documents.
Thatcher was not at her best balancing and selling a fudge during these years. She was an innovator, and her most impressive side came to the fore when she entered 10 Downing Street. She restrained the power of the trade unions, she freed the City of London with deregulation and the freeing of exchange controls, and she privatized large swathes of the economy, and more people owned their own homes and company shares. As former Prime Minister David Cameron put it, “She saved our country.” There is no more of a lasting legacy than that. Still, we can learn from looking back at Thatcher’s rise in the 1970s, as it holds insights for today’s intra-conservative disputes and the conflict with the left. Thacher’s policies were aimed at solving the “British Disease” and reducing trade union power, which were problems of her time. Conservatives need to address the cultural and social problems of today and not fight the economic problems of the past. Moreover, Thatcher showed us that ideas matter and winning the battle of ideas with the left is important. We can also learn from Thatcher in the 1970s that holding the conservative movement together is paramount.
