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Friday 10 February 2012

A 30-year blip?

2 May 2009

The Spectator on the thirty years since Margaret Thatcher was elected Prime Minister

Thirty years ago this Sunday, Margaret Thatcher was elected Prime Minister with a Commons majority of 43. In the 11 years that followed, she took an economic basket case, the sick man of Europe, an offshore banana republic, and transformed it: inflation was curbed, penal tax ended, the unions tamed, and Britain’s confidence on the world stage reasserted by victory in the Falkland Islands and the strength of the Iron Lady’s alliance with President Reagan.

Her greatest achievement, paradoxically, was to transform not one party but two: New Labour was the offspring of Thatcherism too. And for many years it seemed that many core Thatcherite presumptions had become orthodox: in particular, Labour seemed to have grasped that prosperity and wealth creation were a precondition of the revenues the Exchequer needed to fund the party’s ambitions for the public services. To an extent that made many uneasy inside and outside his party, Tony Blair insisted that Britain continued to punch hard on the battlefield.

The global recession, however, has revealed how illusory that apparent orthodoxy really was. As Fraser Nelson argues on page 12, Labour has proudly renounced the idea that revenues rise when tax rates are low and returned to the politics of envy which seemed to have been consigned to the dustbin of history. That disastrous decision reflects a broader fatalism and a fresh flourishing of the idea — prevalent before Mrs Thatcher — that the governance of Britain is about the orderly management of decline.

So the challenge for David Cameron is huge. If, as seems likely, he becomes Prime Minister next year, it will be his task to ensure that future generations do not look back on the years 1979-2009 as a blip — an aberrant resurgence — in the otherwise steady decay of a once great nation.

Ian C

May 1st, 2009 6:13pm Report this comment

"The global recession, however, has revealed how illusory that apparent orthodoxy really was."

I see this sort of fallacious tosh written all over the place. I did not expect to see it in the Spectator.

The orthodoxy remains and always will. Unless a correct analysis of the causes of the current crisis, the world will never pull out of it.

The crisis was not caused by wrong orthodoxy established under Thatcher. It was caused by attempts at worse than pale imitations of where she led (in the UK) and by hubris on both sides of the atlantic that convinced itelf and too many others that the business cylce had been abolished.

1979 to 2007 (correction from 2009) was not a blip and will be proved to be when we get back to a policy of sound money, a retreat of state interference and the abolition of spin. 2001 to 2007 was the aberration.

Jon Livesey

May 1st, 2009 10:21pm Report this comment

"The global recession, however, has revealed how illusory that apparent orthodoxy really was."

I agree with a previous poster that this is nonsense. In fact, it's a bit worse than nonsense, since it is the sort of trite and superficial comment that have become the norm for the MSM during the current financial crisis - which in turn is why I now get my economics from specialist economics blogs, and not from the MSM at all.

What has happened in the past year - so far as the MSM knows, in fact it's been nearly three years - is a classic Minsky moment. You can Google that phrase for more details. Suffice it to say that this crisis is a normal if unpleasant process, and does not invalidate anything.

On topic, however, I doubt if there is much that we or Cameron really have to worry about. What made not-New Labour briefly plausible in the post-war period was in a sense the war itself. The mobilization and control of the economy during the war was so complete - far more complete than in Germany, for example - that similar levels of control in peacetime seemed almost sane.

No more. Like people who have tasted freedom for the first time, the British will never willingly go back to waiting for six months for a telephone and having to apply to a Bank for permission to take their own money abroad for a short holiday. Not-New Labour may be twitching a bit in its death throes, but it's never coming back to life.

Talking of legacies, Maggie did transform two parties, but we should not forget that Blair has a legacy, too. He gave us a country with two "normal" political parties, just like any other western democracy. Brown can't roll that back, although he can hasten his own demise trying.

Bob Jackson

May 2nd, 2009 7:48am Report this comment

1979-2009: North Sea oil, a once-in-a-lifetime bonanza. Norway invested it. You pissed it all away. Morons.

Toby

May 4th, 2009 12:33am Report this comment

Ian C and Jon livesey shouild pay closer attentiont to the textas the peice is saying that the orthodoxy was fragile not incorrect.

Jon Livesey

May 4th, 2009 10:35pm Report this comment

Pardon me? "Illusory" means "fragile"? Since when is that?

When you have to defend a text by mis-quoting it, you should suspect something is wrong.

John Malcolmson

May 6th, 2009 8:10pm Report this comment

Jon Livesey: "Blair gave us a country with two normal political parties."

Don't you mean indistinguishable instead of normal, whatever normal is? At least, they have been since Cameron took over as leader of the Tory party. The only difference I can see is that Cameron is decent enough not to trawl under stones to employ lowlife like Damian McBride.

John Walter

May 8th, 2009 4:41pm Report this comment

If her great achievement was to transform two parties then in effect the british voter was deprived of a meaningful choice for a generation. What we have had in other words is one party rule.
I do not think that should be the purpose of democracy, let alone something to praise.

But then ardent Thatcherites are too blind to see this point, too convinced there is only one answer.

Tom Norton

May 13th, 2009 12:49pm Report this comment

Economic success may be a sufficient condition but it is never a necessary condition for the emergence of a great nation. Britain needs a true statesman.

drisc

May 16th, 2009 4:06pm Report this comment

To add to Bob Jackson's comment on North Sea Oil, even one of Thatcher's business acolytes Michael Edwards said that if you treat Nth Sea oil as revenue and not as capital, you might as well leave it in the ground. The Socialist Norwegians put their money from oil into a sovereign wealth fund, treating it as capital.

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