A 30-year blip?

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.