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British Politics:

British Politics:. Thatcherism & beyond. Background. Economic stagnation Diminishing growth Accelerating inflation Industrial decline Older industries (shipbuilding, heavy metal) less viable than before Restructuring Labour unrest. Both Labour and Conservatives try similar solutions.

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British Politics:

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  1. British Politics: Thatcherism & beyond

  2. Background • Economic stagnation • Diminishing growth • Accelerating inflation • Industrial decline • Older industries (shipbuilding, heavy metal) less viable than before • Restructuring • Labour unrest

  3. Both Labour and Conservatives try similar solutions • Keynesian demand management • Planning • Regulation of trade unions • ‘Battle of Downing Street’ in 1968 • Industrial Relations Act, 1971 • Indexation • Deals with the trade unions: • Labour’s ‘Social Contract’, 1976-78

  4. Increased polarization: Labour moves to the left • Responding to trade unions & increasingly militant left, proposes increased state ownership, trade restrictions – an alternate economic strategy • In contrast to 1950s, 60s, leadership less able to contain the left

  5. Conservatives Shift to the right: • Tentative moves under Edward Heath, 1970-74 • Thatcher ousts Heath in 1975 • After1979, remakes • not only the Conservative Party, • but also British economy

  6. Thatcher’s style: • A strong assertive leader: turningNot for turning-II • Belgrano • Europe

  7. Core elements of Thatcherism Less state: • More scope for private initiative • Allow full play of market forces • Privatize nationalized industries • Create ownership society – • Sale of council houses to owner-occupiers • Promote popular capitalism

  8. Attack on trade unions: • Regulation of strikes, internal elections • 1984 Miners’ Strike: • Protracted struggle with National Union of Mine Workers • End result – break power of unions to resist reforms

  9. Attack on public sector • Restructure civil service • Creation of special agencies • Reliance on performance indicators • Elimination of metropolitan councils • Rate-capping as device to curb Labour councils, restrict spending • Also an attack on Labour Party’s remaining bastions of power

  10. Broader attack on welfare state: • Cutbacks in benefits • Attempted privatization of pensions • Reforms to NHS (later on) • Reluctance to intervene to manage demand, save failing industries • Preference for monetarist economic policies: • Manage money supply rather than manage demand

  11. Insistence on strong state Justice system: firmer stance • No coddling criminals • Harsher sentences International relations • Close alliance with Reagan & US • Anti-Communist • Hostile to EU -- • “We want our money back

  12. Shift to the right • Part of a broader phenomenon underway in both the UK and US, • Later on, in other western democracies • Reflect changes in international economy • Also diminished ability of earlier frameworks – • Keynsian demand management – to find solutions for economic problems • Bolstered by right-wing think tanks on both sides of the ocean which provide legitimacy

  13. From Thatcher to Major • Thatcher in power from 1979 to 1990 • Initially seeks support from all sides of the party • Over time, governs from the right of the party, marginalizing ‘wets’ (former one nation conservatives • 1990 • Michael Heseltine seeks to replace Thatcher as leader • Thatcher steps down when forced to a second ballot (failed to get 60%) • Replaced by John Major, a Thatcher loyalist

  14. John Major • Prime Minister from 1990-97 • Presides over an increasingly divided party • With increasingly strong Euro-skeptic wing • Continues Thatcher program • Privatization of British Rail • Continued restructuring of public sector • Growing insistence on performance indicators

  15. Party battle

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