The myth of Thatcherism

Following the death of Margaret Thatcher, myths about her ideology, her rule and her impact continue to abound. In this 2008 essay, Brendan O’Neill picked apart five of the myths of Thatcherism.

Myth No.1: Thatcher introduced a ‘cultural shift’

Today, Thatcher’s impact on Britain is discussed almost entirely in cultural terms. She is said to have introduced a ‘greed is good’ attitude, to have unleashed ‘yuppiedom’. In novelist Hanif Kureishi’s weird words, her era was a product of the fact that ‘she liked wealth, she liked men, and she particularly liked wealthy men’. It is continually claimed that Thatcher transformed Britain, for the worse, through sheer force of her personality and ideological cunning.

Here, the Thatcher theorists simultaneously overestimate and underestimate her historic role. Far from consciously ushering in a new kind of capitalism, Thatcherite economics was an instinctive, pragmatic response by the ruling elite to the severe crisis of capitalism in the 1970s and 80s. At the same time, far from merely making a ‘cultural shift’, and turning once fair-minded Brits into greedy consumers, Thatcher oversaw an important historic shift from an indirect to a more direct form of capitalist rule.

In Britain in the postwar period – in the era of economic expansion from the end of the Second World War to the recession of the 1970s – the politics of consensus ruled the day. In the 1950s and 60s in particular, the capitalist system in Britain was managed by a continual and normally peaceful dialogue between the state, the unions and employers. Trade union officials were intimately involved in running the system, and were effectively charged by the capitalist elite with containing industrial conflict and managing workers’ expectations.

Yet with the onset of economic recession in the 1970s, which deepened after 1979, consensus politics could no longer be maintained. The crisis required a ruthless response by the capitalist elite to ensure that its economic system could be stabilised and, eventually, profitability restored. Industry had to be shaken out, with people forced out of work, and the state was forced to impose severe restrictions on welfare spending in order to concentrate resources in the hands of the crisis-ridden ruling elite. In such a climate of harsh capitalist survival measures, consensus politics made little sense. The representatives of labour, who for nearly three decades had been invited into the corridors of power to assist with the smooth running of capitalism, became a barrier to the elite’s instinctive attempts to shore up its crisis-hit system by any means necessary. When Thatcher declared that she regarded part of her job to be ‘killing socialism in Britain’, she did not mean defeating an ideology but rather replacing the politics of consensus between the state, the unions and employers with a direct form of capitalist rule more fitting to a time of downturn and austerity.

The various developments of the late 1970s and 1980s that have over time been bundled together and labelled ‘Thatcherism’ – deregulation in certain areas of the economy, privatisation, curbs on the welfare state – were really the pragmatic survival measures of capitalism in crisis rather than a one-woman blueprint for a new society. Thatcher was merely the personification, albeit a powerful one, of a capitalist system pulling out all the stops to survive, and of Britain’s move from the politics of consensus during the postwar period of economic growth to the politics of direct capitalist rule over society during the recessionary period of the 1970s onwards.

The focus today on Thatcher as ‘evil’, as little more than a morally skewed individual who introduced warped cultural trends into Britain, is really a way of avoiding a serious debate about capitalism and its tendency towards collapse in favour of creating a convenient hate figure whose ‘Big Bang policy in the 1980s laid all the seeds of our present problems’, as one observer puts it.

Myth No.2: Thatcher invented ‘Thatcherism’

That Thatcherism was a harsh response to economic crisis rather than a one-woman ideology is clear from the fact that Margaret Thatcher did not invent it. Many of the measures described today as ‘Thatcherism’ were first pursued by Ted Heath’s Conservative government in the early 1970s. With the onset of economic decline, Heath also attempted to bring to an end the postwar politics of consensus in favour of top-down crisis management. Heath, too, elected in 1970, sought to cut state assistance to failing industries, reduce public spending, impose a fixed income policy, and dent – if not smash – the power of trade unions. However, Heath failed. A seven-week strike by the National Union of Mineworkers (NUM) helped to bring down Heath’s government: he called a General Election in February 1974 to bolster confidence in his government, but lost to Labour.

One of the key reasons why Heath failed where Thatcher later succeeded is because, during his rule, the working classes in Britain were generally well-organised and unwilling to have wage cuts or fixed income policies imposed upon them from above. It is striking that where the NUM brought down Heath’s ‘Thatcherite’ policies in 1974, the same union was defeated by Thatcher’s ‘Thatcherite’ policies 10 years later in 1984/1985. So what changed between Heath and Thatcher’s eras to make what is now known as ‘Thatcherism’ – the shaking out of industry and the creation of mass unemployment – seemingly more successful? This is where the intervening Labour government of 1974 to 1979 comes in. Labour PMs Harold Wilson and James Callaghan played a key role in building on ‘Heathism’ and preparing the ground for ‘Thatcherism’.

As economic decline worsened in the late 1970s, the Labour governments called on the unions to face up to the need for austerity and sacrifice. They argued that there would have to be a reduction in public expenditure in favour of ‘prudent housekeeping’, and oversaw the rise of mass unemployment on the basis that ‘protecting the economy’ was more important than ensuring everyone had a job and a livelihood. Unemployment doubled between 1975 and 1976; by 1977 more than 1.5million people were out of work. When the working classes stood up to this Labour-led attack on their living standards, with the strikes that made up the ‘winter of discontent’ in 1979, Labour launched an anti-union offensive, with Callaghan accusing strikers of engaging in ‘free collective vandalism’ and unions of ‘abus[ing] their great strength’. This anti-union sentiment was taken up with vigour by Thatcher when she was elected in 1979.

The defining event between the Heath government of 1970 to 1974 and the Thatcher government of 1979 to 1990 was the Labour administration’s demoralisation of the working classes. In educating the workers about the need for austerity in order to prop up the capitalist system, and in introducing mass unemployment and further demonising ‘union power’, Labour paved the way for ‘Thatcherism’. This is the dirty secret of Thatcherite economics: it sprung from a deep-rooted capitalist crisis at least 10 years before Thatcher actually took power, and its fermentation was assisted by Labour.

Myth No.3: Thatcher was unique

The use of the term ‘Thatcherism’ gives the impression that a distinct economic and political ideology arose in Britain in the late 1970s and 1980s. Alongside the lesser-used phrase ‘Reaganomics’, the idea seems to be that in Britain and America various individuals designed and then spearheaded new economic approaches to running society. Some right-wing theorists even call on other governments around the world to adopt ‘Thatcherite policy’, while Thatcher herself, later in life, toured the world giving speeches about why her economic system is the best that there is.

The treatment of Thatcherism as a unique system born in Britain, and which might potentially be exported around the globe, overlooks the fact that across the Western world in the 1980s government after government pursued policies of austerity and repression to deal with the capitalist crisis. There was little unique about ‘Thatcherism’. Virtually every Western government, from the Reagan administration to so-called Socialist regimes in France and Spain, presided over mass unemployment, made cuts in services, introduced laws restricting the rights and influence of trade unions, and boosted law’n’order in order to suppress dissent. Even the Financial Times recognised that Thatcher’s policies were part of an international trend, arguing in November 1984 that: ‘Thatcherite economic policies are not very different from or better or worse than those to which other European governments, whether called conservative as in Germany or socialist as in France, have found their way.’

Thatcher was not an aberration in the 1980s, and she was neither a supremely visionary nor especially evil world leader. She was the British expression of a Western trend. This often neglected fact illustrates that the harsh measures of the 1970s and 80s did not spring from any particular country or political party (much less from one Iron Lady’s brain), but rather were consequences of the crisis of the capitalist system itself. Again, the focus on Thatcher’s wickedness, her apparently awesome and mysterious power over politics and economics, distracts from a proper debate about the way in which the economic system tends to lurch from one crisis to another.

One reason why the ‘Thatcherite era’ stood out in comparison with similar developments in other countries is because Britain’s postwar era of consensus politics was fairly unique in the Western world. This meant that the shift from consensus to top-down repression was a more radical departure than those which occurred in other Western nations in the 1980s. In most other ways, what we now refer to as ‘Thatcherism’ was a shared Western experience.

Myth No.4: Thatcherism duped the working classes

One of the most long-standing, and poisonous, ideas from the 1980s is that Thatcher exercised a demonic, unshakeable influence over working-class voters. During that decade, Labour officials and left-wing activists were dumbfounded that ‘ordinary people’ could vote for a woman who was enforcing austerity and repression. They said the stupid voters were probably duped by powerful media outlets, such as the pro-Thatcher tabloid newspaper the Sun; or maybe voters had been bought off (and most likely conned) by the idea that they, too, could become home-owners, car-owners and members of the ‘new prosperous society’. As the Independent reminded us last week, in the 1980s it became trendy amongst liberals, including at the supposedly impartial BBC, to wear badges saying ‘Don’t blame me, I voted Labour’ – a way for the apparently wise cultural elite to distance itself from the inexplicable morass of people who continually elected Thatcher.

In truth, Thatcher’s Tories were not as popular as these theories suggest. Between her first election victory in 1979 and her third in 1987, Thatcher’s electoral support fluctuated between 40 and 44 per cent. Her much-heralded (or much-denounced) ‘landslide victory’ of 1983 was won with only 42.4 per cent of the popular vote, representing a fall of 1.5 per cent from her victory in 1979.

Moreover, Thatcherism did not worm its way into the electorate’s mind and brainwash them in the ways of greed and consumption. The British Social Attitudes (BSA) surveys of 1987 and 1988, the supposed high-point years of ‘yuppiedom’, found that people were unconvinced by Thatcher’s ‘enterprise culture’. Those who voted for her did so on the pragmatic basis that she would oversee an economic upturn, but ‘the Thatcher policy revolution has simply not so far been accompanied by an equivalent revolution in public attitudes’. As to the so-called ‘go-getting’ or ‘greedy’ culture, the BSA found that ‘only a minority of the public embraces these ideas, despite all the exhortations over the last eight years, and despite what even many of Mrs Thatcher’s critics would concede are her formidable qualities of leadership’. The idea of ‘ordinary people’ being ensnared and enslaved by Thatcherism is a fallacy.

And it’s a fallacy created by those who must bear a very large portion of responsibility for Thatcher’s victories: Labour and the left. Arguing that Thatcher had a curious ability to dupe voters has become a convenient excuse for the failure of the left to put forward a convincing alternative to Thatcher. Indeed, the very idea of ‘Thatcherism’ – as a powerful, coherent capitalist ideology – was invented by the left itself in an effort to explain Thatcher’s success and its own demise. The truth is that in the 1980s, Labour continually capitulated to the agenda set by Thatcher, and offered voters no alternative to crisis management, austerity and mass unemployment. Faced with a choice between a party that assaulted the workers and prepared the ground for Thatcherism in the 1970s (Labour) and a party that seemed a little more competent in economic affairs and promised to deliver an economic upturn (the Tories), voters plumped for Thatcher.

Recently, a contributor to the Guardian expressed outrage that in a recent poll ‘only four per cent’ of people blamed Thatcher for the current economic predicament; no doubt this will be seen as further evidence that we’re still under her ‘spell’. Or maybe the public understands that things are a bit more complicated than that, and knows from bitter experience that Labour, too, has sold workers and families short over the past 30 years. Today it is only the Thatcher-obsessives in the media and in political circles who are still ensnared by the Iron Lady.

Myth No.5: Thatcherism made us mentally ill

The idea that the public was duped by Thatcher has in recent years transformed into the notion that we were sickened by her – literally. It is now seriously argued, by leading commentators, psychologists and purveyors of the happiness agenda, that the ‘greed is good’ culture of the 1980s gave rise to widespread mental illness.

Oliver James, psychologist, author and adviser to the last Labour government on social policy, argues that people who live in ‘selfish capitalist’ nations, including post-Thatcher Britain, are more than twice as likely to suffer from a mental illness as people who live in ‘unselfish capitalist’ nations (France, the Netherlands, Belgium, Spain, Germany, Italy and Japan). Apparently where 23 per cent of those of us who live under ‘Blatcherism’ (that is, Britain after Thatcherism and Blairism) are mentally ill, only 11.5 per cent of people in the unselfish capitalist world are similarly sick.

Yet, as I argued in the New Statesman in 2008, James’s theory is scientifically and politically unconvincing. He mixes together different, unrelated surveys of wellbeing to make his point (admitting that this is a ‘debateable tactic’) and never convincingly explains why some surveys find that people in poor countries claim to be mentally distressed (20.5 per cent in Ukraine) while some in rising capitalist tigers have no such mental issues (only 4.3 per cent of residents of Shanghai claim to have suffered from a mental illness). What we are witnessing is the emergence of a pseudo-scientific critique of ambition and desire, where the alleged warping of Britain and its inhabitants by the evil of Thatcherism is giving rise to the idea that we need mass therapy, less consumerism, less competitiveness, and the engineered lowering of people’s horizons. This shows how much the strictly cultural understanding of Thatcherism has warped the truth: people now look upon her era as one of greed and oneupmanship, when in fact it was a time of impoverishment and unemployment.

This highlights the dangerous streak behind contemporary Thatcher-bashing. The moralistic attack on one woman’s alleged mission to remake Britain, coupled with the left’s dodgy idea that people were led astray by Thatcher’s ‘enterprise culture’, not only distorts history and lets Labour and the left off the hook – it is now also being co-opted into today’s politics of low horizons, and used to re-educate the public about what they should expect from life. The irony is palpable. Where Thatcher imposed austerity measures to save capitalism at the expense of the masses’ living standards, today Thatcher’s bashers theorise about her impact on our mental health as part of a new campaign to make us accept less and to live more sparsely. The campaign against Thatcherism actually continues her assault, in a new and different way.

As the economic crisis continues, we should challenge the many myths of Thatcherism. The continuing obsession with Thatcherism is shot through with fatalism, as if Thatcher has ‘condemned’ us to meaningless lives based on shopping, and a suspicion of the public and its political choices. The notion that Thatcher has determined every political and economic event of the past 30 years speaks to a profound lack of faith in people’s ability to resist the arguments of their rulers and to change their circumstances. We should not let our understandable distaste for one woman blind us to the truth about recent historic events and political developments, and to the contemporary exploitation of anti-Thatcherism by those keen to usher in a new era of austerity, only without the explicit violence of the Thatcher years.

Brendan O’Neill is editor of spiked. A version of this essay was originally published on spiked in 2008. Visit O’Neill’s personal website here.