Margaret Thatcher’s legacy: Three things that changed for the U.K.
Share Now on:
Former British prime minister Margaret Thatcher, also known as “The Iron Lady,” died on Monday.
A leader whose tactics and policies were widely disputed during and after her 11-year term (the longest for any British politician), Thatcher made a lasting impact on the nation — economically, socially and culturally.
She was steadfast on her set of principles, which became known as “Thatcherism.” What exactly were those principles? According to the New York Times they’re “the belief that economic freedom and individual liberty are interdependent, that personal responsibility and hard work are the only ways to national prosperity, and that the free-market democracies must stand firm against aggression.”
Here are three of the policies that’ll remain as part of her legacy:
1. Raising the tax burden.
Denying the advice of many academic economists at the time, she raised the tax burden and curtailed public sector budgets. According to the BBC, 364 of Britain’s leading economists condemned her policies in a letter to the Times, predicting a worsening slump in a recession already marked by mass unemployment. But the following eight years saw economic revival with annual growth above 3 percent.
2. Breaking labor unions.
Thatcher broke the power of the labor unions. She stood against the all-powerful National Union of Mineworkers and announced plans to shut down several plants and eliminate thousands of jobs. A violent strike by coal miners erupted. It lasted nearly a year, but ended without settlement — though with Thatcher as the clear victor.
“A lot of people here hated her, hated what she stood for, hated what she did for us,” says Cummings, who’s from a coal mining community in the north east of England where Thatcher’s refusal to support the mines caused tens of thousands of job losses. “She has a legacy, a legacy of destruction, a legacy of destroying lives and a legacy of destroying communities.”
3. “Popular Capitalism.”
Thatcher pushed hard for bringing “popular capitalism” to Britain, moving major state industries like telephones and gas supply to the private sector. The economy thrived to the point that in 1985, the Treasury announced it would not need deficit spending in the next fiscal budget.
Her industry minister Lord Young says the policy of privatizing is still popular in Britain and abroad: “In those days — the ’70s — every telephone company in the world outside the United States was owned by the government,” claims Young. “Today none are.”
What Thatcher didn’t change
Nonetheless, Thatcher did face a number of drawbacks.
She did not follow through with her plans to privatize the water industry or the National Health Service, and failed to revamp Social Security. Inflation rose and inflation rates remained high. Among political tensions, she resigned from office in 1990.
On the day of Thatcher’s death, Britain isn’t neccesarily prospering. It’s laden with debt and on the brink of another recession.
However, free market economist Ruth Lea remembers as a civil servant in the 1970s the national mood before Thatcher came to power.
“There was a terrific sense of defeatism that all you were doing in the Civil Service was managing decline. Mrs. Thatcher reversed that,” Lea says. “She left the spirit of the British economy in much better shape than she found it.”
No matter where you fall on Thatcher’s policies, there is an agreement — she left the British economy different than how she found it.
“She made an enormous change to the country, Lea says. “I must say this on the day that she’s died, that is a terrific tribute to her.”
We’re here to help you navigate this changed world and economy.
Our mission at Marketplace is to raise the economic intelligence of the country. It’s a tough task, but it’s never been more important.
In the past year, we’ve seen record unemployment, stimulus bills, and reddit users influencing the stock market. Marketplace helps you understand it all, will fact-based, approachable, and unbiased reporting.
Generous support from listeners and readers is what powers our nonprofit news—and your donation today will help provide this essential service. For just $5/month, you can sustain independent journalism that keeps you and thousands of others informed.