Margaret Thatcher 1979 - 1990

The Economy
1. Thatcherism
  1. Monetarism - Restricting government spending and controlling inflation through use of interest rates and restriction on the money supply
  2. Free-market economics - Thatcher believed that without the interference of government, the free-market forces would allocate resources to optimum efficiency
    1. Right-to-buy scheme allows council house tenants to but their own homes
    2. Deregulation of the financial sector in late 80s abolishes exchange and credit controls and leads to financial boom
  3. Howe's first budget 1979
    1. Income tax reduced, especially for rich - 80% to 60%
      1. Interest rate raised to 14% to lower inflation
        Resulted in huge reduction in inflation - down to 5% by 1983
2. Privatisation and Small Government
  1. Thatcher's emphasis on supply-side economics led to huge privatisation of industry, utilities, transport etc to make them more efficient
    1. Lots of British public became share-holders - 3 million in 1979 to 9 million in 1990
    2. Jaguar 1984, making loss of £32million, but after privatisation in 1985 it was making a profit of £121million on a turnover of £747miilion
  2. Many businesses and industries had subsidies cut, and plants and pits closed at the loss of thousands of jobs
    1. British Steel Corporation losing £7million a week in '79, but after cuts and closures, became the most efficient steel producer in Europe within 2 years
3. Overall - Thatcherism was a huge break from the consensus Keynesian economic theories of post-war Britain. Undoubtedly, it served to streamline British industry and business and make it much more effective, but at the loss of thousands of jibs and social turmoil.
4. North Sea Oil
Elections
1. 1979
  1. The Conservatives won with a landslide in 1979, after support for Callaghan plummeted after huge strikes of the 'Winter of Discontent'
2. 1983
  1. The Falklands War
    1. Argentine General Galtieri invades the Falkland Islands in 1982, but swift and decisive action by Thatcher routs the Argentinian forces within 2 months, and total victory ensures
      1. The 'Falkland Factor' as it became known, was a huge contribution to the landslide Tory victory in 1983
  2. The leadership of Michael Foot was to prove a catastrophe for Labour. His far left-wing policies were to alienate many voters, and combined with the SDP split in 1981, the Labour party suffered hugely in the '83 election
3. 1987
  1. The 1987 election was an unexciting affair, rising affluence and growth led to a convincing Tory victory
    1. Neil Kinnock, Labour leader, was still struggling to pacify the unelectable hard left of the party.
4. Overall - Thatcher is notable as a Prime Minister as never actually having lost an election in her time in Office. Both 1979 and 1983 were huge landslide victories for the Tory party, whilst the continuation of Tory power in 1987 proves that, whatever her critics may say, she clearly still possessed the favour of the majority of voters throughout the 1980s.
The Trade Unions
1. Miner's Strike 1984-85
  1. Government closure of uneconomic pits leads to strike action from NUM leader Arthur Scargill
    1. Scargill calls strike in Spring 1984 - proves to be a huge mistake
      1. 'Battle of Orgreave' June 1984, public opinion turns against miners
        Strike ends in February 1985, as government coal stocks outlast the striking miners. Huge victory for Thatcher
2. Norman Tebbit forces through Employment Acts in 1982 and 83, ending 'closed shop' trades and making ballots before strikes compulsory
3. Overall - Throughout Thatcher's time in Office she faced down many Trade Unions who stood in the way of her plans for development by attempting to retain old, outdated work practices and avoid more efficient mechanisation. She was undoubtedly a success, but in the process caused big social unrest in the North, Wales and Scotland.
The Thatcher Downfall
1. Resignations
  1. The Westland Affair 1986
    1. Westland, an ailing British helicopter company caused a split in opinion between Michael Heseltine and Leon Brittan. Heseltine wanted it to be made part of a European consortium, whilst Brittan wanted to sell it to American company Sikorski
      1. Thatcher sided with Brittan, so Heseltine stormed out of Cabinet meeting and resigned - but so did Brittan, after it emerged that he had put pressure on the European consortium to withdraw. No one came out with any credit
  2. Geoffrey Howe and Nigel Lawsom
    1. Nigel Lawson resigned as Chancellor when Thatcher began taking more note of Alan Walter's, her personal economic advisor
      1. Geoffrey Howe's resignation after Thatchers disagreement over him with Europe proved to be devastating. The usually docile man's speech in the Commons showed great personal injury to the man who had been a loyal Thatcherite since 1979.
2. The Poll Tax
  1. Attempts to introduce standard community charge instead of old system of council tax based on property valuation
    1. Proves to be hugely unpopular, leading to mass riots across the country
    2. Last attempt at poll tax had led the the Peasants Revolt in 1381
3. Europe
  1. Controversy and debate over whether to join the Exchange Rate Mechanism (ERM) a precursor to the Euro, caused deep split between Howe and Lawson and Thatcher
4. Overall - Thatcher's downfall was a combination of high profile resignations and party divisions over Europe (that would continue into the Major government) and the highly unpopular Poll Tax. After a decade in power, the Tory's began to view her as an electoral liability.

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Margaret Thatcher 1979 - 1990

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