Economic Stats 1979-90 Flashcards
What was Thatchers initial economic policy
Monetarism
What was monetarisms key points
Designed to combat issue of inflation that plagued previous governments
Government had to reduce public spending and amount of money in circulation
Government maintained high interest rates to reduce excessive borrowing
How did inflation change between 1980 and 1983
1980- 22%
1983- 4%
How did unemployment change between 1980 and 83
Rose by over 1 million
Over 3 million unemployed by 1983
How did economists respond to Thatchers policies
364 leading economists claimed “there was no economic theory” behind monetarism and that “present policies” would deepen the recession
Was there opposition to monetarism and how was it dealt with
Francis Pym (defence minister) opposed monetarism in the cabinet
1980- “lady’s not for turning” speech helped to ensure dominance of drys
When was the Housing Act
1980
What did the Housing Act do
Allowed council house tenants to buy their homes- at a discount of up to 50%
Allowed tenants to lock in price with £100 deposit
100% mortgages from local authorities
How successful was the housing act
By 1985 over 800,000 tenants had brought their home
1981-1990- 15% increase in home ownership
Labour dropped opposition by 1987GE
How successful was monetarism
Did control inflation (22-4% between 1980-1983) but allowed unemployment to rise (increase by 1m between 1980-83, reached peak of over 3 million)
What was Thatchers second economic policy called
Supply side economics
Key points of supply side economics
Aimed to promote “popular capitalism” by making ordinary people more likely to own shares
How did the number of British shareholders change between 1979-1990
Increased by 6 million
How many businesses were privatised under Thatcher and give examples
50 privatised
British Gas 1986
British airways 1987
British Steel 1988
How much did the government earn from privatisation between 1985-1989
£9.6 billion
How did the number of industrial workers change between 1980-1990
Decrease from 7 million in 1980 to 4 million in 1990
How did real wages change between 1979-1994
Increased 26%
What was the Big Bang
The term used to describe the deregulation of the British financial sector in 1986
How did taxation change under Thatcher
Although she boasted of major tax cuts, the average person had largely similar tax burdens
Average tax on gross income only fell from 45% to 43% between 1979-1990
Cuts in income tax made up by increase in indirect taxation
How did the average tax % change between 1979-1990
Went from 45% to 43%
How did the basic and top tax rate change under thatcher
Basic rate- 33% to 25%
Top rate- 83% to 40%
What was the Zeitgeist of economics at the time and what highlighted this
Greed and personal growth
Highlighted by 1987 film “Wall Street”- claimed “greed is good”
When was the poll tax introduced
1989-1990
What was the poll tax
An attempted move by Thatcher to introduce a standard charge on each person in the UK
