Thatcher Revolution 1979-90: 1 Thatcherism: the first stage Flashcards
what kind of politician was Thatcher?
conviction politician - someone with strong opinions who acts out of principle rather than political expediency
she had a strong aversion to concensus politics - devoid of principle and purpose
when did Thatcher come to power?
1979
what is a free market?
an economic system in which the forces of supply and demand are allowed to operate naturally without regulation by the government
why was Thatcher unimpressed/angry with Heath?
he abandonned his new right policies and reverted to Keynesianism
the cons had encroached on the free market, subsidised private and public companies and permitted growth of trade unions
believed he pushed Britain further towards socialism than even the Labour govs
1979 election results
Thatcher overall majority of 43
how did Thatcher end the post-war concensus?
aimed to return to the principle of individual accountability
believed the state should no longer reward the incompetent and the half-hearted
what did Thatcher believe to be the most harmful social and economic habits of post-war concensus Britain?
- high levels of government spending which led to borrowing, excessive taxation and inflation
- unnecessary gov interference in the economy
- growth of bureaucracy which meant that civil servants and officials increasing intruded into people’s lives
- weak management and powerful unions - led to increased wages and salaries whilst productivity declined
what was Thatcher’s economic policy?
replace Keynesianism with the free market (first she had to tackle inflation however which was a major issue in Britain)
what is monetarism?
a financial theory associated with Milton Freidman, an influential US economist, who taught the root of inflation was government spending
therefore in order to control inflation, govs had to restrict money in circulation and reduce public expenditure
interest rates were kept high to deter excessive borrowing
inflation fell from 19% in 1979 to 5% in 1983
what was a major issue created by monetarism?
unemployment grew every year after 1980 at alarming rates
ultimately creating an economic recession
what is the PSBR?
Britain’s Public Sector Borrowing Requirement
includes the whole of national and local gov and nationalised industries.
the running costs is met from gov revenue. if the revenue is insufficient, the difference is made up by borrowing.
the gap between gov revenue and gov needs is known as the PSBR
cutting gov spending aimed at reversing Britain’s PSBR deficit
what happened as a result of the economic recession?
social unrest
e.g. April 1981, in Brixton hundreds of young people ran riot, burning shops and looting property - challenging for police to contain the trouble
July experiences similar events in Bristol, Liverpool and Manchester
what common factors in the early 1980s caused social unrest?
- poor job prospects in deprived inner-city areas
- alienation of young black people whose perception was that the police discriminated against them on racial grounds e.g. police used the ‘sus’ law against more than 1000 people in April in Brixton across 6 days
- high unemployment among school leavers - in Brixton 13% overall, 25% of ethnic minorities and 50% of young black people
how did the government view the riots?
political troublemakers rather than victims of social and industrial change
Minister for employment, Norman Tebbit told delegates in 1981 that his father in the 1930s didn’t riot but got on his bike and looked for work until he found it
who were the ‘wets’?
government members who opposed/were uncertain about the tough measures adopted under monetarism
