There is No Alternative (57 page)
Read There is No Alternative Online
Authors: Claire Berlinski
46
Alan Howarth, “Some Suggestions for Strategic Themes,” January 4, 1978, THCR 2â6â1â250 (32), p. 4. The end of this section of the document is mildly puzzling. Howarth concludes by calling for “an end to the depressing politics of guilt”âwords rather at odds with all the words preceding them. But the word “politics” has been altered, by hand, to read “policies.” Whose hand did the altering? I don't know. Is it significant? I don't know. Archives are like that, sometimes.
47
Speech to Conservative Party Conference, October 8, 1976, Brighton, Thatcher MSS (digital collection), doc. 103105.
48
John Campbell,
Margaret Thatcher
, vol. 2:
The Iron Lady
(Jonathan Cape, 2003), p. 258.
Margaret Thatcher
, vol. 2:
The Iron Lady
(Jonathan Cape, 2003), p. 258.
49
George Bush and Brent Scowcroft,
A World Transformed
(Knopf, 1998), p.31.
A World Transformed
(Knopf, 1998), p.31.
50
Alan Clark,
Diaries
:
In Power, 1983â1992
(Phoenix, 2001), p. 319.
Diaries
:
In Power, 1983â1992
(Phoenix, 2001), p. 319.
51
Nigel Lawson,
The View from No. 11: Memoirs of a Tory Radical
(Corgi, 1993), p. 680.
The View from No. 11: Memoirs of a Tory Radical
(Corgi, 1993), p. 680.
52
The two HelmutsâHelmut Schmidt, then chancellor of West Germany, and Helmut Kohl, then chairman of Germany's Christian Democratic Union.
53
Chequers is the prime minister's country residence.
55
Diana Gould was a British housewife who on BBC TV in 1983 attacked the prime minister's decision to sink the
Belgrano.
This exchange too may be viewed on YouTube:
www.youtube.com/watch?v=rWOy23MLY1I
.
Belgrano.
This exchange too may be viewed on YouTube:
www.youtube.com/watch?v=rWOy23MLY1I
.
56
TV Interview with David Frost for TV-AM, June 7, 1985, London. Transcript from Thatcher MSS (digital collection), doc. 105826.
57
Wyatt was a Labour MP and journalist who became an admirer of Thatcher.
58
Mayo Clinic Staff, December 19, 2005, Mayo Foundation for Medical Education and Research (MFMER),
www.edition.cnn.com/HEALTH/library/DS/00652.html
.
www.edition.cnn.com/HEALTH/library/DS/00652.html
.
59
John T. Gartner,
The Hypomanic Edge: The Link between a Little Craziness and a Lot of Success in America
(Simon & Schuster, 2005).
The Hypomanic Edge: The Link between a Little Craziness and a Lot of Success in America
(Simon & Schuster, 2005).
60
Thatcher,
The Downing Street Years
, p. 557. She is talking about the conference center, by the way, not the cruise ship.
The Downing Street Years
, p. 557. She is talking about the conference center, by the way, not the cruise ship.
61
He is now Lord Kinnock, but the man is, after all, a socialist (a “crypto-communist,” even, if you take Thatcher's word for it), so the title seems a bit ridiculous. In fact, I finally just asked him, “What would you like me to call you?” He said, “Neil.”
62
June 4, 1985, House of Commons PQs, Hansard HC [80/149â54].
63
July 11, 1985, House of Commons PQs, Hansard HC [82/1256â60].
64
January 16, 1986, House of Commons PQs, Hansard HC [89/1203â08].
65
November 12, 1985, House of Commons PQs, Hansard HC [86/422â28].
66
January 22, 1985, House of Commons PQs, Hansard HC [71/855â60].
67
June 13, 1985, House of Commons PQs, Hansard HC [80/1007â12].
68
Ibid.
69
November 15, 1984, House of Commons PQs, Hansard HC [67/791â96].
70
June 13, 1985, House of Commons PQs, Hansard HC [80/1007â12].
71
January 17, 1985, House of Commons PQs, Hansard HC [71/506â10].
72
May 21, 1985, House of Commons PQs, Hansard HC [79/851â56].
73
April 30, 1985, House of Commons PQs, Hansard HC [78/133â38].
74
February 12, 1985, House of Commons PQs, Hansard HC [73/161â66].
75
I've heard variants on this story from a number of Thatcher intimates. One of her civil servants remembered desperately trying to finesse a compromise between Thatcher and her chancellor during a dispute over the budget. His delicate diplomacy was upended when Thatcher came back from the Commons, apparently quite drunk, and discovered her chancellor holding a secret strategy meeting behind closed doors. She strode in uninvited, kicked off her shoes, tucked her heels under herself, and declared, “Well, gentlemen, let's just settle this now, shall we?” She “held court like a Queen Bee,” and what do you know, they settled it. Afterward, the other civil servants could be heard muttering among themselves, “
Phwooarh
, wasn't she sexy tonight?” Mitterrand, according to the same civil servant, was “visibly moved” in Thatcher's presence.
Phwooarh
, wasn't she sexy tonight?” Mitterrand, according to the same civil servant, was “visibly moved” in Thatcher's presence.
76
Alan Clark,
Diaries: Into Politics 1972â1982
(Phoenix, 2000), p. 147.
Diaries: Into Politics 1972â1982
(Phoenix, 2000), p. 147.
77
George Orwell,
Such, Such Were the Joys
(Harcourt Brace, 1953).
Such, Such Were the Joys
(Harcourt Brace, 1953).
78
Clark,
Diaries: In Power
, p. 35.
Diaries: In Power
, p. 35.
79
It may be seen on the PBS series
Commanding Heights
:
www.pbs.org/wgbh/commandingheights/shared/video/qt/mini_p02_09_300.html
.
Commanding Heights
:
www.pbs.org/wgbh/commandingheights/shared/video/qt/mini_p02_09_300.html
.
80
For a more complete discussion of Jaruzelski's gambit, see John O'Sullivan,
The President, the Pope and the Prime Minister: Three Who Changed the World
(Regnery, 2006), pp. 294â299.
The President, the Pope and the Prime Minister: Three Who Changed the World
(Regnery, 2006), pp. 294â299.
81
Transcript from
Commanding Heights, Chapter 9, Poland's Solidarity
:
www.pbs.org/wgbh/commandingheights/shared/minitextlo/tr_show02.html#9
.
Commanding Heights, Chapter 9, Poland's Solidarity
:
www.pbs.org/wgbh/commandingheights/shared/minitextlo/tr_show02.html#9
.
82
Thatcher,
The Downing Street Years,
p. 380.
The Downing Street Years,
p. 380.
83
Ibid., p. 381.
84
Speech to Conservative Party Conference, October 12, 1984, Brighton, Thatcher MSS (digital collection), doc. 105763.
85
Speech to her constituency at Finchley, October 20, 1984, Thatcher MSS (digital collection), doc. 105769.
86
She told this version of the joke while giving a speech in Bermuda on August 7, 2001, Thatcher MSS (digital collection), doc. 109301. It pops up elsewhere; it seems to have been a staple of her repertoire.
87
Frank Hahn, “On Market Economies,” in
Thatcherism
, ed. Robert Skidelsky (Chatto & Windus, 1988).
Thatcherism
, ed. Robert Skidelsky (Chatto & Windus, 1988).
88
Speech in Korea, “The Principles of Thatcherism,” September 3, 1992, Thatcher MSS (digital collection), doc. 108302.
89
When I spoke to Lawson about the definition of Thatcherism, he noted pointedly that Thatcher “was very much the captain of her team,” but her policies “were made by a team, and not just by her alone.” Of course they were. When I speak of Thatcherite reforms, I am using a shorthand for the reforms made by Thatcher and her team. Thatcher was the
prime
minister, however, so I think it fair to call the reforms that took place while she was in power “Thatcherite reforms.”
prime
minister, however, so I think it fair to call the reforms that took place while she was in power “Thatcherite reforms.”
90
Samuel Smiles was the Victorian author of
Self-Help,
as well as the similar page-turners
Character, Thrift,
and
Duty.
Self-Help,
as well as the similar page-turners
Character, Thrift,
and
Duty.
91
Lawson,
The View from No. 11,
p. 64.
The View from No. 11,
p. 64.
92
For an excellent discussion of this point, see Shirley Robin Letwin's
The Anatomy of Thatcherism
(Transaction Publishers, 1992).
The Anatomy of Thatcherism
(Transaction Publishers, 1992).
93
Speech to Zurich Economic Society, “The New Renaissance,” March 14, 1977, Thatcher MSS (digital collection), doc. 103336.
94
Iain Macleod Memorial Lecture, “Dimensions of Conservatism,” July 4, 1977, Thatcher MSS (digital collection), doc. 103411.
95
Economists will quibble with my rephrasing. They will note that the First Theorem of Welfare Economics predicts only that given certain initial conditions, viz, that (1) there are markets for all the goods and services that people want to trade and (2) that economic agents act as price takers, a free market will generate a Pareto-efficient outcome. The theorem does not specifically predict that fewer people will starve to death. I added that part. I added it because it's true, and we wouldn't give a damn about Pareto-efficiency if it weren't.
96
Again, this is
not
a far-fetched example. This is taking place right now. Food prices are rising precipitously, and governments around the globe are responding with price caps.
not
a far-fetched example. This is taking place right now. Food prices are rising precipitously, and governments around the globe are responding with price caps.
97
“Heresy in the USSR,”
Commanding Heights,
PBS, April 23, 2004.
Commanding Heights,
PBS, April 23, 2004.
98
Beyond this, the economist Georgios Karras has suggested, the drag on productivity begins to outweigh the benefits. See “The Optimal Government Size: Further International Evidence on the Productivity of Government Services,”
Economic Inquiry
34 (April 1996). In developing, rather than developed, countries, the optimal size is larger. When governments cost more than this surprisingly small percentage of a nation's gross domestic product, you do
not
tend to see commensurate improvements in critical social indicators such as life expectancy, infant mortality, or school enrollment. See, e.g., E. A. Peden, “Productivity in the United States and Its Relationship to Government Activity: An Analysis of 57 Years, 1929â1986,”
Public Choice
69 (February 1991). This research was done after Thatcher's rise to power, of course, but would have come as no surprise to her.
Economic Inquiry
34 (April 1996). In developing, rather than developed, countries, the optimal size is larger. When governments cost more than this surprisingly small percentage of a nation's gross domestic product, you do
not
tend to see commensurate improvements in critical social indicators such as life expectancy, infant mortality, or school enrollment. See, e.g., E. A. Peden, “Productivity in the United States and Its Relationship to Government Activity: An Analysis of 57 Years, 1929â1986,”
Public Choice
69 (February 1991). This research was done after Thatcher's rise to power, of course, but would have come as no surprise to her.
99
It is often said that inflation
accelerates
under these circumstances, but this is technically wrong. Acceleration refers to the rate of change. The inflation rate is the rate of change in prices. What is accelerating here is the rise in prices, not inflation. To say that inflation “accelerates” would better convey the drama of the problem, however, as in,
This inflation is like a truck with failed brakes careening down a steep hill.
accelerates
under these circumstances, but this is technically wrong. Acceleration refers to the rate of change. The inflation rate is the rate of change in prices. What is accelerating here is the rise in prices, not inflation. To say that inflation “accelerates” would better convey the drama of the problem, however, as in,
This inflation is like a truck with failed brakes careening down a steep hill.
100
Again, the term, strictly speaking, should be non-
increasing
inflation rate of unemploymentâbut for some reason that's not what economists call it.
increasing
inflation rate of unemploymentâbut for some reason that's not what economists call it.
101
Thatcher's predecessor, Jim Callaghan, also tried to control inflation through monetary policy. It is incorrect to imply, as some do, that Thatcher's was the first British government to try this. But Callaghan didn't last long enough in office to be widely remembered for it.
102
Speech to Conservative Party Conference, October 10, 1980, Brighton, Thatcher MSS (digital collection), doc. 104431.
103
Speech at Georgetown University, Washington, D.C., February 27, 1981, Thatcher MSS (digital collection), doc. 104580.
104
Lawson,
The View from No. 11,
p. 137.
The View from No. 11,
p. 137.
105
Various news reports from Channel 4. These were, not at all incidentally, race riots, very similar to the ones now common in France.
106
In fact, it grew 19.5 percent.
107
Lawson, e-mail correspondence, September 27, 2007.
108
I am greatly indebted to the economist Martin Davies for helping me to disentangle these policies and their consequences.
109
Before Thatcher, the state-owned Post Office provided
all
of Britain's telephone, telecom, and postal services.
all
of Britain's telephone, telecom, and postal services.
110
Per capita income of course is not the only measure of a nation's economic health; it certainly proves nothing about a nation's long-term economic prospectsâif it did, Germany would still be at the top of the table. Moreover, it is not entirely reasonable to compare British performance with Germany's, given that during this period West and East Germany were reunited. Even with these reservations, these are impressive statistics.
111
See, e.g., Stephen Nickell and Glenda Qintini, “The Recent Performance of the UK Labour Market,”
Oxford Review of Economic Policy
18, no. 2 (2002). By their estimates, the NAIRU was roughly 9.5 percent during the 1980s. From 1991 to 1997 it fell to 8.9 percent, and thereafter to 5.7 percent. In “Falling Unemployment: The Dutch and British Cases,”
Economic Policy
(April 2000), Nickell and Jan Van Ours argue that the weakening of the unions was the most important reason for the decline of NAIRU, followed by changes to the tax structure and changes in benefits policy.
Oxford Review of Economic Policy
18, no. 2 (2002). By their estimates, the NAIRU was roughly 9.5 percent during the 1980s. From 1991 to 1997 it fell to 8.9 percent, and thereafter to 5.7 percent. In “Falling Unemployment: The Dutch and British Cases,”
Economic Policy
(April 2000), Nickell and Jan Van Ours argue that the weakening of the unions was the most important reason for the decline of NAIRU, followed by changes to the tax structure and changes in benefits policy.
112
Speech to the Institute of Socio-Economic Studies, “Let Our Children Grow Tall,” September 15, 1975, BBC transcript, Thatcher MSS (digital collection), doc. 102769.
113
See, e.g., Urban Bäckström, “The Swedish Economy,” Svenska Handelsbanken's Seminar, New York, October 7, 1998, and “Swedish Economic History: Structural Problems and Reforms,”
Ekonomifakta
(2008).
Ekonomifakta
(2008).
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