The Impact of Thatcherism 1979-87

Question 1

What were the key economic features of Thatcher and the New Right?

Answer 1

Privitisation, free market economics (Milton Friedman) and reduce direct taxes in order to encourage wealth creation and stimulate the free market.

Question 2

What were the key social features of Thatcher and the New Right?

Answer 2

Traditional social values (e.g. The nuclear family unit as the building blocks of society. Roll back the state to reduce” dependency culture” and lower government spending. Rugged individualism.

Question 3

What were the key political features of Thatcher and the New Right?

Answer 3

Anti-union stance - they were a blight on the free market. Eurosceptic. A willingness to take unilateral action in order to protect the national interest.

Question 4

What were Thatcher’s economic goals when she came to power?

Answer 4

To restore a buoyant economy, free from crippling inflation, rising unemployment and the seemingly flawed policies of the post-war consensus.

Question 5

What were Thatcher’s political goals when she came to power?

Answer 5

To maintain party unity and discipline in the face of her “New Right” departure, to increase her majority of 43 seats at the next election and restore Britain’s status as a global power following the “IMF Crisis” humiliation of 1976.

Question 6

What was instate monetarism?

Answer 6

Controlling inflation and cutting government expenditure in an effort to limit the total money in circulation. It also meant that people would pay higher interest rates and higher taxes. Thatcher claimed to have created a “share-owning democracy”.

Question 7

What evidence was there that instate monetarism was successful?

Answer 7

Trade union membership rapidly fell. Home ownership rates rose throughout the 80s, as did house building.

Question 8

What evidence was there that instate monetarism wasn’t successful?

Answer 8

Job losses and unemployment continued to rise year on year in Britain from 2.2 million in 1980, to 3.4 million in 1987. Privatisation and selling of shares led to increased inequaltiy as the rich became richer. the Lawson boom of 1985 showed after ditching monetarism in 1984, UK economic growth reached 4-5% per year, long time high.

Question 9

Why did Thatcher aim to reduce taxation?

Answer 9

To incentivise wealth creation and stimulate the free market. She lowered income tax, especially for the wealthy in an attempt to ecourage people to start business and press forward in their careers, helping stimulate the British economy

Question 10

What evidence was there that reducing taxation was successful?

Answer 10

She reduced tax rates with the top rate reduced from 83% to 40%. Britain’s GDP improved. Competitive tendering led to the stimulation of the free market in an attempt to provide more efficient value for money.

Question 11

What evidence was there that reducing taxation wasn’t successful?

Answer 11

Led to a dramatic rise in inequality in Britain. She did reduce income tax, but she raised other taxes such as sales tax and VAT. Introduction of the poll tax. Real GDP growth slowed to 2.09% showing the market was not being stimulated. Household debt almost doubled showing wealth was not being created for most people.

Question 12

Why did Thatcher begin the process of privatisation?

Answer 12

Provides the state with large additional funds, aimed at increaasing ‘popular capitalism’ by giving a much greater number of ordinary people the chance to become shareholders - creating a “share-owning democracy”

Question 13

What evidence was there that privatisation was successful?

Answer 13

British industry was becoming more streamlined and cost-effective techniques resulted in higher productivity. Between 1979 and 1989 manufacturing productivity grew at an annual rate of 4.2%. Financial deregulation meant banks and building societies advanced larger loans to their customers - a significant amount of the money borrowed was then spent on consumer goods from abroad.

Question 14

What evidence was there that privatisation wasn’t successful?

Answer 14

Between 1980 and 1989, Britain’s balance of payments deficit rose from £16 billion to £47 billion. Critics viewed privatisation as a squandering of national assets for short-term gain - British National Oil Corporation. Increased unemployment.

Question 15

What was the stop and search law?

Answer 15

A law that permitted a police officer to stop, search and potentially arrest people on suspicion of them being in breach of section 4 of the vagrancy act of 1824

Question 16

What evidence was there that the stop and search law was successful?

Answer 16

The powers given to police officers gave them powers to fight suspected terrorists. Matched the party line of increased law and order.

Question 17

What evidence was there that the stop and search law wasn’t successful?

Answer 17

Highly controversial repealing of civil liberties. Resulted in mass arrests at Brixton, London and Birmingham during the race riots with the majority of those arrested being ethnically black resulting in accusations of racism. The policy was repealed on 27 August 1981.

Question 18

Describe the events of the Brixton riots.

Answer 18

At New Cross Road, London, a fire went through the road, killing 13 young people. The case wasn’t solved, considered to be a racist attack. Police were accused of mishandling the investigation. Led to Black people’s day of action - thousands of black people went to the road. Communities thought back against the police and the sus laws. Inflamed and caused further race riots across Britain.

Question 19

What was the Housing Act?

Answer 19

Offered tenants who had lived in their houses for 3 years a 33% discount on the market value of their house. Increased in stages up to 50% for a tenancy of 20 years. Tenants could put down a £100 deposit, stalling the sale for two years, then buying at the earlier value. Guaranteed 100% mortgages available from the local authority - a move to ‘rugged individualism’ and decreasing the dependency on the state.

Question 20

What evidence was there that the housing act was successful?

Answer 20

By 1985, over 800,000 tenants had begun to purchase the properties they had previously rented. Overall, by 1990 home ownership had increased by 15%.

Question 21

What evidence was there that the housing act wasn’t successful?

Answer 21

Council housing dropped from 33% to 8%. Critics argued that as no new council houses were built, the number of council houses around never recovered. Some argued that by selling houses for under market value, this substantially contributed to the housing crisis

Question 22

Describe some of the union legislation that was introduced in 1980.

Answer 22

Forbade mass picketing. Introduced ballots on “closed shops” (where all the employees belong to a certain union) so that at least 80% of the workers in any particular industry had to support them for their maintenance.

Question 23

Describe some of the union legislation that was introduced in 1982.

Answer 23

Deemed it unlawful to sack a worker for not being a trade union member in a closed shop if the closed shop arrangements have not been approved in the previous five years by the necessary percentage of workers. Outlawed “trade union only contracts”. Empowered employers to fire striking workers and not face unfair dismissal claims if all strikers get sacked.

Question 24

What were the impacts of the union legislation?

Answer 24

One of the reasons for the 1984-5 miners’ strike. Undermined the miners’ legal defences, which made the strike less likely to succeed.

Question 25

What did Thatcher mean when she claimed ‘The lady is not for turning’?

Answer 25

The conservatives would ensure they wouldn’t make a ‘U-turn’ in policy as they did under Heath. To do this Thatcher needed the ‘drys’ to dominate over the ‘wets’ within the conservative party.

Question 26

Did the ‘drys’ dominate the ‘wets’?

Answer 26

Thatcher was party leader up until 1991 and her policy domniated the party. Made clear and some controversial decision to execute her policy e.g. emploiyment acts of 1980 and 1982, privatisation of over 50 state owned companies and the Falklands. However, the Poll tax crisis, turned the party against her.

Question 27

What happened to Labour in the early 1980s?

Answer 27

After James Callaghan, Michael Foot became leader of the Labour party, him and Tony Benn moved the party constitutionally to the left because of their defeat in 1979. Labour begun to fracture because of this, leading to the separation of the Gang of Four. Finally, the ‘longest suicide note in history’ marked the end of Foot’s leadership.

Question 28

Who were the Gang of Four?

Answer 28

Moderate Labour MPs, who boke away in 1981 to form the Social Democratic Party - Shirley Williams, David Owen, William Rodgers and Roy Jenkins.

Question 29

How did the Liberals and SDP effect the election in 1983?

Answer 29

In alliance with the Liberals, the SDP gained a quarter of the popular vote, absorving the votes of disaffected and disillusioned Labour members. Splitting the left vote, giving the Conservatives a considerable advantage.

Question 30

What was the ‘longest suicide note in history’?

Answer 30

The Labour Party’s Manifesto in 1983, it pledged unilateral nuclear disarmament, higher tax on the rich, withdrawal from the EEC, abolition of the House of Lords and the reintroduction of nationalisation in certain industries - failed to capture the zeitgeist.

Question 31

What were the results of the 1983 election?

Answer 31

Labour won 209 to the Conservatives’ 397 seats, and they only won 27.6% of the vote.

Question 32

What did Thatcher say in her memoirs about taking on the trade unions?

Answer 32

The ensuing shift in public opinion meant that ‘from being a liability, our perceived willingness to take on the trade union militants had become an advantage’.

Question 33

What caused the Falklands war?

Answer 33

Both Argentina and Britain had in the past owned the Falklands, and due to its geographical location, Argentina felt it should belong to them, however, 98% of the Falklands population wanted to stay under British rule.

Question 34

What triggered the the Falklands War?

Answer 34

On the 2nd of April 1982, General Galtieri ordered his troops to go and seize control of the island.

Question 35

What were some of the events of the Falklands war?

Answer 35

The first British task force was sent on April 8th. South Georgia was recaptured on April 25th. April 30th, Britain created a 200 mile exclusion zone. Argentinian cruise ‘Belgrano’ sunk leaving the exclusion zone, killing 321 crew and 2 civilians - controversial. Port Stanley captured on June 14th.

Question 36

What were the consequences of the Falklands?

Answer 36

Contributed to 1983 Thatcher victory. Opposition who opposed the conflict were caught attacking the government but still trying to support the military servicemen. Naval supremacy gained, Islands retaken by task force, island permanently garrisoned, people died in conflict.

Question 37

What caused the Miner’s strike of 1984-5

Answer 37

The caol board announced they wanted to close 20 coal pits which weren’t making enough money, which would put many miner’s jobs at risk. The Miner’s argued that with further support, the the pits could become profitable again, as coal was a long-term power source.

Question 38

What were some of the key events of the miner’s strike?

Answer 38

April 1984 - soup kitchens were openned to support miners. Early summer, the thousands of miners picketed and set up a blockade at Orgreave. June 18th 1984 - battle of Orgreave, police outnumbered the Miner’s 7,000 to 6,000. There were 93 arrests and 51 strikers and 72 policmen injured. 200 Miners were arrested throughout the strike. Ended early 1985.

Question 39

Why did the Miner’s strike fail?

Answer 39

Arthur Scargill’s abrasive manner alienated them from other unions. His decision not to go to a ballot made it seem undemocratic. Lack of support from other unions. Tebbit’s employment acts gave the government powerful restraitns on the strikers. The police successfully got strike breakers into work through picket lines. Coal wasn’t as important. The government stockpiled coal factories.