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November 6, 2010

Why Margaret Thatcher Matters

By Marcia Sielaff
Why Margaret Thatcher Matters, "There is No Alternative"
By Claire Berlinski
For delightful reading, few biographers or historians can match this book. Why Margaret Thatcher Matters is equal parts of each genre, but difficult to classify as either.  

Berlinski drew upon the recollections of those who knew Thatcher best and on archival material from the Margaret Thatcher Foundation, newspaper files, and films. (By the time this book was written, Thatcher was too ill to be interviewed.) 

As perhaps the first of a genre, Berlinski asks the reader to consider this a multimedia book and to treat her footnotes as hyperlinks. The reader is directed to the internet for original documents, video files, and photographs. In addition, Berlinski is in the process of making samples of her interviews available on her website. (The Hoover Institution site provides an engaging interview with the author conducted by Peter Robinson.)

Claire Berlinski's prose sparkles with wit, insight, and charm. There is little doubt that those attributes helped to lubricate the many interviews she conducted with Thatcher's friends and enemies, and with those affected by her policies. Berlinski is clearly enthralled by her subject, but she is not blind to Thatcher's failings. The "Iron Lady," as the Soviets dubbed Thatcher, is human and fallible. The author's declared purpose is to bring forth "an extraordinary personality and towering historical figure -- a woman whose influence extends far beyond Great Britain and far beyond her moment of power." That Berlinski does, admirably.

It is, first of all, a cautionary tale. Thatcher became Prime Minister in 1979 when Great Britain was known as the Sick Man of Europe, riven by labor unrest, its industries strangled by shortages, its products defective and its exports shrinking.

How did this nation, once the most powerful and influential nation on the globe, come to such a pass? Berlinski explains that in 1945, Britain was bankrupt and exhausted after fighting two world wars. British Labor Party politician and dedicated socialist Clemet Atlee was elected Prime Minister, having campaigned on promises of a Utopian welfare state with equality and prosperity for all. The Bank of England, coal mining, hospitals, the steel industry, communications, gas and electricity production, aviation, trucking, and railways were nationalized to "improve efficiency." The system of social services was greatly expanded and the National Health Service created. 

The efficiency claim was soon disproved. By 1978, Great Britain was a shambles. Strikes and union picketing interfered with basic food supplies, affected the supplies of essential goods and causing shortages of diesel fuel. There were bread strikes, hospital strikes, strikes at old people's homes. The nation was held captive by the unions.

As Charles Powell, Thatcher's foreign and defense advisor from 1983 to 1990, told the author,

She [Thatcher] knew there had to be a major confrontation ... You can't really imagine what it was like, for people of my generation, we used to switch on the television at night, in the 1960s and 1970s, and there were the trade union leaders, coming out of Number 10 Downing street, night after night, having told the government what to do, and what they could do, what they'd put up with, and they got their way, time after time.

Until Thatcher, the Conservative Party had more or less acquiesced to the welfare state and the resulting cultural transformation. The author recounts a telling incident at a gathering of British conservatives when a functionary delivered a paper on economic policy and advised that Britain take a pragmatic "middle path."  

In the middle of his speech, Thatcher, leader of the Opposition, interrupted. She stood up. She reached in her handbag, extracted a copy of Hayek's Constitution of Liberty, held it up before the audience, and then slammed it on the table. "This," she said, "is what we believe.

Thatcher hated communism and socialism and she campaigned on the decline and humiliation wrought by the Labor Party's socialist policies.

Berlinski writes,

Free market economics and Thatcherism are often held to be synonymous.That is nearly true, but there is an important additional dimension to Thatcherism  -- a faith in the morally redemptive power of the free market that goes well beyond standard economic claims. Generally, free-market economists favor free markets for two reasons: because they believe free markets are efficient and because they are, by definition, free ... Thatcher believed both these assertions to be true. But equally importantly, she believed that free markets not only served but created robust, self-sufficient, and moral citizens, and vice versa.

Thatcher was sounding these themes years before her election. In a 1977 speech, Thatcher said,

Choice in a free society implies responsibility on the part of the individual. There is no hard and fast line between economic and other forms of personal responsibility to self, family, firm, community, nation, God. Morality lies in choosing between feasible alternatives. A moral being is one who exercises his own judgment in choice, on matters great and small, bearing in mind their moral dimension, i.e. right and wrong. Insofar as his right to choose is taken away by the state, the party or the union, his moral facilities i.e. his capacity for choice, atrophy, and he becomes a moral cripple in the same way as we should lose the facility of walking, reading, seeing, if we were prevented from using them over the year.

Kenneth Minogue, in the The Servile Mind, also discusses the morally redemptive power of the free market. Minogue and Thatcher see economic success as a product of moral practice. It is based on the individual, on responsibility, and the capacity to choose. Socialists and progressives try to portray capitalism as immoral because it is based on the profit motive, but it is socialism/progressivism that is immoral. It is immoral because the statist system eliminates choice, and without choice, there are no ethics, no good or evil. They have meaning only when, in Milton Friedman's words, people are free to choose.

Britain's Labor Party was committed to the ideology expressed in Clause 4 of its constitution.

To secure for the workers by hand or by brain the full fruits of their industry and the most equitable distribution thereof that may be possible upon the basis of the common ownership of the means of production, distribution and exchange, and the best obtainable system of popular administration and control of each industry and service." (This clause was not abandoned until 1995.)

Thatcher absolutely disagreed, she told a U.S. audience in 1975:

The pursuit of equality is a mirage ... What is more desirable and more practical than the pursuit of equality is the pursuit of equality of opportunity. And opportunity means nothing unless it includes the right to be unequal and the freedom to be different ...

Thatcher created incentives for people to supply goods and services. She smashed the trade unions. She pared the welfare system, reduced confiscatory income taxes, and privatized public industries and utilities.

In effect, she presided over the restructuring of the British economy. She was also responsible for the human costs of those policies. Withdrawing government support from failing industries meant that people lost jobs, reforming the welfare system caused some to lose benefits, and two recessions during Thatcher's tenure exacerbated problems.    

Whether these costs were unacceptably high and could have been avoided, or whether they were the inevitable result of the transition from an unsustainable system of economic redistribution to a market economy, is something that can be argued.

What is not arguable is that Thatcher's policies worked. She restored Britain's economy to one of the richest and most influential in Europe. Especially telling is that the changes Thatcher put in place were not reversed by her successors and have now been embraced by every major political party in Britain.

Thatcher proved that socialism was not inevitable. She used every tool at her disposal to get her way. She repeatedly refused to back down even when the smart money said she couldn't win. Dispatching a naval task force to take back the Falklands is one example. Defeating the National Union of Mine Workers' effort to shut down the country is another.  

Later, writing about the Falkland War, Thatcher explained:

We had come to be seen by both friends and enemies as a nation which lacked the will and capability to defend its interests in peace, let alone in war. Victory in the Falklands changed that.

Berlinski adds:

Certainly Thatcher is correct to assert that Britain had come to be perceived as a nation lacking the will to defend its interests by force. The seizure of the Falklands is ample proof of this...That the low-simmering Falklands dispute became incandescent offers a pointed lesson about the importance of unambiguous signaling as a deterrent to war.

Thatcher did not believe that an implacable enemy, whether an Argentine dictator or a Soviet one, could be won over by sweet reason. The risk she took in going to war was enormous. Argentina had air superiority and a three-to-one advantage in ground troops. Great Britain was not prepared for surface warfare and amphibious landings. (She had to requisition fifty ships from the commercial fleet and refit two cruise ships, including the QE 2.)  In fact, the battle could easily have gone the other way. 

Failure in the Falklands would have been the end of Thatcher, Thatcherism, and the rollback of socialism in Britain. Her confidence under these inauspicious circumstances was, surely, a miracle of Providence. Leaders who become legend almost always display this strain of preternatural confidence. In all of history, the number of women who have possessed it and achieved the power to exercise it may be counted on one hand.

In a no less determined manner, Thatcher took on the National Union of Mine Workers. Seventy-five percent of British coal mines were losing money. The government was spending more than a billion pounds a year to subsidize a dying, uncompetitive industry. The Union's avowedly Marxist leader, Arthur Scargill, called a strike to protest pit closures, but he intended it to become a general strike. Scargill's stated goal was to bring down the Thatcher government "by any means necessary." Thatcher was determined that that was not going to happen. She won the contest with superior tactics and truncheons.

By setting a domestic example of socialism reversed, she proved a point: The forces of history did not lead inevitably to socialism, as Marx had predicted, nor was it true that once socialism arrived, there could be no going back.

John Hoskyns, Policy Advisor to Margaret Thatcher, told the author,

In a way she trail-blazed for Reagan. I mean Reagan came in, and he followed Carter, and the Carter years were abysmal, really America was suffering, in a less extreme form, from the same fashionable left-of-center waffle that we were doing in spades, for years.  And, everywhere there was the sort of feeling of, well, you know, that's not the future. Market economics is just nineteenth-century fantasy. It no longer has a part in the modern world, it's not like that. But Thatcher was already beginning to show that the impossible was happening - to the worst basket case of all in the civilized world.

In contrast to what advisors on both sides of the Atlantic were saying, Ronald Reagan and Thatcher believed the Soviet Union was economically and morally vulnerable. Reagan's strategy, to rollback Soviet influence, was opposed by every world leader except Thatcher. Her support was expressed in deeds as well as words. Without consulting her cabinet, Thatcher allowed Reagan to use British bases to stage the raid against Libya. Berlinski includes some of the acrimonious debates in the House of Commons between Thatcher and the opposition over this and other issues.

By publicly supporting Reagan when he was most isolated abroad, Thatcher won Reagan's trust and earned his gratitude. Ultimately, and in large part owing to her sheer, dogged loyalty, her influence on Reagan came to exceed that of most of his cabinet members. The influence proved pivotal when Mikhail Gorbachev came to power.

Chapter nine describes the warm relationship between Reagan and Thatcher and how her appraisal of Mikhail Gorbachev, newly ascended to power in the Soviet Union, influenced Reagan. Readers will find much in this chapter they may not know, including the dialogue between the pilot of the plane who shot down Korean Flight 007 and the Soviet general who issued the order, and an account of an incident a year later that almost resulted in nuclear war.

In the last chapter of the book, the author weighs Thatcher's faults and achievements and concludes that the scale tilts in favor of the latter. As Berlinski points out, Thatcher's strengths were also her weaknesses.  

Berlinski frames the events that led up to Thatcher's resignation as a Shakespearian tragedy. After first endorsing and then refusing to be drawn further into the European Union, Thatcher's policies divided her cabinet and caused her longest-serving cabinet minister's resignation. She was all for European cooperation, but she was not going to surrender British sovereignty in the bargain. In her 1988 speech before the College of Europe at Bruges, she voiced her discontent.

... Working more closely together does not require power to be centralized in Brussels or decisions to be made by an appointed bureaucracy.

Indeed it is ironic that just when those countries such as the Soviet Union, which have tried to run everything from the center, are learning that success depends on dispersing power and decisions away from the center, there are some in the Community who seem to want to move in the opposite direction.

We have not successfully rolled back the frontiers of the state in Britain, only to see them re-imposed at a European level with a European super-state exercising a new dominance from Brussels.

Berliniski writes, "She concluded by warning against Utopian goals. 'Utopia never comes,' she said. 'We should not like it if it did.'"

Hindsight has since established the wisdom of that counsel. It was not perceived as such at the time. But according to Charles Powell, her sentiments about Europe were only part of the problem. She became aloof and estranged from her allies within the Conservative Party and increasingly impatient with those who disagreed with her. Her previously uncanny political judgment began to fail, her popularity declined, and the Conservative Party began to see her as a liability. In the end, Berlinski writes, "she was dislodged by a coup d'état, not by any democratic procedure."

In the conclusion to the book, Berlinski answers the question posed in the title Why Margaret Thatcher Matters. "She matters now because her battles are not over. Socialism," the author writes, "was buried prematurely." Its appeal as a political program remains seductive and enduring. It is "an ideology that is destined to rise again and again from the grave. Skeletal claws out-stretched and grasping for the instruments and subjects of labor."

Every society confronting these historical forces will inevitably arrive at a place much like the one Margaret Thatcher found herself upon her ascent to 10 Downing Street.

Thatcher understood these forces and, for a time, mastered them, but the claws are still outstretched, hidden behind the same beguiling promises of equality and prosperity for all.

Margaret Thatcher matters because she demonstrated that freedom is always an option.

Marcia Sielaff blogs at What Would the Founders Think.com.
on "Why Margaret Thatcher Matters"
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