There was an alternative to Margaret Thatcher – and she did not save Britain

And so she is finally gone, turned into a handful of ashes and a puff of smoke into the Mortlake sky. As was the case with Osama Bin Laden there will be no gravestone around which worshippers will be able to congregate, or for dissenters to desecrate. That’s the end of Margaret Thatcher – the most divisive figure in British politics in living memory. But whether we revere her or despise her if we are objective we should acknowledge that it was not just the offensively over-the-top nature of her funeral that we should deplore. We should also abhor the intellectually impoverished attempts in the last week to create the myth that “There was no alternative” to the Thatcher way back in the 1980s. This myth creation has been accompanied by an unparalleled excess of hyperbole  - David Cameron’s reaction being typical:

“The real thing about Margaret Thatcher is that she didn’t just lead our country she saved our country,and I believe she’ll go down as the greatest British peacetime Prime Minister.”

“The greatest” ? Well Britain has had 73  peacetime Prime Ministers since Walpole in 1721 so this is quite a claim. Cameron’s entitled to his view on this but I doubt many would share it (or find it a particularly interesting area of debate). What he is not entitled to do, in my opinion, is to peddle the myth that Thatcher “saved our country”. This claim, and its close cousin Thatcher’s own phrase, so beloved of her supporters, “There is No Alternative” are just fallacious. Not only was there an alternative but if it had happened, as it nearly did, Britain would be a far better place today.

Lets travel back to the 1970s when Margaret Thatcher, the new leader of the Conservative Party, started her crusade. The quadrupling of Crude Oil prices in the early part of the decade caused a shock to the system not dissimilar to the banking meltdown of 2007. Edward Heath as Prime Minister struggled to deal with the after effects of this and failed also to achieve his ambition of freeing up the City to compete more effectively. There was a series of U-turns. The Industrial Relations climate under Heath was woeful and when he tried to take on the miners with a “Who Governs Britain” question the country told him he didn't - and Labour returned to power. The Wilson administration of 1974-1976 was notable for its achievement in restoring order after the chaos of Heath and his three-day week. They did this not from the Left but from the centre and it is worth quoting what one of the most astute of political commentators of those times, Peter Jenkins, said in April 1976:

“Mrs Margaret Thatcher is having to come to terms with a powerful Government led by a powerful Prime Minister which has stolen some of her more fashionable creations…Mr Wilson has put together what is a really powerful ruling coalition… [and] he has answered the question “Who rules the country?” and exploded the notion…of ungovernability. The country does have now a kind of National Government appropriate to a deep economic crisis…. [Mr Wilson’s] Government does not dare, and perhaps never will, to speak openly the language of German Social Democracy, but that is the direction in which their policies are now pointing. Like it or loathe it, the face of British politics has been virtually transformed…”

So the legacy taken over by James Callaghan in 1976 when Wilson retired was not that of a country which need “saving” and was also one in which the forces of Social Democracy, rather than Socialism,  were already beginning to be dominant. Nevertheless it was still something of a “hospital pass”. In 1975, inflation had touched 25% and the Industrial Relations climate, though better than under Heath, was poor. By late 1978 Callaghan and Denis Healey had reduced inflation to less than 10% and the Government, whilst not hugely popular, was sufficiently respected  to have a lead in the opinion polls of 5.5% in November.  Callaghan could well have won an Autumn 1978 General Election if he had called one. Members of Callaghan's cabinet at that time included Denis Healey, David Owen, Shirley Williams, Peter Shore, Eric Varley, Roy Hattersley, Bill Rodgers and Harold Lever. All of these highly influential figures were of the social-democratic right and although there were to an extent balanced by left-wingers like Michael Foot and Tony Benn it was clear that the trend to the centre identified in 1976 by Peter Jenkins had continued. If Britain didn't need “saving” in 1976 then it didn't in late 1978 either!

Between late 1978 and May 1979 the Callaghan government was to go into free-fall. The “Winter of Discontent” showed that the “Coalition” under Wilson had broken down and there is no denying the fact that the Nation, or large parts of it, had had enough. A 7 per cent swing to the Conservatives gave them an overall majority of 43 and brought Margaret Thatcher to power. As we have seen only a few months earlier there had been an alternative and now, immediately, there was to be one again - albeit one involving the need for Labour to play the waiting game. In his autobiography David Owen wrote “I hoped [Callaghan] would resign immediately… If he went now, he could go with dignity and hand over to Denis Healey.”   That Callaghan did not do this – and indeed hung on until November 1980 – was one of the most fateful mistakes in politics in modern history, at least as seen from the perspective of the Left! As we have seen the modernising of the Party had already been underway under Wilson and had Callaghan won an Election in the Autumn of 1978 there is no reason why this would not have continued. Similarly had Callaghan given way to Healey in June 1979 (Healey would certainly have won a leadership contest) then in opposition Healey, Owen, Williams, Rodgers and the rest could have worked to continue the transformation of Labour to a modern Social Democratic Party. They would have offered a strong opposition to Mrs Thatcher who was struggling arguably more than Callaghan had ever done. Inflation was at 22% by May 1980 and the Conservatives were down to around 35% in the opinion polls with Labour at nearly 50%. However at that moment the Party decided to commit Hari-Kari! A Special Conference decided on a very Left Wing defence agenda involving Unilateral Disarmament. By the end of the year , as Owen put it, “Partisan politics was back in Britain with a vengeance”. Michael Foot had been elected leader of the Labour Party and the cause of Social Democracy, so buoyant less than a year or so earlier, had been defeated – temporarily anyway.

To return for a moment to the subject as to whether there was an alternative to Thatcher and whether she was “Saving the country” in those early years of her Premiership. First there is no doubt that a new Labour Party could have emerged and been successful under Healey. This didn’t happen but it was an alternative. Secondly what did happen instead was the most open threat to Thatcher of all – the foundation of the Social Democratic Party (SDP)  in 1981. If a Healey-led Labour party was an alternative to Thatcherism that didn't happen the SDP was an alternative which most certainly did – and it was only defeated by the extraordinary circumstances of the Falklands War. The SDP was founded on opposition by Social Democrats to the fact that, as they said, “A handful of trade union leaders can now dictate the choice of a future Prime Minister”. The SDP was not “anti union” in the simplistic sense of that phrase but pro democracy – and therefore against the block vote and the disproportionate amount of power that Union leaders had in the Labour Party. The SDP was more than this of course and it had a credible complete manifesto which by the 1997 General Election had become mainstream Labour policy – but that's another story!

In 1981 the SDP gathered strength. A Gallup poll in December gave the SDP (with its Liberal allies) 50% of the vote with Labour and the Tories on around 23% each. And by-elections had been won as well. Then in April 1982 the Falklands War broke out and the country rallied behind Margaret Thatcher and her Government. Although the “Alliance” , as it now was, continued to poll quite well and at the  the 1983 Election only 42.4% of the electorate who voted chose the Conservatives with 53% choosing one or other of the two main Opposition parties (who were almost equally split). Nevertheless the electoral system gave Thatcher an overwhelming majority of 144. Was there an alternative to Thatcher in 1983 ? 57.8% of those voting thought so – they just couldn't agree what it was !

So as we have seen there most certainly were viable alternatives to Thatcher and the Country was within a whisker three times of either not having her at all of of minimising her reign. In 1978 Callaghan could have won an election and later have handed over to Healey who would have driven the Labour Party down a Social Democratic path. The SDP would never have happened – and nor would a Thatcher premiership. In 1979 Healey could have immediately succeeded Callaghan as Leader. Again the SDP would not have happened and whilst the Falklands effect might still have meant that Thatcher won in 1983 that is unlikely. A united (Social Democratic) Labour Party under Healey would surely have defeated Thatcher if she had only got the 42.4 % she did when Michael Foot was her Labour opponent. Indeed far more likely is that against Healey she would have got less than that and been soundly defeated. Finally had the Falklands War not happened then the 1983 election could have had an outcome with the SDP/Alliance being a major influence and possibly forming a Government in some sort of Coalition with Labour.

Margaret Thatcher was a remarkable woman but she was far from the only moderniser around in the late 1970s and 1980s. The challenge of changing the Labour Party was well under way under Harold Wilson in 1976 and it was only the ghastly “Winter of Discontent” that halted it. The principles of Social Democracy were alive and well in 1979 but the Neanderthals of the Left in Labour resisted change and made Labour unelectable in the process. But whilst the Labour Party needed saving, and had to wait for Kinnock and Blair for this to happen, the Country did not. It needed to change of course – not least to the power of the Unions which was excessive. But this was recognised explicitly by those who founded the SDP (as I have shown in the quote above) and these are the same people, along with Denis Healey,  who would have modernised the Labour Party and run a Social Democratic Government. One of the big “If onlys” of modern politics! Thatcherism in practice would  not have happened at all or would have been a short-lived phenomenon.

There was an alternative to Thatcher – but we had to wait for New Labour in 1997 for it to happen. In the meantime in the years 1979-1990 we had confrontation, division, ideologically driven bombast, destroyed communities, destruction of the manufacturing sector, class war and latterly madness at the top. For too long she was dangerously “in office but not in power” as Geoffrey Howe put it. We were for too long governed by someone who believed not in Society, not in a mixed economy, not in partnership but in the naked power of the market – and to hell with the social cost. Some of the changes which took place during these years needed to happen – after all Blair/Brown did not repeal them. But could it all have happened without the confrontation ? Maybe it could. Certainly once Thatcher was gone a calmer approach to governance happened under John Major – albeit from a Conservative perspective. Not “One Nation” maybe – but not Thatcherite either.    

It is our lack of heroes today which forces us to seek heroes from the past. We all too often look back to times when life was different and ascribe virtues in a hugely exaggerated way. This leads to the sort of hyperbole of Cameron’s statement above and to the frankly absurd over the top send off for Margaret Thatcher. She was not far away from being just a footnote in history as I have tried to argue here. And I think that we’d all be better off if she had been.