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For a Civic and Constitutional Republic 


Issue No 119 Sunday 28 April 2013

This Week

  • Her Malign Lasting Legacy We Live With Every Day of Our Lives (Part Two)

News Stories

Highlighting news stories important to the Civic Republican view, particularly those that are overlooked or little covered in the main media.

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Her Malign Lasting Legacy We Live With Every Day of Our Lives (Part Two)

Peter Kellow gives a personal view

What you said about Part One:

" interesting, original, informed, and insightful."
- David

"very interesting, I look forward to reading the second part"
- rickyem

"excellent summary of the abuse suffered by the British people at the hands of every government of the past thirty-something years. I look forward to part 2."
- Phil Norton


Her Malign Lasting Legacy ... (Part One)

  1. Thatcherite Economics. Libertarianism
  2. Thatcherite Economics. Monetarism
  3. Exploitation of the Prime Ministerial Power
  4. Privatization
  5. Falklands war
  6. Channel tunnel

    Her Malign Lasting Legacy ... (Part Two)
  7. Industrial relations.
  8. Attack on the civil society.
    A. Attack on the civil service
    B. Attack on the professions
    C. Attack on the universities
  9. Centralization of the state

    Still to come ...
  10. The Union of Britain
  11. Foreign Policy
  12. Contracting out
  13. Council house sales
  14. Poll tax
  15. Philistinism


7. Industrial relations.

Every now and again somebody confides in me, often rather guiltily, that, although they really did not like Margaret Thatcher, they believe there is one good thing she did that had to be done: she confronted the trade unions and brought in legislation to curb their power. Like so much that is constantly repeated about hers, this idea takes on the dimension of myth and, like most of the myths surrounding her, she was primarily the one who invented it.

In this narrative, comparison is always made with the 1970s and the times and events of the government that preceded her - the Labour government with Jim Callaghan as prime minister. In fact, this was a comparison that Thatcher herself made throughout her period in office and I can still hear her strident voice bellowing the words "the last Labour government" right up to the ignominious end of her political career. She never stopped referring to "the last Labour government" as if it was the sole measure that should be held up to judge her own achievements - and this even after her third general election victory.

This comparison has been perpetuated as a permanent part of the Thatcher myth and is regarded by many as a clincher when her legacy is challenged. OK, she was awful, but she was better than what went before with rubbish piling up in the streets unburied dead - two highly conspicuous events that occurred, as it happened, in the winter of 78/79 before her election in the spring.

Thatcher's union busting is thus never discussed without referring to the 1970s. To cast Callaghan's government is a truer light, we should recall the role of the previous Conservative Prime Minister, Edward Heath, for the long term damage he inflicted on industrial relations. Heath had taken an out-and-out confrontational attitude to the unions and had shown himself ready to virtually shut the economy down in order to resist their demands and not negotiate. In 1973, in order to take on the mining union he introduced a three-day working week for all companies in the land with only limited consumption of electricity allowed. While people were trying to run the economy by candle light, he appealed to the electorate to support his strategy and called a general election. This was a tactical blunder and he narrowly lost bringing Labour back into power.

This was the background against which Labour for a relatively short period had to govern the country and the unions in the late 70s with a fragile majority. The Conservative government of 1970-74 had done immense structural damage to industrial relations by Heath's extreme actions and whoever was in charge had a massive task in returning things to some kind of normality.

This is not to say things were perfect before Heath, but the country in the 60s was still enjoying the postwar expansionary boom, oil was cheap and this was still the era when "consensus" was not a dirty word. PM Harold Wilson had set up the National Economic Development Council (NEDC) (Neddy) which allowed industry, unions and government to discuss, plan and avoid conflicts if possible. The important point about Neddy was that it recognized that Britain had a problem, not of unions, but of industrial relations. Relations are two-sided - here, between employees and employers. It was only the Conservatism of Heath and Thatcher that insisted on seeing the problems as lying all on one side. They saw the world in terms of quasi-tribal conflicts and their only policy was to see their side won. Working to resolve differences and recognizing faults lay on both sides was outside of this worldview.

The point here is that Britain had a choice. It could have looked anew at the whole way industrial relations worked. There were plenty of good models to look to in other countries in northern Europe (Germany, Sweden) to help find the right way forward for Britain. In this mix it would have been essential to look at the way that capitalism worked in Britain and in particular the emphasis on short-termism and the enormous importance attributed to a company's share price as quoted on the stock market - two features relatively absent in, for instance, Germany. But once Thatcher was elected, this was never going to happen. The NEDC should have continued as the way forward, but Thatcher detested the whole idea of it and just ignored it (it was finally abolished by PM John Major in 1992).

The legislation to reform the unions that Thatcher introduced, abolition of secondary picketing, abolition of the closed shop, compulsory union registration, could all have been put on the statute book without active confrontation - the Conservatives had an overall majority, after all. But this was not the Thatcher way. She insisted on having a confrontation with the miners' union, the NUM, to demonstrate government and employer power.

It is true a large part of the blame for the truly terrible days of the 80s miners' strike must rest with their leader, Arthur Scargill, who could entertain no comprise and insisting on leading his fellow workers off a cliff. He was the perfect stool pigeon for Thatcher to shoot. He was too foolish to note that, unlike Heath in the 70s, Thatcher had build up a great stockpile of coal to prepare for a long war of attrition.

Most of the 80s legal reforms of the unions are probably reasonable. They could have been balanced by getting real reforms in the way businesses cooperated with their labour forces and negotiating a whole package through Neddy. But Thatcher had an even more powerful weapon to deploy than a stockpile of coal - the shutting down of vast swathes of British industry. This was truly her unspoken WMD.

Even while the miners' strike was on, she was allowing pits to fall into disrepair, making reopening all but impossible. The steel industry was decimated and her macroeconomic policies of monetarism and neo-liberalism were doing their job of closing down companies and throwing millions on the dole queues. The Big Bang in the City of London in 1985, that chucked out the accumulated wisdom of caution and bank regulation that had been built up over centuries, shifted the economic focus away from hard industries and contributed to the decline of the industrial areas of England, Wales and Scotland. PM Thatcher presided over all this with apparent indifference.

As I have remarked before, all this destruction was made possible through the one-off bonanzas, of North Sea oil revenues and privatization receipts. In addition, an artificial house price boom was created as, following the Big Bang, banks could release massive amounts of unregulated credit to pump up house prices and create a temporary sense of well being. The expression "smoke and mirrors" frequently escaped the mouths of commentators at the time. It was obvious what was going on to many. And certainly it was to those on the receiving end of the closures. In many parts of the Kingdom today the bitterness of the Thatcher legacy lives on with full force.

Thatcher made sure, because of her overbearing personality and driven ideology, that Britain chose conflict and strife over faith in common interests. Her worldview of non-compromise and ignorance of society brushed aside the norms that needed to prevail if we are to create the kind of good well-adjusted society in which most people believe.

8. Attacks on the civil society.

Everyone knows that Margaret Thatcher said that "there is no such thing as society". Her admirers like to say this phrase was taken out of context. Well, OK, let's put it into context. This is what she actually said:

"I think we've been through a period where too many people have been given to understand that if they have a problem, it's the government's job to cope with it. 'I have a problem, I'll get a grant.' 'I'm homeless, the government must house me.' They're casting their problem on society. And, you know, there is no such thing as society. There are individual men and women, and there are families. And no government can do anything except through people, and people must look to themselves first. It's our duty to look after ourselves and then, also to look after our neighbour."

The problem is that once you put this statement back into context, it looks even worse. Thatcher criticizes the idea that people should receive grants to make improvements in their lives even when they might have an entitlement. She suggests that the government has no responsibility to help the homeless. Her sentence "no government can do anything except through people" expresses the vapid Rousseau-esque notion of populist sovereignty to which she subscribed. And, yes, we should look after our neighbor, but certainly not before ourselves. These statements simply buttress her central message: the country consists of atomized individuals with no cohesive values. This is the government's position and so, if you have a problem, to hell with you!

The society, which Thatcher referred to, which she believed did not exist, was society in general. But part and parcel of this conviction was a denial of the virtues of the civil society. This denial has been inherited by all of her followers and this includes every subsequent prime minister to the extent that we have almost lost the sense of what the civil society is. Certainly I cannot remember the last time a major politician used the term. But the civil society is, or should be, an essential underpinning to what our whole civilization, and indeed our society, stands for. So what exactly is the civil society?

Everyone understands that we live in a democracy. But what is less recognised is that we cannot have a democracy without a civil society to support it. In a sense the civil society is the other side of the coin of democracy. You can appreciate this with just a moment's reflection. Not everything can be decided by democracy. There are whole areas of our lives upon with democracy does not bear directly if at all.

Commercial exchanges are obviously one area but this is not the civill society. I am referring here about the running of government public services, of the civil service and also those independent professionals, like judges and accountants, upon whom we rely for detached advice and decisions. It should include also all educational institutions: schools and universities. If the civil society is full of crooks (as is the case unfortunately in some countries) society breaks down. Nothing can be trusted. Individual and business life becomes a nightmare of shifting sands and corruption. Wealth where it is accumulated by some individuals is zapped out of the country never to be seen again.

Britain is not at that stage and it is unlikely ever to be, such is the strength of our traditions, but nevertheless the civil society can be undermined. When this happens democracy starts to break down and injustice rears its ugly head everywhere and these two trends are rampant today. This prepares the ground for either apathy and disenchantment with the political process or the emergence of a populist leader who believes they can appeal to the people over the head of democracy and its supporting civil society. Thatcher was such a populist leader. This does not means she was popular - it refers to her style of leadership. Let's now look in a little more detail at what her attack on the civil society meant in practice.

A. Attack on the professions.

As a populist, Thatcher hated the independent professions: lawyers, accountants, architects, teachers and doctors. Her criticism of them was based on what she called "restrictive practices". She saw (quite rightly) that the conduct of these professions was not based and "market forces" and that they had certain privileges that purely commercial operations did not share. So, for instance, lawyers have protection of their "function", in that you have to be a qualified lawyer to practice law. This protection is governed by their chartered professional body, the Law Society.

Now, professions go back a long way in British history and this certainly accounts for much of the relative stability and lack of corruption that the country has enjoyed (even if these virtues are visibly on the wane at present). As I have said a robust civil society is essential to a democracy. What Thatcher could never recognize is that the privileges that professions enjoy is part of a trade off whereby in exchange for this privilege they are expected to operate according to certain criteria of impartiality and independence. In this, they contrast with commercial companies who are not so obliged. The latter are not criticized, except in extreme cases, for looking putting their own interests first.

Now, we can have a discussion about how well the professions are operating at present. Many people express a resentment of lawyers for instance, and this may or may not be justified. But, I can only say that when you need a solicitor or barrister, you are very glad they are there. And you are glad that they are governed by some professional principles, whereby it is expected that the advice they give you is not directed purely at their own personal gain - as for instance the advice of, say, a carpet salesperson might be.

The most successful attacks Thatcher waged on the professions were in her undermining of the architectural and teaching professions and her assault on the latter amounted at times to a vilification. The teaching profession never recovered from the stigma Thatcher put on them and now find themselves in a very weak position in the face of constant demands from central government. The profession has suffered from demoralization and insecurity since the time of Thatcher.

Without going into the details of each case, we can note that Thatcher's attempts to undermine the legal profession were less successful as lawyers know how to defend themselves, but Thatcherism was continued by her ardent disciple, Tony Blair, who succeeded in making it possible for people who are not qualified as solicitors to set up law firms. This has done nothing to provide a better service to the public. It is driven purely by the ideology that market forces are the best regulator for everything.

B. Attack on the civil service.

When Thatcher was at No. 10 with husband, Denis, there was one TV programme she never missed. It made her laugh out loud. It was witty and theme of the jokes was dear to her heart. Although written for laughs the programme could have been propaganda for one of her deepest ideological convictions. This programme was "Yes, Minister".

The thrust of the humour was based on the way a long serving top civil servant, "Sir Humphrey", manipulated and out-manoevred, his counterpart in his government department, the elected minister. Now, the scripts would not have worked if there had not been a grain of truth in them and the power of "restrictive practices" in the civil service is something which should always put us on our guard. If the programmes had been put out when the attitude of the elected government to the civil service was neutral then their content could have just been taken as fair comment. The problem was they coincided with the term of a prime minister who was determined to undermine the influence of the service and so they contributed to her distorted view of how things actually worked and inadvertently supported her policy.

As in so much of what Thatcher did, her dislike of the civil service was part of her populist ideology. She did not see that virtue of anything that got in the way of her political power. She believed she embodied the popular will. She had no need of anything that interfered with this compact and the civil service was a prime of example of this - and one close to her every moment of her working life.

Thatcher's period in office coincided with a sea change in the civil service and this was earnestly taken forward by the Thatcherite New Labour government. So the last thirty years has seen a "hollowing out" of a service that was once the pride of Britain and the envy of, and the model for, many other countries. The average age of civil service employees has fallen dramatically as years of experience are cast aside to bring in younger staff who can be molded more easily into the new downgraded role of the service.

Parallel with this process has been the development of an inner or "kitchen" cabinet so that the prime minister, instead of listening to the non-partisan voices in the civil service hires in outside people who recommend themselves because of some success they have had in the commercial or academic worlds. Thatcher, for instance, brought in Sir Alan Walters to advice her on the economy. Such appointments created tensions and disruption to the smooth running of the government and undermine the authority of permanent secretaries and the conduit they provide to the built up resource of experience in the civil service. In this way government policy can easily become driven by fads of the day so wreaking havoc on the sense of continuity the nation needs.

(Incidently it might be thought that the inner cabinets resemble the presidential cabinets in republics like the USA and France were the cabinet is hand-picked by the president. However, there is a crucial difference for cabinet choices in those countries must, under the constitution, be approved by the legislature and the legislature can veto somebody they don't like. We may argue about whether forming the cabinet in this way from people who have not been elected is the best system, but the checks imposed on this system ensures an element of democracy and scrutiny. It is certain that this procedure would have stopped Andy Coulson, for instance, from entering the government inner circle.)

And although it is an obvious point, it cannot be stated too often that the continuity provided by the civil service is fundamental to the working of democracy. Democratic elections can overturn the people who head the government but the vast machinery that works under them does not change directly as a result of general elections. This is why I say that democracy and the civil service go hand in hand. It is also why if you don't care much for one you are unlikely to see the necessity of the other. In preferring populist rule it was entirely consistent that Thatcher should always try to bypass the democracy and the civil society and impose her will on her colleagues both those who were elected and those in the permanent service.

The inner cabinets not only affect the civil service but also work directly against democracy for they can be used by the prime minister to override his or her cabinet colleagues. The latter, unlike the members of the inner cabinet, have been democratically elected. This naturally creates resentment and can lead to the isolation of the prime minister. This was the case with PM Thatcher who jettisoned not only the talent of the civil service by also a lot of talented elected colleagues. This isolation from both democracy and the civil service undoubtedly contributed to her eventual demise.

Since Thatcher's time we have seen some disastrous appointments as prime misterial advisors of which a recent prominence case was David Cameron's choice of former News of the World editor, Andy Coulson. One does not need to ask whether he consulted his permanent secretary on the wisdom of this appointment.

As I have said, the populist style is to seek to bypass both the democratic machinery and other government institutions. It was Thatcher who laid the foundation for this trend which has continued ever since.

C. Attack on the universities

The idea of the institution of the university is a very old one in Europe. In Britain it goes back to the 13th century and although there were many changes in them up to the 1980s they always retained their fundamental original character to a great degree. Their function is diverse but what marks a university out from a straightforward educational institution is their broad cultural role. They are centres of excellent in academic study and foster and maintain a body of culture and learning that is integral to the society.

In this role they also educate mostly young people who then take the spirit of learning and enquiry into the nation at large and confer these qualities on the workplace and the community. Because this role is so diffuse and difficult to define it is essential that universities retain their independence. A "university" under control by the state (or anything else such as a rich individual or company) is decidedly not a university.

When this concept of the venerable institution of the university confronted the populist ideologue that was Margaret Thatcher it was clear there was going to be trouble. Universities are (or were) part of the civil society she detested. All those free thinking academics (many of them surely "lefties") were not something she could endure without trying to tamper with their positions.

The dislike was mutual and in 1985 Oxford University refused the prime minister an honorary degree. This followed a campaign led by academics in protest against the government's cuts in funding for education. The vote against her was a decisive 738 to 319. Academics were particularly concerned about government support for scientific research, which, they said, was at crisis level. Professor Peter Pulzer, of All Souls, who led the opposition, said:

"This is not a radical university, it is not an ideologically motivated university. I think we have sent a message to show our very great concern, our very great worry about the way in which educational policy and educational funding are going in this country".

But within three years Thatcher had got her own back on the universities with her Education Reform Act of 1988. This contains a number of changes to education and amongst them was one that was designed to undermine a the hallowed tradition of British universities - this was the abolition of tenure for university teaching staff. To give more sting to this measure she backdated the new law by two years.

(Yes, you read that correctly. Under the British constitutional arrangements you can actually backdate laws so that an action that was perfectly legal at the time it was done becomes illegal later on and so can be retroactively punished! Ignorance of the law is not a defence and so your plea that you could not see into the future would not stand up in court. Most Prime Ministers in the interest of common sense and justice back off ever using this but not the heroic Thatcher.)

If someone has "tenure" this means in simple terms that they cannot be sacked. In university life tenure confers a lot of status giving its holders independence. The entry in the Wikipedia says:

"Academic tenure is primarily intended to guarantee the right to academic freedom: it protects teachers and researchers when they dissent from prevailing opinion, openly disagree with authorities of any sort, or spend time on unfashionable topics. Thus academic tenure is similar to the lifetime tenure that protects some judges from external pressure. Without job security, the scholarly community as a whole might favor "safe" lines of inquiry. The intent of tenure is to allow original ideas to be more likely to arise, by giving scholars the intellectual autonomy to investigate the problems and solutions about which they are most passionate, and to report their honest conclusions."

To Thatcher this all smacks of privilege and being protected from her beloved "market forces". The principle of academic independence, in spite of the fact that it had sheltered her great heroes in Hayek and Friedman, had no appeal to her. She saw it as a threat. As a populist she considered she had the mandate to sweep it away and that is what she did.

Anyone now working in academia will tell you that things are not how they were. Researchers are fearful for their positions and so have to adapt their studies to the prevailing orthodoxies. Frequently they are on short term contracts and have to present themselves for re-engagement every few years putting them and their families through the trauma of uncertainty of employment. And cuts and more cuts are always in the pipeline to add to the insecurity.

Tony Blair continued the assault on the universities by making all the polytechnics call themselves universities. This was a deliberate misnomer. Far from the polytechnics being truly upgraded to universities the universities all became more like polytechnics and they were obliged to take on hugely more students and turn themselves into degree factories.

Of course, there are still pockets where the ancient role of the university can be said to still be alive, but these are continually under threat. The only modern states that have relished the destruction of the independence of universities have been dictatorships. In spite of Lord Hailsham's description of the office of British prime minister as a dictatorship it would be going too far to call Thatcher a dictator. But in her treatment of universities as in other areas she came perilously close. Subsequent governments have done nothing to undo her work in this area.

8. Centralization of the state.

There is no better indication of Thatcher's contempt for democracy than in the way she centralized the British state. Most people cannot conceive of democracy without some form of dispersal of decision making to the regions and to cities and towns. A centralized state is automatically a less democratic state. Tony Travers writing in the Guardian said

"Margaret Thatcher's Conservative government presided over an 11-year war between central and local government. … From the start, in 1979-80, there were cuts in government funding for councils. The Local Government, Planning and Land Act 1980 introduced a new 'block grant' … for direct labour organisations. The block grant allowed the government to impose grant penalties on councils which exceeded expenditure targets. [She introduced} Rate-capping, which restricted the spending of councils, utterly divided local and central government. Even Conservative councils and leaders were opposed.

Mrs Thatcher's government also abolished the Greater London Council (GLC) and the six metropolitan county councils. Despite a massive campaign to stop abolition, it went ahead in 1986. Four years later, the Inner London Education Authority was also abolished.

This decision on the GLC, as we know, has now been reversed and London given a measure of independence with a high profile elected mayor. Having a major capital of the world under the thumb of central government was too much even for the ardent Thatcher acolytes that were to follow her into No 10.

Travers's conclusion is:

"Thatcher's legacy to local governments was increased centralisation and the willingness … to cap, limit and control local democracy in England. This country is one of the most centralised of western democracies".
[my emphasis]]

Where does this achievement figure in the Thatcherite myth making? How many times is it flagged up by the myth makers?

This desire to cut away the layers of the democratic machinery was all part of her populist conception of how to govern. In this vision local democracy is a huge nuisance - and of course it is out of the centre's control. There is no knowing what troublesome individuals might get elected by the local people and these individuals might challenge the plans of the prime minister.

Following Thatcher there have been exercises in presenting to the public the appearance of less decentralization and New Labour's "Regional Development Authorities" in England were an example - although the experiences of many businesses who were supposed to be helped by the RDAs is very mixed. The coalition weighed in and abolished them on taking office and put in place its policy of setting up Local Development Agencies but these are very patchily distributed and this has led to charges of unfairness and of even seeking electoral advantage through them.

The much trumpeted coalition policy of "localism" is a populist policy designed to sideline the democratic decision-making of local authorities. The language of giving power to "local communities" is typically populist, but in practice will not translate in to better representation. Local communities are already represented by the local councilors. The idea that you can sideline those who were locally elected and go over their heads and appeal directly to the people that voted for them is rank nonsense. The agenda can only be the undermining of local democracy. Thatcher would have been proud of this initiative.

Footnote. Michael Portillo's view

In this time when people naturally reflect on the Thatcher legacy, I was interested to hear what one of her greatest admirers and advocates would have to say and so I watched with interest the edition of Andrew Neil's This Week programme at the time of the funeral to hear what regular, Michael Portillo, who was a minister under her, would say. In praise of her he made three points

1. Firstly, he recounted a conversation that he had had with her in 1981 about taking on the miners union. She said that that was not the time as she needed to plan for a long struggle and so first had to build up coal stocks and this would take a few years. He said this refuted what he claimed was a commonly held view that she launched into actions without reflection. Well, OK, Michael, so she was a calculating b****. I think we knew that already

2. Secondly, he said she was absolutely free of corruption. Well, politics has sunk to a pretty low level when not being corrupt is a major point in someone's favour. In addition, it may not be too wise to shout about it in Margaret Thatcher's case as there was always something murky about the activities of her son, Sir Mark, in Saudi Arabia, in Oman, in South African not to mention his use of his family name in his consultancy firm. Question were asked about these at the time and are still being asked.

3. Lastly, Portillo said something that was exceptional about her is that she always had a ready opinion on any subject. But this was because she was an ideologue! Ideologues of any colour always have pre-formed opinions on everything and she was no exception. It is hard to see why this should be worth citing as a good quality.

Overall this was pretty thin gruel. I was hoping for something more robust and just a tad more metaphysical from someone who must have thought deeply on the subject. I suppose Portillo thought with the Thatcherite mythology so firmly established by the political elite and the press it only remained for him to do a little polishing around the edges - such is the entrenched position of the Thatcher myth.

Still to come:

The Union of Britain
Foreign Policy
Contracting out
Council house sales
Poll tax

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