Thatcher and the End of Consensus 1979-97

  • Created by: TaylorYS
  • Created on: 31-05-19 14:54
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  • Thatcher 1979-1990
    • 1979 Election (43 Seat Majority)
      • Decline in the Liberal party
        • Blamed for keeping Callaghan's government in office since 1977
        • Handed many liberal seats in the Midlands and the South to the Tories
      • Labour punished by constituencies in London and the Midlands
        • Failure to deal with economy, trade unions, Winter of Discontent
      • Electoral System
        • Marginal seats were key, Thatcher appealed to these by stressing need for Trade Union reform and attacking socialism
    • 1983 Election (144 Seat Majority)
      • Falklands Factor (1982)
        • Favourable press coverage
        • Saw Thatcher as leading a national revival
      • Split in the Labour Party
        • Foot as leader meant the more moderate element of the party split to form the SDP
          • Liberal/SDP alliance
        • 'Longest Suicide note in History' Labour manifesto 1981
        • Anti-Thatcher vote was split
      • Privatisation increased public shareholding
    • 1987 Election (102 Seat Majority)
      • No more Falklands Factor and no more huge weakness in Labour leadership meant a loss of 21 seats
      • Selling council houses and shares appealed to the middle classes and skilled working classes
      • Unemployment was falling and the pound was strong
      • Split in the left wing vote
    • Economic Policies
      • Problems identified
        • Inflation
          • Eroded middle class savings
          • Over priced industry
          • Fuelled by government spending
          • Overall Thatcher managed to decrease inflation
        • Lack of investment and modernisation, and economic stagnation
        • Lack of incentive to modernise and increase productivity
        • She wanted to reduce the amount of money in circulation (Monetarism)
      • Taxation Policies
        • Shifted from direct to indirect tax
          • Direct tax = based on individual's income
          • Indirect tax = levied on goods bought
          • Initially worsened inflation
            • VAT increased price of goods
            • In 1980 and 1981, government expenditure and borrowing were cut, and taxes were increased
              • 'Most unpopular in history'
            • The impact afterwards was positive and negative
              • Inflation by 1983 had reduced from 18% to 4.5%
              • Falling manufacturing output by 14%
              • Unemployment doubled by 1983
              • Government didn't support failing businesses
              • Increased interest rates
              • Value of the pound increased
      • Privatisation
        • Thatcher believed that nationalised industries were inefficient and over-manned
        • Hugely popular with those who bought shares
          • Hoped this would reward those with values of hard work that she admired
            • Gave more people a stake in the success of the economy
        • Undervaluing initially meant shareholders would sell early to big operations for an instant profit
        • Improved performance, lowered prices, offered consumers more choice
      • Deregulation
        • Lawson 1983-89
          • Indirect taxes increased
          • Lawson's Boom
            • Gap between thriving areas and depressed areas was growing
          • Financial Services Act 1986 deregulated the stock market, revitalising London's money market (Big Bang)
            • Ensured that London remained at the centre of the global financial market
      • Critics
        • North Sea Oil
        • Privatisation for big shareholders rather than customers
        • 'Get Rich Quick' attitude
        • Fall in manufacturing hit unemployment
    • Social Policies
      • NHS
        • Applied business principles to the NHS
          • Hospitals became self governing, in charge of their own budgets
          • NHS services would compete to offer efficient and cost effective service
          • GPs became fund holders with their own budgets
        • Injected financial discipline
        • Appeared to prioritise profits over patient care
      • Schools
        • Replace O levels and CSEs with GCSEs
          • Open to students of all ability
          • Regular national ability testing, and a national curriculum
            • Some believed the curriculum was too restrictive and testing too frequent
          • Some argued they were not rigorous enough
        • State schools could become grant-maintained, in control of their own budget
      • Universities
        • Universities needed to be more economically self sufficient
          • Cut Uni budgets in 1981, forcing them to accept more students, and find alternative sources of income
          • University staff lost security of tenure
      • Council House Sales
        • Property Owning Democracy
          • Wanted to reward those who shared her values of hard work, self reliance, and initiative
          • Owning property gave people a stake in society
        • Allowed long term tenants to buy their council houses
        • Gave home owners tax relief on their mortgages
          • Government money spent on subsidisation increased by 12%
    • Industrial Relations
      • Thatcher believed jobs would become available once British industry adjusted to market conditions and Unions lost their power
      • Legislation
        • Employment Act 1980
          • Outlawed secondary picketing, increased rights on non-union employees
          • Encouraged ballots for strikes by offering government money
        • Employment Act 1982
          • Restricted sympathy strikes
          • Ballot needed over 85% support
          • Compensation for those sacked for not joining a union
        • Trade Union Act 1984
          • Ballots for industrial action were required
        • Except for the year of the miners strike, working days lost to strikes were considerably lower as a result
          • High unemployment deterred strike action
          • Union numbers were falling anyway, difficult to mobilise strike action
      • Miners Strike 1984-85
        • Government preparations
          • Whitehall committee stockpiled coal in 1981
            • As did the Central Electricity Generating Board
          • National Reporting Centre in New Scotland Yard, central control of policing
        • Why it was defeated
          • Miners were not united (breakaway union in December 1984)
          • Less demand for coal in the Spring/Summer
          • Labour wouldn't support Scargill
          • Widespread sympathy was dampened by violence on picket lines
          • Government were prepared to use considerable force
        • Impact
          • Divided support on Thatcher
            • She was successful to her supporters as she was firm in her attitude to the unsustainable coal industry
              • Held firm against Trade Unions
            • Enemies believed she wanted to destroy livelihoods
    • Fall of Thatcher
      • Growth in Opposition to her Style
        • Heseltine
          • Resigned in 1986 over the Westland Affair
        • Lost a supporter in Whitelaw to a stroke, and fell out with Lawson and Howe over the economy and Europe
        • Howe's resignation speech
          • Called for a challenge to her power, he had endured bullying and hatred from her
            • Triggered her downfall
      • Poll Tax
        • Flat rate tax on every individual
          • Massive anti poll tax demonstration in Trafalgar Square March 1990
      • Economic Difficulties
        • Stock Market Crash 1987
          • Lawson reduced income tax, causing an increase in inflation
            • Lawson then raised interest rates rather than cutting government spending
              • Thatcher's most admired people were now paying extortionate amounts
      • Divisions over Europe
        • Thatcher sceptical of the ERM, regretted accepting the Single European Act 1986
      • Personal Isolation
        • Labour began to win the opinion polls and some elections
          • There began to be challenges to her power within the party (Anthony Meyer)

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