Quite a debate raging about whether or not Margaret Thatcher can be blamed for any of the economic malaise affecting the Uk today. Good arguments on both sides but for me she has to be apportioned a share of the blame because many people pointed out the risks and flaws in her strategy at the time but were ignored.
Clearly Britain in the late 70s and early 80s needed supply side reform and despite my sceptical anti-privatisation dissertation in 1984, I have to admit that privatisation delivered more than many people expected. When I helped privatise the Argentinian phone company in 1990 it was clear that radical measures are sometimes needed when the average waiting time for a telephone was 8 years. However, the privatisation wave like many others was a short term solution but didn’t lay the base for long term success – look at the UK power sector today and the struggle to create a framework for investment for the long term.
That was Thatcherism, short term change but no long term plan, because the market would look after the future. At University studying economics in the 1980s, there was more than enough material warning of the consequences of liberalising capital markets without proper controls, of allowing the £ to appreciate and destroying manufacturing and of squeezing investment out of the economy. Journalists like William Keegan, politicans like Tony Benn and economists like Wynne Godley all pointed out the long term risks of building an unbalanced economy and squandering the benefits of North Sea Oil on current expenditure rather than long term investment in productive capacity, education and skills and infrastructure. Anyone in doubt should search “de-industrialisation” and see how many people were so worried about what was happening at the time.
For me the fact that so many people were so concerned about the future turning out in the way that it actually has today means Margaret Thatcher has to take some of the blame, she ignored advice that was correct.In so doing she wasted the opportunity to build a model similar to Norway today, using the proceeds of oil to build a better more stable future.