British's Difficult 70s: Margaret Thatcher and Neoliberalism

The 1970 era in British politics will always be remembered as one of its darkest times after world war II. This era was very hard for the people living in Britain and even for the politicians, there were many negative aspects in Britain in the 1970s but the main aspects because of which Britain was proving hard to be governed were dump in the economy and the rise of inflation, the war between the industries and the government, rise in public and domestic violence in whole of Britain, lack of education.

The conflict between the industries and the government can be deemed as the most vital problem Britain faced in the seventies, signs of future conflicts were very evident in the ’60s but the government at that time were negligent at looking at the conflicts due to which the conflicts got bigger and bigger until they become the most important problem. The Donovan report of 1968 gave a clear indication what to expect in the future because they researched that the leadership structures of unions were rapidly changing and the unions were passing on powers to anyone and the report showed that how these people would, later on, use the powers against the government. National collective bargaining was becoming increasingly localised which gave them more power, but all of this was still looking like it was under control until the 1971 industrial Act which proved to be the last straw for the unions mentioned above. The act was a very dangerous move at a very dangerous time because at that time UK was already facing too many problems, the act attempted to apply legal sanctions to industrial relations which were at that time under the voluntary collective bargaining since the 1906 trade dispute act. The unions started to observe strikes across the country and they were ready for the worst because they had great support and they were working with some unions that were finding strong people amongst the government to join them. The industrial relation act of 1971 led to the largest protest the country had ever seen at that time, but this was just the beginning because after this protest the coal miners started their own protests which was held in 1972 and 1974.

The 1974 strike had a lot of impacts because that strike led to a national state of emergency which led to the government introducing the three day week, the three day week aimed to reduce electricity consumption by limiting electricity to households for only 3 days which shows how the government was starting to become unpopular not only for the protesters but also for the people living in the UK at that time. An immediate general election was called because of how the government was looking and it was looking like the unions were running the country instead of the government. After the elections, Heath’s government had to resign because they lost the elections and it was clearly looking like the unions had more power than the government in the UK. The Labour government were elected next but the troubles between the government and the unions still continued. A contract was signed between the government and the unions which was called a social contract in which conditions were laid down that the unions would stop protesting until their demands were met through legislation. A new minister for industrial relations was appointed, Michael foot who was willing to work with the unions and was willing to give them everything and he restored the 1906 voluntary collective bargaining, but now as many protesters had seen what they could do many unofficial strikes began to happen which were not in control of the unions and there main aim was a higher wage due to which inflation in the country rises up to more than 30 percent, more and more local strikes were happening which not only affected the government it affected the people directly for example school teachers were now on strikes due to which parents couldn't send there children to school which resulted in a loss of education and loss of education is also one of the main aspects of why Britain was looking like ungovernable in the 1970s, Furthermore health workers and nurses were on strike which led to the hospitals being shut down. On January 22nd 1979 1.5 million workers decided not to turn up for work. In all in the 1970s 4,583,000 workers were involved in strikes which led to a massive loss of production and generated in the worsening of the country’s economy. Those strikes continued until the labour government fell from power.

Although the protests were the main reasons for an unstable 1970 Britain there were many other reasons such as the divide in the politics of the UK in the 1970s, before the seventies although the conservative and labour parties were against each other they would normally cooperate with legislation that were beneficial for the country such as no involvement in any wars and the European Union although it was an issue in which both parties had different ideas but the conservatives got UK into the common market and labour confirmed this and made this legal and passed a legislation in1975 during the middle of the seventies decade things began to change in the politics, the labour and the conservative parties took extreme moves which made them go against each other and they became extremely against each other and during this time the fight between the conservatives and the labours led to the liberals showing some signs of revival after being out since the David Lloyd George era. Members of the party were going against their leaders trying to overtake them this shows how much the politics were divided in the seventies and this only made the public living in it more miserable. This was the time when Margaret Thatcher came into real prominence in the world of politics. When Heath fell as party leader after they lost the election which heath himself had called Margaret thatcher to take over the conservatives and Margaret thatcher changed there party’s philosophy from one-nation traditions to the Neo-liberal free market. Trade union leftists who had started the industrial revolt in the country now turned themselves political and made themselves known that they were willing to step aside from their views and were becoming more radical.

Linked closely with the industrial revolt was the decline of the economy of UK in the 1970s. The early years of the 1970s were a period of economic growth in the UK this was due to the bank of England Deregulating the mortgage market which meant that high street banks were offering mortgages to people before this it was regulated that only local building societies could lend mortgages to people, because of this regulation the prices of houses sky-rocketed because now most of the people could apply for mortgages and be successful and this also increased consumer wealth as they could save more by getting mortgages. 1972 budget introduced tax cuts and use of credit also increased as people were now getting credit cards more often which resulted in an increase in there savings which lead to a growth in personal wealth for a lot of individuals this increase in the economy only lasted till 1973 because by 1973, inflation in the UK had risen to 20 percent and this was because of wages rising of people because of the protests, the 1972 budget by chancellor Anthony barber which cut a lot of taxes, increased growth in credit and consumers spending, people were now using credit cards very frequently and many of them were not able to pay back which increased inflation a lot they were literally spending it without realising they had to pay back which led to an increase in inflation. Mortgages given were also the main problem because citizens were finding it difficult to pay back their mortgages. During the late half of sixties and early part of the seventies Oil had become a very important part in the UK’s economy as it was cheap and was used a lot often which resulted in people buying more cars which was because of mortgages and tax cut consumer wealth had increased, because of a rise in motor cars and cheap oil Britain completely adopted the motor cars and because of this in 1973 inflation rose and prices of petrol increased more then 65% this was also one of the reasons government had to impose the three day week to reduce consumption of oil and petrol. High inflation in the country also resulted in a current account deficit this was because of inflation UK goods were less competitive because at that time consumer spending had increased and UK products were less attractive to them rather then imported goods, exports decreased and imports increased which automatically resulted in a current account deficit. The current account deficit plus increased inflation and concerns over the value of the pound, sterling led to the UK in 1976 apply to the International Monetary Fund (IMF) for a bailout package which was worth near 2 billion pounds, IMF granted the bailout package to the UK but demanded that there must deep spending cuts to tackle the deficit, but this did not result in lower inflation, heath government wanted to impose the same wage caps but the trade union were in no mood for that this is why the strikes went out in the first place and because of the wage caps the three day week was introduced to lower the spending. This industrial stagnation was accompanied and indeed compounded, by a weak currency and a high rate of domestic inflation. Before the arrival of North Sea oil, the pound steadily, and often dramatically, lost value against other major currencies, including the weakening dollar. The Sterling lost 29 per cent of its value against the dollar between December 1971 and June 1975.

The people living in the UK were becoming to dependent on the government to provide them with the basic need of life as can be illustrated by the sugar shortage in the UK which led to people looking at the government to supply them with sugar they had become to dependent on the government it got to the point that if the government were not willing to provide sugar the citizens would be without it, Although the government is not at all responsible for providing sugar to its people they can and did supply it but they were not responsible for it because growing and supplying of sugar to the people is in private hands not in public. Furthermore, other than becoming dependent which made governing the UK in the 1970’s difficult there was also an issue that children and students were not getting any higher education and not a lot of students in the country had enrolled themselves for higher education, this can be blamed on the strikes at that time because teachers were out on the strike with the union leaving students to miss there classes or completely leave the schools because there was no one available to teach them, but most of the problem was that the government were finding it extremely hard to finance higher education for any individual who wanted to gain it. So with less education, people facing unemployment and unemployment leads to a lot of negative things in a country.

The period of violence in the UK in 1970’s also made the country look ungovernable, the United Kingdom once known and seen as a peaceful and stable country seemed to be emerging in violent crimes throughout the country. The events in Northern Ireland lit the fire on violent crimes. The crimes in the UK were at an all-time high due to which Reginal Maulding a minister imposed a few law to reduce the crime for example he introduced imprisonment without trial for those who would be in anyways associated with a violent crime and he also tried suspects of terrorism in a jury less court so they could get no sympathy from the jury. The events in Northern Ireland and Britain were very horrifying. Tensions were rising bombing and assassinations were looking normal in the country, sort of civil war broke out in the country between the British army and the residents. Violent events now multiplied in Britain itself, with the brutal murders of civilians in Birmingham, Guildford and other places. Britain was getting more violent day by day citizens living in were terrified, minorities such as Muslims were getting killed every day and law enforcement agencies couldn't do anything about it because they were already fighting with these criminals and these criminals at that time were gaining more and power and were using the government instabilities to there benefits. Strikes across the country plus government fighting with each other made these criminals to kill, and loot more openly than Britain had ever seen in a long time. Tourists were afraid to visit London as it was deemed unsafe. Britain also faced a bring problem in terms of resources because the country lacked resources to build up the economy and the future of the country and also for the betterment of its people. Education was needed quite badly but Britain did not have the full resources such as financing students who could not afford higher education. Britain at that time was completely dependent on foreign imports to fulfil the lack of resources they couldn't provide which in turn resulted in imports more than exports. There were water shortages in the country and because of the miner's strike electricity was also scarce thats why the 3 day week was introduced, there were less houses for people living because of the lack of resources in the country to build a lot of houses due to which many citizens who could not afford were living on the streets or were involved in crimes such as burglaries and killing.

The government were interfering in everything during the seventies the difference between the private and public sector had disappeared because the government was trying to take over everything it was good in one way but it lead to people depending on the government too much as mentioned above. Conservative government rescued builders and nationalised luxury car service dealers rolls Royce who was at the time going bankrupt although they should not have done it because if they really wanted to help the citizens they should've worked with sectors who were producing basic necessities of life, not a luxury car dealer service which was not even required at that time. On other hand, the Labour government had funded the collapse a private-owned airline. In 1975 it was deemed that public was public and private was also public to, but when it came to the shortages of the Irish potatoes the government could not provide the people with them because they were too busy funding other companies they forgot about the basic necessities of life.

After this period in the British politics in 1979, the conservatives won the general election and Margaret thatcher was crowned as the first female prime minister of the united kingdom and she formed a government on May 4 1979, after taking up the office she introduced new reforms which at that time looked to be a disaster but are now considered as the most important reforms introduced in British political history. Thatcher abolished the exchange control and decreased income tax on unearned money but she increased the value-added taxes on the income and this created unemployment in the country, because of this inflation reduced in the country but still Britain went into a deep economic recession and it was deemed as the deepest recession Britain had suffered in a long time. Margaret Thatcher also wanted to reduce the power of unions after everyone saw what they did when they had the power, she used a strategy of accumulative changes and many trade unions protested against this but this time the UK government was ready because thatcher and her government had been restocking coal and other natural resources so that the citizens of the country wouldn't have to go through another phase like the three day week in the seventies the strike continued for a year and after a year the mineworkers decided to get back to work as they saw that this time the government had implemented better rules and this they couldn't win the protests so due to which the unions also backed out of the strike without even getting a deal from the government.

In conclusion, Britain in the seventies was very ungovernable this was because of not having a strong and stable government on which people could rely also it looks like the labour movement were scared of implementing new reforms as this can be evidenced by the fact that they had to sign a pact and give a deal to the unions so that they could stop protesting. Furthermore other then the government's incapabilities the citizens living in the country were also equal to blame too because first of all they were becoming to dependent on the government it was looking like they were just begging the government to provide them like during the sugar shortages, other than being dependent they weren't enrolling to get higher education or primary education this can also be faulted on the government as they were not able to finance all of the institutions in the country. Violence also made the country look very unstable, the country was known as a tourist destination but due to open bombings, assassinations and burglaries in the country worldwide made the tourists scared and unwilling to enjoy their holidays in the UK. So it can be concluded that Britain was very unstable and ungovernable in the seventies and it can be blamed on the government the workers, trade unions and the citizens of the country.