Margaret Thatcher's impact is encapsulated in the term 'Thatcherism': her principles and policies have not only been attributed to an '-ism', but this ideology also came to define the period of British history from 1979 to 1987. Let's have a look at what Thatcher's principles entailed and why Thatcherism declined.
Thatcherism summary
Thatcherism is a widely disputed concept, but there is consensus that the core principles of Thatcherism are small government and individual responsibility. These are the key elements upon which her social and economic policies were based. Below are some key terms that will be relevant throughout the article.
| Keyword | Definition |
| Thatcherism | The ideology, principles and policies of Margaret Thatcher |
| Thatcherite, noun. | A politician who is a supporter and proponent of Thatcherism |
| Thatcherite, adjective. | Principles and policies which are motivated or characterised by Thatcher's ideology |
| Post-war consensus | The cooperation between British political parties in the post-war period on matters such as how the economy should be run and the welfare state |
| One-nation conservatism | A branch of conservatism that believes the government has a duty to look after the poor and disadvantaged |
| Free market | An economic system whereby the production of goods and services is driven solely by consumer demand - the private sector - rather than being controlled by the government - the public sector. |
| Privatisation | Selling nationalised industries to private buyers |
Margaret Thatcher was the first woman to become Prime Minister of the United Kingdom, a position she occupied from 1979 to 1990. Margaret Thatcher was a self-proclaimed conviction politician whose strong beliefs in hard work and individual responsibility were motivated by her middle-class background as a 'grocer's daughter'.
Conviction politics
A political practice of campaigning for one's genuinely-held political convictions rather than adjusting one's political opinions to adhere to a political consensus
Thatcher won three consecutive general elections as leader of the Conservative party - in 1979, 1983 and 1987. Her win in 1983 was particularly notable with a landslide 144-seat majority for the Conservatives after Thatcher's decisive action in the 1982 Falklands War.
Fig. 1 - Margaret Thatcher.
The Ideology of Thatcherism
Historians and social scientists have grappled with the political character of Thatcherism since its inception. Margaret Thatcher belonged to the Conservative Party, but the political ideology of Thatcherism cannot be boiled down to traditional Conservatism, as Thatcher represented a break from traditional Tory politics.
Thatcherism and Neoliberalism
There is a general consensus that the politics of Thatcherism belong to the New Right, which incorporates aspects of neoliberalism. Let's take a closer look at these two political philosophies.
Neoliberalism
Neoliberalism is generally used to describe the 20th-century resurgence of 19th-century economic ideas surrounding "economic liberalisation", which generally involves:
- Small government
- Free market policies, where industries regulate themselves
- Limited public ownership
Privatisation, limited government spending, and deregulation were all key neoliberal policies that Thatcher pushed during her tenure.
New Right
The New Right is an ideological trend within Conservatism that emerged as a response to the permissiveness of the Swinging Sixties.
Permissiveness is a term used to describe complete, or even excessive, freedom of behaviour. The 1960s are often described as an era of permissiveness, particularly in the United States but also in the UK, with the rise of hippiedom, sexual liberation and a greatly diversified arts and culture scene.
The New Right encompasses the free-market individualism principles of neoliberalism combined with social conservativism. It is generally used to describe the particular strand of politics embraced by Thatcher and then US President Ronald Reagan, forcing a trend away from social liberation and towards social conservatism and market liberation.
Thatcherism and Reaganism
Thatcher and Reagan had a lot in common in their political opinions - both desired a limited government, reduced government spending, reduced taxation and deregulation. They also became allies in their foreign policy, contributing to the end of the Cold War.
Rejection of the post-war consensus and one-nation conservatism
To Thatcher, both the post-war consensus and the Conservative Party's political trend of one-nation conservatism were evidence of the state's excessive power and control over individual lives. Thatcher firmly believed that the adherence to these ideologies and the economic policies they informed kept the country's economy in the gutter.
Thatcher's rejection of the post-war consensus meant that she abandoned her predecessors' commitment to full employment, as she believed this was not the government's responsibility but rather the responsibility of individuals to look for work.
Thatcherism: society, individuals and the state
From her rejection of the post-war consensus and one-nation conservatism, we can get an idea of Thatcher's social attitudes and beliefs. Thatcherism promotes self-sufficiency and individualism over social cooperation and collectivism.
We can see how the post-war consensus governments' took a collectivist approach in their efforts to keep full employment and their introduction and continuance of the welfare state and nationalisation.
When Thatcher took office, she was ready to cut back on these collectivist government efforts, believing they were too costly to upkeep and had made the public too reliant on the government:
I think we have gone through a period when too many children and people have been given to understand 'I have a problem, it is the government's job to cope with it!'... and so they are casting their problems on society and who is society? There is no such thing!
There are individual men and women and there are families... It is our duty to look after ourselves and then also to help look after our neighbour and life is a reciprocal business and people have got the entitlements too much in mind without the obligations.
- Margaret Thatcher, interview in Woman's Own, 1987.
This quote from Thatcher is a useful summary of the ideology of Thatcherism. Pay close attention to the language Thatcher uses in this piece of rhetoric, as she uses the language of business transactions. What does this quote tell you about Thatcher's views on the post-war consensus, and how does it represent a break away from the consensus?
Social morality and individualism
The Thatcherite social approach can be seen as both conservative in its promotion of traditional morality and neoliberal in its promotion of individualism. Thatcherism prizes individual freedoms, which means that the government should not interfere in individuals' lives. Therefore, Thatcher's social conservativism was secondary to a belief in individual freedoms.
In practice, what this means is that although Thatcher believed in traditional gender roles and the nuclear family, these views came second to the promotion of individual freedoms. During her time in Parliament in the 1960s, Thatcher voted in favour of the decriminalisation of homosexuality and supported the 1967 Abortion Bill.
Reduction of the state
If individuals should take responsibility for their own lives, then the state should get out of the way and encourage them to do so. As the role of the state diminishes, the role of the free market increases.
Thatcher wanted to reduce the influence of government in people's lives and believed that this would encourage them to find gainful employment while reducing government spending, thereby stimulating the economy.
Thatcherism can also be defined as a style of government - as a reaction against excessive welfare spending and excessive trade union power. Essentially, Thatcherism seeks to reduce the role of the state in personal lives, while simultaneously making sure that the authority of the state isn't undermined by trade union power.
Thatcherism: Economics
Thatcher's economics are a key part of the Thatcherite legacy and are notable for their uncompromising ideology.
Monetarism
When Thatcher came to power, UK inflation was sky-high. Previous administrations had pursued Keynesianism, whereby a government attempts to stimulate the economy by increasing demand through credit finance and public spending. Thatcher rejected this approach, believing there was too much money in the economy which slowed economic growth and caused rising inflation.
She thought the solution was to reduce government spending and so she pursued monetarist policies, which are now considered a key feature of early Thatcherism.
Monetarism is an economic theory that says inflation is caused by government spending. The solution to inflation is, therefore, for governments to control the money supply and reduce public expenditure.
Thatcher reduced state handouts and subsidies, emphasising individuals, not groups.
Thatcherism was influenced by Milton Friedman and F.A. Hayek's economic theories. Thatcher famously banged a copy of Hayek's The Constitution of Liberty on a table, shouting "this is what we believe!"
These monetarist policies reduced inflation and led to a strengthened currency, but reduced industrial output, which led to an economic slump in 1981. This led to a huge increase in unemployment, for which Thatcher was heavily criticised.
In the mid-1980s, Thatcher shifted from a monetarist economic approach to a 'supply-side economics' approach. Supply-side economics demands lower taxes, decreased regulation and government interference with trade practices, and allowing a free market. To allow this to happen, Thatcher embarked on mass privatisation, another crucial element of Thatcherite politics.
Privatisation
During Thatcher's second term, beginning in 1983, unemployment exceeded 3 million and was Thatcher's main economic challenge.
She embarked on a huge string of privatisation and deregulation of national companies, such as British Rail and British Airways in an attempt to encourage companies to grow without being bogged down in government red tape. The idea was that this would then lead to more employment and a strengthening economy.
Her most controversial policy was the eventual closure of almost a hundred mining pits across England, Scotland and Wales which caused the Miner's Strike.
The rise and fall of Thatcherism
The table below presents the main events of rise and fall of Thatcherism.
| Year | Key Event |
| 1979 | Labour lost a vote of no-confidence in Parliament and Thatcher won the ensuing election with the country keen on her hardline rhetoric after years of uncertainty. |
| 1980-81 | Thatcher's popularity dipped due to rising unemployment caused by her strict monetarist policies. |
| 1982 | Thatcher's swift response to the Falklands invasion and a turning economic tide boosted her popularity. |
| 1983 | Thatcher's popularity and a bitterly divided opposition saw her win a landslide 144-seat majority election victory. |
| The fall |
| 1987 | By this time, people were starting to get tired of being told to do as they wanted but to keep within certain boundaries and Thatcher increasingly came into conflict with her own party. Despite this, Thatcher comfortably won the 1987 election. |
| 1989 | The Community Charge, more commonly called the Poll Tax, was introduced - it was very unpopular, as everybody paid the same regardless of their income or the value of their house. |
| 1990 | The Poll Tax controversy was the last straw for many in the Conservative Party and prominent MP Michael Hestletine forced a leadership contest. Thatcher resigned, feeling that she had lost the support of her party and John Major became the new leader. |
Legacy of Thatcherism
Thatcherism has influenced the policies of all major parties since her tenure ended in 1990. Peter Mandelson, a prominent Labour politician, famously said in 2002 "we're all Thatcherites now".
Labour Prime Ministers Tony Blair and Gordon Brown are sometimes described as "neo-Thatcherite" by those on the far left, as they had taken the Labour Party much closer to the political centre, and many of their policies were influenced by Thatcherism.
Subsequent Conservative Prime Ministers have moved away from Thatcherite social policy, focusing on one-nation conservativism - an approach which Thatcher pointedly rejected.
The economic austerity policies implemented by Conservatives David Cameron and George Osbourne after the financial crashes in 2008 and 2010 were markedly - possibly extremely - Thatcherite.
Austerity
Economic measures to tackle budget deficits, such as raising taxes and reducing public spending
Thatcherism - Key takeaways
- Thatcherism is a term used to describe the political theories and ideology of Margaret Thatcher, who was the British Prime Minister from 1979 to 1990.
- Thatcherism encompasses neo-liberalism and social conservatism, rejecting big-spending and embracing the New Right.
- Thatcherism proposes a small state with limited government involvement in regulation and support. It encourages a free market and theorises that a free market and deregulation will stimulate employment opportunities and benefit the economy.
- Thatcher embraced monetarist economic policies, before shifting to a supply-side approach.
- Thatcherism enjoyed huge popularity during the 1980s, but towards the end, it was dividing even those in Thatcher's own inner circle.
- Subsequent political leaders have all embraced elements of Thatcherism, particularly the economic policies of Labour's administration between 1997 and 2010. Subsequent Conservative administrations have pursued Thatcherite austerity policies but returned to one-nation conservatism.
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