Thatcher:Rolling back the state
Thatcher and state intervention
Economic liberty through free economy and market
To end Keynesianism
End corporatism
cut government spending on welfare
cut direct taxes
Threatened by:
soviet union
powerful union and vested interests, un democratic unions
terrorists, hooligans, and muggers- violence
🗳 State intervention: Economy and influence on politics or society
Corporatism
Economic management style where gov negotiated with common policy on pay
Thatcher and her ministers, including Tebbit, politicised the term
Abandoned corporatism from 1979
Gov to abandon prices and incomes policies
Stopped negotiating with major unions
The department for trade and industry reorganised to break links with the condederation
of british industry
Meant gov gave up important tool of state intervention
Keynesianism
Thatcher:Rolling back the state 1
, Cutting taxes and increase spending
Thatcher rejected, believe it led to high inflation and disruption of free market
Howe budgets cut spending
Lawson cut taxes
Didn’t mean end of economic management, just different monetary policy
Union policy
Gov tried to control unions- significant extension of state power
The employment act 1980 criminalised secondary action
The employment act 1982- union leaders could only imposed close shop if backing of
majority in secret ballot
The trade union act 1984- unions to call secret ballot and win a majority before starting
strike action
By extending state power, British unions weakened.
Defence
1979- US cruise missiles stationed on British territory
1980- Trident bought- nuclear weapons for us
For first 15 years trident cost £7.5bn/ year
1981, the defence review, entitled, The way forward, committed 3% spending increase
every year
1982 approval of Falkland Islands Argentina operation to retake
1986 permission for us bombers stationed in britain to bomb raid Libya
Defence spending rose by 20% 1979-86
Consequences of the spending on trident
1984-86- 18,000 troops made redundant
Thatcher:Rolling back the state 2