The Prime Minister cut a gloomy figure in his New Year's message recently. "The economy," he announced in his distinctive voice, "is likely to prove the greatest challenge for the Coalition." It's hard to disagree with him. Given how the last Conservative Prime Minister fared when the economy sank into recession, William Hague must be quaking in his boots.
Today, only serious history or politics buffs can remember the name Margaret Thatcher; aside from pub quiz questions on Britain's only female PM, she has left next to no obvious impact on the British political landscape. But in the early 1980s, it did not seem that way. Thatcher had come to power in 1979 and immediately embarked on an economic experiment called monetarism, which aimed to bring the money supply under control in order to tame inflation. Instead, inflation sky-rocketed as productivity nosedived, while her Chancellor, Sir Geoffrey Howe, insisted on using his Budgets to turn the screw even tighter. Meanwhile, the Labour party was busy being torn apart by fighting between the moderates and the hard left. It is small wonder that the new Social Democratic Party, formed by breakaway Labour moderates, proved so popular; it made a nice change to have someone nice to vote for.
For Thatcher, it was clear that she was walking a tightrope, but in 1981 her luck ran out. With the largest ever seen industrial collapse, rampant inflation and riots in the inner cities, many in her Cabinet felt the country was close to social collapse. When Howe presented a mini-Budget detailing more cuts in public expenditure, the so called 'wets' found their voice. Sir Ian Gilmour delivered the lethal blow when he quoted Churchill: "However beautiful the strategy, you should occasionally look at the results." The Cabinet refused to back Howe, and Thatcher was forced to resign. The Defence Secretary, Sir Francis Pym, was propelled into Number 10, and he instantly announced an about face in economic policy, sacking Howe and placing Michael Heseltine at the Treasury. Pumping vast amounts of money into the economy helped to ease the pain of the international recession, but the damage was largely done. The depths which Thatcherism had reduced the country to were plain to see in 1982, when Pym was forced to negotiate a peace deal with the Argentinian leadership after their invasion of the Falkland Islands; savage cuts to the armed forces meant Britain was forced to watch the Islands be transferred to the UN Trusteeship Council. Meanwhile, the SDP-Liberal Alliance went from strength to strength, overshadowing both Labour and the Tories, picking up MPs from both parties.
The 1984 general election turned out to be one of the most dramatic election results of post-war British politics. The Conservatives lost their majority but remained the largest party, while the Alliance overtook Labour in votes, but not quite in seats. However, with the support of the Ulster Unionist Party and the abstention of Gerry Adams, the Conservatives, now under Heseltine, were able to continue in government, although his paper-thin majority and internal splits between the Heathites and the Thatcherites prevented him from getting many of his policies through. Somehow Heseltine managed to last four years, but the 'do nothing' label appended to his government did untold damage to his prospects. The Alliance, meanwhile, had merged into 'The Social, Liberal and Democratic Alliance', or Alliance for short, with David Steel as overall leader, attracting even more defectors from Labour and the Conservatives. In the 1988 election, the Alliance was propelled into office with a majority of 38. The Tories sank into second place, while Labour, riven between the remaining moderates and the increasingly powerful hard left, slumped into third place.
The Alliance immediatley used the goodwill behind it to repair much of the damages of nine years of Conservative rule. Targeted use of the public finances by the new Chancellor of the Exchequer, David Owen, helped to ease unemployment in the areas where heavy industry had all but collapsed, instead encouraging the reorientation of the economy towards emerging markets in technology, green products and light industry. The presence of an industrial policy helped the economy to survive the deep international recession of the early 1990s. The tax system was also transformed beyond all recognition; the introduction of a localised income tax headed off the now forgotten idea of charging people per head for local government, and the resultant abolition of national income tax in 1991 did wonders for the government's popularity going into an election year.
A range of political reforms were driven through, with the introduction of proportional representation in local government, the House of Lords and in the new devolved assemblies in Scotland, Wales and London. The temptations of power meant that PR in the Commons remained elusive, although the fixed term four year parliaments combined with the AV/PR hybrid devised by Shirley Williams (Affectionately known as Shirley's AV) proved to be enough for all but die-hard constitutionalists. Plans for a Northern Irish Assembly reached fruition in 1998 with the historic Good Friday Agreement, however the plans for elected English regional assemblies never really got off the ground.
But it was the change in social policy which really distinguished this government from its predecessors. Money was poured into benefits, education and health at times when the Conservative party had either frozen or cut these budgets. The halting of plans to introduce markets into the education system and NHS helped to prevent disparities opening up in these services, and ended fears of the emergence of a managerial class in these sectors. The progressive use of benefits put extra money in the pockets of millions of Britons, helping to boost the economy and the government's popularity in equal measures. Although often derided as gimmicks by the majority of the population, efforts to improve the position of women, ethnic minorities and other excluded social groups went down well with these groups and did have a small impact in the wider world.
The 1988 election marked the start of the long years of Alliance party dominance of British politics. David Steel proved a hit with the electorate, who happily returned him in 1992 by a landslide, in spite of the new electoral system. The Conservative party under Thatcher's lieutenant took a severe battering but remained in second place, while Labour, who had been led by Tony Benn since the takeover over the party machinery by the hard left in 1988, saw a collapse in their support, reducing them to a mere 37 seats. It was clear the Age of the Alliance was upon us. Steel repeated his landslide in 1996, before standing down in 1997 in favour of Tony Blair, who led the Alliance to two further landslides in 2000 and 2004. Neither Labour nor the Conservatives could land a blow on the Steel and Blair governments, who continued their efforts to change Britain for the better.
But when Blair stood down in 2007, handing over to financial genius and former Chancellor Chris Huhne, things began to change. Luckily, Huhne held the 2008 election before the near collapse of the global banking sector, but it still resulted in a much reduced Alliance majority. This financial and economic crash came to define his premiership, especially as he'd been the Chancellor during the period of 'light-touch' financial regulation of the banks which now came back to haunt him. The government's response was to open the taps on public spending. While this did help to take the edge off of the recession, it confirmed in the minds of voters a deep unease with ever increasing public spending, which to many people appeared to be out of control. The MP's expenses scandal in 2009 epitomised the excess which people so hated.
The Conservatives, led now by William Hague, began to recover their position in the polls, offering to slash public spending, which by 2010 had reached alarming levels. Meanwhile Labour under Yvette Cooper finally began to undercut the Alliance from the left, saying it would better target public spending towards those at the bottom of the scale, the underclass which many believed the Alliance's policies had helped to create. However, with an election not due until 2012, it looked as if things would remain unchanged for a while.
What did change matters was the revelation in 2010 that Chris Huhne, whilst Welfare Secretary in 2003, had persuaded his ex-wife to take speeding points on her driving licence for an offence he had committed. Although many voters were bemused (Isn't that what *everyone* did?!) it was the final straw for those MPs who disliked the Prime Ministers abrasive style. Enough Alliance MPs abstained in a vote of confidence in April 2010 for the government to be defeated. Although the hastily installed Alliance leader Nick Clegg was able to hang onto second place in the ensuing election, and prevent a Conservative overall majority, he botched the ensuing negotiations with Yvette Cooper's much strengthened Labour. It looked to many like 2010 would be a year of two elections.
But they were wrong. To the shock of almost the entire British political establishment, Hague announced that, rather than run a minority government, he would instead establish a coalition with Cooper, who managed to guarantee many key (high spending) Cabinet posts for Labour ministers. If they could do it in Ireland, then why not here? When Cooper was attacked at her party conference for doing so, she responded with a blunt message: This was the first Conservative government in twenty-two years; will the public not reward us for clipping its wings? It remains to be seen if this high risk strategy can pay off.
P.S. Prime Ministers, 1979-2012
1979-1981- Margaret Thatcher (Con)
1981-1984- Sir Francis Pym (Con)
1984-1988- Michael Heseltine (Con)
1988-1997- David Steel (Alliance)
1997-2007- Tony Blair (Alliance)
2007-2010- Chris Huhne (Alliance)
2010-2012- William Hague (Con/Lab Coalition)
P.P.S. Conservative Leaders, 1975-2012
1975-1981- Margaret Thatcher
1981-1984- Sir Francis Pym
1984-1988- Michael Heseltine
1988-1993- Norman Tebbit
1993-1998- Malcolm Rifkind
1998-2001- Michael Portillo
2001-2003- Iain Duncan Smith
2003-2005- Michael Howard
2005-2012- William Hague
P.P.P.S. Alliance Leaders, 1976-2012
1976-1985- David Steel (Liberal)/ 1981-1985- Roy Jenkins (SDP)
1985-1997- David Steel
1997-2007- Tony Blair
2007-2010- Chris Huhne
2010-2011- Nick Clegg
P.P.P.P.S. Labour Leaders, 1980-2012
1980-1984- Michael Foot
1984-1988- Neil Kinnock
1988-1994- Tony Benn
1994-2005- Robin Cook
2005-2012- Yvette Cooper
Steel Cabinet, 1988
Prime Minister- David Steel
Lord President of the Council and Deputy Prime Minister- Sir Roy Jenkins
Chancellor of the Exchequer- David Owen
Foreign Secretary- Richard Wainwright
Home Secretary- Bill Rodgers
Defence Secretary- Paddy Ashdown
Health and Social Security Secretary- Alan Beith
Education, Training and Science Secretary- Dick Taverne
Trade and Industry Secretary- John Horam
Employment Secretary- David Penhaligon
Energy Secretary- Jim Wallace
Environment Secretary- Robert Maclennan
Transport Secretary- Sir George Young
Arts and Culture Secretary- Clement Freud
Chief Secretary to the Treasury- Charles Kennedy
Scottish Secretary- Russell Johnston
Welsh Secretary- Sir Anthony Meyer
Northern Irish Secretary- Christopher Brocklebank-Fowler
Agriculture, Fisheries and Food Minister- Tony Blair
International Development Minister- Rosie Barnes
Leader of the House of Commons- Sir Cyril Smith
Leader of the House of Lords- Lady Seear
Chancellor of the Duchy of Lancaster, Minister for Political Reform and First Secretary of State- Shirley Williams
Hague Cabinet, 2010
Prime Minister- William Hague (Con)
Chancellor of the Exchequer- Philip Hammond (Con)
Foreign Secretary- Andrew Mitchell (Con)
Home Secretary and Deputy Prime Minister- Yvette Cooper (Lab)
Defence Secretary- Liam Fox (Con)
Justice Secretary- David Davis (Con)
Welfare Secretary- Liam Byrne (Lab)
Children, Schools and Families Secretary- Michael Gove (Con)
Business Secretary- George Osborne (Con)
Environment Secretary- David Cameron (Con)
Higher Education Secretary- Andy Burnham (Lab)
Transport Secretary- Justine Greening (Con)
Employment Secretary- Alan Johnson (Lab)
Culture, Media and the Arts Secretary- Jeremy Hunt (Con)
Communities Secretary- Jon Cruddas (Lab)
Equalities Secretary- Harriet Harman (Lab)
International Development Secretary- Andrew Lansley (Con)
Chief Secretary to the Treasury- Ed Balls (Lab)
Scottish Secretary- Jim Murphy (Lab)
Welsh Secretary- Carwyn Jones (Lab)
Northern Irish Secretary- Owen Paterson (Con)
Leader of the House of Commons- Sir Malcolm Rifkind (Con)
Leader of the House of Lords- Lord Clarke (Con)
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