Saturday, December 31, 2011

Thatcherism Under Review

Once again, I am fascinated by what I call recent history. I hope to go see the new movie on Margaret Thatcher -- The Iron Lady. I was reminded of it this morning, listening to Marketplace.

”Well in case you thought Hollywood was going to wrap up the year without releasing a biopic about a powerful British leader, check your local movie theater listings for today's opener: "The Iron Lady." It's about former British Prime Minister Margaret Thatcher, played by Meryl Streep. The movie has gotten mixed reviews.

And so has the Iron Lady herself -- more than 20 years after leaving office. In the U.K., they're still arguing about the economic changes Margaret Thatcher brought.”

I’m somewhat taken aback by the debate that still rages about Thatcherism and Reaganism. Hopefully, we in the States can be a little more dispassionate about Thatcherism.

”Thatcherism claims to promote low inflation, the small state and free markets through tight control of the money supply, privatisation and constraints on the labour movement.“

Which one of those has helped out the world? Especially in light of our current economic situation? Labor is at its lowest level of power in a century. How has this helped you? Or anyone else? The big one, of course, is the “small state and free markets”. It’s just another way of saying “deregulation”.

In short, the union movement in the United Kingdom overreached and the voters put Margaret Thatcher in charge. She crushed the unions and without that restriction on their power, the corporations took off. They bought government entities -- taking public conveniences and making them profit centers. Come to think of it, a “public convenience” is not a bad way of thinking about a bank. And before your advertising-soaked brain screams “Capitalism!” you might want to ask yourself why a “private” entity has a government guarantee.

I think , if you look, you’ll find what I have found -- it didn’t work. I believe the financial system she left -- privatized and deregulated -- is a pretty glaring example. But you can look elsewhere and see the same thing.

Effects of privatisation

”Privatisation was supposed to bring improved customer service...”

”In practice, the average age of trains in the UK is no different to that under the last years of BR. (British Rail )”

”One of the principal expectations from privatisation was that the railway service could be delivered more efficiently in the private sector because of the profit motive. The expectation that there were considerable costs that could be slashed from the system was not fulfilled; new operators found that BR had already done much of what could be done to improve efficiency.”

”One of the benefits promoted for privatisation is that it would remove railways from short-term political control which damaged an industry like the railways, which had long-term investment requirements. This has not happened...”

I’m looking forward to seeing the movie. Maybe, in a few years, we’ll see one like it about Reagan. Let’s go back to that Marketplace story for the closing line.

”But that apparently did not endear her to most people here. A local paper asked its readers what they would like to see displayed at a prominent site in the town (Thatcher’s hometown): a bronze statue of Margaret Thatcher or an antique steamroller. Eighty-five percent voted for the steamroller.”

Don Brown
December 31, 2011

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