MARGARET THATCHER

Margaret Thatcher, the U.K.'s first and - to date - only female Prime Minister, died earlier this week. What did I think of her?

I'll be up-front about this, I didn't like her. She was supposedly much influenced in her views by her father, and she tended to run the country much like a grocer's shop in Grantham; there was lots in the way of housekeeping and admonishments, and little in the way of vision. She had a relatively small number of fixed views, prejudices even, and she stuck to them through thick and thin. She (and, even more so, her supporters) made that out to be a virtue. But I was always reminded of Keynes' famous comment "when my information changes, I alter my conclusions. What do you do, sir?". No matter how much new information Mrs. T. received, she never changed those gut conclusions.

She was a successful politician, in that she was Prime Minister for so long. But she is also a reminder that power exercised over a long time (and British Prime Ministers are very powerful, witness how Tony Blair got the country to sleepwalk into the Iraq War) makes people think they are invincible. At the end, she did not lose at the ballot box and resign, but was ditched by her own party, fed up with an increasingly autocratic stance that brooked no dissent. As a civil servant in the Treasury (Finance Ministry) at the time, I saw how policy proposals painstakingly thought through by Ministers and civil servants, and sent up (never round) to Number 10 for final approval, were sent back with a curt "no".

Perhaps the most egregious example was a huge consultative document by the Inland Revenue which tried to sort out the tangled mess governing "residence", the basic principle underpinning taxation. Because of individual tax cases decided long ago, the U.K. had a tax loophole, whereby people who were resident, but non-domiciled, did not pay U.K. tax on their foreign income unless they remitted that income to the U.K. The classic case was Greek shipowners living in London. The Revenue wanted to sort residence out and do something about the loophole, with a proposal for change that included very generous transitional arrangements. Yet those same Greek shipowners, many of them contributors to the Conservative Party, persuaded Mrs Thatcher that they would move to New York if the proposals were introduced. After a year of work, a simple no got the proposals withdrawn. But the problem didn't go away; indeed, it is somewhat ironic that 25 years later, the Revenue is from 6 April 2013 introducing a statutory test for residence in order to bring much needed clarity into what is a fundamental part of the law and administration.  

In the same vein, what seemed like decisive decisions back in the Thatcher era were in reality merely postponements. She may have beaten the miners, but the U.K.'s overdependence on the City for economic growth remains today. She may have banged her handbag on the E.U. table and got "her" money back; but the question of Britain's budget rebate has not gone away, nor has its role within the E.U. The U.K. has still not got over her (negative) obsession with the Germans. As a civil servant, I worked on the famous NHS review that was supposed to settle how the country provided and financed healthcare; Governments are still grappling with that issue today. The final status of the Falkland Islands is still not settled. Her instinctive ("mother knows best") centralising tendencies, exemplified by the poll tax debacle, have not been reversed, with the result that London, which has more people than Denmark and many other E.U. countries, still has limited local Government and absolutely no tax-raising powers. Perhaps worst of all, she was a ground-breaking woman in a male-dominated profession, but did nothing for women in general.

It is also often forgotten how lucky Mrs Thatcher was in having such inept opponents. The grandees of the Tory party failed to take her seriously as a woman, letting her slip through the leadership race as a dark horse, and unseat Ted Heath. Jim Callaghan failed to go to the polls in the autumn of 1978, when he was leading in the opinion polls; the Winter of Discontent and a witty slogan "Labour isn't working" allowed her to win in 1979. Her opponents in her first Cabinets (the "wets") were feeble. With her popularity very low and her Foreign Office team actively negotiating with Argentina to hand over the Falkland Islands, the junta jumped the gun and invaded, giving her the opportunity to win the subsequent war (just) and appeal to national pride. The miners' leader Arthur Scargill led a strike without holding a ballot first, thereby alienating moderates who believed in democracy, splitting his own union, and leading it to eventual defeat. People believed the rhetoric that she was a tax-cutter, failing to distinguish between cuts in income tax rates and tax take as as a percentage of GDP (overall taxes went up during her reign, mainly because of the doubling of VAT to 15% in the 1979 budget, which also caused a recession). Abroad, communism was always doomed to failure, it was just a question of when.

Luckiest of all, she had to fight a Labour Party under Michael Foot and Neil Kinnock that spent most of its time promoting barmy policies of unilateral nuclear disarmament, widespread nationalisation and extreme socialism. One member of the shadow cabinet called Labour's 1983 election manifesto the longest suicide note in history; it was true. With the opposition split between Labour and the Social Democrats, the U.K.'s first past the post electoral system allowed Mrs. Thatcher to win elections with more and more M.P.'s, despite getting fewer and fewer votes. Unfortunately for her, the new intake were ideological neophytes who thought she walked on water. Eventually, the party came to its senses and got rid of her.

Mrs. Thatcher did some good things. She abolished foreign exchange controls, and cut tax rates from the ridiculous levels under Labour to a maximum of 40% (tax revenues went up). In sending Lord Cockfield to Brussels, she provided the impetus behind the Single European Act (though she later pretended that she hadn't understood what she was signing). She started the long tortuous process which eventually led to the Good Friday Agreement in Northern Ireland. But the U.K.'s greatest peace-time Prime Minister? No.

Even privatisation, the policy most associated with her, wasn't something she invented. That honour should rightly go to a Treasury official called Gerry Grimstone, whom most people have never heard of. But history is written by the winners, which is why I doubt he will be given a funeral in St. Paul's Cathedral when he dies.

Walter Blotscher