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Literature Review 2 How Important Were Think-Tanks in Shaping The Literature Review 2 How important were think-tanks in shaping the changing attitudes of the Conservative Party towards privatisation in the period 1964 to 1990? Between 1945 and 1951 the Labour Party implemented a far-reaching programme of nationalisation of Britain’s major industries including civil aviation, gas, iron and steel. 1 It was not until Margaret Thatcher’s tenure as leader of the Conservative Party from 1975 to 1990 that the idea of privatisation began to make real headway in terms of party policy. Privatisation was part of a broad package of liberal economic reforms that sought to reverse Britain’s economic decline. The literature surrounding privatisation offers a plethora of reasons on why the Conservative Party finally decided that it was a politically and economically viable project. The role of think-tanks, namely the Institute of Economic Affairs (IEA), the Centre for Policy Studies (CPS) and the Adam Smith Institute (ASI) is assumed and referenced but not thoroughly investigated. 2 Therefore, this literature review will look at the narratives of Thatcherism as a whole before considering what is written about privatisation as part of the Thatcherite project. Finally, the literature on British ‘New Right’ think-tanks will be explored to elucidate the research gap: the lack of examination into just how crucial think-tanks were in causing the Conservative Party to pursue privatisation. E. H. H. Green argues that the majority of the literature on Thatcherism since the 1980s has been dominated by either ‘higher journalism’ or political science scholarship. 3 This is illustrated in the works of Gilmour, Gamble and Kavanagh. Ian Gilmour was a member of Margaret Thatcher’s cabinet from 1979 to 1981 and belongs to the One-Nation Tory tradition. 4 This regards Thatcherism as a threat both to the Conservative Party and 1 M. Lynch, Britain 1945-2007 (London, 2007), p. 16. 2 A. Denham and M. Garnett, British think-tanks and the climate of opinion (London, 1998), p. 3. 3 E. H. H. Green, ‘Thatcherism: An Historical Perspective’, Transactions of the Royal Historical Society, Sixth Series, vol. 9 (1999), pp. 17-42, p. 17. 4 I. Gilmour, Dancing With Dogma: Britain Under Thatcherism (London, 1992), p. 3. 1 to Britain. 5 One-Nation Conservatism became prevalent during the post-war consensus that emerged in Britain, with the Conservatives adopting a paternalistic stance with regards to the role of the state in terms of welfare. 6 Gilmour assesses the effects of Thatcherism and portrays it as dogmatic with little regard for national unity. He argues Thatcherism was ‘unrelentingly divisive and discriminatory against the poor, whose human dignity was relentlessly ignored’. 7 He cites how indirect taxes between 1979 and 1989 were raised by £22 billion to account for cuts in direct taxation, in particular the top rate of income tax from 83 to 40 per cent. 8 He saw this as a switch that placed the heaviest burden on the poor, something One-Nation leaders such as Macmillan would not have tolerated. 9 Even with privatisation, a policy that Gilmour largely supports, he argues that dogma took it beyond acceptable ends. The ‘hands-up’ approach to the economy and belief that ‘markets are always right’ meant that utilities such as water, which the public generally believed should remain in public hands, were privatised. 10 In Gilmour’s eyes Thatcherism created ‘haves’ and ‘have-nots’. 11 Andrew Gamble in The Free Economy and the Strong State seeks structural explanations for Thatcherism, drawing on the socialist tradition which included theorists such as Stuart Hall. 12 This tradition emphasises economic factors and class. 13 Gamble considers Thatcherism from a political science standpoint, looking at the causes of Thatcherism winning the battle of ideas. He calls Thatcherism a ‘hegemonic project’, arising in response to ‘the emergence of a pervasive crisis of social democracy’. 14 The economic crises of the 1970s, in particular the world recession sparked by the 1973 oil price rises caused support for social democracy to deteriorate, with Thatcherism ‘one 5 M. Bevir and R. A. W. Rhodes, ‘Narratives of Thatcherism ‘, Western European Politics, 21:1 (1998), pp. 97- 119, p. 101. 6 Ibid. 7 Gilmour, Dancing With Dogma, p. 172. 8 Ibid., p. 152. 9 Ibid. 10 Ibid., p. 127 and p. 338. 11 Ibid., p. 172. 12 See also S. Hall, ‘The Great Moving Right Show’, Marxism Today, January 1979, pp. 14-20. 13 Bevir and Rhodes, ‘Narratives of Thatcherism’, p. 107. 14 A. Gamble, The Free Economy and the Strong State: The Politics of Thatcherism (Basingstoke, 1988), p. 13. 2 particular national alternative’. 15 He argues ‘authoritarian populism’ was key to Thatcherism overthrowing social democracy. As Thatcherism meant challenging those with vested interests in continuing with consensus politics, Thatcher’s governments had to be ‘authoritarian’ to restore the authority of the state against groups such as trade unions, shown with their uncompromising attitude towards The Miners’ Strike of 1984-5. 16 To complement this, Gamble’s focus on ‘populism’ incorporates nation, family, duty and authority with neo-liberal beliefs of self-interest, individualism and anti-statism. 17 Therefore, Thatcherism was transformed into a moral and social force which established ‘a new common sense’ as opposed to the ‘old common sense’ of social democracy. 18 Dennis Kavanagh’s Thatcherism and British Politics comes from the Whig tradition of studies on Thatcherism, a tradition which focuses ‘on the interaction between ideas and institutions’. 19 Kavanagh focuses on the ‘end of consensus’, arguing that whilst normally elections are rarely turning points in political history, after Thatcher’s triumph in 1979 it was evident many important changes occurred. 20 Like Gamble, Kavanagh seeks explanations for the phenomenon of Thatcherism, but also focuses on how this affected the political agenda in Britain. 21 As in Gamble’s narrative, the idea of a ‘strong state and a free economy’ is explicitly referred to as central to Thatcherism. 22 The transition to the sometimes harsh rules of the market economy needed a government that was prepared to see the transition through and not ‘U-turn’ when the going got tough, as the Heath administration had. Kavanagh’s argues that Thatcher ‘dominated the content and style of British politics in the 1980s and shaped the politics of the post-Thatcher era’. 23 This links in with his study of the decline of the Labour Party and how the left-wing radicalism within the Party during the 1980s would not 15 Ibid., p. 20. 16 Lynch, Britain, p. 127. 17 Bevir and Rhodes, ‘Narratives of Thatcherism’, p. 108. 18 Ibid., p. 184. 19 Ibid., p. 104. 20 D. Kavanagh, Thatcherism and British Politics: The End of Consensus? (Oxford, 1988), p. 3. 21 Ibid., p. 21. 22 Ibid., p. 13. 23 Kavanagh, Thatcherism, p. 319. 3 result in re-election because Thatcherism took advantage of the ‘constellation of events and ideas’, forging a new consensus. 24 25 The main areas commonly explored in the literature on privatisation are: the roots of Conservative favouring of privatisation pre-1970s; why the Conservative Party opted to pursue privatisation and what it achieved. Francis argues that the ideas of the Conservatives in the 1950s and 1960s would ‘inform the rhetoric and the ideology’ of the privatisations in the 1980s. 26 Anthony Eden advocated widespread private property ownership ‘to enable every worker to become a capitalist’. 27 This is a recurring theme. Ramsden argues that the idea of the ‘property-owning democracy’ was a means of heading off potential conflict between owners and earners. 28 This view is corroborated by Francis who says the wider distribution of property was a way of safeguarding capitalism. 29 Central to Conservative concerns in the 1950s and 1960s was public support for the free enterprise system. 30 The large-scale nationalisations undertaken by the Attlee governments of 1945 to 1951 led to Conservative fears about the future of free enterprise in Britain, with ownership seen as the prime way of allaying these fears. Therefore, whilst in the 1950s and 1960s privatisation was not yet viewed as a politically viable project, long before 1979 there were ‘ideologues’ within the Party who viewed it as the way forward. Whilst it was clear there were Conservative ‘hankerings’ for privatisation throughout the post-war period, this does not explain why it became viable as a policy for the Thatcher governments. 24 Ibid., p. 183. 25 Ibid., p. 318. 26 M. Francis, ‘“Not Too Many Capitalists, But Too Few”: The Conservative Party and the Property-Owning Democracy, 1945-64’, (Unpublished paper, 2014), pp. 1-12, p. 12. 27 D. Howell, ‘The property-owning democracy: Prospects and policies’, Policy Studies, 4:3 (1984), pp. 14-21, p. 14. 28 J. Ramsden, ‘“A Party for Owners or a Party for Earners?” How far did the British Conservative Party really change after 1945?’, Transactions of the Royal Historical Society, Fifth Series, vol. 37 (1987), pp. 49-63, p. 52. 29 M. Francis, ‘“A Crusade to Enfranchise the Many”: Thatcherism and the Property-Owning Democracy’, Twentieth Century British History, 23:2 (2012), pp. 275-297, p. 278. 30 Francis, ‘Not Too Many Capitalists’, p. 4. 4 Numerous reasons for pursuing privatisation crop up in the literature. Consideration of think-tanks will be saved for the next section. A consistent theme is the financial reasons behind privatisation. Heffernan argues that privatisation was not originally designed to raise revenue and the main priority was always for underperforming nationalised enterprises to be sold. 31 This is not a view that finds many supporters. The literature refers to ‘waves’ of privatisation. The first wave arose in response to the macroeconomic conditions in 1979. Parker points to the economic recession and its detrimental impact on taxation and higher welfare expenditure.
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