Thatcherism vs. New Labour - Case Study Example

How, if at all, are ‘Thatcherism’ and ‘New Labour’ interrelated? Eighteen years of Thatcherite rule drastically altered the social, economic and political terrain in British society, forcing the incoming government to make a fundamental choice of direction. The government could either offer an alternative and radical strategy to Thatcherism that was altered to take into account the shifts of the 1970’s and 1980’s or adapt it’s policies to the Thatcherite, neo-liberal terrain. After becoming leader of the party in 1994, Blair opted for the latter and made a decisive break away from Old Labour’s traditional political stance, rebranding the party as ‘New Labour’ and ending the toleration of the militant left-wing policies. He was the first serious politician of the left to appreciate the legacy of Mrs. Thatcher and was able, unlike his predecessors, to operate in the post-Thatcher world. Blair identified where the new centre was and quickly occupied it, leading to many branding him as a ‘closet Tory’. However, we have to decide whether he merely stripped down socialism to make it acceptable in post-Thatcher Britain or whether he has taken certain social democratic values and added them to a variant of free market neo-liberalism that was prevalent in Thatcherism. Although there seems to be a significant continuation of policy in many areas, this may have been necessary for Labour to win back lost electoral ground by pursuing a large degree of conformation to the highly successful Thatcherite campaigns. It is therefore necessary to compare Thatcherite and New Labour policies before we can say how interrelated the two ideologies are. Is the ‘Third Way merely a more compassionate version of Thatcherism or is it a new ideology, combining traditional social democratic values with neo-liberal tendencies that have grounded themselves in British politics? Ideological Divide Eric Evans wrote that Thatcherism embodied a series of interconnected political attitudes rather than a coherent body of thought. He emphasized that few of these attitudes are new: Free trade ideology developed out of Adam Smith’s distinctive contribution to the eighteenth-century European Enlightenment and reached its apogee in the Liberalism of William Gladstone, and so forth. (3) The importance of Thatcherism, therefore, lay not in the novelty of its ideas but in the context of their operation in the late 1970s and 1980s. Thatcherism as an ideology stood for a limited but firm government, the rolling back of the welfare state, the end of consensus politics and a staunchly anti-European and independent attitude on many vital issues. (Adams 1998, p. 95) The question of just how successful the Thatcher revolution was in making Britain a better place is a matter of fierce controversy. How people answer it depends a great deal on their political inclinations. Nonetheless, it is widely argued that Thatcherism shook up Britain’s economy and made it more competitive and prosperous. On the other hand, it is argued that the deep recession of the early 1980s, at least partly caused by monetarist policies, destroyed large parts of the British manufacturing industry from which it took more than a decade to recover. At this point, it is important to underscore that the traditional Labour ideology is in the opposite pole: it embodied the classical socialist democracy/welfare state as it stood for state intervention, fiscal policy (tax and spend policy) and welfare rights. (Driver & Martell 2006, 17) Thatcherism drew a stark contrast when she assumed power by introducing ‘pure’ neoliberalism for business and the state. What is certainly true is that Thatcherism changed the political landscape in Britain. Many policies, such as trade union reform and privatisation of major utilities, were almost inconceivable in 1979. Because many of these policies have been popular, Thatcherism was an electoral process for some. As a result, other parties have had to abandon old policies and come to terms with Thatcherism and change their ideas and policies accordingly. Thatcherism vs. New Labour Many scholars believe that New Labour’s long term strategy has been to transform social democracy into a variation of free-market neo-liberalism. New Labour has therefore ‘cosied up to business’ (Hall, 2003), favouring its interests in many ways. Most commentators and academics believe that without “Thatcherism”, the “New Labour” would not have been possible. Indeed, New Labour is defined by, though it departs from Thatcherism. The impact of the latter is deeply felt on the transition in the Labour Party to New Labour. This was an incremental process between 1983 and 1997. The changes of New Labour were made to modernize the party and help it catch up with the international, economic and political shifts of the ‘new times’ (Allender 2001). Blair, despite being criticized for ‘selling out’, actually maintained a number of traditional left-wing policies in his ‘Third Way’ such as pumping money into public services, setting up a minimum wage, constitutional reform, setting targets for the elimination of child poverty, meeting UK targets on the Kyoto protocol and increasing international aid (O’ Hara 2005, 11). The policies of the Labour government since 1997 are indisputably closer to those of the Conservatives, however, than they are to traditional social democracy. As Shaw (2003) points out, many social democratic principles such as social justice, the right to work and social equality remain a key influence on New Labour policy even though they have been incorporated in a revised context. This also highlights the fact that there is another dimension to the transition into the New Labour. Problems created by Thatcher’s neoliberalism policies propelled several problems that were needed to be addressed: In production, for instance, pure cost competition has shown its limits; infrastructures essential for production have declined; labour power has been inadequately reproduced; and the rate of profit has consequently not risen sufficiently to stabilize the British national economy. (Gough et al. 2006, 186) The legitimacy of neoliberalism has also been eroded by deterioration of the social and physical environment, its individualistic culture, profiteering for business, and widening inequalities. With these factors on hand, the Third Way was conceived. Here, rather than being beyond Left and Right, it attempts, with some success, to combine them in a balance. Thus, Blair’s New Labour was born. While some refer to the development as a shift from neoliberalism to what came to be referred to as “conservative interventionism” it would be more appropriate to label as a transition within the Labour Party – from the traditional to the Third Way. This vision took some beneficial models from the Thatcher experience while taking policies from the old school in order to address problems left by the Thatcherism. For example, improved funding for public services; cautious revival of the notion of citizenship. These are intended to improve the quality of services and labour power available to production, to defuse antagonism in employment, to strengthen social order, and thus relegitimate capitalism in its neoliberalism form. (Gough et al. 86) Ian Adam (1998) stressed that two features reflective the New Labour. One is that there is the prominence given to enterprise, competition and the free market; while the second is the moral dimension, with references to personal responsibility, the family and our duty to care for each other. (p. 146) Now, these reflect two broad streams of influence on Blair’s thinking. One of these, specifically the former issue is Thatcherism, while the other is a mixture of old and new ideologies and influenced by several other factors. Under the controlled intervention of the New Labourmany key features of Thacherite neoliberalism have been continued and actually deepened. To sum up the interrelationship between Thatcherism and the New Labour: The principal Thatcherite element in New Labour is supply-side economics (although not its extreme monetarist form that Mrs. Thatcher initially favoured.) It is believed that only a competitive economy can be successful in the modern globalised world, and this means that many Thatcherite policies such as low inflation, low public expenditure, low taxes and no overmighty trade unions. Keynesian means the government controlling the national economy as a self-contained unit, which is no longer realistic. Next, New Labour policy also recognized the need to steer people away from welfare dependency. Work is seen as a cure for poverty, not higher benefits, thus single mothers, the disabled and other welfare recipients are helped to find work. As previously stated by this paper, if the Labour Party sought to appeal to middle classes, and those working class voters with middle-class lifestyles that had been the foundation of Mrs. Thatcher’s electoral successes. In the process, New Labour has “stolen” many of the themes of conservatism. Labour now claims to be the party of business, the party of the whole nation and so on that currently its version of socialism is a matter of debate. There is even an argument that the New Labour is the first postmodern party, that it has no basic principles and simply is skilled at offering what the bulk of the electorate want. (Adams, 106) Blair himself acknowledges Mrs. Thatcher’s influence on his New Labour policy. He was prepared to say, as few of his colleagues in the wider party are, that Margaret Thatcher got some things right. Adams confirmed this as he recounted how Blair admired Thatcher’s economic realism: She understood that Britain had to compete in a global economy without any of the old protections afforded by state intervention. The economy had to be dynamic and competitive, and enterprise must be encouraged and rewarded. He found Thatcherism particularly important in destroying prejudices and vested interests. (146) It is helpful to go back in the late 1970s and 1980s, wherein the economic program of Bennite socialism was for Britain to withdraw from Europe and retreat behind a tariff wall. But economic self-sufficiency, or even sovereignty, was somewhat unrealistic, given Britain’s inevitable role as a trading nation a role that locked her into the international economy more than most. And if the left’s economic isolationism was implausible at that time, it had become many times more so since. The most important economic development of the last quarter of the twentieth century was the globalisation of the world economy. Blair recognized that Britain had to have a competitive economy or die. Socialists of whatever stripe could no longer deny that a free market economy – a Thatcherian legacy – in some form, was the most efficient and competitive form of economy available. The traditional socialist belief that a state planned and controlled economy would be infinitely more efficient than a free market one is no longer plausible. New Labour claims to have developed a new ideology, equidistant between traditional social democracy and Conservatism. The current labour ideology, writes C. E. F. Ricketts (2003), is much more positive about markets than earlier social demographic governments. Markets are not just seen as engines of wealth creation, they provide individuals with a variety of opportunities for action. Christine Collette and Laybourn, Keith (2003) cited some examples of the convergence of such opposing ideas: A compromise between traditional Conservative and Labour views was patently implicit in the Blair’ tough on crime, tough on the causes of crime soundbite. New Labour similarly offered both a communitarian resistance to Thatcherism, and a strong tendency to authoritarian social conservatism. Blair argues that the old left championed indiscriminate and often ineffective public spending, while the Third Way concentrates on ensuring that public spending delivers the required results. New Labour seeks the ‘dynamic market’ of America but also the social cohesion of Western Europe. (22) All in all, while there is an element of truth in the analysis that Thatcherism is fundamental in the development of the New Labour, there is still some room for doubt especially if we see Blairite socialism in a wider geographical and historical context. For instance, one can argue that the New Labour is merely a response to globalisation. The global markets exercise a continuous influence in that if a state is deemed to be following wrong-headed policies it will suffer through confidence in its currency and other factors that will economically damaging. However, globalization essentially is not the socialist’s cup of tea. It goes against their notion of independent and isolated country barricaded by tariffs. Globalisation and the global economic trends require the transition of Britain into a free market. Bibliography Adams, I. (1998). Ideology and Politics in Britain Today. Manchester: Manchester University Press. Allender, P. (2001). ‘What’s new about ‘New Labour’?’ Politics, 21 (1), 56-62. Collette, C. and Laybourn, K. (2003) Modern Britain since 1979: A Reader. I.B. Tauris Driver, s. and Martell, (2004). L. New Labour. Polity.Evans, E. Thatcher and Thatcherism. Routledge. Gough, J., Eisenschitz, A., Sales, R., and McCulloch. (2006) Spaces of Social Exclusion, Routledge. Hall, S. (2003). ‘New Labour has picked up where Thatcherism left off’ The Guardian, August 6. O’ Hara, K. (2005). ‘After Blair, Conservatism Beyond Thatcher’, Cambridge: Icon Books Ltd Rickett, C. F. (2003). International Perspectives on Consumers' Access to Justice. Cambridge University Press. Shaw, K. (2003). ‘Britain: Left Abandoned? New Labour in Power.’ Parliamentary Affairs 56 (1): 6-23 Read More