Politics (19951 15(1) pp. 49-54

Evaluating Thatcherism Over the M o o n or as Sick as a Parrot? David Marsh and R.A.W. Rhodes

Despite Jeremy Moon’s assertions we do not claim that there was no signt$cant change in policy content or outcomes during the natcher period; or that the entire post-war period is marked by seamless continuity We recognise that substantial change occurred We examine Moon’s sins of omission and commission before arguing that in order to establish the extent oJ; and reasons for change in the natcher period, we need to undertake detailed, theoreticallyinfirmed empirical analysis rather than dealing, like Moon, in assertion.

Informed debate and argument is the spice of academic life. As such, we are happy to reply to Jeremy Moon’s critique of our work (Poli- tics 14(2)). However, we would be con- siderably happier if his critique was based upon a solid understanding of what we say, and what we do not say; then we could engage with the critique in order to move the debate on ‘Thatcherite exceptionalism’ for- ward. Unfortunately, Moon’s analysis of our work is partial and misleading, so a significant part of this response will correct his sins of commission and omission.

We have no problems with being classified as sceptics or with being linked with Brian Hogwood in this respect. However, we would certainly hope to be in the same camp as

Andrew Gamble. As Moon himself points out, although Gamble argues that there was sig- nificant change in the Thatcher years, he also emphasises that Thatcher had ‘difficulties in legitimising her ambitions’ given ‘quasi-institu- tional and institutional impediments’ (Moon, 1994, p.47). This is not just a debating point. Moon fails to do justice to our work and thus recognise that we share Gamble’s position. Indeed, he misrepresents our position in order to create a ‘straw-man’ to criticise.

Moon’s analysis seems almost exclusively based upon our article in Parliamentay @airs, all the quotations are from that piece. We stand by our analysis in that article but it does seem perverse to ignore: our edited book, in which nine different authors deal with the extent of change in 9 policy areas (Marsh and Rhodes, 1992); Marsh’s review of the privatisation literature (1991 1; Marsh’s book on industrial relations policy under Thatcher (1992); or Rhodes’ extensive work on changes in local government policy (see for example Rhodes, 1991). All this work is extensively cited and, thus, difficult to ignore. Scrutiny of it might have corrected some of Moon’s partial (in both senses) reading of the Parliamenta y @airs article.

We do not claim that there was no sig- nificant change in policy content or outcomes during the Thatcher period; or that the entire

David Marsh, University of Strathclyde, R.A.W. Rhodes,University of Newcastle

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Evaluating Thatcherism 0 Marsh and Rhodes Politics (1995) 15(1) pp. 49-54

post-war period is marked by seamless con- tinuity. Such a view would clearly be non- sense. Rather, we were taking issue with the growing orthodoxy that the Thatcher period was exceptional. There is little doubt that this is the orthodoxy. It is for example the clear message of the most cited review of the Thatcherism literature (Douglas, 1989). Indeed, Douglas, like Moon, views 1979 as a watershed (pp. 399-401) and argues (p. 401): ‘The literature clearly shows that Thatcherism represents a break with the normal pattern of incrementalism’.

Our aim was to provide an antidote to that literature which is often based on heroic assertions rather than detailed analysis. More specifically, our focus was upon policy change in order to establish, rather than assert, the extent to which 1979 marked a watershed. In his critique, Moon claims that it does, but he, like others before him, fails to substantiate this claim. Our approach was more systematic although, of course, it exam- ines a limited number of policy changes. In the article Moon continually cites, we exam- ined the 4 policy areas in which many authors have claimed that there was most change post-1979: privatisation; industrial relations; local government; and housing. In the edited collection the various authors look at the extent of, and reasons for, change in 9 policy areas chosen to reflect a three-fold classifica- tion developed by Savage and Robins (1990): policy areas characterised by radlcal change; areas with some change; and areas marked by policy continuity.

Our conclusions are clear: 1. Legislative change was much greater in

some areas than others. So, for example, in the Thatcher years there were forty Acts of Parliament affecting local government and five major pieces of legislation restruc- turing industrial relations law. In contrast there were areas where relatively little new legislation was introduced, for example agricultural policy and environmental policy. Often, the government was stronger on rhetoric than legislation.

2. Despite the claims of some authors there was considerable change in the institu- tional and administrative structures in the 1980’s. So, for example, in the local gov- ernment policy area, the whole basis of local government finance was transformed, the metropolitan authorities were abol- ished and the powers and responsibilities of other local authorities were significantly reduced. In a similar vein, in the health field the Area Health Authorities were abol- ished and in the social security area the Department of Health and Social Security was split into two separate Departments and five new Agencies were created.

3. Even where significant legislative, and even institutional, change was undertaken the Thatcher Governments didn’t necessarily achieve their objectives. So, while five of the seven aims of the Government‘s priva- tisation policy were achieved there is con- siderable doubt as to extent to which the main aim of increased competition and efficiency in the newly privatised compa- nies was realised (Marsh, 1991). Similarly, Bradshaw (1992) shows that although the Thatcher Governments did attempt to change the social security system radically, particularly advocating greater use of incomes-related/means-tested benefits, they failed to achieve their major objective which was to cut social security expendi- ture. In fact, social security expenditure increased in absolute terms, real terms and, for most of the period, as a propor- tion of GNP.

Of course none of this means that there was no significant change, or denies that some objectives were achieved. Indeed, it is certainly possible to argue, as Moon does, that despite their ‘failures’ the Thatcher Governments achieved a sig- nificant change in outcomes in comparison with previous governments, particularly when one acknowledges the difficulty of achieving change. However, in order to substantiate a ‘Thatcher effect‘ one would still need to control for other factors. In

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particular, it must be acknowledged that any comparison of policies introduced before and after the oil crisis of the early 1970s is especially difficult.

4. Some Thatcherite policies had spectacular unintended consequences which under- mined other policies. The best example is clearly housing policy where the emphasis on home ownership, with the concomitant expansion of mortgage tax relief, stimu- lated inflation. As property prices rose sharply, home owners started to realise the equity tied up in this seemingly ever- increasing asset. This fuelled a credit boom which sucked in imports. This outcome was unexpected, and in the context of continuing tax cuts, helped undermine the Government’s economic strategy.

5. The Thatcher effect was more limited than the Conservatives had hoped, and some observers have claimed, because the Gov- ernment experienced major implementa- tion problems. In part these were problems shared by all governments; the Thatcher Government had conflicting objectives, insufficient information on which to take effective decisions and lim- ited resources. However, some problems were clearly exacerbated by the Govern- ment’s approach to policy making. In par- ticular, it’s rejection of consultation and negotiation almost inevitably led to imple- mentation problems, because those groups and agencies affected by the policy, and who were not consulted, failed to co-operate, or comply, with the admin- istration of policy. So, as just one exam- ple, local government found ways to circumvent central government controls over local expenditure. The 1984 Rates Act gave the Secretary of State for the Envir- onment power to determine an ‘over- spending’ council’s maximum rate. In response, as an insurance against future rate-capping, Treasurers in non-capped authorities advised their Councils to put up their rates. Given that any future rate- capping would be based on current rate

levels, it was logical that local Treasurers would want to ensure that any cutting would be from a high base. As a result, local government expenditure rose rather than fell.

This summary indicates that we do believe there was substantial policy change in the Thatcher years, although any such claim needs to be disaggregated. We are more sceptical abour the notion that there was a ‘transformation’. In addition, we contend that there was an important implementation gap which any analysis of the Thatcher effect has to acknowledge. Moon’s summary does little justice to our position.

Of course, one of the key problems of Moon’s critique is that he treats as sins of commission what are, at most, under- standable sins of omission. He advocates a comparison between the Thatcher years and previous periods. We agree that this would be an excellent research topic, but that was not our aim. He also implies that an analysis of the third term would reveal more radical changes (1994, esp. p. 48). This may be so, but our analysis specifically focused on the first two terms. We will cover the third term in an article to be published in Parliamen- ta y #airs in 1995.

One other point is important here. Moon is an advocate of the comparative method; an advocacy which we would generally endorse. However, he stresses comparing across time in Britain rather than comparing across poli- ties at the same time. We are well aware that both types of comparison involve problems but surely it is not irrelevant that a compar- ison across polities during the 1980s might throw doubt on the ‘Thatcher exceptionalism’ thesis; perhaps this is why Moon downplays such comparisons. To take just two exam- ples: the most radical attack on the trade unions in the 1980s in Europe was not in Britain but in ‘socialist’ Spain; while similar market-orientated economic policies emerged in response to economic crisis throughout the developed world.

If the lack of cross-polity comparison is a

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sin of omission on Moon’s part he also exhi- bits important sins of commission; some of which could have been corrected if he had read our other work.

Moon’s knowledge of some of the policy areas he discusses is partial, at best. So, for example, when talking of privatisation he asserts:

Marsh and Rhodes observe that Thatcher’s government depended on privatised com- pany managers and that this inhibited the extension of competition, thereby imped- ing the success of privatisation. But equally privatisation broke, at least temporarily, dependencies upon nationalised industry managements and labour forces which constrained previous governments (Moon, 1994, p.45).

The error here is glarins to anyone who has studied privatisation; The privatised company ‘managers’ and the ‘nationalised industry managements’ were the same people. The pattern of dependency upon the same people continued, at least temporarily, into the ‘new era’ (see Marsh, 1991, p. 467).

Despite this, Moon’s analysis is most lim- ited in the area of industrial relations policy. He suggests that we fail to recognise that the policy was a rolling process; it was successful because it ‘averted the symbolic focus for mobilising opposition which previous govern- ments had fatally attracted (Moon, 1994, p.45); the fact that we argue that ‘the history and current state of relations within a given company have most effect’ confirms the ‘Thatcher effect’ in this field; and identifying the period between 1966-79, rather than the period after 1979, as atypical is misguided. The first three assertions are wrong and the last is, at best, contentious.

Marsh has written frequently and at length, some would say too frequently and at too much length, on the ‘step-by-step’ nature of the industrial relations legislation (Marsh, 1992, see esp. Table 3.3, pp 78-79). Moon is right that the Conservative’s approach in this area was cautious, with each piece of legisla- tion building upon the previous legislation, so

in that sense it was step-by-step. Nevertheless, it was unclear even 1980 how policy in this field would develop. Certainly, it would be a mistake to think in terms of a coherent policy developed in Opposition and followed though in power. In fact, the Conservatives were cautious exactly because they feared a problem of compliance, which failed to mate- rialise. Obviously, this failure owed something to the strategies of the Conservatives; particu- larly the decision to make Jim Prior, a noted conciliator who was widely respected in the trade union movement, the first Secretary of State for Employment. However, the trade unions’ response was also effected by the growing public antagonism towards them provoked by the ‘Winter of Discontent’ and the worsening economic situation, which weakened their economic and, therefore, political position.

This leads us to a major problem with Moon’s analysis of trade unions. How can one attribute the decline of trade unions influence/power purely, or even mainly, to the nature and extent of the Thatcher legisla- tion, thus ignoring the economic context. This is not the place to rehearse the argu- ments in the industrial relations literature on the relative effect of the Thatcher legislation, the changing composition of the workforce and macro-economic changes on the role and influence of trade unions. However, Moon should certainly read it before ignoring eco- nomic factors (it is summarised in Marsh, 1992, Chaps 8 and 9). We shall return to this point later.

In emphasising the specificity of industrial relations in individual companies we are not confirming a clear ‘Thatcher effect’. In a sense, the reverse is true. The argument which is developed at some length in Marsh’s work (1992; Chap 8) is that Government policies can only have an indirect influence on private sector shop-floor industrial rela tions. That does not mean that Government policies have no effect; merely that now, just as before 1979, the key factors affecting industrial relations in a company are related

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to the history of industrial relations in that company and the company’s contemporary economic situation.

Our fourth criticism of Moon treatment of industrial relations may be more contentious but it also returns us to a general point. Many of the assertions about ‘Thatcherite excep- tionahm’ depend on a particular reading of the past. This is especially true in the case of industrial relations. Many authors claim that the trade unions were the dominant force within British politics prior to 1979. They then show that the unions are now less pow- erful before arguing for a ‘Thatcher effect’. In our view these assessments of the power of the unions prior to 1979 are contentious and not based on thorough empirical analysis (for a more detailed defence of this position see Marsh, 1992, Ch. 2). What is more the unions political role was only really important for some of the period between 1966 and 1979. So, in a sense, the proper cross-time compar- ison in this policy area is between post-1979 and pre-1966 not between 1974-1979 and post-1979.

The reader may now be exhausted by what she may view as on ultra-defensive response to Moon. As such, we want to conclude with a positive suggestion as to the way forward. We can all accept that there was significant change; our point is merely that one should not overestimate that change by talking of a ‘revolution’ or ‘transformation’. What we really need are more attempts to try to explain the origin and development of, and the extent of changes involved in, Thatcher- ism. Moon’s approach on this issue is implicit rather than explicit.

It seems to us that Moon views change in the Thatcher years as ideologically and, possi- bly to a lesser extent, politically driven. So, he endorses Letwin: ‘(The Thatcher Govern- ment) was flexible in the detail in order to pursue their broader interests by encouraging a loose set of what Letwin dubs “vigorous vir- tues” ’ (Moon, 1994, p.47 quoting Letwin, 1992, p.32). However, as Marsh argues else- where (1995) this view that ideology shaped

political decisions, that the Government made strategic political decisions in order to for- ward a consistent ideology, is surely again a reverse of the truth. Interesting enough, it is also a view which would be totally rejected by Gamble who argues (1988, p 141): ‘Thatch- erism is much better explained as statecraft than ideology’. He suggests, and this point is developed by Marsh (1995), that ideology was a tool used by the Thatcher Government to pursue its political and electoral interests, rather than a blueprint which informed strate- gic decision making or policy formation.

We would endorse that view but add that Thatcherism cannot be understood indepen- dent of the economic context within which it developed. Privatisation and industrial rela- tions reforms were, in large part, a response to a deepening economic crisis; and it is not surprising that this economic crisis, although varying in degree in different capitalist sys- tems, provoked similar, market-oriented responses in very different polities (see Taylor, 1992). This is not to say that the eco- nomic determines the political. Rather, we are making two related points. First, Moon ignores the economic constraints under which the Thatcher Government, like all gov- ernments, operate. Second, a full explanation of Thatcherism must consider the articulation between economics, political and ideological factors (for a broader discussion of this point see Marsh, 1995).

Overall, our work has been concerned to offer an antidote, not kill the patient. We do not claim that the Thatcher period was marked by a continuity with the past; we recognise that substantial change occurred. Our aim was, and is, to improve the condi- tion of the patient. Indeed, we would argue that the Thatcher period will provide the data which scholars will use to address many of the most crucial problems in political science and sociology in the coming years. However, in order to establish the extent of, and rea- sons for change, we need to undertake detailed theoretically-informed empirical ana- lysis rather than dealing in assertion.

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