← More or Less
More or Less
Thatcher in numbers
00:09:39
Baroness Margaret Thatcher, who has died aged 87, was Britain’s first female prime...
Loading summary
Transcript22 lines
- [00:01]
BBC Announcer
Thank you for downloading from the BBC. For details of our complete range of podcasts and our terms of use, go to bbcworldservice.com podcasts
- [00:13]
Ruth Alexander
hello and welcome to More or Less on the BBC World Service. I'm Ruth Alexander. Baroness Margaret Thatcher, who's died following a stroke, was Britain's first female Prime Minister and one of the most influential political figures of the 20th century. She was a pioneer of free market economics, helping to spread the ideas around the world. But the Iron lady was a divisive figure with passionate supporters and critics. Both hold to strong beliefs about what she did. But what does the data tell us about the many claims made about Mrs. Thatcher?
- [00:49]
Professor Andrew Oswald
And the mounted police are going in again
- [00:54]
BBC Announcer
at a full gallop, right up the hill in the face of missiles.
- [00:58]
Ruth Alexander
The miners strike in 1984. The battle between Mrs. Thatcher and the miners defined her premiership. To her supporters she defeated the over powerful unions. To her critics, she destroyed whole swathes of British industry like mining and manufacturing. Well, a look at the numbers certainly confirms Baroness Thatcher's reputation as the ultimate union basher. In the 1970s, before she came to power, there were 128 million strike days in Britain. In the 1990s, after a 10 year dose of Thatcherism, there were just 6.5 million days lost to strikes, a huge decline. It's also true that the mining industry shrank dramatically in the 80s. But was Mrs. Thatcher responsible? Professor Andrew Oswald, an economist at Warwick University in the uk, looks at employment trends over decades and internationally.
- [01:53]
Professor Andrew Oswald
At its peak, there were more than 1 million miners in Britain. This is before the Second World War. Now there are only a few thousand. That huge sweep down in the giant graph that economists use to draw mining employment was really nothing to do with Mrs. Thatcher. She may have intensified the drop off in mining employment, perhaps in the late 80s after the giant confrontations. But it's not sensible to blame Mrs. Thatcher for the decline of the mining industry. This is a trend visible all over the Western world.
- [02:27]
Ruth Alexander
Nor, Andrew Oswald says, does the data support the popular view that Thatcher killed off British manufacturing.
- [02:34]
Professor Andrew Oswald
The decline in manufacturing as a proportion of total employment in a country like Britain, that's a very long standing and Mrs. Thatcher couldn't make much impact on that downward trend. She's viewed historically as the enemy of manufacturing industry. But I think most of that her criticism is incorrect. These are very powerful historical trends. As we get richer and richer in Western countries, we live more by our wits than by our skill at producing physical items.
- [03:04]
Ruth Alexander
Thatcher's also pictured as the great Tax slasher, a portrait she partly painted herself.
- [03:11]
Margaret Thatcher (archival audio)
How often do you hear people say, look how much they've taken from my pay packet. They don't work for the chance of the Exchequer, they work for their families. So we've got to cut the tax on earnings and the tax on skill, give our people incentives and once again, Britain will be back in the race.
- [03:29]
Ruth Alexander
But what did the statistics show? Well, it's true that Thatcher cut direct taxes. When she came to power, the top rate of income tax was 83%. By the time she left government, it was 40%. And basic rate tax fell from 33 to 25%. But indirect taxes went up. For example, VAT on goods and services almost doubled. So what does this mean for public spending? Did she roll back the frontiers of the state? Well, not as much as her supporters and critics like to believe. Public spending actually went up in real terms Under Thatcher, high unemployment meant she had to spend more on benefits. But as a proportion of the economy, public spending fell during her time in office from 44% to 39%.
- [04:17]
Margaret Thatcher (archival audio)
The National Health Service is safe with us.
- [04:24]
Ruth Alexander
During Thatcher's premiership, critics believed she had a secret plan to dismantle the National Health Service. That was her famous response. But the idea that she starved the NHS of money has stuck. Yet, contrary to popular belief, Thatcher more or less maintained the same steady rate of increase in state health spending as her predecessors. And here's economist Alyssa Goodman.
- [04:46]
Alyssa Goodman
I certainly look back on that era with the impression that there were a lot of cuts in health spending. But when you actually look at the figures, that isn't the case. Health spending grew both in real terms and slightly as a share of the economy. Education is slightly different. As a share of the economy, it did fall back slightly. But on the other hand, it was also a time of falling pupil numbers. And I think that partly offsets that slight Trend.
- [05:13]
Ruth Alexander
In the 1980s, pupil numbers went down from well above 13 million to well below 11 million. So, in fact, although public spending on education fell, pupil numbers fell faster, meaning more money per child. But what about the claim that Britain under Margaret Thatcher became a more unequal society? Yes, the data says this did happen. Here's Professor Nick Crafts, economic historian at Warwick University.
- [05:40]
Professor Nick Crafts
If we look at the mid-1970s, the top 10% were probably earning two and a half times the level of the bottom 10%. By the end of the 80s, beginning of the 90s, that ratio had moved to about three and a half times and was still continuing to rise.
- [05:56]
Ruth Alexander
Taking account of inflation, the incomes of the top 10% grew about 60% during Thatcher's time in office, while the incomes of the poor grew, grew hardly at all, and on some measures shrank. Mrs. Thatcher wasn't the only cause. But policies over which she had discretion, such as the reduction of the top rate of tax and the break of the earnings link by which benefits had been uprated, did increase the gap. For her critics. That complaint goes hand in hand with another that Mrs. Thatcher was responsible for one of the worst periods of unemployment in modern British history.
- [06:29]
Professor Andrew Oswald
The latest unemployment figures show a rise of 128,000, taking the total to a new record, nearly three and a quarter million. The news brought the comment a great disappointment from Mrs. Thatcher.
- [06:40]
Ruth Alexander
The numbers were unquestionably high and the experience for many people miserable. But what can we tell from the data? Well, when we look at the trends on the graphs, the rises and falls in unemployment over the long term compared with those in other countries, including those with policies quite different from her own, it's actually difficult to identify a specific Thatcher effect. His economist Andrew Oswald.
- [07:03]
Professor Andrew Oswald
Mrs. Thatcher inherited a growing unemployment problem. The 50 years from 1950 to the year 2000. Unemployment in great Britain is like a gently rising escalator with a lot of wiggles along the way. So there's a strong upward trend. What did happen in the year of 1979 was there was a very large rise in the price of oil and that undoubtedly pushed up unemployment a lot over the ensuing, let's say two or three years that that trend was visible all over the Western world. Her government was very strong on controlling inflation and that probably added an upward twist to the unemployment. But most of the rise in joblessness I think can be traced back to what happened in the Middle east, not to Mrs. T herself.
- [07:50]
Ruth Alexander
And something else happened to UK unemployment later in the 1980s. It fell sharply and far more quickly than elsewhere in Europe. And still to this day employment in Britain is higher than in most European economies. And it was Mrs. Thatcher's governments that imposed labour market flexibility, partly by the attack on the unions, which probably contributed. So does this mean that the net effect of Margaret Thatcher's time in office, and perhaps this is her supporters boldest claim, is that she transformed a sick man of Europe into a dynamic enterprise economy. Well, the numbers show it is true that economic growth was decent and improved the UK's position in relation to its European rivals. So the list of dramatic things Margaret Thatcher is said to have done for good or ill, is long. The list she really did do, the numbers tell us, is rather shorter. But in the end, for both friend and foe, the image, perhaps because it was so vivid, perhaps because it was even cultivated, far exceeds the evidence of the numbers. If there are any numbers you'd like explaining or investigating, do email us. Our address is more or less@BBC.co.uk and you can listen to more editions of this program and sign up for a free Download at our bbcworldservice.com More or less thank you for listening to More or Less. And thank you to Michael Blasland and Andrew Dillnott, whose journalism greatly contributed to this program.
- [09:23]
BBC Announcer
There are dozens of different podcasts now available from the BBC, including news, documentaries, science, business, arts and sport. For details of them all, go to bbcworldservice. Com Podcasts.