The History Podcast: Invisible Hands – Episode 3: Selling The Silver

Release Date: April 9, 2025

Introduction

In Episode 3 of "Invisible Hands," titled "Selling The Silver," host David Dimbleby delves into the pivotal moment in British history when Prime Minister Margaret Thatcher spearheaded the free market revolution through the privatization of state-owned industries. This episode intricately explores the ideological battles, strategic maneuvers, and cultural shifts that accompanied the transition from a state-controlled economy to one dominated by free enterprise.

Background: State-Controlled Britain

Before Thatcher's ascent to power in 1979, Britain operated under a post-war consensus where essential services such as water, electricity, gas, railways, and telecommunications were nationalized. These industries were managed by the state with the belief that government oversight would ensure efficiency and accessibility for all citizens.

David Dimbleby sets the stage by highlighting the inefficiencies and public dissatisfaction with state-run services:

David Dimbleby [09:05]: "Nationalization didn't deliver all it promised. Gas was cheap, ok, but getting repairs done, you had to wait for weeks. Trains never seemed to run on time."

The Rise of Privatization: John Redwood's Vision

John Redwood, a prominent Conservative MP and ardent free-market advocate, becomes the focal point of the episode. Raised in a council house in Canterbury, Redwood's personal observations of the inefficiencies in state-run services led him to champion privatization as a solution.

John Redwood [08:02]: "Always came from competing private sector companies. The progress didn't seem to come from the state."

Redwood's epiphany was rooted in the tangible improvements seen in everyday consumer goods, which he attributed to private sector competition rather than government intervention.

Ideological Battles Within the Conservative Party

Redwood's radical ideas initially faced significant resistance within Margaret Thatcher's own Conservative Party. Elder statesman Harold Macmillan emerged as a vocal opponent, vehemently criticizing the concept of privatization.

Harold Macmillan [16:54]: "It was simply too radical, too ambitious even for her."

Macmillan argued that selling national assets was irreversible and likened it to liquidating a family's estate, emphasizing the loss of national pride and control.

The Privatization of British Telecom

Undeterred by internal opposition, Thatcher entrusted John Redwood with leading the privatization of British Telecom (BT), one of the largest and most critical state-owned enterprises. The process involved meticulously planning the sale of shares to the public, a novel concept at the time.

John Redwood [11:19]: "These things could be an awful lot better if they had private capital or competition or better management."

To overcome skepticism from bankers and the media, Thatcher's government launched an aggressive advertising campaign, making share ownership accessible and appealing to ordinary Britons.

David Dimbleby [22:14]: "Advertisements appeared overnight. It would tell you how much the shares cost and how you buy them, urging the public to sign up to the sale of BT shares in just four months time."

The campaign was a resounding success, raising £3.7 billion and making over 2 million Britons shareholders in BT.

David Dimbleby [24:16]: "Kenneth Baker emerges from the lift into a bustling party of executives and journalists and government ministers. And then on a screen near the bar, the numbers started flashing up. 3.7 billion pounds raised."

Overcoming Opposition and Cultural Shifts

Despite fierce opposition from both within the Conservative Party and external entities like trade unions, the successful privatization of BT marked a turning point. It demonstrated that large-scale privatizations were feasible and could generate significant revenue for the government.

John Redwood [20:20]: "I said, yes, I think what's going to happen is that when we privatize you, you're going to put your salaries up and grant yourself enormous bonuses and this is going to be a huge embarrassment to the government."

This victory emboldened Thatcher and her free-market allies to pursue further privatizations, fundamentally altering Britain's economic landscape. The campaign also aimed to reshape the British mindset, encouraging widespread participation in capitalism and shareholder ownership.

Margaret Thatcher [25:41]: "Popular capitalism is a crusade, a crusade to enfranchise the many in the economic life of Britain."

Impact and Legacy

By the end of the 1980s, the privatization movement had transformed the British economy, raising £60 billion and making 15 million Britons shareholders. This shift not only altered economic structures but also catalyzed a cultural revolution, embedding capitalist principles deeply into British society.

David Dimbleby [26:12]: "And in so doing, they create a new society."

The episode concludes by emphasizing how these changes laid the groundwork for subsequent economic reforms and positioned Britain as a prime example of successful free-market transformation.

David Dimbleby [28:33]: "And the foundations were also laid for the next revolution, because with a quarter of people in the country owning shares, profit had become king and another old world was waiting to be shaken up."

Conclusion

"Selling The Silver" provides a comprehensive narrative of the privatization era, highlighting the strategic vision of key figures like John Redwood and Margaret Thatcher. Through detailed analysis and engaging storytelling, the episode underscores the profound and lasting impact of the free market revolution on Britain's economy and cultural identity.

Notable Quotes with Timestamps

• John Redwood [08:02]: "Always came from competing private sector companies. The progress didn't seem to come from the state."
• Harold Macmillan [16:54]: "It was simply too radical, too ambitious even for her."
• John Redwood [11:19]: "These things could be an awful lot better if they had private capital or competition or better management."
• John Redwood [20:20]: "I said, yes, I think what's going to happen is that when we privatize you, you're going to put your salaries up and grant yourself enormous bonuses and this is going to be a huge embarrassment to the government."
• Margaret Thatcher [25:41]: "Popular capitalism is a crusade, a crusade to enfranchise the many in the economic life of Britain."
• David Dimbleby [24:16]: "Kenneth Baker emerges from the lift into a bustling party of executives and journalists and government ministers. And then on a screen near the bar, the numbers started flashing up. 3.7 billion pounds raised."
• David Dimbleby [28:33]: "And the foundations were also laid for the next revolution, because with a quarter of people in the country owning shares, profit had become king and another old world was waiting to be shaken up."

Final Thoughts

Episode 3 of "Invisible Hands" masterfully captures the essence of Britain's free market revolution, illustrating how strategic leadership, ideological conviction, and cultural campaigns converged to reshape a nation's economic destiny. Through detailed accounts and firsthand testimonies, listeners gain an in-depth understanding of the forces that drove privatization and the enduring legacy it left on British society.