252. Iron Lady

Mrs Thatcher’s first term in office was one of the great get out of jail events. She came into office intent on braking with the Keynesianism and social democracy of the postwar consensus. She drew on the ideas of the economists Friedrich Hayek and Milton Friedman (both briefly discussed in this episode), with their championing of the free-market and, in Friedman’s case, of monetarism.

Initially, however, things didn’t go well: unemployment soared, the economy shrank and even inflation, the very issue monetarism set out to tackle shot up. She maintained, however, that she had no intention of changing tack, declaring ‘the lady’s not for turning’.

By 1981, she was sitting on the worst favourability ratings of any Prime Minister since records had been kept.

But then the economy started to come back from recession, helped by the fact that oil began to flow from Britain’s North Sea fields, inflation fell, and her ‘right-to-buy’ scheme allowing tenants of council housing to buy their homes proved popular. Nothing, though, helped her as much as the behaviour of two enemies.

Labour kept up its drift leftwards leading to its split, with the Social Democratic Party launched by some senior figures leaving the party, most notably Roy Jenkins. In alliance with the Liberals, they represented a dangerous splitting of the anti-Tory vote.

Even more helpful for Thatcher, was the invasion of the Falkland Islands – or Islas Malvinas – launched by the Argentinian junta under General Galtieri. By responding with military force, and winning, she was able to turn herself into a victorious war leader and a hero to many in Britain. Her approval rating surged to 51%.

Suddenly, from someone expected to lose the next general election, she’d become a practically unbeatable leader for it.

Illustration: British paratroopers entering Port Stanley – Puerto Argentino – in the Falkland Islands – las Islas Malvinas – at the end of the war against Argentina for their possession. Public Domain.

Music: Bach Partita #2c by J Bu licensed under an Attribution-NonCommercial-No Derivatives (aka Music Sharing) 3.0 International License