UK Economic Prospects

I've written two articles on Margaret Thatcher (here and here) and am constantly trying to reconcile my understanding of economics and politics with the scenes of decay and heartfelf bitterness that her legacy has produced. Although the UK economic reforms of the 1980s were divisive, if there is some common ground then it's because almost everyone accepted that something had to be done.

Despite the mechanism by which inflation and unemployment came down, the true blame should never be thrust at the doctor that diagnoses the condition and takes responsibility for the painful cure - the blame should rest firmly with whoever it was that created the underlying problems.

If a doctor says that you've got weak blood pressure, it's not his fault. If he forced you to take exercise, don't curse the cure.

It would be utterly wrong to paint Thatcher as a vindictive individual, since that implies the lessons of her stewardship are irrelevent for today. On the contrary, the lesson is relevent and should be never again.

We all accept that the closing of certain industries was difficult and harsh (although does that mean freed slaves should compensate their former owners?), but rather than blame the doctor lets learn the lesson and ensure that the country never again gets held to ransom by the unproductive. Lets not encourage young people to enter industries that can't sustain them, or pump money into a gravy train that will inevitably need to be realligned. Lets not fuel bubbles, or deflate one (assets) by inflating another (housing).

So before it all happens again, lets take note of what's happening at the moment. This time lets blame the underlying cause of structural problems -- as they happen -- rather than whoever might come along to push through the necessary, yet painful cure. So we should all be worried by this recent article in The Economist:

This litany of complaints sounds drearily familiar. The exceptional decade has not transformed the economy, although it has helped it to work rather better than in the past. Mr Brown's reversion to tax-and-spend, together with the ever-rising burden of regulation, is starting to do increasing damage to work incentives and business interests. The price for past excess, both by consumers and by the chancellor, will be future slower growth. As the feel-good factor fades, the politics of plenty will give way to the politics of austerity.

So here's the paradox - the more you hate Thatcher, the more concerned you should be by Gordon Brown. It's time for old Labour to confront economic reality and ensure that they don't create the very problems they so readily use to blame others. Once should judge a Chancellor by the state of the economy 5-10 years after leaving office. Despite initial promise, the jury's still very much out on Mr Brown.

Comments

[Quinn]

It would be utterly wrong to paint Thatcher as a vindictive individual, since that implies the lessons of her stewardship are irrelevent for today.

I don't think it does. I think it is possible to view Thatcher as vindictive, yet still agree she was right on some matters, and to still see some relevance in what she said. Personally, I think vindictive is a bit harsh; but certainly I don't think she cared much for people she did not consider to be "one of us".

It is wrong to blame a doctor for a disease, and indeed you should give credit to a doctor who gives an accurate diagnosis and prescription for treatment; but if that doctor then botches the operation you still have a case for malpractice.

And while I too share concerns about Brown's current policies which had waved goodbye to "prudence", and I agree that the jury is out, I think the verdict was returned a while ago on the Tory chancellors' custodianship of the economy, and they weren't acquitted.

[AJE]

Good point. To clarify, I should have linked to my previous post "discrimination" which explains my concerns that we too readily associate events with particular individuals, and therefore neglect the chances of them ever ocurring again.

If we associate Thatcher's legacy with Thatcher herself, we run the risk of making the same mistakes again.

But I agree with everything you've said, and am glad you've extended the metaphor!