- Thatcherism: self-reliance rather than reliance on the state, emphasised the importance of family, reduce inflation, reduce the
power of the trade unions, deregulate the market, reduce the budget deficit, a conviction politician (policies should be based
on what was right, not popular)
Margaret -
-
Thatcher was the only woman in cabinet.
Wets- those in government that didn’t support her enough. They were outside the inner circle.
Thatcher - Dries- enthusiastic supporters she could rely on. Were in her inner circle.
Economy:
- Thatcher believed that inflation eroded missile class savings and caused strikes demanding higher wages, made British industry
over-prices and uncompetitive and reduced industries and enterprises from being competitive because higher prices meant
higher taxation.
- The new right believed that individuals, not the govt, should be responsible for how they spend their own money.
- Howe’s Budget 1979: followed a monetarist approach. Income tax was cut from 33% to 30% and the highest rate was cut from
83% to 60%. VAT went up from 8% to 15%. Increase defence expenditure. The govts initial measures actually worsened
inflation which doubled to 21.9% In 1980, unemployment hit 2 million. These figures would of have been worse if it wasn’t for
the coming up of oil in the North Sea. The government found it wasn’t getting enough money from taxation so had to borrow
money to help pay benefits. In Nov 1979, interest rates rose again to 17% which caused even more unemployment.
- Howe’s Second Budget 1981: Government spending was cut by £900m, benefits were frozen, and grants given to councils were
cut, prescription charges increased, taxes on fuel and alcohol increased, £4b in tax increases and 20% tax on North Sea Oil. This
budget increased the number of unemployed to 2,8 million by the end of 1981. Manufacturing output fell by 15%, steel
1979-1990 production cut to less than 14m tonnes. By 1983, unemployment hit 3m. The government’s policy was to move Britain from a
manufacturing economy to a service one. This was due to counterparts in other countries in which Britain couldn’t keep up
with. There was little help to those areas that relied on manufacturing it transfers into the services economy, and this increased
the North-South divide. People turned to alcohol and drugs while feeling depressed. Howes budget was met with widespread
disapproval, with riots being sparked in Brixton in 1981. However, Howe’s budget did reduce inflation to single figures, reduce
wage demands by unions.
- By the mid-1980’s monetarism was quietly dropped, and supply side economics was adopted – she believed in the power of
the free markets and the use of incentives to encourage people to create growth in the economy.
, - 1986: The ‘Big Bang’- this was the name given to the financial deregulation that introduced competition to the City of London
and allowed foreign banks to operate. This led to a huge growth in the financial services. City of London became a financial
centre again. Computer screens and online trading made instant transactions possible.
- Cutting the powers and expenditure of local govt was a key aim of Thatcher – especially many of them being labour run.
Margaret - Rate Capping was introduced to limit the amount of money that local govt can raise through taxes.
- Westland Affair: 1980 Westland faced financial issues so entered negotiations with a US company. Defence secretary Heseltine
Thatcher suggested a European bid for the company. His suggestion was rejected. Thatcher favoured the deal being proposed by US Fiat
group.
- Privatisation was a central government economic policy by thatcher’s second term. She argues that state owned businesses
were monopolies and were less likely to innovate due to the lack of competition.
- 1992: 2/3 of state businesses had been sold. Commercially public sector virtually disappeared by the end of the 1980’s. 32.5b
raised in revenue.
- Lawson boom 1986-88: economic boom saw strong growth during the second half of the 1980’s. there was a fall in
unemployment, 2m by the end of 1989. Top tax rate was reduced again from 60% to 40%.
- 1980: the economy advantaged by North Sea Oil and Gas contributing to 15% of the National Income by 1985.
- North South Divide: Britain’s industries faced challenges. Weekly household income in 1989- North/Northeast: £173, Southeast
£248. There was urban decay in areas of economic deprivation where there was an increase in ill health. There was a increase
in poverty and tensions In race relations were a cause for riots in inner cities.
Poll Tax 1989:
1979-1990 - The poll tax was a govt controlled taxation scheme where everyone, rich or poor, would pay the same amount of property tax.
Thatcherites believed that it would a fairer system due to everyone paying equally – but it was in fact very economically
inequal.
- This scheme hoped to ensure that councils would be forced to be more efficient and responsible for their spending if now
everyone who lived in their area contributed towards it.
- Local taxation increases, so those who rented property would have been angered. Either they hadn’t been paying it or they
didn’t notice it was a part of their rent. They saw it as an additional taxation.
- Ministers found it hard to justify why a pensioner would pay the same as a millionaire.
- It was a massive failure because it was hard to keep track of those who kept moving house. People were also simply not paying
the tax. The cost of implementing the tax grew massively.
power of the trade unions, deregulate the market, reduce the budget deficit, a conviction politician (policies should be based
on what was right, not popular)
Margaret -
-
Thatcher was the only woman in cabinet.
Wets- those in government that didn’t support her enough. They were outside the inner circle.
Thatcher - Dries- enthusiastic supporters she could rely on. Were in her inner circle.
Economy:
- Thatcher believed that inflation eroded missile class savings and caused strikes demanding higher wages, made British industry
over-prices and uncompetitive and reduced industries and enterprises from being competitive because higher prices meant
higher taxation.
- The new right believed that individuals, not the govt, should be responsible for how they spend their own money.
- Howe’s Budget 1979: followed a monetarist approach. Income tax was cut from 33% to 30% and the highest rate was cut from
83% to 60%. VAT went up from 8% to 15%. Increase defence expenditure. The govts initial measures actually worsened
inflation which doubled to 21.9% In 1980, unemployment hit 2 million. These figures would of have been worse if it wasn’t for
the coming up of oil in the North Sea. The government found it wasn’t getting enough money from taxation so had to borrow
money to help pay benefits. In Nov 1979, interest rates rose again to 17% which caused even more unemployment.
- Howe’s Second Budget 1981: Government spending was cut by £900m, benefits were frozen, and grants given to councils were
cut, prescription charges increased, taxes on fuel and alcohol increased, £4b in tax increases and 20% tax on North Sea Oil. This
budget increased the number of unemployed to 2,8 million by the end of 1981. Manufacturing output fell by 15%, steel
1979-1990 production cut to less than 14m tonnes. By 1983, unemployment hit 3m. The government’s policy was to move Britain from a
manufacturing economy to a service one. This was due to counterparts in other countries in which Britain couldn’t keep up
with. There was little help to those areas that relied on manufacturing it transfers into the services economy, and this increased
the North-South divide. People turned to alcohol and drugs while feeling depressed. Howes budget was met with widespread
disapproval, with riots being sparked in Brixton in 1981. However, Howe’s budget did reduce inflation to single figures, reduce
wage demands by unions.
- By the mid-1980’s monetarism was quietly dropped, and supply side economics was adopted – she believed in the power of
the free markets and the use of incentives to encourage people to create growth in the economy.
, - 1986: The ‘Big Bang’- this was the name given to the financial deregulation that introduced competition to the City of London
and allowed foreign banks to operate. This led to a huge growth in the financial services. City of London became a financial
centre again. Computer screens and online trading made instant transactions possible.
- Cutting the powers and expenditure of local govt was a key aim of Thatcher – especially many of them being labour run.
Margaret - Rate Capping was introduced to limit the amount of money that local govt can raise through taxes.
- Westland Affair: 1980 Westland faced financial issues so entered negotiations with a US company. Defence secretary Heseltine
Thatcher suggested a European bid for the company. His suggestion was rejected. Thatcher favoured the deal being proposed by US Fiat
group.
- Privatisation was a central government economic policy by thatcher’s second term. She argues that state owned businesses
were monopolies and were less likely to innovate due to the lack of competition.
- 1992: 2/3 of state businesses had been sold. Commercially public sector virtually disappeared by the end of the 1980’s. 32.5b
raised in revenue.
- Lawson boom 1986-88: economic boom saw strong growth during the second half of the 1980’s. there was a fall in
unemployment, 2m by the end of 1989. Top tax rate was reduced again from 60% to 40%.
- 1980: the economy advantaged by North Sea Oil and Gas contributing to 15% of the National Income by 1985.
- North South Divide: Britain’s industries faced challenges. Weekly household income in 1989- North/Northeast: £173, Southeast
£248. There was urban decay in areas of economic deprivation where there was an increase in ill health. There was a increase
in poverty and tensions In race relations were a cause for riots in inner cities.
Poll Tax 1989:
1979-1990 - The poll tax was a govt controlled taxation scheme where everyone, rich or poor, would pay the same amount of property tax.
Thatcherites believed that it would a fairer system due to everyone paying equally – but it was in fact very economically
inequal.
- This scheme hoped to ensure that councils would be forced to be more efficient and responsible for their spending if now
everyone who lived in their area contributed towards it.
- Local taxation increases, so those who rented property would have been angered. Either they hadn’t been paying it or they
didn’t notice it was a part of their rent. They saw it as an additional taxation.
- Ministers found it hard to justify why a pensioner would pay the same as a millionaire.
- It was a massive failure because it was hard to keep track of those who kept moving house. People were also simply not paying
the tax. The cost of implementing the tax grew massively.
