• Not Margaret Thatcher, too!

    Look, when Margaret Thatcher came to power, I was still in grade school. So my memory of the time isn’t as good as I’d like. Moreover, history classes always seemed much more concerned about what happened in the Industrial Revolution than what was happening in the recent past. Because of this, I sometimes get a bit confused as to what really happened in the 1970’s and 1980’s.

    To hear rhetoric today, you’d think Ronald Reagan was a born again Tea Partier. Same with Margaret Thatcher. Thank goodness Bruce Bartlett is ready with the facts in another must-read column:

    While Mrs. Thatcher is a towering figure in British political history, well deserving of admiration, the conservative legend about her time in power is at odds with the facts. In this legend, she was even more aggressive than Reagan in cutting taxes and the welfare state. But that is not true.

    As this table shows, taxes as a share of the gross domestic product in Britain actually increased sharply during Mrs. Thatcher’s first seven years in office before falling in the later years. Even at the end, they were significantly higher than they were when she took office. Spending also rose during her first seven years before falling in Mrs. Thatcher’s later years.

    To those familiar with Mrs. Thatcher’s tax policies, these data are not surprising. Although she cut the top personal income tax rate to 60 percent from 83 percent immediately upon taking office, the basic tax rate was only reduced to 30 percent from 33 percent. And in 1980, the 25 percent lower rate of taxation was eliminated so that 30 percent became the lowest tax rate.

    More importantly, Mrs. Thatcher paid for her 1979 tax cut by nearly doubling the value-added tax to 15 percent, from 8 percent.

    And let’s not forget this:

    In particular, Mrs. Thatcher, like all the members of her party, strongly supported the National Health Service, which provides national health insurance for every Briton.

    I have to remind myself continuously that what’s considered “conservative” has not always been what it is today. More importantly, I need to remember that it’s a mistake to let politicians, or the media, teach you about history.

    On that note, does anyone have any good books they’d recommend on US history from 1970-1990?

    • Let’s not forget that Ronald Reagan had this to say about the debt ceiling:

      “The full consequences of a default – or even the serious prospect of default – by the United States are impossible to predict and awesome to contemplate. Denigration of the full faith and credit of the United States would have substantial effects on the domestic financial markets and the value of the dollar.”

    • For an _economic_ history of those years (including a great introduction to econ policy in general), Michael Meeropol’s _Surrender_ is excellent.

      • A very readable account that covers some of Thatchers years is Nicholas Timmins’ book The State Were In ~1996. Basically reviews the rise of the issues that gave space for Blair’s New Labour of late 1990s….with Thatcher as the set up for this

    • In general, European politicians labeled conservative would be regarded as left-wing radicals in the US. The center here has a very deep belief in the power of governments to contribute to the good of society, and a clear understanding of the concept of “public goods.”

      • @David
        yep. if Margaret Thatcher ran for congress in the U.S. she would be labelled a socialist