Austerity economics – how it failed 35 years ago


Since winning the 1979 General Election, the Conservatives had embarked on an economic policy described as ‘monetarism’   This entailed rigorous control of the money supply in order to curb the great British disease of inflation.  The outgoing Labour Chancellor of the Exchequer Denis Healey, no stranger to cutting government spending himself, had dubbed the new creed as ‘sado-monetarism’.

9780436164859-uk-300The high priest of monetarism was a professor at the Chicago school of economics by the name of Milton Friedman.  Without going too far in to the vast detail that any debate on economics can become mired in, Friedman essentially threw out the conventional Keynesian wisdom that in a depression, governments should spend to keep people in work.

Out of control public spending, he argued, would lead to something called ‘stagflation’ – stagnation with high inflation – which was a prevalent condition of many economies in the 1970s.  The answer was a kind of shock therapy where high interest rates, as one weapon, would make it unattractive to spend money.  This would then lead to restraint in wages and prices, which would result in inflation coming down.

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JK Galbraith

Oh that life was so simple, Keynesians retorted angrily – in many newspaper columns and on the letters pages.  Friedman’s leading Keynesian nemesis on the global stage was the elderly but highly alert J K Galbraith, who had served in President Franklin Roosevelt’s administration steering through the New Deal.  He warned over and over again that Friedman’s medicine would lead to idle industrial plants and high unemployment.

Just because it hurt, Galbraith thundered, didn’t mean monetarism was actually doing any good to Britain.

“Suffering must have a purpose: out of much suffering there must come much good.  No one is quite sure how this works in economics; one only knows that the bad times are somehow the price of the good.  Pain and punishment are considered especially salutary for other people.”

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General Pinochet – enthusiastic supporter of austerity economics

So agonising were the effects of monetarism that many on the left pointed out that in its most undiluted form, it had only successfully been applied in Chile – which still languished under a military dictatorship.  The implication being that a democracy could not hold the lid down on a population tormented by the rigours of this doctrine.

Within the trade unions, the widespread suspicion was that the Conservatives were using high levels of unemployment deliberately to beat down pay demands.   With an instinctive hatred of state regulation of the economy, Thatcher didn’t want to get involved in imposing incomes policies (as Labour had tried to do in the 1970s) but fear of the dole, it was thought, was her preferred weapon against wage inflation.

In reality, the Conservatives quietly dropped monetarism and adopted a more pragmatic and less doctrinaire approach after 1982.  But not before they would experience a bitter lesson from Britain’s hugely pissed off youth on how far you can pursue an experiment before the subject bites back.

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Badges of the 80s

Political badges from the 1980s


Emptying out my parents’ attic as they downsize, I opened a tatty plastic bag and out fell a load of political badges from the 1980s. These were worn with pride on my lapels at various demos back in the day. They date from about 1979, when I’d have been 16 years old through to around 1984 and the miners’ strike. As a snapshot of what we fought, cared and fretted about – they’re truly fascinating. And the language now seems a bit dated on some of them.

Badges of the 80sBadges of the 80sBadges of the 80sBadges of the 80sBadges of the 80s Take a look at the photos below and I’ll just chat through some of them. Nuclear arms – big obsessions. There were surveys at that time where most young people honestly believed there would be a nuclear catastrophe in their lifetime. Remember we had the Soviet Union versus Uncle Sam and in 1981, I went on the massive CND demo to Hyde Park. I remember one old dear screaming at me that I was as bad as those Hitler loving pacifists in the 1930s Peace Pledge Union. Another big demo that year was the People’s March for Jobs and you can see a big badge there for that.

The 1981 Brixton riots put the focus on the SUS laws – stop and search by police, which impacted on black kids a lot more than white. And it’s still an issue today – how depressing!  The anti-racist badge saying “will you choose to abuse” seems a bit patronising and corny now – your views? Note the brilliant badge with Home Secretary William Whitelaw and his detergent that would whitewash police tactics over Brixton – still think that’s amusing.

On the global front – you had Chile under the Pinochet dictatorship and of course we all know how much Thatcher liked him. There’s also a Polish Solidarnosc badge as the movement against Stalinism in that country took hold – then faltered. Spain had emerged from the Franco dictatorship and the socialist party – the PSOE – was about to take power. Though the promised socialist revolution never materialised. Rhodesia gave way to Zimbabwe at the end of the 70s and you can see a badge there. Ireland and the ‘Troubles’ were a constant feature with bombings in the north and on the mainland UK. In 1979, Lord Mountbatten was blown up. Thank goodness that all seems like ancient history now.

Above all else – there was a visceral hatred of Thatcher. When I watch all these 80s progs saying we were all yuppies in that decade, it makes me furious. Nobody who was there would recognise that narrative. We were heavily polarised as a country. You either loved Maggie or hated her – and your style of dress and badges reflected that.

Maggie Thatcher, the Tories and race relations


So what did Maggie think about race issues in the 70s and 80s. One of her key advisers, Alfred Sherman, had views on ethnic minority issues that would be regarded as slightly beyond the pale in our more inclusive times.   One such was that immigration had been from cultures that were alien to English values including “sex, honesty, public display and respect for the law”.

A recurring theme from Sherman was that waves of immigrants from ‘alien cultures’ had resulted in a loss of control of what it meant to be British.  If this sounds familiar, it’s because Margaret Thatcher similarly remarked in 1978 on TV that many Britons “fear rather being swamped by an alien culture”.

Behind Thatcher, on the Tory backbenches, views on immigration and race relations were a touch reactionary.  In one debate on immigration in the House of Commons on 5th July, 1976 –  some rum comments were made.

Winston Churchill’s grandson, who shared the same name but not the same glittering career as the war leader, thought the tolerance and generosity of the British people was being tested to the limit.

“We can not fail to recognise the deep bitterness that exists among ordinary people who one day were living in Lancashire and woke up the next day in New Delhi Calcutta or Kingston, Jamaica.”

During the 1976 debate, Churchill pointed out that a West Indian had told him at his MP’s surgery that he would remove his daughter from a school, which was 75% immigrant, because she had no chance of a ‘proper English education’.  Churchill added, “that man was as black as your coat, Mr Deputy Speaker”.

John Stokes, MP for Halesowen and Stourbridge claimed that a petition to the Home Office might be replied to in six weeks but an “immigrant leader” who wanted to see the Prime Minister would get an audience in two days.

He went on to claim that a vast gap existed between what he called the pro-immigrant camp – made up of race relations people, intellectuals, the media and do-gooders – and “the ordinary people who look to us in the House of Commons for protection”.

“They do not want a multi-racial society.  They do not believe that integration will work.”

And in case anybody thought that by immigration, the Commons debate might be referring to all those who entered the UK, George Rodgers – MP for Chorley – put them on the right track.  “The difficulties revolve around the colour of people’s skins.  We should bear that in mind and recognise the problem, not avoid it.”

And so it went on with Nicholas Winterton, MP for Macclesfield, even demanding that the then Labour government apologise to Enoch Powell for the comments they had made after his notorious 1968 anti-immigration ‘rivers of blood’ speech.

Three years later, the 1979 Conservative Manifesto would include proposals for toughening up of immigration policy directly under its promises on fighting crime.  It acknowledged that the ethnic minorities had made a valuable contribution to the life of the nation.

“But firm immigration control for the future is essential if we are to achieve good community relations”.

If you were a teacher in Maggie’s Britain – just accept being hit!


I wasn’t sure whether to laugh at this news item from The Guardian in 1982. A teacher had been hit by a parent but when the case went to court, a London magistrate told the teacher that she had:

  • wasted ratepayers’ money by bringing the case
  • being hit was a risk that came with the occupation
  • she could expect to be hit another six or so times in her career
  • the best protection was to have a man around

The whole thing was referred up to Thatcher and the Lord Chancellor when unions went ballistic. But you have to remember, this was a time when the unions would have been accused of being soft or trouble making or politically correct. Here’s the article – see what you think!

Teaching in the 1980s
Teaching in the 1980s

Spandau Ballet – 1981 worries about dodgy politics


In the very early 80s, there were lots of bands wearing Teutonic, Germanic, Weimar and Berlin references.  This raised a few eyebrows among the politically aware – correct? – who felt that some combos had strayed from Weimar in to the era of Germany history that came after.  Think of man with small dark moustache who invaded most of Europe and you’ll have arrived.

Now, Spandau Ballet were about as far removed from the Third Reich as you can get.  Let’s make that clear from the off.   But it’s amusing to see some journalists vexing about their look and name at the time.

One such was a scribbler called Sunie who penned a rather silly piece for Record Mirror on February, 28th, 1981.

“Unfortunately, the element of this project which I find disturbing, threatening and worthy of debate lies not in the music itself, but in the premise upon which our young warriors have erected their grandiose musical/lyrical edifice.”

Wow – serious stuff.  Sunie went on to note that the album was white-on-white with a muscular naked form.  The journalist was rattled by a quote inside the record sleeve – “…the soaring joy of immaculate rhythms, the sublime glow of music for heroes…stirring vision….journeys to glory…”

Sunie said this linked Spandau Ballet to an ‘Aryan Youth ideal’ reminiscent of you know whose youth movement.  The review then went on to make it clear there was no linkage to far right groups being suggested just a sense of discomfort.

The argument gets unintentionally funny when Sunie tells readers to play ‘Muscle Bound’ back to back with ‘Tomorrow Belongs to Me’ from Cabaret and see how the ‘mood’ is the same.  “Tread very carefully for all our sakes,” Sunie ended by warning the band.