I do want to be charitable and while I'm not terrible well disposed towards the Iron Lady, I'm not convinced that you don't owe someone some charity on the day of their death; of course, this can hardly be an absolute rule: it'd be hard to argue that on the day of Hitler's death we should say only nice things about him.
Parenthetically, I'm really not well disposed to her: back in the 80s I saw her as Britain's Reagan, though she got there first and I was no fan of Reagan's. Indeed he and George W. Bush hold the lead of my two least favorite Presidents in my lifetime and possible for a very long time.
Sumner thinks there is much to admire in her economic legacy:
"When I was a young adult Thatcher and Reagan were my two favorite political leaders (I was a bit more conservative during the cold war period.) So I was sad to hear that Margaret Thatcher died today."
"There are of course many ways to view her legacy, but I like to draw the comparison between Britain and France. These two countries have almost identical populations, GDPs, GDP per capita (PPP), etc. Both have large capital cities that completely dominate their respective political, economic and cultural life. There are obviously many historical connections."
"When Thatcher took office Britain was beginning to significantly lag behind France in all sorts of economic indicators. Thatcher’s reforms allowed Britain to catch up to France. (Indeed by some measures they have edged ahead.) Of course the economic outcomes are not identical (Britain tends to have lower unemployment while France has less inequality.) But they are back to being the two of the most similar countries in Europe. (What are other good pairs? Denmark/Finland? Greece/Portugal?)"
PS. And let’s not forget that the Falkland Islanders are still free of Argentine rule.
http://www.themoneyillusion.com/?p=20627
Krugman had a piece Did Thatcher Turn Britain around? He then puts up two charts that make the same point as Sumner: that Britain's performance improved relative to France after Thatcher was elected
"Now, there is no question that Britain did turn around. In the 1970s it was a country with huge economic problems; today, despite the failure of austerity policies, it’s in a much stronger position. There are various ways you could show this; I find it useful to compare Britain with its love-hate-relationship neighbor France. So, here’s per capita GDP in Britain relative to France:
A long decline ended and turned into a revival.
And here’s unemployment in the two countries:
"Britain had terrible unemployment for a while, but has done pretty well since (France has done better than the numbers suggest, for technical reasons, but still)."
http://krugman.blogs.nytimes.com/2013/04/08/did-thatcher-turn-britain-around/
As he points out though the correlation is not perfect. While Margaret Thatcher was elected a record 3 times by the British, unemployment was elevated for most of her tenure-it never really was lower than 7%.
"So, a real turnaround. Was it the Iron Lady wot did it?"
"Well, there’s a bit of a problem: Thatcher came to power in 1979, and imposed a radical change in policy almost immediately. But the big improvement in British performance doesn’t really show in the data until the mid-1990s. Does she get credit for a reward so long delayed?"
"This is, by the way, somewhat like a similar issue in America: right-wingers were eager to give Ronald Reagan credit for the productivity boom of the Clinton years, which also didn’t start until around 1995; if Reagan could get credit for events that were 14 years or more after his 1981 tax cut, shouldn’t Richard Nixon be given credit for anything good that happened in the Reagan years?"
This is what makes establishing causation so difficult in economics. Conservatives blame Carter for stagflation and see Reagan as the Gipper riding in on a white horse to put things right. Yet what was the main cause of whipping inflation? Many would say Volcker's big hike in interest rates who was appointed by Carter not Reagan.I think Sumner argues that Carter would never have "allowed" Volcker to do what's necessary-ie, raise interest rates. Actually Volcker had already started in 1979-and even embraced Milton Freidman's money supply targeting. What kept inflation elevated for the rest of Carter's term may have had a little something to do with the second big oil shock. So who's right between Sumner and me? This is what makes proving causation tough.
What I can't help but notice though from Krugman's charts is that even if unemployment improved in Britain relative to France it twas elevated until the mid 90s as Krugman says. In 1979, the year Thatcher came to power, it was under 5%. It wouldn't get there again until the early 2000s-after some years of Tony Blair. Does he and Labor get the credit or is it delayed from Thatcher-23 years after she was elected?
You could ask why unemployment in both France and Britain were under 5% in 1979 and have been so much higher for most of the years since. If you look at Britain's absolute performance during this period, how impressive is it?
Naked Capitalism had a piece on her that is critical but quite interesting from Michael Hudson
but very interesting. He discusses how she brought Monetarism to Britain, all the privatizations which have achieved ququestionable results and of Monetarism-Hayek and Friedman were, of course, welcomed to Britain like foreign dignitaries
He does admit though that the British economy was not in such swell shape in the 70s and that the nationalizations had perhaps gone too far in some areas.
Despite it's largely critical tone, there is one thing that I think you have to say is to Thatcher's credit that he discusses-Britain's fateful decision to not join the EU. If nothing else, she gets a lot f credit for this, regardless of her reasoning:
"The ideological pedigree for the Chicago School’s narrow-minded economics was provided by Frederick Hayek and Milton Friedman. Hayek’s most famous book, The Road to Serfdom (1944), opposed any and all government planning in principle as leading inevitably to either fascist or Communist authoritarianism. When Keith Joseph gave Mrs. Thatcher a copy of this book she readily responded to his hard line. “Hayek saw that Nazism – national socialism – had its roots in nineteenth-century German social planning. He showed that intervention by the state in one area of the economy or society gave rise to almost irresistible pressures to extend planning further into other sectors. He alerted us to the profound, indeed revolutionary, implications of state planning for Western civilization as it had grown up over the centuries.” This would underlie her opposition to European unification under the Maastricht Treaty.
Her reasoning may not have been right but her deicison not to join certainly was.
http://www.nakedcapitalism.com/2013/04/michael-hudson-thatchers-legacy-of-failed-privatizations.html
Finallly one more piece on Thatchers' legacy comes from Yglesias. I think he makes a crucial point:
'"I'm down in the Texas Hill Country visiting with my in-laws, and yesterday we drove out to the LBJ Ranch National Historic Park. Then this morning I learned that Margaret Thatcher has passed away. Thatcher and Reagan both strike me as fascinating figures—icons of the Anglophone right who were elected before I was even born and whose substantive legacies in public policy seem to me to be far more praiseworthy than their later influence as icons."
"LBJ made me think of this in two ways. One is that because of Vietnam, Johnson never became a heroic figure to American progressives despite Medicare, Medicaid, the Civil Rights Act, Voting Rights Act, federal aid to education, a raft of new national parks and environmental legislation, and a whole truckload of "lesser" bills that would count as major achievements of nearly any other administration. Another is that though Johnson was very much an FDR Democrat, his policies were quite different from FDR's. Most of all, the central theory of FDR's domestic policy was an obsessive need to duck and cover on issues of racial justice while LBJ's policies were all about aiming squarely at the race problem. LBJ didn't repudiate FDR's successes, but he didn't try to replicate or repeat them either. He knew that 1964 wasn't 1934."
"Thatcher, like Ronald Reagan in the United States, became what Johnson never was—more than an influential politician but a generation-defining icon."
"And yet while the policies of the Thatcher and Reagan revolutions have been largely successful, the political legacy seems to me to be quite mixed. Listening to contemporary conservatives, you often get the sense that they want to just rerun the policy agenda of the late 1970s and early 1980s. But today the leading global problem is climate change, not Communism. That's not because Communism isn't bad, it's because the Cold War is over. Privatizing state-run industrial companies won't jump-start growth. That's not because state-ownership of industrial firms is a good idea, it's because we don't have any. Reducing the power of labor unions to curb cost-push inflation doesn't fix anything because labor unions aren't powerful anymore. When you triumph, you triumph. But history doesn't end, new issues come to the front of the stack. We have a crisis of inadequate demand. We have the problem of providing health care to an aging population. Trying to apply the "lessons of Munich" to Vietnam was a disaster. Trying to apply the economic policy solutions of a generation ago to the problems of today is equally inappropriate."
I think this is a real problem for the Right, certainly in the U.S. where the party is always looking for the next Reagan. Were Reagan and Thatcher right? Maybe about some things. However, the world we live in today bares little resemblance to 1979. During the election we kept hearing Romney and his advisers invoke the 1980 election. They were even predicting a landslide arguing that Romney would pull away late as Reagan did. The danger in looking at legacies is that it makes someone lose sight of the world today rather than the world yesterday.
Just take a look at the Ginni index under Thacher's rule. It's all you need to know of her legacy. That, and claiming that Nelson Mandela's ANC was a communist front. She was instrumental in prolonging apartheid in South Africa with this notion.
ReplyDeleteActually another good thing is the WSJ big restrospective today-of course they were loving her. But one thing the writer said he admired is when she forbade anyone in the British government to participate on Bastille day as she didn't see French republicanism as something worth celebrating-she said it was violent and subversive. I might write about that later-your point is good to and might show up in it.
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