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April 14, 2013

Margaret Thatcher: Wrong on many things, but right on the one thing that mattered - or so argues Christie Davies

Posted by Christie Davies • Category: Historical Thoughts

Margaret Thatcher was a great Prime Minister because she was right on the one issue that mattered in her time - the need for socialism to be defeated both in Britain and in the World. The views expressed here are those of Christie Davies, not those of the Social Affairs Unit, its Trustees, Advisors or Director.

The late Lady Thatcher, the great Mrs Thatcher, was wrong about most things but she was right, relentlessly right, about the central problem of her time the menace of Socialism. She will always be remembered as the woman who destroyed Socialism, much as we remember Churchill as the man who stood up to Hitler. Churchill was wrong about India, about the economy, about most things but on the one big issue he was right. Today we are also free of the spectre of Socialism that haunted the 20th century. That is Mrs Thatcher's legacy.

It is difficult now to remember how close Socialism came to victory in the 1970s. The Soviet Union was steadily advancing its control over the world, notably in Africa and in South East Asia. Latin America was threatened with subversion. The release of the KGB files has shown how many people, including Allende in Chile and senior politicians in India, had been under their control. The Brezhnev doctrine decreed that no country which had ever come under socialist rule could return to democracy. East Europeans feared that their slavery would last for ever.

It was to change. Mrs Thatcher came to power in 1979 and Ronald Reagan in 1981. Between them they defeated the evil empire. The Soviet Union went from world domination to downfall in ten years, the ten years of the woman the Soviets called the Iron Lady. Where other British leaders had been timid, she was bold. Where they had been silent, she was vocal. Where they had been shaky, she was resolute. She understood exactly what the Soviet Union was and meant.

In 1979 Britain was on the verge of economic collapse. The Labour governments of 1974-1979 had been the servants of the trade unions, as well as of their own ideology. Britain was close to being a socialist economy. A large section of industry was owned and run by the State - coal, iron and steel, gas and electricity, telephones and railways. A large part of the country's housing stock was council-owned.

Other important sectors, such as car manufacturing and shipbuilding, depended on government subsidies and were the subject of government directives. The combination of trade union power and lax monetary policy had led to high inflation. Governments sought to deal with this through the state regulation of prices and incomes. Marginal tax rates were very high. The very bases of capitalism - the price mechanism, incentives to earn, save and invest, and rapid change and innovation - were undermined and rendered inoperative.

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