Assess the Reasons Why Thatcher’s Economic Policies Were Controversial
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- Date Submitted: 02/26/2016 05:46 AM
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Without a doubt Margret Thatcher was one of the most controversial prime ministers of all time. It can be said that she was Britain’s most dominant political figure of the 20th century. Primarily her success came from bringing an end to the post war consensus and replacing it with a free-market ideology. Aside from her political dominance it was her economic policies that sparked the most controversy. It could be argued that her economic policies such as monetarism, privatisation and trade union reform had more successes than failures which ultimately lead to her gaining three consecutive terms in office. To be able to assess each economic policies controversy we must consider three key aspects the successfulness of the policies, the failures and lastly the overall impact on society.
Perhaps her most controversial economic policy to date was monetarism. The theory, described as “crazy” by previous Tory Chancellor, Reginald Maudling; was an attempt to control inflation through restricting the supply of money, Thatcher wasted little to no time to quickly implement it during her first term in office. She reduced public spending substantially, along with increasing interest rates on loans to a staggering 17% to restrict borrowing. Supporters of monetarism say that it reduced inflation subsequently; their main evidence for this is the decrease in inflation from 19% in 1979 to 5% in 1983. On the other hand opponents would argue that the decrease in inflation came about as a result of the decrease in the price oil and the fact that the UK were going into a recession. With regards to unemployment monetarism caused unemployment to rise from 5.7% to 13% in just three years. This lead to major rioting in many cities the most severe rioting took place in areas such as Brixton, Moss side and Liverpool. However monetarism did see success in the sense that it was able to cut high levels of taxation inherited by the previous labour government, income tax was slashed from 33% to...
Perhaps her most controversial economic policy to date was monetarism. The theory, described as “crazy” by previous Tory Chancellor, Reginald Maudling; was an attempt to control inflation through restricting the supply of money, Thatcher wasted little to no time to quickly implement it during her first term in office. She reduced public spending substantially, along with increasing interest rates on loans to a staggering 17% to restrict borrowing. Supporters of monetarism say that it reduced inflation subsequently; their main evidence for this is the decrease in inflation from 19% in 1979 to 5% in 1983. On the other hand opponents would argue that the decrease in inflation came about as a result of the decrease in the price oil and the fact that the UK were going into a recession. With regards to unemployment monetarism caused unemployment to rise from 5.7% to 13% in just three years. This lead to major rioting in many cities the most severe rioting took place in areas such as Brixton, Moss side and Liverpool. However monetarism did see success in the sense that it was able to cut high levels of taxation inherited by the previous labour government, income tax was slashed from 33% to...