When Everything Was Going Wrong: Britain In The Seventies

When Everything Was Going Wrong: Britain In The Seventies

This article from the May 2013 edition of the IPA Review is written by Research Fellow at the IPA, Richard Allsop.

Almost everything in 1970s Britain seemed to be failing. Its industrial economy was in steep decline, crippled by strikes and excessive wage demands. Inflation peaked at over 30 per cent and unemployment reached its highest level since the War. The ‘Troubles’ in Northern Ireland escalated out of control and spread to the mainland, rates of crime increased drastically, football hooliganism raged, radical teachers ruined many schools and the nation itself appeared in danger of splitting, as devolution movements gained strength in Scotland and Wales.

Both the Conservative and Labour Parties had turns at addressing these problems and historian Dominic Sandbrook uses the terms of those governments to divide his work on the decade into two meaty volumes. Ted Heath’s Tory Government, which came to power after an upset election win in June 1970, was ‘by conventional standards … a total failure’. Yet Sandbrook has some sympathy for Heath who, despite his manifest personality flaws, had been ‘incredibly unlucky’ with the range of problems which assailed him.

On the other hand, Sandbrook has little sympathy for Labour leader Harold Wilson who began his second Prime Ministership in 1974 with none of the zest he had shown when first taking office a decade earlier and it is hard to disagree when Sandbrook writes that Wilson’s two years of governing from 1974 to 1976 ‘was probably the worst in modern British history’. Rather than taking actions to address the nation’s problems, Wilson took comfort in too many glasses of brandy and wasted countless hours dealing with his private secretary Marcia Williams (who was obsessed by issues such as who got to lunch with her boss). Such was her malign influence that some other staffers semi-seriously discussed the idea of having her murdered.

One who took the idea of committing murder a little further was the leader of the Liberal Party Jeremy Thorpe. Thorpe was seen as a rising star when the Liberals did well in the February 1974 general election, but he lived in fear that his former lover Norman Scott would one day expose their affair. A bizarre plot to kill Scott came to light when the bungling would-be assassin, hired by an intermediary, managed to shoot Scot’s dog on Dartmoor, but failed to even fire a shot at Scott. Thorpe was eventually cleared of criminal charges, but the credibility of the Liberals and the political class in general was further damaged.

In the first half of the decade, under both Heath and Wilson, almost all politicians remained addicted to Keynesian economics. Sandbrook observes that ‘Heath’s ministers still believed that the proper role of government was to administer a gently expanding welfare state, with more money being spent every year on health, education and social benefits’, a fact which was most clearly exhibited in the highly expansionist 1972 budget. This unleashed what became known as the ‘Barber boom’, named in honour of the Chancellor who delivered it, Anthony Barber. It contained both big tax cuts and large spending increases with the expectation that this massive increase in demand would produce sustained growth. The strategy was of course doomed to failure, even before the Oil Price Shock hit in late 1973, the year in which incidentally the UK joined the European Economic Community (EEC).

By 1975, the Government share of GDP reached 60 per cent, funded by extraordinarily high tax rates (including a corporate tax rate of 52 per cent, a top marginal rate of income tax for ‘earned’ income of 83 per cent and a top rate on investment income of 98 per cent) and debt. The country’s productivity levels were appalling. Each car worker was making a third as many cars per year as their American counterparts, and each steel worker a third as many tonnes of steel as those doing the same job in Germany. Yet, they still demanded more money and went on strike to get it, driving up both inflation and unemployment, a combination that the Keynesian consensus had thought to be impossible.

Sandbrook includes an excellent summary of the role of the Institute of Economic Affairs (IEA), ‘probably the most influential think tank in modern British history’, in driving the intellectual mood away from Keynesianism. He traces how some of the ideas which the IEA floated in papers in the early 1960s gradually moved from being seen as radical to the mainstream.

The Wilson government stuck with failing policies in its first year in office, but then the penny dropped for Chancellor Dennis Healey who began to take steps to cut spending, commenting later that he ‘abandoned Keynesianism in 1975’. Fortunately, after Wilson’s departure, new Prime Minister Jim Callaghan shared Healey’s view, telling the 1976 Labour Conference that the option of the country spending its way out of recession no longer existed, pointing out that ‘paying ourselves more than the value of what we produce’ ultimately led to both inflation and unemployment. To underline the crisis point the economy had reached, Britain had to be bailed out by the IMF in late 1976. The tough medicine led to significant declines in real incomes, but inflation began to come under control, at least until there was an explosion of strikes in what became known as ‘the winter of discontent’ in 1978-79.

So widespread were the strikes in that bitterly cold winter, it reached the stage that if you got sick you could not go to hospital because the hospital workers were on strike, but dying was not a viable alternative as the grave-diggers were also out. However, before any Australians get too smug, Sandbrook notes that Britain was not actually the most strike plagued nation in the western world in the 1970s—Australia and Canada were both worse.

Sandbrook argues that while militant left-wingers were obviously an important factor in the industrial chaos, an equally important factor was a materialistic desire of different categories of workers not to fall behind others in a newly affluent society. Hence, whether you were a coal miner, factory worker or civil servant, if a neighbour had a new car or was able to take a holiday in Spain, you could easily feel that only militant industrial action would ensure that you would get these things too. And the more often employers and governments caved in to excessive demands, the more that seemed the only viable approach.

Another Seventies British curse, which Sandbrook ascribes to increasing affluence, was football hooliganism. Sandbrook takes a machete to the arguments of both the right (product of the permissive society) and left (working class rebellion against bourgeois values) as to its causes. Instead, he persuasively argues that it was caused by the fact that many older married men stopped going to matches but stayed home with the new products of affluence, gardens and cars, leaving young men unsupervised on the terraces. Further, the greater affluence of these young men meant they were much more able to travel to away games.

The other great failing of English football in the 1970s was an inability to qualify for the World Cup Finals. Of England’s inability to beat Poland at Wembley in October 1973, Sandbrook writes that ‘even in an autumn of inflation, bombings and strikes, there were few more compelling symbols of England’s national decline’.

Football hooliganism was not the only type of crime increasing rapidly in the Seventies. Across the decade, the number of serious crimes in England and Wales rose from 1.6 million in 1970 to 2.8 million in 1980. Then, there was the threat of IRA terrorism, which early in the decade spread to the mainland. It is now more remembered for the miscarriages of justice in relation to Guildford and Birmingham, but should not disguise the degree of fear which the atrocities generated at the time. Similarly, while Heath’s handling of Northern Ireland is most remembered for Bloody Sunday, Sandbrook points out that his Sunningdale Agreement of 1973 foreshadowed much of the Good Friday agreement of 1998, but it needed another quarter century of killing for the extremists to see the need for compromise.

Sandbrook’s great skill is to effortlessly combine political, economic, social and cultural history and also to recognise that amid all the gloom, people enjoyed events like the Queen’s Silver Jubilee and everyday life was often more comfortable for ordinary citizens than it had ever been before. There were lots of excellent novels written and a lot of brilliant British-made television to watch, although one might challenge his description of the classic comedy series Man About The House as one for ‘the less discerning viewer’, when it was clearly superior to several of those in his long list for the ‘discerning viewer’.

He effortlessly integrates television and other popular culture with the political narrative. For instance, he uses the television series The Good Life (which features a couple trying to live sustainably on a suburban block) as an introduction to a chapter on the rise of environmentalism, while a chapter largely devoted to the politics of Scottish Nationalism begins with the Bay City Rollers and ends with Scotland’s ill-fated performance at the 1978 World Cup Finals.

He manages to write extensively, and with authority, on a topic like punk music, particularly the Sex Pistols, while still concluding that it was ‘just wrong’ to see it as the sound of the Seventies, as its following was tiny compared to that of acts like Abba, Boney M and the Bee Gees. Of course, rock music writers loved to paint punk bands as a working class response to alienation from bourgeois society, but only managed to do so by failing to mention facts such as the lead singer of the Clash being an ex-boarding school boy.

Sandbrook’s previous books, Never Had It So Good and White Heat, took the British story from the mid 1950s to the end of the 1960s. He is now apparently working on a volume on the 1980s. Already in his volumes on the Seventies, Sandbrook has demonstrated that the term ‘Thatcher’s Britain’ is one of the most profoundly misused phrases in public discourse. Sandbrook time and again shows that so many of the elements of industrial decay, resultant unemployment and social problems, which the phrase is meant to conjure up, were already strongly in evidence.

Yet, in Sandbrook’s nuanced approach, we also are reminded that Thatcher was part of the ministerial consensus during the Heath government and as Education Minister vigorously pursued the policy of closing grammar schools. He also documents how her leadership was often under pressure in her time as Opposition leader and how Callaghan outperformed her in the House of Commons. One of the great counterfactuals of British political history is what would have happened if Callaghan had gone to the polls in the autumn of 1978 when the economy was performing moderately well and before the winter of discontent.

However, the winter of discontent demonstrated that while the Callaghan-Healey approach was an improvement on what had gone before, something much more radical was required if Britain was not to degenerate into a semi-failed state. And that something was certainly not the old-style consensual Tories. When one of their leading figures, Willie Whitelaw stood for the party leadership in 1975, one backbencher told him that he needed to stop agreeing with the last person to whom he had spoken. Whitelaw nodded vigorously and said ‘I agree, I agree’. By the dawn of the 1980s, Britain desperately needed someone to disagree.

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