Kwasi Kwarteng explains how Thatcher saved her premiership in 1981by / October 17, 2015 / Leave a comment
“Thatcher’s Trial”, a new book by the Conservative MP Kwasi Kwarteng, is about a “leader beset by troubles.” In February 1981, faced with the threat of a nationwide strike by the National Union of Mineworkers (NUM), Margaret Thatcher’s government withdrew its plans to close 23 pits. After David Howell, the Energy Secretary, announced a range of concessions to the NUM, one of Thatcher’s advisers, John Sparrow, wrote to her with the following warning: “You will be aware of the disappointment and, in some places, bitterness that have caused by [the] decision to retreat in the face of the NUM.”
As Geoffrey Howe prepared that year’s budget, many seasoned observers thought that Thatcher’s government was on borrowed time. Yet, by September 1981, she felt secure enough to remove from the Cabinet two prominent “Wets” (non-believers in the Thatcherite experiment), Ian Gilmour and Lord Soames. Kwarteng’s book examines the six months between the budget and the reshuffle—six months which, he argues, defined Thatcher as a leader. When I met Kwarteng in Westminster earlier this week, I began by asking whether he thought Thatcher’s temperament, which he rightly describes as “Manichean,” was one of the major causes of the grave political peril in which she found herself in early 1981.
KK: I think it often happens in politics that your strength becomes a weakness. A lot of her problems in 1981, you could argue, were a consequence of that mindset. There is a revisionist view that 1979 was not really a watershed and that Thatcher was more consensual a politician than she appeared. But my research has led me to the opposite view. I read a lot of newspapers from the time, and none of them were saying [of Thatcher’s election], “This will be business as usual.”
JD: Do you think she actively sought confrontation with her Cabinet colleagues in the period 1979-81? And if she did, was this a function of personality (that Manichean mindset) or ideology?
I don’t think she actively sought confrontation, but there were lines of tension and division between her instincts and those of the rest of the Cabinet. From 1975 [when Thatcher was elected Conservative leader], there was a sense in which she was ideologically different from what had gone before.
You quote a description of Thatcher in 1981 as the “loneliest prime minister since Attlee,” a “very solitary leader” with “no party base.” How accurate do you think that description was?
I think we can exaggerate the extent to which she was a loner. What I was trying to get across was that culturally she was very isolated. Unlike her predecessors, she hadn’t fought in a war. In the early Eighties, the officers’ mess/gentlemen’s club world was a much more significant ingredient in Conservative politics than is the case today. If you look at her Parliamentary Private Secretary, Ian Gow, he had been a regular army officer, he was a public school boy. He was a member of four or five gentlemen’s club, and he’d pick up gossip in those places. It was a totally different political culture than it is now. And, as a woman, she was much more isolated than would be the case if we had a female prime minister today.
The first decisive event in the story you tell in the book was the budget in March 1981. One of the useful things you do is set it in context—specifically, you discuss the concessions that the government was forced to make to make the miners in February 1981.
Given what we know about Thatcher’s personality, I think we can say that the toughness of the Budget and the concessions to the miners were connected. I think she felt she had given in on the miners’ pay demands, so she thought, “No more Mr Nice Guy,” as it were. In the Commons debate on the miners, [Labour leader] Michael Foot had made mincemeat of her. So, from a parliamentary point of view, it was a capitulation, and slightly embarrassing. And don’t forget that at the 1980 party conference, she’d made the “Lady’s not for turning” speech. She felt guilt, almost, about this concession and said, “Now, I’m going to stick to my guns.”
And sticking to her guns in economic policy meant, above all else, bringing inflation down.
Yes, and public expenditure. She used to remind Geoffrey Howe, the Chancellor, “I’m First Lord of the Treasury,” in a way I can’t remember another prime minister doing. So I tend to think she was more of a driving force behind that Budget than Howe.
What was her relationship with Howe like?
After 1975, I think her instinct would have been to make Keith Joseph Shadow Chancellor. But it was widely thought that to have Thatcher as leader and Joseph as Shadow Chancellor would have been too much of the ideological, Thatcherite agenda. So she chose Geoffrey Howe. He was very stubborn. Once he took a decision, he was immovable. And I think Thatcher understood how strong he was. And he was very sound in terms of his monetarist credentials. So she sensed that there was a kind of double-act there. She was the fiery, flamboyant one. And he was this sober, provincial solicitor type (though of course he was actually a barrister).
But that steeliness that you identify in Howe would also serve him well in 1990, when he helped to defenestrate her.
Absolutely right. She pushed him too far. [By then], her instincts weren’t as good, while her self-belief had gone through the roof. She believed her own myth.
How important were Thatcher’s economic advisers, Alan Walters and John Hoskyns, to the conception of the 1981 budget?
I think they were very important. As an outsider herself, Thatcher liked other outsiders. She liked people who were going to storm the citadel. It’s hard to imagine, for example, any of her predecessors promoting someone like Norman Tebbitt. It wasn’t really to do with people’s backgrounds. Hoskyns had gone to Winchester, after all. But he had an unconventional life. He set up a computer company in the 1960s—you had to be quite radical in your thinking to do that. She liked to bring in people who reinforced her more radical instincts.
There are many parallels between the period you describe and the present day—not least the civil war inside the Labour Party, which in March 1981 precipitated the formation of the SDP. Was Thatcher a lucky prime minister? While she was, as you say, weak in the early years of her premiership, the opposition was even weaker.
What the SDP were reacting to was Margaret Thatcher. It was her style of politics that allowed them to have an opening. You could argue that if the Tories had been led by one of the “Wets,” then Labour wouldn’t have split. If the Tories had been closer to the centre, the SDP would have had less room for manoeuvre. But you’re certainly right: the split [in Labour] helped her. But we’re looking at this with the benefit of hindsight. Bear in mind that at the end of 1981, the SDP were at 50 per cent in the polls. But politically and intellectually, Thatcher found it difficult to grasp the point of the SDP. She’d have understood Jeremy Corbyn because her politics were about Manichean struggle.
There were two highly significant speeches made at the recent Conservative Party conference by the Prime Minister and the Chancellor. How Thatcherite do you think those speeches were?
Clearly the One Nation rhetoric isn’t something she was particularly comfortable with. So the style is slightly different. But I think some of the aims are similar, particularly from the Treasury point of view—trying to make the country pay its way, balancing the books, all of that. That’s a Thatcherite narrative. The Prime Minister has a broader social vision than she did. But you’ve got to understand her in the context of the time. She was coming off the back of industrial unrest and the need to restructure the British economy in a fundamental way. So context is everything. And the context today is very different.
Do you see yourself as keeper of the Thatcherite flame?
I wouldn’t say that! But she was the reason so many Conservatives of my generation got into politics. She was a hugely interesting figure. In 200 years’ time, people will still be discussing Thatcher.
Kwasi Kwarteng’s “Thatcher’s Trial: Six Months That Defined a Leader” is published by Bloomsbury (£20)