Perhaps the adjective most used to describe Prime Minister Margaret Thatcher in the week of her passing has been "divisive." Indeed, there are few elected leaders who have inspired such passionate disagreement among their electorate. But what is striking is that while there is much division about the lady herself, the results of her administration are undeniable.
Just read some of the obituaries. The New York Times noted that: "Her policies revitalized British business, spurred industrial growth and swelled the middle class." The Guardian (a far-left British paper) noted that: "Thatcher broke the pattern of postwar politics and changed its nature. Labour [the opposition party] accommodated rather than reversed her attack on the welfare state and left her employment legislation almost untouched."
Most Americans probably don't see many differences between the U.S. and British economic systems today. However, in the 1970s, Britain was quite different. The government owned major industries: steel, cars, coal, telecommunications and others.
These industries were controlled by powerful unions who ensured that the government would keep funneling public money into them even as they lost millions of pounds every year. During the 1980s, the leader of the most powerful union, the mineworkers, was an open communist who actually solicited funds from Moscow. Violent strikes kept politicians from acting to reduce union power and Britain had developed a reputation as the "sick man of Europe."
As a more junior member of Parliament, Margaret Thatcher was initially supportive of the Conservative Party's attempts to find a middle way that would please socialists and those who believed in the free market. These attempts at compromise failed and the Labour Party took the country even deeper into chaos as they took the majority. Thatcher came to realize that only a vigorous attack on entrenched power and a full-throated defense of the free market would turn her country around.
And turn it around she did. When she took over as Prime Minister, workers' wages were falling. Under her leadership, wages began to increase again. As her successors continued to follow her lead, wages continued to rise and surpass those of neighboring France. While she was often denigrated as supporting only the rich, it was the common man who benefited from the rising economy.
The United States may not be facing the same grim problems of 1970s Britain, but there is still much we can learn from their experience. What Margaret Thatcher saw clearly was that socialist policies couldn't provide what they promised.
Socialism promised that everyone would share success equally. The problem was that failure was rewarded as much as success. British car companies, working within strict employment rules, were putting out inferior products. They were losing gobs of money, but no one was being held accountable. Workers assumed that their jobs would be safe regardless of the quality of their products.
Meanwhile, successful industries and workers were paying devastating taxes. According to the New York Times, in the "70s nearly half of the average taxpayer's income went to the state. Nearly one-third of workers were employed in nationalized industries. Tax rates on investment income topped out at 98 percent.
Since 2008, the U.S. government has bailed out banks and car companies, given billions of dollars to politically connected "green" companies, and installed a union lawyer on the National Labor Relations Board. Right now, we have the fewest number of Americans working since 1979.
Frankly, in many ways the President is pushing policies that mirror what was tried in Britain in the 1970s. These policies just don't work. I know that he thinks government intervention will make things better for workers, but in reality the government ends up punishing success and rewarding failure.
Margaret Thatcher worked to turn her nation around. She didn't let vigorous opposition sway her opinion. She knew what was necessary to make Britain strong again. This may have been divisive, but the results weren't.
In fact, the Labour Party only retook power in Britain when their platform called for liberating business from government regulations, ending taxes on investment and reducing welfare. Imitation is the sincerest form of flattery.