Background

• 1974 (Oct) – The second election of 1974 resulted in a slim Labour victory, with a majority of only 4 seats. This was a blow to Harold Wilson who had expected a much more comfortable margin, but with both parties exhausted and the country having little appetite for more elections Wilson accepted his victory. The Liberals who had hoped for “One More Heave” saw the loss of a seat, and Billy Wolf’s SNP saw a gain of 4, but he once again lost his own attempt to enter Parliament.
  
• The Iron Lady:
  
• Well it’s been a while since a leadership position last changed hands and here we have the first of three. Margaret Thatcher rose to prominence as Heath’s Education Minister, having been chosen as a hard-working and intelligent backbencher worked her way up as spokeswoman for various departments, she was then chosen by the US for its Foreign Leader Program - an exchange program which saw her tour the US and meet with various notables such as Nelson Rockafeller, and the IMF. Thatcher created a favourable impression on the Americans and gained a position on Heath’s Shadow Cabinet. As Education Secretary Thatcher was hard working and stuck to her remit, although she was perhaps best known for cancelling the programme of free school milk for children (she herself argued she was continuing a Labour policy as they’d cancelled the programme in secondary schools). After the Feb 1974 loss Thatcher was downgraded to Shadow Environment Secretary - perhaps a reflection of her and Heath’s frosty relationship. But what was meant to be a downgrade caused Thatcher’s star to rocket. Thatcher proposed a new policy of abolishing the rates system which was a property tax, and for it to be replaced by a new tax based on income (although the latter part was sometimes left out).
  
• Thatcher unveiled this policy during August when the rest of Parliament was on holiday and hoovered up the media’s attention with little else going on politically. As I discussed last week she also notably tore into Dennis Healey’s budget, which gained her great acclaim as Healey was seen as a formidable debater. Thatcher was aided by the fact that she never believed she'd be leader. The contest after Heath had already seemingly been set in stone: WIllie Whitelaw vs Keith Joseph. I’ve touched on Whitelaw previously but he was seen as a consensual centrist, whereas Joseph was the leader of the Conservatives’ right. However, after the October 1974 election, Joseph torpedoed his budding campaign in a series of controversial interviews, during one of which he argued poor people should stop having children because it diminished the British racial stock. The fact that Thatcher stood despite not being considered a forerunner for Leader meant that she avoided accusations of scheming or being power-hungry despite her political manoeuvring.
  
• Thatcher’s policy of scrapping taxes during a dismal campaign where 2 parties fought over who was the least unpopular brought her great acclaim and she was heavily featured in the Conservatives TV broadcasts (see my last post). This fame allowed her to take the unprecedented step of challenging Heath in 1975. Heath had assumed he’d stay on as leader, and most of his cabinet fell in line out of loyalty to him, but after losing 3 out of 4 elections most Conservative backbenchers were itching to get rid of Heath who as discussed previously could be unbearably haughty and arrogant. The contest with Thatcher brought out the worst of Heath as he failed to hide his disdain for the (as he saw it) annoying woman with right-wing views. Thatcher could sense the backbenchers had enough of Heath however and her image shown in TV broadcasts of the wife and mother cleaning up in the kitchen before whipping off the apron and dashing out for a business meeting struck a chord with many people along with her previous fame for scrapping taxes and coming across well in party broadcasts. Thatcher also managed to channel the anger of the right of the party who had stuck with Heath after he sacked Powell and then been disappointed by Heath’s u-turns while in power, and his shift to the left in the contests of 74. The heavyweights of the Conservative party dutifully fell in behind Heath and were stunned when he lost the first round of voting in a surprise upset. Heath withdrew and other candidates such as Whitelaw piled in but Thatcher had the momentum on her side, and for her courage in challenging Heath she won the second round and became Leader of the Conservative Party.
  
• But what does Thatcher believe, and how is she as a leader? Those within the Conservative party saw her as a figure of the right due to her monetarist policies and sympathies for Enoch Powell but the larger public had little idea of what she stood for. Thatcher embarked on a series of lengthy political interviews with journalists and commentators to advocate for her positions. Thatcher loved debating commentators so much she extensively appeared on the American show Firing Line, hosted by William F. Buckley. The show was only broadcast in the US so it had no political advantage for Thatcher but she enjoyed honing herself in TV debates. In this way Thatcher is totally different from Wilson, Heath, and Callaghan. Heath loathed TV appearances and could go a whole year as Prime Minister without ever giving an interview or putting himself on TV. Wilson disappeared after the 1970 election and tried to fade into the background of the referendum on the Common Market because he despised journalists and knew how much the public were sick of him. Callaghan did not avoid the press as much but was known to be a quiet figure who rarely made appearances. Thatcher’s outstanding quality during this period is her abilities as a political communicator and teacher, and her ability to frame issues. The policies she advocated for were radical, and are very different to the manifesto’s we’ve gone through before (briefly the “Post-war consensus” consists of a “Tripartite” agreement where managers represented by the CBI and trade unions are consulted before economic decisions are made, full employment is maintained through Keynesian economics trade unions are regularly consulted by the government on policies and are given widespread powers, and a strong welfare state is maintained through high taxes. Thatcher in effect opposes all of this), but Thatcher was able to frame her policies in a way which seemed completely normal, and appealing.
  
• Her economics were not just about numbers for example but freeing the people and giving them power. When asked if she was a pragmatist she replied ‘I’m a pragmatist in the true sense of the word… putting your principles into practice.’ When asked if she was right-wing she replied ‘Define what you mean by right-wing… you can’t look after hard-working people unless you create enough wealth to do so… My views don’t differ very much from Iain Macleod/ If you want lower taxes it’s called right-wing… If you support the police it’s called right-wing… If you want to sell council homes it’s called right-wing… If you want to uphold standards in education it’s called right-wing… If you call that right-wing, I’m right-wing.’. When discussing her housing policy she declared “property is freedom”, when discussing the economy she claimed Britain’s economy was struggling because something had “gone wrong spiritually and emotionally”. She declared she would not suffer disagreements from her cabinet. Heath and others scoffed at Thatcher for being overly simplistic and ignoring the realities of governing, but over the inertia of the political scene, Thatcher’s policies were seen by the public as bold and exciting. But Thatcher could only pursue these policies because at the time the British economy and political system were in total crisis and so a rethink made sense to voters. Elsewhere Thatcher was more careful, her cabinet, for example, contains more “wets” and “Heath-men” than natural allies. I should also note that by this point Margaret Thatcher is not seen as “The Iron Lady” or a particularly strong, or tough woman. At the announcement of her victory, she pulled out a feather duster and cleaned the stage to laughter, and when first called “The Iron Lady” she mocked the term and pointed out her done-up hair, her expensive dress, and her make-up. Thatcher’s image will change over the next few years. In summary, Thatcher is a bit of an unknown quantity but is seen as representing a clear break from Heath, and as someone with very clear principles, but also perhaps inexperienced.
  
• In or Out? - As promised after his victory Wilson eventually held a referendum on Britain staying or leaving the Common Market. This had been devised by Wilson to help keep the Labour party together which was split almost 50-50 on the issue. Both sides, however, saw a referendum as a way of solving the issue, and Wilson believed it’d let some of the tension out of his cabinet. Wilson largely took a backseat and let his cabinet members appear on TV to fight one another, intervening sparingly in favour of “Yes” (or remaining within the Common Market). Wilson had held off on a referendum until every available poll showed “yes” would win and in the 3rd election in 11 months the British public voted to stay within the Common Market
  
• Big Jim - Wilson then rather abruptly stood down as Labour leader. It’s still unclear why exactly Wilson stepped down. It may have been because his wife was ill, he developed colon cancer, or the realisation he was developing Alzheimers, and there are other reasons as well. As I’ve mentioned before Wilson’s cabinet was one of the most stacked in history and there were several candidates to succeed him the Labour party was split into 2 main ideological camps with the “soft right” being the largest. The left were split between Tony Benn and Michael Foot. Benn was a young charismatic maverick, and the darling of the hard left, whereas Foot was seen as a figure of the left who could still unite the party and therefore won the first ballot. On the right, there were 4 candidates although Anthony Crosland is pretty irrelevant. The main figures were the Chancellor Dennis Healey who was busy writing a budget and had just had a public spat with the left-wing magazine “Tribune” who were one of the main voices behind the “No” campaign which tarnished him. Roy Jenkins was one of the favourites to win, Wilson’s modernizing Home Secretary who legalised homosexuality a few posts ago. Jenkins had been the right’s standard-bearer but had voted against a Labour whip to vote yes to entering the Common Market when Heath was Prime Minister, and then resigned as Deputy Leader when Wilson committed Labour to re-negotiating Britain’s entry. Jenkins was therefore seen as disloyal and divisive among the party. Callaghan was a steady, safe pair of hands. A figure of the right but one who’d opposed British membership into the Common Market and led the trade unionist charge against “In Place of Strife” making him a figure the left could fall behind, and as the oldest candidate was seen as someone who’d maybe lead Labour into another election but would resign relatively soon, giving the other contenders another crack at leadership anyway. He had also been unofficially endorsed by Wilson, so when Jenkins withdrew after the first round of voting Callaghan hoovered up his support and went on to win.
  
• Thorpe to Steel - And finally we have the bizarre case of the Liberals change in leader. During the 60s Liberal leader Jeremy Thorpe had a homosexual affair with a man called Norman Scott, then a criminal offence. MI5 tracked the two but took no action. When Thorpe became leader Scott resurfaced and tried selling his story but was turned down by newspapers due to the story being difficult to confirm and old news, but these rumours distressed Thorpe. Thorpe took money from a Bahaman millionaire to help cover his party’s election expenses and then gave the money to an airline pilot who promised to assassinate Scott. The pilot bungled the attempt however and ended up shooting Scott’s Great Dane. In court Scott testified that he believed the shooting had been motivated by his affair which made his relationship with Thorpe public knowledge. The pilot then sold his story the next year when he was released and the pressure made Thorpe step down as leader, although prominent Liberal figures defended him. The case eventually goes to court in 79 but the case is handled poorly, with Scott also bizarrely claiming that Thorpe infected him with the lifelong disease of homosexuality and should therefore pay for his care for the rest of his life. Thorpe is acquitted but is widely perceived as being guilty and the Liberal leadership goes to great lengths to distance themselves from him. The subsequent leadership election was won by David Steel who had been Thorpe’s chief whip and foreign affairs spokesman. Steel was a popular progressive figure, perhaps most notable for writing and proposing a bill which legalised abortion in 1966 but he’s not as charismatic as Thorpe, who after achieving the Liberals’ best modern result has badly tarnished its image.
  
• The Economy Stupid - The economic crisis we’ve discussed in the last few posts as a result of the oil crisis and stagflation continued into Wilson and Callaghan's government, but the resignation of Wilson made things worse as creditors lost confidence in Pound Sterling and it was temporarily pulled from being able to be converted into other currencies. In order to try and restore confidence, Callaghan instituted a program of austerity with widespread government cuts but the pressure continued and in 1976 the government was forced to ask the IMF for a hefty loan to keep going. The IMF agreed on the condition of more cuts which were implemented. Many in the Labour cabinet were opposed to both of these series of cuts and Callaghan employed the tactic of letting his opponents talk themselves into circles until eventually, it became clear that cuts were needed, however, this tactic resulted in extremely lengthy meetings where the cabinet seemed to endlessly debate amongst itself, leading to Thatcher’s aforementioned comments about not allowing much dissent within her cabinet. With the world economy improving, Labour’s cuts, the strengthening of the Pound, and a pay freeze (more on that Labour) inflation began climbing down from a peak of 26% in 75 to 7.8% in 78. Unemployment began falling and the economy as a whole began improving which led to an uptick in Labour’s polling, with polling in 78 showing Labour slightly ahead or a hung parliament likely. But by 1979 unemployment rose to 5.5% and inflation hit 13.39% and the economy began faltering again.
  
• The Lib-Lab pact - Although the Labour party had won a majority of 4 seats this was quickly whittled away due to by-election defeats, with the Labour Parliamentary Party elected in Oct 74 being notably older than usual. To combat this Callaghan negotiated with the SNP and Plaid Cymru, Scottish and Welsh nationalist parties, agreeing to referendums on Scottish and Welsh devolution and the prospect of creating a Scottish Parliament and Welsh Assembly in return for their backing on key votes. In 1977 an agreement was also made with the Liberal Party for the Liberals to back key votes such as the budget to keep Labour in power, an exchange for a joint Liberal-Labour committee which would examine government policies and legislation. It has been suggested that Steel as a new, young leader was naive to agree to this agreement as it didn’t give the Liberals much real power, but after the Thorpe affair, Steel believed close cooperation with the government would help the Liberal party rebuild its legitimacy. The pact, however, was unpopular with activists within both parties. The prospect of an election was growing more likely, and it was believed Callaghan no longer needed the Liberals. The Scottish and Welsh nationalists would wait until their referendums on devolution, and the upcoming boundary review was predicted to give Northern Ireland more seats so the Northern Irish parties would hold off, it’d also give Labour roughly 6-8 seats too so the Labour party wouldn’t try to bring him down beforehand, and MPs in both parties from marginal seats were nervous about an election. Just 15 months after it was agreed to the pact was terminated in August 1978.
  
• The Social Contract - In order to prevent the chaos of the Heath years Harold Wilson devised a “social contract” with the trade unions. The Industrial Relations Act was repealed and new protections were given to unions such as protections over picketing and “closed shop” practices where an employer agrees to only hires members of a specific union, and workers are forced into remaining members of that union otherwise they’ll be fired. Labour also agreed to pass legislation which favoured trade unions and carried out social policies which they agreed to, in return the unions would review pay every 12 months instead of just striking constantly. Miners were also given a further 35% pay increase to keep them happy. The unions agreed to this, and then to an “incomes policy” where the government and unions agreed to restrain themselves when it came to giving pay raises. This somewhat surprisingly worked and the trade unions kept to the agreement despite significant drops in real wages.
  
• The election that never was - by 1978 Callaghan had caught up to the Conservatives in opinion polls and as mentioned previously was slightly ahead or level with them. This is due to the low levels of striking and industrial actions, the improving economy, Callaghan himself whose calm and relaxed demeanour even during crisis reassured voters who felt as though they could trust him, and also Margaret Thatcher’s unpopularity with voters with her personal polling not being very impressive. By 1978 there was serious media speculation that Callaghan would call for an early election and Callaghan seriously considered one. He consulted widely but opinions were mixed. David Steel actually told him to go for an election, and most of his cabinet agreed, although the more prominent members didn’t want an election. As mentioned previously Callaghan’s position was seen as safe, and he personally didn’t believe the polls that suggested he would gain a majority. Callaghan believed there would probably be a hung Parliament again and that this would lead to more negotiations with other parties which he was exhausted at the prospect of after negotiating with the Nationalists and with the Liberals. Callaghan therefore decided to hold off until 1979 and let the economy improve some more. At the 1978 Trade Union Conference Callaghan was set to give a speech and it was expected he’d announce a general election, Callaghan instead made a joke, telling the conference that the commentators had set the date and the election but Marie Lloyd (a singer) had set the time and the event but that they all knew what happened, he went on to sing the song “Waiting at the Church” in a moment hailed as showing his domination of the political field.
  
• The Winter of Discontent - ...But that social contract did not last forever. In 1978 the agreement was due to be renegotiated and with the economy improving the unions believed it was time to loosen the belt. Callaghan without consulting anyone decided on a rather arbitrary limit of 5% pay rises at most for workers. Union leaders refused to accept this, knowing that it’d lead to their members turning on them and the head of the transport union asked who James Callaghan was to tell him he should refuse the pay increases he’d negotiated for his workers. The dam broke when Ford workers went on strike demanding a pay raise of 30% due to the companies growing profits and the fact that Ford’s chairman had just raised his pay by 80%. Ford offered the 5% the government had advised but the workers refused to accept it and eventually settled at 17%. The consequence for breaking government policy should have been sanctions for both the union and the company but when this was voted on in Parliament Labour’s left backed the unions and Callaghan was defeated. This meant that there was no pay restraint for the private sector but that public sector workers pay was still capped, which led to a strike at the BBC with workers threatening to go on strike over Christmas and not play the Sound of Music which BBC had just bought the rights to. A pay freeze only for public sector workers could not hold and limits were withdrawn. What followed were a massive wave of strikes with over 29 million days of work lost from January-February as different unions began striking to secure the pay rises that other unions had secured, culminating in a national “day of action” where 1.5m workers went on strike at the same time. At the same time, one of the coldest winters on record swept the country with temperatures hitting an average -14 degrees celsius or 57.2 Fahrenheit. The UK was buffeted with storms and heavy snows just as the strikes began. Lorry drivers went on strike and demanded a raise of 40% which caused petrol stations to shut down due to distribution issues, and food stores to be stripped empty as people began panic buying. Cities were blockaded stopping all movement in or out and the strike also meant cancer patients could no longer receive chemotherapy. Gravediggers went on strike which saw bodies being dumped out in the open and discussions were held on how they could bury people at sea instead, binmen went on strike so garbage was simply dumped in the streets, hot water supplies were disrupted so people had to boil water instead, nurses went on strike and blockaded hospitals, then ambulance drivers went on strike. Workers walked out en-masse in St. Ormond’s Street Hospital, leaving the sick and dying children to lay inside alone. After this formerly left-wing Labour MPs even began to give speeches in the House saying the unions were going too far.
  
• Crisis? What Crisis? - What was Callaghan doing during all of this? Well, he was at an economic conference in the Caribbean where the press took photos of him gleefully sunning his toes and posing with beach babes. Callaghan had no idea of what was happening in the country and when he returned he decided to give a press conference straight after getting off his plane. During the conference Callaghan scoffed at journalists for asking if he should have come home, claiming they were jealous, brushed off a question about mounting chaos and then laughed about it, asking if he’d be able to find a cup of coffee with all the chaos the journalists were braying about. Callaghan’s cool and calm nature had won the public over during previous crises but this press conference seemed beyond the pale for voters who’d had images of blizzards, empty shelves, and cities being left to starve seared into their minds. When Callaghan soaked in the scale of what had happened he told his press secretary he’d let the country down. When told if Labour kept their heads and fixed things they’d still be able to win the next election Callaghan murmured “I’m afraid we might”, and he refused to give a televised statement on the chaos, asking how he’d give an address admitting his policy had collapsed. During the crises, Thatcher appeared on television to put forward a programme of restricting union powers. By the election, 82% of the public believed the unions were too powerful and Labour were 20 points behind the Conservatives. The day after Callaghan’s conference The Sun ran the headline “Crisis? What Crisis?” Callaghan never said the words during the conference although The Sun claimed he’d said them to a journalist afterwards in private. But the headline summed up what many thought of Callaghan’s response and it formed the basis of one of the Conservative’s most iconic political broadcasts which I’d highly recommend watching to understand the narratives at play during this election, and so you can see the images of the Winter of Discontent
  
• No Confidence - As the strikes petered out referendums were held in Scotland and Wales on devolution. The Welsh referendum was voted against outright whereas the vote in Scotland passed but did not meet the required threshold to implement a Scottish Parliament so Labour blocked it. This led to the SNP calling for a motion of no confidence in Big Jim, who claimed that they were turkeys voting for Christmas. The motion was a tense affair and there are many stories about how one or two decisions could have changed history but in the end, the motion passed by 311 votes to 310, and a general election was called. With the Conservatives jeering the young Labour MP Neil Kinnock leads his party in singing The Red Flag. Harold Wilson is asked for his thoughts and he murmurs that he thinks his wife will vote Conservative because they’re led by a woman. The Labour party is not particularly happy with his contribution
  
• The Campaign - The Campaign itself is relatively uneventful. The Conservative Party employs the advertising agency Saatchi and Saatchi who come up with the poster “Labour isn’t working which becomes iconic and is reused in later elections. Thatcher is also trained in lowering her voice to make it sound more commanding, but Thatcher isn’t quite the Iron Lady yet and isn’t a natural at campaigning. Callaghan comes off as by far the most experienced and like Wilson in 74 tries to focus on prices rather than larger ideological debates. One of his advisors told Callaghan he thought they could win it due to Callaghan’s campaigning but Callaghan replied that once every generation there was a sea-change in politics when what people wanted completely shifted and that they were experiencing that now. Before the election Thatcher gave a speech claiming that there was a worldwide revolt against big government and bureaucracy and that now they were witnessing the end of an era, and throughout the campaign the Conservative party focused on promising a radical break from the past whereas Labour promised continuity, flipping the party’s traditional roles.