Labour’s poll ratings are now more than double those of Rishi Sunak’s beleaguered Tories. Not since the 1970s has a change of government looked so inevitable—yet so challenging. In particular, how will Labour cope with the poisoned economic chalice?
The past doesn’t at first glance offer much guide to the future, since the two crisis-inheriting governments of the 1970s suffered radically different fates.
The first was Harold Wilson’s Labour government of 1974, which took over from Edward Heath’s mostly disastrous Tory government of 1970-74 amid rampant inflation and the most serious national strike—in the mining industry—for half a century. Labour in turn ran into the sand within five years. Wilson retired in 1976, and under his weak unelected successor, Jim Callaghan, the government was engulfed by another strike wave, this time across the public sector. It was dubbed the “winter of discontent”.
The 1974 Labour government’s birth and death both came in the context of industrial strife and economic crisis. It had a precarious existence and precious little peace in between, and no continuity of leadership.
Labour’s failure gave rise to the Tory government of 1979, whose trajectory was radically different. Margaret Thatcher became the longest serving prime minister of the 20th century and almost completely eviscerated the trade unions. Indeed, the current winter of discontent is the first truly widespread industrial unrest since Thatcher defeated the miners’ strike of 1984-85, led by the revolutionary firebrand Arthur Scargill.
How does one account for this stark contrast between Callaghan’s implosion and Thatcher’s recovery, and which prime minister is Starmer more likely to emulate?
Significantly, the 1984-85 strike, the second major miners’ strike within barely a decade, came well into Thatcher’s second term of office. The so-called “iron lady” was highly cautious on industrial relations and much else in her first term (1979-83), afraid of suffering the same fate as Heath and Callaghan. She granted inflation-busting pay settlements to end public sector strikes and at the outset bought the miners off to avoid an early showdown over pit closures.
The battle with Scargill came after the successful war against the Argentinian dictator Galtieri following the invasion of the Falkland Islands in 1982—and after the Labour party had split and the Tories been re-elected by a landslide in 1983. Timing was all, and Thatcher’s boldness was gradual.
The situation confronting Keir Starmer is obviously different in fundamental respects to the 1970s. In particular, he faces a collapsing NHS which needs to be rebuilt, not a collapsing coal industry which has to be managed through decline. But there is a key similarity: namely, the precarious authority of the state, gravely weakened by the failure of successive governments since 2015 to stabilise the economy and govern without endemic crisis. Until Thatcher could re-establish the authority and reputation of the state—the real significance of her victory in the Falklands—she was in a position as weak as Wilson and Callaghan. Fully recovering the government’s authority took the best part of her first term and a half in power—from 1979 until the defeat of Scargill in 1985.
It is also highly significant that the big decision that Heath got right—and which Thatcher sustained—was Britain’s entry into the European Union (then called the “common market”) in 1973. This established stronger economic fundamentals which paid increasing dividends over time, particularly when the second- and third-term Thatcher government largely created the single European market, deepening and broadening free trade across our biggest overseas markets.
That last bit sound familiar? As for the rest, I suspect the real moral is whether the cautious Starmer is strong, determined and lucky enough to make it through to a second term. For he has just as big a job on his hands as Thatcher to restore the authority of a state beset by a decade of massive, unrelenting failure.
