The wind of change

Just in Time: inside the Thatcher revolution

Sir John Hoskyns <em>Aurum Press, 432pp, £20</em>

I

We still await a convincing biography of Margaret Thatcher. This would have to be not only an astute work of psychology, but a history of postwar Britain, depicting its slide from late wartime euphoria to a succession of crises which tore apart both major parties, generating the desperation that enabled a middle-aged woman from the provincial lower middle classes to wrest control of the leadership of the Conservative Party, of all institutions, win a general election against the odds, and rise in the space of a few years to the status of a major world figure, only to topple ungracefully and subsequently haunt the political scene like a ghost.

The ideal historian would need to assess the legacy of the Thatcher interlude. As John Hoskyns complains in his new book, the Major premiership was devoted to de-Thatcherisation by stealth. (A subsequent attempt at explicit de-Thatcherisation, launched by Peter Lilley, was indignantly rejected by the party and its author sacrificed by William Hague, who had initiated it.) In its early years, the present government implicitly rehabilitated Thatcher; only recently have Labour's plans for increased state expenditures and trades union powers called into question her major achievements. So far, academic writing on the period has been unambitious and uninspiring. Worse still are the plethora of self-justifying memoirs by former ministers.

John Hoskyns's book is a welcome departure. He is not and was not a politician. A regular soldier, he left the army to start his own successful business, which he then sold in order to devote himself to repairing the state of the country. He wrote a book, which was never published, but which included complex diagrammatic schema of Britain's interlocking problems. This first brought him to my attention.

Hoskyns had initially joined Labour Party study groups in good faith, but left disillusioned as the party veered leftward. He then met me by chance, and was drawn into the work of the newly established Centre for Policy Studies as an unpaid fellow. Margaret Thatcher was quickly attracted by his remarkable abilities. After her election victory in 1979, she made him head of the Downing Street Policy Unit, a Wilsonian innovation, over the head of Adam Ridley, the party establishment's candidate. Hoskyns resigned in 1982, when it seemed that he could no longer make a contribution, in spite of Thatcher's requests for him to stay on. I can confirm that she promised him a place in the Cabinet if he sought and found a seat in parliament. He feared that, even if she kept her word, this would hold the danger of converting him, over time, into yet another Conservative grandee, thereby undermining his potential contribution as an outsider unencumbered by any need for electoral popularity. The "art of the possible" had come to mean swimming with the tide instead of setting a course and fighting to achieve it, which had been his original motivation.

In his book, 18 years on, Hoskyns still justifies his decision to leave Downing Street. He complains of how the political system throws up Cabinet ministers incapable of making and implementing policy, which is left to civil servants, who lack a broader vision and are guided by administrative convenience. When he joined the Centre for Policy Studies, his thesis was that mid-1970s British society demanded radical change, if it was to escape disaster. Big state expenditures, designed solely to avoid political conflict by keeping nationalised industries and their shop stewards content, were crippling the economy, upon which perverse welfare budgets and the trades unions were inflicting mayhem. Bold cures were required.

But assent by the then shadow cabinet, of whom a majority were committed to the old ways, did not mean compliance. In particular, James Prior - supported by the Conservative Research Department under Chris Patten (1974-79) and several members of the shadow cabinet - fought a rearguard action based on the thesis that the trades unions were too strong to be confronted; that most of "industry" recognised this; and that bad management was a bigger problem than bad unions.

Just in Time relates how John and I fought back against Prior and the CRD, mobilising industries run by entrepreneurs and managers in situ against Prior's praetorian guard in the CBI, which consisted mainly of former ministers and civil servants co-opted on to boards because they had influence in the right places. Prior was defeated in no small part because sections of the labour movement, as well as the public at large, resented the bullying antics of shop stewardry.

The neo-Keynesian monetary squeeze, which Thatcher inherited from Denis Healey and the IMF, was the conventional wisdom. Its intellectual demolition, in Keith Joseph's Monetarism Is Not Enough pamphlet, in 1976, was not enough to break its grip. Although Margaret Thatcher and others assented to Joseph's thesis, they perpetuated Healey's policies, against Hoskyns's urging, from 1979 onward. To counteract this, I brought in Professor Alan Walters as Thatcher's economic adviser, to temper the squeeze. In the meantime, Healey, quick on his feet, had denounced his own policies, with Friedmanite rhetoric, as "Thatcher monetarism", a term that stuck and helped produce a series of by-election defeats in normally safe seats.

The infamous 1981 Budget, on which Walters and Hoskyns worked together with the prime minister, counteracting the Treasury's neo-Keynesian orthodoxies and the warnings in the Times from 364 tame economists, represented the apex of the achievement of our group of "irregulars". From there, Hoskyns left Downing Street, Walters returned to the World Bank and to Johns Hopkins University, and the CPS was de-Shermanised and neutered. As this later entailed "airbrushing" me out of Margaret Thatcher's memoirs, The Downing Street Years, and other such records, I am glad that Hoskyns gives my crucial role at the time full credit.

Memories of Maggie is a collection of contributions, mainly by Conservative parliamentarians, most of whom, being politicians, use her as a peg on which to hang autobiographical fancies. One of the few non-Tory contributors, David Owen, is among the most interesting, perhaps because he shared so many of her experiences. He praises Thatcher as the leader of the middle-class revolution that restored Britain's self-confidence, and writes off her hubris as a collateral deformation professionnelle. Our ideal historian of Thatcher can safely be left to pick and reject among the essays; few deal with the problems that brought Thatcher to the fore in the first place, and without which she makes no sense. As I write, in my own contribution to Memories of Maggie: "In the course of time [Thatcher's] enthusiasm for ideas seemed to lapse while the iron-clad self-confidence, which had been so essential when she was an outsider storming the citadel, became an impediment."

Of how many leaders is this not true? We are left, in the end, with admiration tinged with regret.