Thatcher’s Deconstruction of Industry

Thatcher’s deconstruction of British industry is one of her lasting legacies. On the right, you’ll hear how it was necessary and beneficial toward moving Britain in the direction of a free market economy, a concept that Thatcher never truly believed in. On the left, you’ll hear how the government should have continued propping up the mining and manufacturing industries despite chronic problems and a reliance on stolen funds i.e. taxation. However, neither answer is satisfactory in understanding what has happened since the deconstruction of industry by Thatcher.

By ending major industries in the UK, Thatcher destroyed swathes of the North and Midlands. Instead of the dynamism of entrepreneurship enthusing laid off factory workers and miners, service sector jobs in call centres and supermarkets became the major employer in Northern and West Midland towns and cities. In fact, nothing much of a free market reigned in the UK, with Thatcher centralising government functions (education, areas of healthcare) and moving subsidies into retail and finance. A real free market would have favoured non-subsidised industrial sectors, reducing the economies of scale and not making these industries reliant on the falsity of international competitiveness.

The way industry could have been reformed would have been much better for the overall economy. By actually allowing for free markets to develop in communities and localities, you wouldn’t need a reliance on London-based capital firms and too big to fail banks. Economies of scale would have remained at a regional or national level, due to the elimination of transport subsidies in rail and roads. Thus mining and manufacturing sectors would have had a major part to play in such an economy. They would have provided factor inputs for infrastructure projects and for local businesses involved in niche and craft manufacture.

To do this, industry would have to have been decentralised, favouring trade union and community control over those means of production which would construct industry involvement in new economies of scale. This would have saved government money, as they could taper off the subsidies and get rid of the overpaid bureaucrats and managers that festooned these companies and their regulatory bodies (such as the Coal Board). Transitioning control of government run industry to worker/trade union control or localising industry into private ownership would have allowed for heavy industry to compete, grow and evolve, creating new innovations and leading to different industries.

The subsequent destruction of traditional communities in England and Wales wouldn’t have happened, and new innovations in micro-manufacturing and community workshops could have happened as the infrastructure was there for their development and proliferation. Community control of capital through social capital markets and the decentralisation of public services could have occurred due to the infrastructure being there to maintain and pay for them.

A proliferation of cooperative and municipalised enterprises, run through a combination of local, community markets and decentralised planning for public goods and general provision toward worker run and locally-owned businesses. These would be nestled in relations of capital that are communally or individually controlled. Proper free markets would resemble this, making the state as a construct redundant as it could have its social and economic functions subsumed. Supposedly, the reduction in the size of the state is what Thatcherites want.

Instead of taking this direction in reforming industry and the general UK economy away from the grasp of statism, they simply moved the functions of statism and the elitism it confers onto a new class of people. It moved from bureaucrats and middle management in the state sector toward those in the private sector. Instead of decentralisation and free markets, we saw nominally private ownership with all the privileges of state cartelisation. All Thatcher’s deconstruction of industry did was move state functions into private hands, while simultaneously destroying the working class spirit of trade unions and their communities. It had nothing to do with economic efficiency (as shown by Gabb who noted that the cost of fighting the NUM strikes was larger than the actual subsidy to the coal industry[1]), but was rather a plan to make unruly unions and communities realise that a new epoch of capitalism was developing in the move from Bretton Woods to neoliberalism. “Authoritarian states are instinctively scared of social structures outside their control. What they want, in the words of Auberon Waugh, is the power to press one button and watch everyone jump at the same time”[2]. Because Thatcher saw these communities as having the potential to unravel her economic plan, she aimed to crush them, and she did.

This plan follows similar epochs of capitalism, with its shifts in power and mutation into a new, ever more fluid elite. As Carson noted in relation to the introduction of electrical power into industry, ” there were two alternative possibilities for organizing production around the new electrical machinery: decentralized production for local markets, integrating general-purpose machinery into craft production and governed on a demand-pull basis with short production runs and frequent shifts between product lines; or centralized production using expensive, product-specific machinery in large batches on a supply-push basis”[3]. Thatcher was also presented with two similar possibilities, and like every global leader in hoc to powerful vested interests, she chose the latter, and with it further centralised the British state and the economy, creating more despair and alienation.

But that doesn’t mean that the possibilities of industry that I have laid out don’t exist. While the last colliery in England has been closed, their need to be reopened would come with a decentralisation of the economy and the necessity for locally sourced energy. Similar developments would occur in the natural resource sector, with iron and other raw materials being produced for local transport links and for new, small-scale industries, such as hackerspaces and community workshops. Inevitably, some of these industries would fail, but with the infrastructure to absorb their human capital and thus stop them from becoming another alienated, unemployed class of people. Kropotkin noted the natural tendency for industry to decentralise to job-shops and guilds 100 years ago. The only thing stopping it now is the coercive power of the state, that subsidises large transport links and global value chains. Without these, community independence and market autonomy naturally occur, mutually reinforcing each other into a free economy of independent labourers and collective ownership of the means of production. Capital would become an anachronism for the collectively owned resources of a community or business, rather than a byword for authoritarian control of an economy. While Thatcher’s revolution is now long dead, a new libertarian anarchist revolution may well be on the horizon.

[1] Gabb, S. (2015). Margaret Thatcher, the Miners’ Strike, and the Triumph of Middle Class Leftism. Available: http://thelibertarianalliance.com/2015/04/20/margaret-thatcher-the-miners-strike-and-the-triumph-of-middle-class-leftism-2015-by-sean-gabb/. Last accessed 17th Jan 2016.

[2] Gabb, S. (2015). Margaret Thatcher, the Miners’ Strike, and the Triumph of Middle Class Leftism. Available: http://thelibertarianalliance.com/2015/04/20/margaret-thatcher-the-miners-strike-and-the-triumph-of-middle-class-leftism-2015-by-sean-gabb/. Last accessed 17th Jan 2016.

[3] Carson, K. (2010). The Distorting Effects of Transportation Subsidies. Available: http://fee.org/freeman/the-distorting-effects-of-transportation-subsidies/. Last accessed 17th Jan 2016.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s