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Wednesday, April 10, 2013

Tribute to a Great Leader

“Europe will never be like America. Europe is a product of history. America is a product of philosophy.” — Margaret Thatcher

During the 1990s I spent a great deal of time in Great Britain working with a firm in Swansea, Wales. During this period I got to know something of the British economy and medium-sized businesses. The one thing that sticks in my mind from this experience is the tremendous admiration these professionals had for Margaret Thatcher. While the international press called her the “Iron Lady” these colleagues of mine referred to her as the savior of the British economy and nation. Some of them admitted that they had been members of the Labor Party for years, but constantly supported the Conservative Thatcher. In that sense she drew support from left-leaning voters in the same manner Ronald Reagan pulled support from Democrats.

Margaret Hilda Roberts was born on 13 October 1925 in Grantham, Lincolnshire, the daughter of a grocer. She went to Oxford University and then became a research chemist, retraining to become a barrister in 1954. In 1951, she married Denis Thatcher, a wealthy businessman, with whom she had two children.

Thatcher became a Conservative member of parliament for Finchley in North London in 1959, serving as its MP until 1992. Her first parliamentary post was junior minister for pensions in Harold Macmillan's government. From 1964 to 1970, when Labour were in power, she served in a number of positions in Edward Heath's shadow cabinet. Heath became prime minister in 1970 and Thatcher was appointed secretary for education. Throughout her political life she was greatly influenced by political works such as Friedrich von Hayek's "The Road to Serfdom", which condemned economic intervention by government as a precursor to an authoritarian state.

After the Conservatives were defeated in 1974, Thatcher challenged Heath for the leadership of the party and, to the surprise of many, won. In the 1979 general election, the Conservatives came to power and Thatcher became prime minister. It is reported that during one of the Conservative conferences where there was debate over whether to take a more moderate position closer to Labor so they could garner more votes Thatcher stood and held Hayek’s book above her head and proclaimed in frustration that the Party should follow more the ideology espoused by the Austrian School of Economics than the Keynesian policies that were leading Great Britain down the road to socialism and destruction. She was also an advocate of the writings of the French Economist Frederic Bastiat.

She was an advocate of privatizing state-owned industries and utilities, reforming trade unions, lowering taxes and reducing social expenditure across the board. Thatcher's policies succeeded in reducing inflation, but unemployment dramatically increased during her early years in power as she privatized many of the government owned businesses and utilities making them more efficient and profitable.

Victory in the Falklands War in 1982 and a divided opposition helped Thatcher win a landslide victory in the 1983 general election. In 1984, she narrowly escaped death when the IRA planted a bomb at the Conservative party conference in Brighton.

In foreign affairs, Thatcher cultivated a close political and personal relationship with US president Ronald Reagan, based on a common mistrust of communism, combined with free-market economic ideology. Thatcher was nicknamed the 'Iron Lady' by the Soviets. She warmly welcomed the rise of reformist Soviet leader Mikhail Gorbachev.

In the 1987 general election, Thatcher won an unprecedented third term in office. But controversial policies, including the poll tax and her opposition to any closer integration with Europe, produced divisions within the Conservative Party which led to a leadership challenge. In November 1990, she agreed to resign and was succeeded as party leader and prime minister by John Major.

In 1992, Thatcher left the House of Commons. She was appointed a peeress in the House of Lords with the title of Baroness Thatcher of Kesteven and continued giving speeches and lectures across the world. She also founded the Thatcher Foundation, which aimed to advance the cause of political and economic freedom, particularly in the newly liberated countries of central and Eastern Europe. In 1995 she became a member of the Order of the Garter, the highest order of knighthood in England.

Margaret Thatcher was the not only the first woman Prime Minister of theThatcher_Union_Fla_2353616b United Kingdom she was the longest serving PM during the 20th century serving from 1979 to 1990. When she left office the UK had a ratio of 39% of GDP for spending and 35% of GDP in tax revenue. By 2000 with the continuation of her policies by John Majors and Tony Blair the ratio had flipped to spending at 34.5% of GDP and tax revenues at 36.2% of GDP.

Of all the possible ways to remember Prime Minister Margaret Thatcher — victorious cold warrior, pioneering woman politician, resolute American ally — the one that’s probably most relevant today is the way she transformed Britain’s domestic policy and economy.

The numbers tell the story. As the Telegraph reports, when she took office in 1979, the top British tax rate on earned income was 83 percent, on “unearned” income, 98 percent. By the time she left office in 1990, the rate had come down to 40 percent.

It was a classic supply-side success story. The growth encouraged by the lower rates (along with an increase in the value-added tax that shifted the tax burden to consumption rather than income) caused government revenues to more than triple, to 187 billion pounds in 1990 from 57 billion in 1979. Yet because the private sector grew faster than government spending, even during a Cold War military buildup and a war in the Falkland Islands, government spending as a percentage of GDP in Britain shrank during Thatcher’s administration, to 39 percent from 47 percent. Britain had annual real GDP growth of 4 percent in 1986, 4.6 percent in 1987, and 5 percent in 1988.

As if that weren’t enough, the Telegraph’s summary continues, she privatized government-owned gas, electric, coal, telephone, and airline companies, and she sold the “council flats” housing projects to the tenants who lived in them:

“The proof that the Trades Unions were tamed was seen not merely in better industrial relations and improved performance of the economy, but also in the way the once-mighty National Union of Mineworkers, led by Arthur Scargill, was defeated in a year-long strike in 1984-85. With that dragon finally slain, Mrs. Thatcher could now unpick what she considered one of the most wasteful legacies of state socialism, the nationalized industries. A succession of privatizations — of gas, electricity, coal, telecommunications and airlines — created a nation of shareholders and raised a fortune for the Treasury, enabling taxes to be cut at the top rate to 40 pence in the £ in 1988. A similar drive to spread prosperity as widely as possible was seen in the sale of council houses to their owners. By the end of the second Thatcher term in 1987 the British economy had been transformed, by these and by other important deregulatory measures, into one of the strongest in the western world.”

How did she do it? There are all sorts of possible explanations, including the fact that Britain in the late 1970s, like America, had sunk to such a sorry state that there was a market for solutions that were alternatives to the big-government conventional wisdom. But the point that seems most salient from this distance is Thatcher’s steadfast confidence in the basic principles behind her policies. It was, as she put it in her “Iron Lady” speech, “my defense of values and freedoms fundamental to our way of life.”

She explained those values in her 1988 Bruges Speech, speaking of how “From classical and mediaeval thought we have borrowed that concept of the rule of law which marks out a civilized society from barbarism. And on that idea of Christendom, to which the Rector referred — Christendom for long synonymous with Europe — with its recognition of the unique and spiritual nature of the individual, on that idea, we still base our belief in personal liberty and other human rights.”

She went on:

“The lesson of the economic history of Europe in the 70's and 80's is that central planning and detailed control do not work and that personal endeavor and initiative do. That a State-controlled economy is a recipe for low growth and that free enterprise within a framework of law brings better results. And that means action to free markets, action to widen choice, action to reduce government intervention. Our aim should not be more and more detailed regulation from the center: it should be to deregulate and to remove the constraints on trade.”

Even The New York Times obituary, beneath a home-page headline characterizing the heroine of the Cold War as “divisive,” seemed to grasp what it describes as “the principles known as Thatcherism — the belief that economic freedom and individual liberty are interdependent, that personal responsibility and hard work are the only ways to national prosperity, and that the free-market democracies must stand firm against aggression.”

But it probably seemed remote in the late 1970s, too, that Britain’s first woman prime minister, who had grown up in an apartment above her father’s grocery store, would reshape a failing post-colonial power into an exemplar of liberty. And who would have thought then that, 30 years later and an ocean away, she would be inspiring those of us who believe that even after Thatcher’s (and Reagan’s) Cold War victories and tax cuts, there yet remains room for another political leader with the conviction and skill to redefine the possibilities for growth and economic freedom?

At the height of the Cold War in 1980 when the United States and the Soviet Union were at the brink of nuclear war and all of Eastern Europe suffered under the oppressive yoke of tyrannical communism four people came together who changed the world and liberated millions of people while drastically reducing the threat of a nuclear exchange. Those four leaders were Ronald Reagan, Margaret Thatcher, Pope John Paul II, and Mikhail Gorbachev.

John O’Sullivan, who was a special adviser to former British Prime Minister Margaret Thatcher and part of her inner circle of speechwriters, on Monday credited her with restoring Britain’s world reputation and its economy.

In an interview with Newsmax TV, O’Sullivan said Thatcher, who died Monday at 87, played a key role, in putting Great Britain back on the world stage.

“She is the woman who managed to restore Britain’s reputation much in the same way that Ronald Reagan restored America’s,” he said.

“She was his partner in the victory over the Cold War, but domestically she reversed failures spanning about 30 years and turned Britain into a significant country globally and economically,” he said.

On March 3, 1995 Margaret Thatcher gave an address at Hillsdale College where the only statue of the Iron Lady in the United States resides. In her speech entitled "The Moral Foundations of Society" Mrs. Thatcher stated:

“History has taught us that freedom cannot long survive unless it is based on moral foundations. The American founding bears ample witness to this fact. America has become the most powerful nation in history, yet she uses her power not for territorial expansion but to perpetuate freedom and justice throughout the world.

For over two centuries, Americans have held fast to their belief in freedom for all men—a belief that springs from their spiritual heritage. John Adams, second president of the United States, wrote in 1789, “Our Constitution was designed only for a moral and religious people. It is wholly inadequate for the government of any other.” That was an astonishing thing to say, but it was true.

What kind of people built America and thus prompted Adams to make such a statement? Sadly, too many people, especially young people, have a hard time answering that question. They know little of their own history (This is also true in Great Britain.) But America’s is a very distinguished history, nonetheless, and it has important lessons to teach us regarding the necessity of moral foundations.

John Winthrop, who led the Great Migration to America in the early 17th century and who helped found the Massachusetts Bay Colony, declared, “We shall be as a City upon a Hill.” On the voyage to the New World, he told the members of his company that they must rise to their responsibilities and learn to live as God intended men should live: in charity, love, and cooperation with one another. Most of the early founders affirmed the colonists were infused with the same spirit, and they tried to live in accord with a Biblical ethic. They felt they weren’t able to do so in Great Britain or elsewhere in Europe. Some of them were Protestant, and some were Catholic; it didn’t matter. What mattered was that they did not feel they had the liberty to worship freely and, therefore, to live freely, at home. With enormous courage, the first American colonists set out on a perilous journey to an unknown land—without government subsidies and not in order to amass fortunes but to fulfill their faith.

Christianity is based on the belief in a single God as evolved from Judaism. Most important of all, the faith of America’s founders affirmed the sanctity of each individual. Every human life—man or woman, child or adult, commoner or aristocrat, rich or poor—was equal in the eyes of the Lord. It also affirmed the responsibility of each individual.

This was not a faith that allowed people to do whatever they wished, regardless of the consequences. The Ten Commandments, the injunction of Moses (“Look after your neighbor as yourself”), the Sermon on the Mount, and the Golden Rule made Americans feel precious—and also accountable—for the way in which they used their God-given talents. Thus they shared a deep sense of obligation to one another. And, as the years passed, they not only formed strong communities but devised laws that would protect individual freedom—laws that would eventually be enshrined in the Declaration of Independence and the U.S. Constitution.

They would do well to look at what has happened in societies without moral foundations. Accepting no laws but the laws of force, these societies have been ruled by totalitarian ideologies like Nazism, fascism, and communism, which do not spring from the general populace, but are imposed on it by intellectual elites.

It was two members of such an elite, Marx and Lenin, who conceived of “dialectical materialism,” the basic doctrine of communism. It robs people of all freedom—from freedom of worship to freedom of ownership. Marx and Lenin desired to substitute their will not only for all individual will but for God’s will. They wanted to plan everything; in short, they wanted to become gods. Theirs was a breathtakingly arrogant creed, and it denied above all else the sanctity of human life.

The 19th century French economist and philosopher Frederic Bastiat once warned against this creed. He questioned those who, “though they are made of the same human clay as the rest of us, think they can take away all our freedoms and exercise them on our behalf.” He would have been appalled but not surprised that the communists of the 20th century took away the freedom of millions of individuals, starting with the freedom to worship. The communists viewed religion as “the opiate of the people.” They seized Bibles as well as all other private property at gun point and murdered at least 10 million souls in the process.

It is important to understand that the moral foundations of a society do not extend only to its political system; they must extend to its economic system as well. America’s commitment to capitalism is unquestionably the best example of this principle. Capitalism is not, contrary to what those on the Left have tried to argue, an amoral system based on selfishness, greed, and exploitation. It is a moral system based on a Biblical ethic. There is no other comparable system that has raised the standard of living of millions of people, created vast new wealth and resources, or inspired so many beneficial innovations and technologies.

The wonderful thing about capitalism is that it does not discriminate against the poor, as has been so often charged; indeed, it is the only economic system that raises the poor out of poverty. Capitalism also allows nations that are not rich in natural resources to prosper. If resources were the key to wealth, the richest country in the world would be Russia, because it has abundant supplies of everything from oil, gas, platinum, gold, silver, aluminum, and copper to timber, water, wildlife, and fertile soil.

Why isn’t Russia the wealthiest country in the world? Why aren’t other resource-rich countries in the Third World at the top of the list? It is because their governments deny citizens the liberty to use their God-given talents. Man’s greatest resource is himself, but he must be free to use that resource.

In his recent encyclical, Centesimus Annus, Pope John Paul I1 addressed this issue. He wrote that the collapse of communism is not merely to be considered as a “technical problem.” It is a consequence of the violation of human rights. He specifically referred to such human rights as the right to private initiative, to own property, and to act in the marketplace. Remember the “Parable of the Talents” in the New Testament? Christ exhorts us to be the best we can be by developing our skills and abilities, by succeeding in all our tasks and endeavors. What better description can there be of capitalism? In creating new products, new services, and new jobs, we create a vibrant community of work. And that community of work serves as the basis of peace and good will among all men.

The Pope also acknowledged that capitalism encourages important virtues, like diligence, industriousness, prudence, reliability, fidelity, conscientiousness, and a tendency to save in order to invest in the future. It is not material goods but all of these great virtues, exhibited by individuals working together, that constitute what we call the “marketplace.” [“Reprinted by permission from Imprimis, a publication of Hillsdale College.”]

In American eyes, or at least in the eyes of those on the center and center-Right, she represented a set of ideals: freedom, anti-communism and the transatlantic alliance. She stood by Ronald Reagan in his battle against the Evil Empire. She used the same language as he did – free markets, free people – and entered into a unique public partnership with him. There has been nothing like it since: Clinton-Blair, Blair-Bush, Obama-Cameron, none of them endorsed one another with the same mutual enthusiasm. They saw one another’s flaws and they differed on small and large issues – as is normal between politicians of very different countries – and in public, these differences sometimes did show.

But Thatcher-Reagan was possible because they both understood the value of political symbolism, and each saw how useful that quality could be in the other. If Reagan wanted to pull away from whatever domestic mistakes and scandals absorbed him, he could appear with Thatcher on a podium. If Thatcher wanted to enhance her status on the world stage and escape Arthur Scargill, she could appear with Reagan at the White House.

Outside of Britain and America – and outside of Western Europe – their partnership had enormous force. All across communist Europe, and even in the Soviet Union, they came to represent a set of very real and very clear ideals. When Reagan lit candles in the White House windows in honor of the Polish Solidarity movement, eyes rolled in Washington. But in Warsaw, people took heart. When Thatcher arrived in Gdansk in 1988, dressed in Tsarina boots, a full-length fur coat, and a fur hat, ready to meet Lech Walesa, everyone thought something important would soon happen – and it did. Not accidentally, the most successful nations in what used to be called Eastern Europe are the ones that most admired the old Thatcher-Reagan agenda: Poland, Czechoslovakia and Estonia have all been led at various times in the past two decades by politicians who would describe themselves as “Thatcherite”.

Can the British appreciate this side of Margaret Thatcher? Probably not fully:Margaret_Thatcher they remember her mistakes, her errors and her arrogance all too well. But Americans can, and do, remember what she stood for on the world stage, and that is a part of her legacy too. No politician is a saint — that honorific is left to Popes and God. Madison, Jefferson, Lincoln, Churchill, Reagan, and Thatcher were no saints, but they did saintly things. They all had a deep respect for individual freedom, free markets, and property rights. Like all politicians they worked within the framework of their times while looking back on the great thinkers and philosophers of the past for guidance. In many ways they were pragmatists realizing that they could not change the world overnight, but needed to convince their citizens that the course they were taking was a correct one towards life, liberty and the pursuit of happiness. The great leaders of history are able to do just that without the club of tyranny.

Margaret Thatcher, the most dominant British prime minister since Winston Churchill in 1940 and a global champion of the late 20th-century free market economic revival, died on April 8, 2013 at the age of 87 from a stroke. She was a leader who understood the values of life, liberty and the pursuit of happiness as well as our Founders and governed under those values. May she rest in peace and be remembered for her major accomplishments and not the “diversity” expressed by small-minded statists intellectuals and masterminds.

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