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  a) A deep moral disgust with the Labour-Trades Union alliance and its results—the “sick society.” (Disappointment with the material results is not enough.)

  b) A strong desire for something better—the “healthy society.” (The hope of better material results is not enough.)29

  To this end, the author advises, Thatcher’s speeches shouldShow how the Labour-Trades Union alliance “power at any price” has corrupted the union movement and impoverished and polluted British society.30

  Later, in a review of the “Stepping Stones” plan, he notes:Relative decline makes little impact on ordinary people until it has gone so far that it is almost too late . . . We therefore suggested that the key to changing attitudes would be people’s emotional feelings, especially anger or disgust at socialism and union behavior.31

  Note again: The point is not that socialism has made people worse off, materially. It is that Britain is corrupt, immoral, disgusting, and polluted. It must be returned to a state of grace. This is a much more ambitious program, and there is no doubt that it was, indeed, Thatcher’s program.

  Nothing less.

  “Stepping Stones” is an essential artifact, the document that best expresses a core precept of Thatcherism: British decline was a punishment for the sin of socialism. Conservative policy was developed around the strategy set out by Hoskyns in this paper, which not only helped Thatcher achieve victory, but led directly to almost every key Thatcherite reform.

  Thatcher’s inner circle was famously divided between the wets and the dries. The wets resisted the radicalism of her program. The dries were true believers. Hoskyns was drier than a Churchill martini; indeed, he resigned from government service in 1982, exasperated, having decided that Thatcher herself was a bit damp.

  Hoskyns joined the military at the age of seventeen, one week after VE day, and served in the army for a decade, helping to quell the Mau Mau rebellion. He went on to be an extremely successful software entrepreneur. Like many of the men close to Thatcher, he was an outsider; not only was he not educated at Oxford or Cambridge, he did not have a university education at all.

  At the time Thatcher came to power, very few prominent figures in government had any kind of background in business. Many still don’t. “You get a tendency to think,” Hoskyns says to me over lunch, “that ‘business is a sort of unskilled labor for people who aren’t as clever as I am,’ you know, ‘I got a First in PPE and therefore I’m naturally going to be in the cabinet, and I’m going to be running the world, even though I’ve never done anything.’ I mean, David Cameron is a classic example of this.”32 It maddened Hoskyns that the men determining British economic policy had no idea what managers and entrepreneurs actually did, what it really took, day by day, to create wealth.

  Parenthetically, Bernard Ingham’s reaction when I described Hoskyns’s views was priceless:CB: He was extremely critical of the civil service, and felt that it was stacked by people who knew nothing about business, nothing about economics, had no experience of running a company, and felt this was one of the great liabilities that Thatcher confronted—what do you say to that?

  BI: It is in my view a load of bunkum! They aren’t there to run a business, they’re there to run the government machine! That’s rather like the press telling me that the government didn’t know anything, and this sort of thing, and I said, “You dare!” I mean, I exploded, in a very early encounter, I said, [shouting and banging table] “You dare to tell me that you know how to run any bloody business when you people were playing Mickey Mouse on a Friday night on Fleet Street!” I mean, people made up identities in order that they could be paid! I said, “Get stuffed!” I said. “Go away!” I mean, I got so angry with them. [Calming down slightly] But no, I don’t think you have to be a businessman to know how to run Britain, especially in those days, when businessmen had made a complete hash of managing their businesses. They couldn’t manage them without the government! I mean, the number of times that I was—I just—I was reduced to groaning , quietly, in meetings, when these businessmen came in, stormed upon her, said what a brilliant Prime Minister she was, but we need more incentives! And I cheered when she said, “You realize that ‘incentives’ means more taxation, do you?” I mean, they were totally insecure, totally insecure in their ideology, and they were pure opportunists! . . . In any case, how many businessmen have got any experience in government? Bah! . . . Maybe life is a bit more complicated than Mr. Hoskyns thinks!

  Back to Hoskyns, who in fairness would actually be described as the Thatcherite who best appreciated the complexity of life. In the 1970s, contemplating the intensely hostile business environment in which he was obliged to operate, he began thinking obsessively about the etiology and dimensions of the British sickness. “It was,” he writes, “like one of those puzzles from a Christmas cracker that you can neither solve nor leave alone.”33 His analysis of this sickness, which he details in his memoirs, is one of the most comprehensive extant.One could start the discussion at almost any point: trade union obstruction, inflationary expectations, the tendency of the best talent to keep away from the manufacturing industry, fiscal distortions, high interest rates, an overvalued pound, stop-go economic management, the low status of engineers, poor industrial design, the anti-enterprise culture, illiterate teenagers . . . Almost everything turned out to be a precondition for almost everything else, and trying to solve one problem in isolation would probably make the other problems more intractable.34

  In his efforts to delineate the constituent parts of the sickness, Hoskyns produced what has come to be called the wiring diagram, a labyrinthine pictorial description of the British Disease (overleaf).

  This is not, I think you will agree, the work of a man who fails to see that life is complicated.

  Having constructed the diagram, Hoskyns concluded that Britain’s postwar settlement had produced an entirely dysfunctional economy and society. It would have to be completely rewired. In other words, Britain needed a revolution. For a revolution, you need fervor. In “Stepping Stones,” he supplied the vocabulary with which to rouse that fervor.

  Events continue to reveal the true morality of collectivism.

  But the real point—that socialism is less moral than capitalism, rather than as immoral—has not been made.35[Emphasis in original]

  Reproduced with John Hoskyns’s kind permission.

  A VIEW OF THE UK ECONOMIC PROBLEM

  As of 1 October 1974. John Hoskyns

  How was that point to be made, precisely? He proposed that the electorate might be divided among “Doers,” “Thinkers,” and “Feelers.” Thatcher’s message, he held, should be tailored to appeal to all three groups, but to all, one message would be repeated over and over: Shame.

  TRIGGERING THE DOERS

  We believe this should concentrate on people’s place of work . . . This is the behavior we wish to cause people to question. Are people really not ashamed that they enter into strike action which, they all know, has no concern whatsoever for their fellow humans, let alone workers? They must be ashamed but they do it because they are frightened and bewildered and because no political party has identified a society which can give them hope for the future and reason to behave as the science tells them they ought . . .

  They know that there are massive hidden economies, i.e., fiddles and thefts that go on at work. Yet no one has made them feel ashamed of this, no one has pointed out that it would be far better if morality and integrity were reintroduced into society so that all could hold their heads up with pride . . . 36 [My emphasis]

  Thatcher, he advised, must demand that the electorate not merely change its government, but reject socialism root and branch.

  To achieve this it is necessary to instill into the emotional majority (the “Feelers”) . . . a sense of shame and disgust with the corrupting effects of socialism and union power—class war, dishonesty, tax fiddling, intimidation, shoddy work37 . . . [My emphasis]

  Thatcher with Conservative politician Neil Thorne a
t the Ilford Conservative Club, presenting her case during the 1979 general election campaign. The journalist John Biffen once described the prime minister as “a tigress surrounded by hamsters.” (Courtesy of Graham Wiltshire)

  The Labour Party, argued Hoskyns, must be identified clearly with this shame:To regain the initiative, we therefore have to explain to the Feelers that Labour really does stand for Clause 4 Socialism, and the dictatorship of unsackable union leaders; a partnership which has led to a “Sick Society” which is materially impoverished, dishonest, stupid, arbitrary, unfair, and finally frightened; so that it is pitied, as childish and backward, rather than respected by other countries.38 [My emphasis]

  Above all, the voters must be made to understand the meaning of socialism:Spell out Clause 4, printed on every party members’ card . . . This is what they’re determined to get, in the end. . . . The union-Labour link is unique to Britain; so socialism always has the real power, whatever people thought they had voted for. That is why we are now the most socialist, as well as the poorest country in the Western world except for Italy . . .

  Socialism—and the Labour Party—must be shown to be inextricably linked with the overweening power of the trade unions:In order to attack an adversary, one must first identify his weak points or Critical Links. For the Labour Party this is obviously their relationship with the unions . . . We must both attempt to defeat the Labour Government in its own right, and also the unions in their own right. If we succeed in bringing down one, we bring down both.39

  But the message must not, he repeated, be confined to promising people that they will be better off, economically, under the Tories. “Morality in the end counts for more than personalities; an appropriate value system counts for more than ‘correct’ economic policy.” 40 My emphasis, again.

  Stern stuff.

  I meet John Hoskyns for lunch at the Travellers Club, the oldest of the gentlemen’s clubs on Pall Mall. You might think, from the documents above, that Hoskyns would be rather a grim and self-righteous personality, but nothing could be farther from the truth. He is jolly and charming, quick to laugh, and touching—grandfatherly, almost—in his concern that I enjoy my meal and order the richest items on the menu. I order the Dover Sole, and to please him, the buttery mashed potatoes. Then we discuss the famous wiring diagram.

  John Hoskyns: What the diagram really said is that if you’re going to change anything, you’ve got to change everything. Not because that sounds like a good, Hurrah! sort of thing to say, and we want to be revolutionaries, and we want to do big things, but because actually, in terms of logic, the causal connections are such that you cannot say, “Let’s just do that,” because—you can’t! Because actually, there are five other things that are causing that.

  [Waitress interrupts]

  Waitress: Would you like to look at the dessert cart?

  JH: What would you like? A large slice of chocolate cake?

  CB: I’ll have a look—

  Waitress: We have a strawberry cheesecake, chocolate truffle cake, and then we have a trifle, and strawberries in red wine with orange—

  CB: I’ll try a trifle.

  JH: There we are! . . . I think the wiring diagram satisfied me, and I know I had to explain to Keith [Joseph], “This is not a magic gadget which tells us how to do it. What it does is it says, ‘At last, we have an imperfect but very rough and ready picture of the problem, well, really, of the answer to the question, why is this country such a mess?’” And the answer goes right back to the end of the war, the challenges of the peace, and the policy responses to those challenges . . . which with hindsight, very easy to make that mistake at the time, probably if one had been in his forties or fifties as a politician in those days, one would have done the same thing. One would have gone with the New Jerusalem. The Thatcher remedy started, I do think, with the wiring diagram. Then, the next step is you say, “Only a revolution will do any good.” And you don’t have revolutions for fun, they’re very uncomfortable, very unpleasant, a lot of people get hurt, and—You shall have a war. It’s going to be very unpleasant, and we’re going to be hated, and the better the things we do, the more hated we will be. I remember all these thoughts were in my mind when I was working for her, and I thought, “We’re not likely to bring it off. But if we do, she will be a historic figure.”

  CB: When you first met her, did you sense any particular political charisma? Or was that something that only emerged later?

  JH: [Long silence] I didn’t particularly. I think that grew as time went on. I was interested, having already met her through Alfred Sherman [initially one of Thatcher’s political advisors], a tough, rude, multilingual, seven-languages or something, brilliant East End Jew, built like a sort of 5’2” gorilla—lovely man, very funny man, too—absolutely fearless, tremendous mental energy—and I thought, if she can realize what he’s got to offer, compared with some of these Beta-minus, Beta-plus intellects in the Party machine, and doesn’t safely settle for another public schoolboy, but takes this fellow instead, well then—and that Keith and Margaret, those two people, could forge such an unlikely bond, and both listen to this completely from-outer-space brainbox, it did make me think, when I came to meet her, “She’s not your ordinary, world-weary, pompous, self-important, thinking-inside-the-box, slightly defeatist, pragmatic, cautious, Tory politician.” You know, she’s not. She’s actually realizing that something terrible has got to be done.

  Something terrible had got to be done. The battle would be bloody, and they would be hated. Hoskyns knew it, Sherman knew it, Joseph knew it, Thatcher knew it. So did everyone who managed her ascent to power. Even the wringing-wet Chris Patten, then director of the Conservative Party’s research department, uneasily sensed it. He drafted a paper titled “Implementing Our Strategy” in 1977, outlining the themes to be stressed in the coming election campaign.

  Labour’s record is appalling. What has happened is their own fault. They cannot blame us, or world factors. They virtually doubled prices, more than doubled unemployment, doubled the tax burden and doubled public spending? Why? Because when they came in they gave us a double dose of Socialism.41

  Nigel Lawson, who was later to become the most famous member of Thatcher’s cabinet as her chancellor, reviewed this memo and heartily concurred with this sentiment, writing in response that “A well thought-out scare campaign is a must.”42 The words are underlined in Thatcher’s hand, I believe.

  Lawson appended to this note an earlier memo he had written titled “Thoughts on the Coming Battle”: The Socialists have avowedly adopted the most extreme Left propaganda and posture in their Party’s history. This central fact, and its detailed implications, should be the ever-present theme of our propaganda war . . .

  Linguistics. The semantic battle is an important aspect of the overall battle. We need what newspapers call a “house style,” circulated to all concerned, to ensure that Socialist policies are always referred to by words with unfavorable emotive overtones, and our policies by words with favorable emotive overtones.43

  The minutes of a 1977 meeting of Thatcher’s Strategy and Tactics Committee emphasized, again, the semantic linking of socialism, guilt, and sin:SECRET

  NOTES ON THEMES

  Destruction of our opponents:

  Guilty men. Hypocrisy of individuals, damaging failure as Government. Label them with failure. Link failure/decline of Britain inextricably with Socialism. . . .

  “Doubled” theme—spending, unemployment, but particularly prices. Doubled Socialism/nationalization. Juxtapose doubled nationalization and doubled prices. . . .

  Labour and the Trade Unions will turn us into an Eastern European state. What’s moral about locking up your enemies? . . .

  Free Enterprise. Moral case for freedom. Choice, dignity, responsibility, worth of the individual.

  Let the individual control his own life. Right to property.

  Open up debate on what sort of society we want in the late 20th century. The right approach to society/so
cial policy . . .

  The courage and the real concern to do what is right. [My emphasis]44

  Shortly afterwards, Alan Howarth, a member of the inner sanctum of the Conservative Research Department, wrote a paper for Thatcher’s benefit titled “Some Suggestions for Strategic Themes.” He hoped, he wrote to her, that it might serve as “raw material” for “the philosophical case that you have been contemplating making.” 45 The paper is much in the same vein, and I suspect that it did indeed provide raw material—or at least rhetorical inspiration—for Thatcher’s case.

  Labour’s failure. Fantastic economic mismanagement. Prices doubled in three years, production at level of five years ago, unemployment more than doubled, colossal debt. A humiliated and impoverished Britain. . . .

  The Guilt of the Socialists. They are guilty of fraud. Remember “Back to work with Labour” and look at the unemployment. Look at the social services, the dereliction of Labour controlled cities and the crime and violence. [Underlined in original]

  It is the Socialists who are guilty, not the British people (or world economic factors).

  Their Guilty Men. Their hypocrisy.46

  An interesting aside: In 1993, Howarth defected to the Labour Party. It seems he changed his mind.

  This culminates in Thatcher’s own voice, rallying her troops in 1976. The speech anticipates and embodies all of these themes:I want to speak to you today about the rebirth of a nation: our nation—the British nation.