Chapter 13
Writing in 1989, Maurice Cowling penned a memorable account of the ‘sources of the New Right’ in British politics since the Second World War.1 A participant in some of the circles that he delineated, Cowling sketched a vivid portrait of the small group of intellectuals, politicians and activists who, he said, had been instrumental in rallying Conservative opinion to mount a concerted counteroffensive against the ‘liberal collectivism’ established in 1940. This ‘New Right’ constituted about fifty people in total ‘(mainly graduates, and mostly men)’, and had ‘five faces’: the revivalist market liberal economists centred around the Institute of Economic Affairs (IEA); the opponents of progressive education, comprehensive schools and university radicalism who coalesced around the publication of the Black Papers; the intellectuals and MPs who supported Enoch Powell and then Margaret Thatcher (including by founding the think tank the Centre for Policy Studies (CPS)); the small group of Conservative academics (including Cowling himself) who were associated particularly with the London School of Economics, Peterhouse, Cambridge and the journal The Salisbury Review; and, finally, the intellectually inclined journalists who promulgated New Right opinion across the national British press in the 1970s and 1980s, particularly in TheTelegraph but also in The Times and most other influential British newspapers of the period (Cowling, 1989, p. 11). Cowling recognised that there were severe limits to the impact of such intellectual endeavours on political and social life, but he nonetheless insisted that even the seemingly pragmatic Conservative Party required ‘reserves of belief which can be called up without having to be created on each particular occasion’. Fostering such ‘reserves of belief’, argued Cowling, had been the important accomplishment of the New Right (Cowling, 1989, p. 12).
The term ‘neoliberalism’ had not yet come into widespread use at the time Cowling wrote, but there is considerable overlap between Cowling’s enthusiastic reconstruction of the intellectual roots of his New Right and the many accounts of late modern British history that ascribe significant causal weight to neoliberal ideology. Like Cowling, some of the most influential works on Britain after the 1970s have stressed the importance of a variety of academics, journalists, think tanks and freelance activists in generating the distinctive policy agenda that has dominated British politics since then. The most un-Cowling-like figures Andrew Gamble and Stuart Hall pioneered in the pages of Marxism Today and later academic publications a fecund analysis of Thatcherism as a distinctively ideological project that sought to refashion public policy and political discourse in a style that would be more favourable to the interests of the Conservative Party. Whereas Cowling himself said little about the wider international context of this turn towards a more muscular form of conservatism, Gamble and Hall conceptualised Thatcherism as the local embodiment of a global ideological counteroffensive by market liberals (Hall, 1979, pp. 14–20; Hall & Jacques, 1983; Gamble, 1994).2 This line of argument dovetails with the work undertaken more recently by intellectual historians, which has documented in detail the creation of an influential body of economic and political theory by the ‘neoliberal thought collective’ organised around the Mont Pèlerin Society (MPS), the international discussion group founded by Friedrich Hayek in 1947 to revive market liberalism (Mirowski, 2009; Jackson, 2010, pp. 129–51; Burgin, 2012; Stedman Jones, 2012; Mirowski, 2013; Slobodian, 2018; Whyte, 2019).3
In spite of this widespread interest in the ideology of neoliberalism, other historians have nonetheless expressed reservations about how influential such ideas really were.4 This is particularly the case in the field of modern British history, where two different strands of the burgeoning scholarship on the late twentieth century have created a pincer movement against this preoccupation with the intellectual roots of Thatcherism.5 One strand originates in the field of political history and offers a high political account of the 1980s that is doubtful about the extent to which senior politicians and civil servants meaningfully engaged with the New Right intelligentsia identified by Cowling. Perhaps the most important variant of this argument has been elaborated by Richard Vinen. Among other things, Vinen has argued that historians and political scientists have paid disproportionate attention to think tanks and intellectuals compared with the more consequential role played by government ministers and civil servants. These latter figures, Vinen argues, were more obviously central to government decision-making than the obscure scribblers emphasised by commentators fascinated by ideas (Vinen, 2009, pp. 34–38).6 Yet in a curious twist, this interpretation of Thatcherism is itself somewhat Cowlingite in flavour, as it asserts the autonomy of the ‘high political’ domain at the expense of a wider analysis of economic, social and intellectual forces, a point that Cowling himself had famously used as a guiding principle when writing his histories of modern British politics (Cowling, 1967; 1971; 1975).7 Indeed, Cowling had raised precisely this point in his article on the New Right:
Until enough of the archives are open, including the private archives of politicians, it will be difficult to know how Mrs Thatcher succeeded after 1979 in effecting changes which Mr Heath had promised in 1966 but had failed to deliver in office. It may well turn out that the existence of an independent intelligentsia was unimportant, what mattered was the opinions of civil servants and of the political heavyweights – Mr Nigel Lawson, Sir Geoffrey Howe, Lord Joseph and, pre-eminently, Mrs Thatcher herself – after the acquiescence of the last three under Mr Heath. [Cowling, 1989, pp. 7–8]
While this strand of political history has sought to minimise the importance of ideological argument to the politics of Thatcherism, a second strand of scholarship has sought to downplay the significance of party politics and state decision-making altogether. Social and economic historians have sought to ‘decentre’ the 1980s and 1990s by focusing on larger economic, social and discursive changes that they argue are of more fundamental causal significance than the neoliberal ideology given star billing in many of the standard histories of the late twentieth century (Hilton et al., 2017, pp. 145–65). One important economic claim that has been pressed in the literature on the global rise of neoliberalism is that material changes in capitalist production and class interests should bear the bulk of the explanatory weight in accounting for the neoliberal trend in public policy after the 1970s (Duménil & Levy, 2004; 2011; Harvey, 2005). With respect to Britain, a powerful version of this wider interpretation has been made by Aled Davies, who has shown that the changing structure of the financial sector in the 1960s and 1970s – with the growth of institutional investors, the liberalisation of the banking sector and the rise of unregulated global capital markets in London – undermined key elements of the post-war economic model and facilitated a shift in economic policy in a neoliberal direction (Davies, 2017).8
A more radical strand of economic analysis denies not just that ideology was important in the rise of neoliberalism but that ‘neoliberalism’ itself is an overrated category for conceptualising economic change in the late twentieth century. Jim Tomlinson, for example, has drawn attention to the importance of the economics of deindustrialisation in this period – a process that he sees as largely independent of the actions of particular governments and which (he argues) produced much of the social and economic tumult usually attributed to the Thatcher government and ‘neoliberalism’ (Tomlinson, 2016, pp. 76–99). Similarly, David Edgerton has argued that economic change in modern British history is best described as a transition from a mid-twentieth-century nationalist and industrial model of the economy to an internationalist, service-sector economy that emerged under the Thatcher government after the state became self-sufficient in food and energy and was therefore much less dependent on earnings from manufacturing exports (Edgerton, 2019).
This economic analysis can be placed alongside the work of social historians who have detailed the decline of social deference in the post-war period. Historians such as Florence Sutcliffe-Braithwaite and Jon Lawrence have argued that the 1960s and 1970s saw the emergence of a new egalitarian spirit centred around the idea of ‘ordinariness’, which rejected established class hierarchies and prioritised individual autonomy and authenticity. This new social morality formed the context for Thatcherism, in that the individualism promoted by those governments was one way of formulating a political project that could appeal to these deeply rooted popular sentiments, but from this perspective Thatcherism and neoliberalism look much more like a product of this underlying social change rather than the cause of it (Lawrence, 2011; Sutcliffe-Braithwaite & Lawrence, 2012; Robinson et al., 2017, pp. 268–304; Sutcliffe-Braithwaite, 2018; Lawrence, 2019; 2011). Like the economic histories, the new social histories of this period detect more deep-rooted, long-range trends that lie beneath the dramatic political events of the 1980s and suggest that a preoccupation with the personalities, policies and ideology of the Thatcher government obscures these more fundamental changes in Britain and around the world in the late twentieth century.
These are all salutary and important points, which deserve serious consideration in any historical account of this period. However, in this chapter, I want to respond to this scholarship by reformulating the importance of intellectual history to our understanding of Britain after the 1970s. But I want to do so in a way that steers the debate away from the more exuberantly idealist accounts of the 1980s towards a more constrained account of how the history of ideas can complement the important insights that we can glean from the study of high politics, the economy and social change.9 Scepticism about the social significance of ideas is, of course, a perennial theme in historical study that has generated in turn many compelling and ingenious answers from historians of a more idealist bent.10 But one of the difficulties with resolving our specific question of whether neoliberal ideology should be seen as causally significant is that critics of the importance of ideas sometimes misunderstand what intellectual historians see as the distinctive contribution of their approach. In fact, there are a variety of ways in which ideas matter to the political life of modern societies and it is only by enumerating them, and distinguishing between them, that we can make progress in identifying the contribution of the history of ideas to the study of late twentieth-century Britain. In order to gauge the limits of intellectual history for our period, it is first necessary to make a reckoning with what precisely the study of neoliberal ideas can tell us.
One preliminary point to stress is that the most recent wave of scholarship on the intellectual history of neoliberalism is precisely trying to avoid a charge of gross idealism by integrating the study of ideas with a more sociological account of the networks that mobilised behind neoliberal ideas and of the social functions performed by intellectuals and think tanks across a variety of national contexts in the post-war period. The pioneering research on the MPS and on the rise of neoliberalism in the US and Europe has been distinguished from earlier work on this topic precisely because it has identified neoliberalism as a movement of ideas that organised and publicised its ideology through a specific set of institutions that mobilised both intellectual and material resources in order to reshape elite opinion. This analysis of what Philip Mirowski and Dieter Plehwe have dubbed ‘the neoliberal thought collective’ uses the tools of social research to track the network of intellectuals who founded the MPS. It is significant that Mirowski and Plehwe adopted the term ‘thought collective’ from the sociology of science. Following Ludwig Fleck, a ‘thought collective’ refers to a community of thinkers who develop a shared set of ideas as a result of repeated intellectual interaction – highlighting that intellectual production is a collective enterprise that unfolds through social networks rather than in the solitary minds of great thinkers (Plehwe, 2009, p. 35, footnote 5; Mirowski, 2009, pp. 428–29). The ‘thought collective’ that coalesced around the MPS drew on the material resources of like-minded figures in the business world to construct a global alliance of think tanks and advocacy organisations whose role was to promote the neoliberal policy prospectus to elites around the world (Plehwe et al., 2005; Mirowski & Plehwe, 2009; Phillips-Fein, 2010).
This was a strategy that drew on Hayek’s diagnosis of political change in his 1949 essay ‘The Intellectuals and Socialism’. Hayek argued that changes in intellectual fashion were politically consequential because the boundaries of what is considered to be feasible in public policy were defined by a group of public intellectuals – journalists, novelists, certain academics, technical experts of various kinds – who broadcast to a wider audience their own perception of what were the most valid political and economic theories (without necessarily themselves having the expertise to adjudicate on this question). In Hayek’s view, the success of socialism was explained by the widespread adoption of socialist ideas and attitudes by these ‘second-hand dealers in ideas’ over the course of the first half of the twentieth century. The neoliberal strategy, as it developed over the 1950s and 1960s, was therefore to counteract the intellectual growth of socialism by broadcasting market liberal ideas to elites (and to a lesser extent the public) through new public policy organisations – think tanks – that sat at the interface between academic knowledge and political debate and in effect contested the status of the left-leaning social sciences that had made such headway in the public sphere in the decades after the Second World War (Hayek, 1949; Medvetz, 2012). Such a project required considerable financial investment and assiduous political networking, both of which the ‘thought collective’ was able to build up over the course of the 1960s and 1970s.
The argument for the importance of neoliberal ideas is therefore a much more nuanced one than is sometimes supposed, insofar as it rests on this wider analysis of the social context of the generation of political ideas. In effect, the claim of intellectual historians is not that ideas were in and of themselves causally significant, but rather that ideas served as a key element in the neoliberal right’s political strategy and succeeded in gaining a wide social purchase because they were effectively marketed by well-funded and highly strategic policy entrepreneurs. This was a transnational process and, in the case of Britain, there is a sense in which this represents an Americanisation of British political debate, since the most prestigious neoliberal figures and ideas tended to be transferred to Britain after being germinated in the US.11
A second preliminary point is that this new intellectual history has also stressed the internal diversity of neoliberalism. Neoliberal thought was the product of intellectual collaboration across national boundaries, but it also comprised several distinct strands of argument that reflected these diverse national origins and were at times in tension with one another. Austrian economists such as Hayek, for example, elaborated a strong form of economic individualism and a priori reasoning that was highly sceptical of the use of economic statistics or even the pursuit of macroeconomic policy by the state, both of which were key features of the work of the ‘Chicago School’ of economics associated with figures such as Milton Friedman. Meanwhile, the ‘ordo-liberal’ tradition developed in Germany by economists such as Walter Eucken and Wilhelm Röpke incorporated a powerful role for the state in maintaining market freedom, for example by enforcing strong anti-monopoly policies, precisely the point that economists from Chicago such as George Stigler sought to contest in post-war policy debates in the US.12 Other important strands of neoliberalism have also been identified. Quinn Slobodian, for example, has drawn attention to what he has called the ‘Geneva School’, which overlaps in membership with some of the groups mentioned earlier, but which focused on problems of global rather than domestic economic order. Slobodian has demonstrated that an important strand of neoliberalism has sought to ‘encase’ markets in institutions of global economic governance that would prevent sovereign states from disrupting private property rights and market transactions (Slobodian, 2018, pp. 7–13). Likewise, the ‘Virginia School’ associated with James Buchanan, which focused on public choice theory and the economic analysis of political institutions, has recently become the subject of considerable debate (MacLean, 2017; Farrell & Teles, 2017; Fleury & Marciano, 2018, pp. 1492–1537; Mirowski, 2019, pp. 197–219). At one level, this internal ideological diversity makes the story of neoliberalism’s influence much more complex, since it is necessary to dig more deeply into the precise ideological connotations of particular arguments and policies and to be aware of the extent to which there was no straightforwardly homogeneous ‘neoliberalism’. Neoliberalism was in any case a distinctive kind of ideology, which (as we have seen) was created not as part of a social movement, but initially as an elite-led effort to fight back against the ideological success of the Left. Neoliberals were therefore at first detached from existing political factions – and to enter public debate in an influential way, they had to synthesise their ideas with pre-existing ideological traditions. This process meant that different currents of neoliberalism became available in public debate in Britain and elsewhere as liberals, conservatives and even socialists absorbed aspects of neoliberal theory into their political thought (Sutcliffe-Braithwaite & Lawrence, 2012, pp. 497–520; Jackson, 2016, pp. 823–50; Mudge, 2018).
Amid this dizzying array of differing forms of neoliberalism, however, it is also important to remember that neoliberal theorists and their political allies shared a lot in common as well, not least in the opponents that they saw themselves as arrayed against: the social democratic state bureaucracy, trade unions, the Soviet bloc, post-colonial movements, and left-wing intellectuals and experts. One way of reconciling this mix of commonality and diversity within neoliberal ideology is to think of it as an alliance between different intellectual tendencies that were concerned about the various ways in which, over the course of the twentieth century, popular politics had eroded the liberating and efficient powers of the market. Neoliberals were therefore, as William Davies has put it, ultimately pursuing ‘the disenchantment of politics by economics’ in order to ‘replace political judgement with economic evaluation’, a project that was ultimately capable of a variety of theorisations and practical instantiations (Davies, 2014, pp. 2–3).
The nature of neoliberalism and its influence is therefore far from a straightforward issue. In the rest of the chapter, I will seek to navigate this complexity by developing a working typology that distinguishes between four different ways in which historians of this period can usefully engage with the history of neoliberal thought when telling the story of Britain in the late twentieth century. Firstly, and minimally, the study of ideology is itself one important way of documenting wider social and economic changes. The intellectual output of writers, thinkers, politicians and activists forms a substantial body of source material for understanding how contending elites in a society understood the times in which they lived and the fundamental political ideals that they sought to pursue to reform and improve that society. Such texts can also offer the clearest and most systematic exposition of debates that otherwise remain implicit or inchoate in popular discourse. From this perspective, the palpable growth of advocacy for neoliberalism during the 1970s and 1980s is itself a signifier of the way in which market economics emerged as a challenger to the model of the British state that evolved in the mid-twentieth century. Without making any claim about wider political influence, such source material simply offers the historian a means of accessing the most detailed statements of the ways in which unvarnished capitalism began to shift from an old-fashioned world view to an appealing option for the future. For example, leading advocates of neoliberalism in Britain, such as Arthur Seldon, the editorial director of the IEA, believed that the lived experience of post-war capitalism was fundamentally at odds with the top-down logic of the social democratic state because it gave individuals the capacity to make choices for themselves, as consumers, rather than simply accepting what they were given by state-run services. The British people, Seldon argued in 1966, now enjoyed much greater ‘freedom of choice for their food and drinks, their clothes, their furniture and household equipment’. Since the average man and woman were now ‘treated like lords and ladies at their grocer’s, the hairdresser’s and on the plane to their fortnight in Spain’, it was unlikely that they will ‘tolerate much longer being treated as servile, cap-in-hand supplicants in the local state school, the doctor’s surgery, the hospital’. Hostility to the paternalism of state-provided welfare, Seldon concluded, would therefore increase as incomes rose (Seldon, 1966, pp. 320–21). The attractions of market-based forms of freedom – and their presumed appeal to certain electoral groups – can therefore in part be documented through an investigation of the way they were expressed in public debate.
Secondly, some of the scepticism about the importance of ideas noted earlier neglects the extent to which the capacity to engage in argument about public policy depends on fundamental conceptual innovations among technical specialists that in turn provide the very categories that structure that debate. When new political agendas are formulated, as they were in the 1970s and 1980s, whether they are pushed to the forefront of policymaking by material pressures or by high political manoeuvres, they nonetheless require intellectual content with sufficient technocratic authority to make the proposed policies appear credible to financial markets, civil servants, the media and (to a lesser extent) the public. They therefore must draw on the specialised language developed by professional intellectuals of various sorts, whether located in think tanks, academia or the higher echelons of the media. This is a particularly acute need in the case of economic policy, where a workable governing economic strategy requires a level of technical detail that can only be provided by specialists in the field. Professional economists are therefore the principal group of intellectuals who, from the mid-twentieth century onwards, have been able to act as the authoritative interpreters of a body of knowledge that has a direct relationship with policymaking. The precise influence of academic economics on economic policymaking is, of course, a complex one, but my specific focus here is on the way in which changes at a broad level in economic theory reshape public policy (Middleton, 1998; Fourcade, 2009). My argument is not at this stage the more fine-grained one that specific ideas shape specific policy proposals; rather it is that deep conceptual shifts open up new spaces in political argument.
A useful illustration of this point is the well-ventilated debate about monetarism. The history of neoliberalism is inextricably bound up with the history of new ideas about macroeconomic management, especially the rise of monetarism as an alternative to what is sometimes rather crudely referred to as ‘Keynesianism’. As Jim Bulpitt pointed out many years ago, monetarism proved politically useful for the Conservative Party because it prescribed a new form of counter-inflationary statecraft that departed from reliance on negotiating wage increases with trade unions (a practice that was widely believed to disadvantage the Conservative Party electorally in the 1970s) (Bulpitt, 1986, pp. 19–39). In essence, Bulpitt identified the high political rationale for economic policy change that has been widely discussed by historians and political scientists ever since (Gamble, 1994; Tomlinson, 2012). But while it is correct to note that monetarism became politically useful to the Conservative Party for this reason, this does not mean that a more idealist account of monetarism is irrelevant to a historical explanation of its rise. As we have seen, the technocratic character of economic policy is such that it is not possible simply to adopt any economic idea as state policy unless it carries with it a degree of scientific authority, as perceived by government and central bank officials, financial markets and economic commentators. Any story about why monetarism emerged as a policy option in Britain in the 1970s – whether relating to the condition of the British economy, party interest, the role of financial markets and so on – therefore must start by acknowledging that the concept of something called ‘monetarism’ existed because it had been constructed in the first place by a number of technically qualified economists, notably Milton Friedman, who popularised the term and set out a range of arguments for it.
In particular, it seems clear that Friedman’s famous 1967 presidential address to the American Economic Association, ‘The Role of Monetary Policy’, had an important international agenda-setting impact in highlighting the case he (and others) had made in hitherto specialised publications that there was no long-run trade-off between inflation and unemployment since workers come to expect price rises and to demand that their wages keep pace with inflation. While there is a considerable debate about the theoretical originality of this lecture (or its lack of it), and its subsequent reception among economists, Friedman’s address was nonetheless widely perceived by policymakers and in elite public debate in the 1970s as signifying an important shift in economic opinion (Forder, 2014; Forder & Sømme, 2019, pp. 1683–1700; Cherrier & Goutsmedt, 2017). The continued application of inflationary stimulus, Friedman was understood to have argued, cannot push unemployment below its ‘natural’ rate. Instead, Friedman popularised the adoption of monetary rules to control inflation and to focus government policy on ensuring monetary stability rather than lowering unemployment (Friedman, 1968, pp. 1–17). The complexities of implementing this theoretical design were formidable and caused enormous problems for the Thatcher government in practice,13 but the point nonetheless stands that intellectual history is a necessary ingredient of this larger historical story because it enables us to identify the precise concepts and theories that were then taken up in policy debate, and to track how these concepts and theories provided political actors with new languages with which to legitimise their actions. Intellectual history is therefore in part about a stage a few steps removed from the exigencies of political decision-making insofar as it reconstructs the formation of the broad conceptual space in which that decision-making takes place.
#A third way in which ideas are salient to historical explanation is that it is only through language that social change can itself be interpreted. That is to say, the study of ideas is not only, as I suggested earlier, a means by which underlying social change can be registered, it is also a way to understand how historical actors imprinted a particular meaning on this social change and constructed compelling narratives about the political action necessary to rectify the problems they diagnosed. In one sense, this is to agree with much of the neo-Cowlingite picture painted by historians such as Richard Vinen, which focuses on the capacity of leading politicians, not least Thatcher herself, to use rhetoric as an effective weapon in the struggle for power. A ‘high politics’ analysis of Thatcherism is an ally of the intellectual history of this period insofar as both approaches agree that focusing purely on shifting economic interests or exogenous social change cannot offer a full account. This is because both political and intellectual historians follow the linguistic turn insofar as they see interests as only legible to historical actors through a process of conceptualisation and interpretation that necessarily relies on ideas (an insight that has, of course, also been recognised by social historians ever since the early debates about the linguistic turn in the 1980s).14 In the case of political history, more emphasis is placed on the way in which leading political figures construct coalitions of support and frame policy debates through careful use of public speech (Williamson, 1999, pp. 12–18). For intellectual historians, the focus falls more on the fine-grained analysis of the writings of professional ideologists, whether formally employed as academics, journalists, policy experts or even politicians. But there is no reason to see these two approaches as contradictory, as some political historians seem to suggest in the case of Thatcherism. We might instead see them as complementary, in part because politicians inevitably draw on and render in more demotic form the language first set out at a more abstract level in specialised books and periodicals, and in part because the intellectuals also take their lead from the politicians and develop new arguments that extend and reinforce the positioning first laid out in a more popular form in political speeches.
To give one example of the former process, in the late 1960s, Enoch Powell made a robust public case for market liberalism (and nationalism) that drew on a close acquaintance with neoliberal political and economic theory (Powell was a long-standing MPS member). Powell was an important forerunner of elements of Thatcherism, though he was markedly less successful than Keith Joseph or Thatcher in framing public debate in Britain in neoliberal terms, in part because he spoke as an outsider, lacking the authority of a leading figure in a party aspiring to form a government, and in part because the economic context – only a few years into a new Labour administration – could not yet be as persuasively portrayed as a systematic crisis as it could be in the later 1970s (Schofield, 2009; Corthorn, 2019).
Joseph played a more significant role as an outrider for what became Thatcherism in the 1970s, initially making a series of important speeches in 1974 that set out an early version of what became the Thatcherite analysis of Britain’s decline during the post-war period. These speeches were written in collaboration with his adviser, Alfred Sherman, as well as with the input of sympathetic economists and journalists such as Alan Walters and Samuel Brittan (Denham & Garnett, 2001, pp. 255–57). All of these figures had close connections to the alternative intellectual infrastructure developed by neoliberals over the 1960s and 1970s – Walters, for example, was a member of the MPS (and later an adviser to Thatcher in government), and Brittan had been deploying the ideas of figures such as Hayek and Friedman in his journalism in the Financial Times throughout the 1970s (Middleton, 2011, pp. 1141–68; Jackson, 2012, pp. 50, 54). Joseph’s speeches were punctuated by references to IEA pamphlets and works by economists associated with the MPS, forming an overall analysis that clearly owed a great deal to the political and economic theory of neoliberalism. As Joseph himself wrote to Ralph Harris at the IEA during his summer holiday in the middle of writing and delivering these speeches: ‘I’m steeping myself in Hayek – and am ashamed not to have read the great Constitution of Liberty long ago’. He also reported that he was reading Friedman’s IEA pamphlet, Monetary Correction, and various other IEA pamphlets he had taken with him (Joseph, 1974; Friedman, 1974).
The central argument of Joseph’s speeches was that Britain’s economic turbulence in the 1970s – or Britain’s ‘decline’, as Joseph would have seen it – was the product of systematic flaws in the economic and social policy of the British state, flaws which he diagnosed as related to a failure to exercise appropriate control over inflation via monetary policy and the expansion of government activity into the economy in a way that had distorted market price signals and incentives (Joseph, 1975). Similar points about the artful use of political language to construct a particular interpretation of the economic crisis of the 1970s have also been made by Robert Saunders in relation to the speeches of Margaret Thatcher and by Colin Hay with respect to the popular press (Saunders, 2012; Hay, 1996, pp. 253–77; Hay, 2010, pp. 446–70). Given the numerous interconnections that can be documented between the realm of more abstract intellectual argument and political speech, it therefore seems more fruitful to treat these approaches to the analysis of political language as complementary rather than antagonistic.
A fourth way in which ideas influence political outcomes is a much narrower one: when it can be demonstrated that specific policy innovations or decisions drew on ideas that were initially elaborated by think tanks or political writers. This is often the hardest category to document and is perhaps the form of influence that sceptics of intellectual history have in mind when they suggest that ideological accounts of Thatcherism are overblown. It is certainly important to be cautious when making claims about the specific influence of intellectuals on decision-making that occurs amid the extraordinary pressures that face governments, when politicians and their advisers and officials daily face new headwinds that buffet them off course. Yet even here there are examples of neoliberal ideas being deployed directly by politicians and their advisers in state policymaking, examples which usually demonstrate the important mediating role played by right-wing think tanks in connecting the ideological domain with practical policymaking. The reason that ideology enters the decision-making equation at this high political level is precisely because of the pressures and complexity of state policy formation: amid this tumult it is necessary to have a ‘heuristic’ that can guide political action in an agreed strategic direction without having to litigate that overall strategy on each occasion (Biebricher, 2019, pp. 198–200). In the case of the Thatcher governments, such a rough rule of thumb was often related to the desire to increase consumer choice, widen asset ownership and increase market competition. In practice, this ideological orientation was not always successful, but it does provide an important insight into how decisions were taken by the Conservatives in power. Several examples of this have been documented in the literature on Thatcherism.
Matthew Francis, for example, has shown that the precise form taken by the Thatcher government’s privatisation policies reflected an ideological preference for widening private property ownership that went beyond traditional Conservative statecraft or economic necessity to reveal a conservatism that had been deeply influenced by neoliberalism. Each of the privatisations was designed to offer preferential access to ownership to ‘ordinary’ individuals, whether through employee share ownership, priority for small investors or significant discounts on the purchase of council houses (often in the face of objections from the Treasury, on the grounds that this approach would not maximise government revenue). These choices in policy design reflected an extended discussion within the Conservative Party from the 1970s about the relationship between democracy and ownership and a marked shift in the thinking of key Conservatives towards the neoliberal argument that the wider personal choice facilitated by private property ownership represented a deeper form of democratic control than voting or political participation (Francis, 2012, pp. 275–97).
Charles Lockwood has identified a second example: the introduction of compulsory competitive tendering for local government services. This idea was pushed up the political agenda by the Adam Smith Institute (ASI) in 1980, in a pamphlet authored by the future Conservative MP Michael Forsyth (who at that time was a councillor on Westminster City Council). Drawing on the public choice theory of MPS member Gordon Tullock, Forsyth argued that introducing competitive tendering for core functions of local government would serve as a way to introduce market competition into council services while avoiding the full-scale political row that would ensue if services were straightforwardly privatised. Thatcher’s policy unit ordered 20,000 copies of the pamphlet to circulate to Conservative local authorities. The scope of compulsory competitive tendering was increased over time by the Conservatives in government from 1980 onwards, with certain Conservative councils acting as pioneers who would go much further than the legislative requirements laid down by central government (Lockwood, 2020, pp. 232–33; Forsyth, 1980; Ascher, 1987).
A third example, which I have discussed elsewhere, was the Major government’s introduction of vouchers for nursery education in 1995. The decision to create a voucher system for nurseries was a straightforward reflection of the wider debate among Conservative intellectuals and think tanks about the importance of introducing a market for childcare services in Britain rather than a universal taxpayer-funded system. Pamphlets by the CPS and the ASI had made this point in the run-up to the government’s pivot towards offering greater financial support for working parents. The author of the ASI pamphlet, David Soskin, ran a chain of private nurseries, and shortly after writing the report for the ASI he went to work in the number ten policy unit for John Major, thus providing a particularly clear example of the way in which neoliberal think tanks mobilised social networks and ideas in a politically effective way (Jackson, 2019, pp. 297–316).
A fourth, more ambiguous, example, uncovered by Aled Davies, James Freeman and Hugh Pemberton, concerns the important role played by the CPS in the Thatcher government’s pension policy. Figures associated with the CPS and the wider neoliberal policy community, such as Nigel Vinson and Philip Chappell, made considerable headway in internal government debates by arguing for a radical extension of personal responsibility into pensions. Rather than accepting the collective and institutional character of pension funds that had developed by the 1980s, they argued that the Thatcher government should seek to introduce individualised pension funds that were owned and managed by individual workers themselves. This proposal was not in fact implemented in full, in part because of internal opposition within government but also because of the severe practical difficulties that emerged in putting such a radical vision into practice. However, as Davies, Freeman and Pemberton have shown, the pension reforms enacted by the Thatcher government did take up ideas of individual choice derived from neoliberal theory. Rather than the initial idea of creating a nation of individual investors, a new vision emerged of a pension system that furnished consumers with the freedom to choose between different pension providers. As Davies, Freeman and Pemberton put it, Thatcherism emerges from this case study as a ‘pathway through the diverse array of neoliberal ideas’, a political project that evolved in the making as it drew on certain strands of neoliberalism and traditional British conservatism to overcome both internal ideological tensions and practical obstacles (Davies et al., 2018, p. 500, emphasis in original).15
The case for the importance of neoliberal ideas in shaping the political trajectory of Britain since the 1970s is therefore a strong one, but (as the example of pensions policy shows) it is crucial to qualify this statement by recognising that the influence of neoliberalism was also a limited one, which should not be used straightforwardly to capture the entirety of British historical experience between the 1970s and today. Firstly, intellectual history by its nature tends to focus on the elaboration of ideas among elites, so this approach has tended to pay less attention to the way in which neoliberal ideas circulated among the wider public.16 Public opinion research certainly gives good reason to think that some key neoliberal tenets were not in fact widely accepted by the electorate (Crewe, 1989). The work of social historians who have drawn on social surveys has likewise suggested that ‘popular individualism’ in Britain was not the same as Thatcherite individualism but rather provided a social context that Thatcherites were able to tap into rhetorically without always accurately representing it (Sutcliffe-Braithwaite, 2018, pp. 145–72).
Secondly, neoliberalism was not the only influential ideology in public life in the late twentieth century. A full account of the period would have to consider how other politically powerful ideas made a social impact (and interacted with neoliberalism). Foremost among these other ideas would undoubtedly be feminism, multiculturalism, nationalism (British, Scottish, Welsh, Irish, English) and the more general rise of human rights in political and legal discourse.17 With respect to economic policy, the rise of New Keynesianism, which sought to retrieve insights from John Maynard Keynes in the wake of the monetarist counteroffensive, also furnished political debate on the centre left during the 1990s with an influential and distinctive set of economic ideas (Hutton, 1999; Arestis & Sawyer, 2001, pp. 258–78; Clift & Tomlinson, 2007, pp. 47–69; Corry, 2013, pp. 34–45). All of these bodies of thought were in some respects in tension with neoliberalism and pushed public life in directions that neoliberals were highly critical of but found themselves unable to stop.
Thirdly, while ideas help historical actors to conceptualise and direct social change, there are always structural limits to political action set by the economic, demographic and institutional context. The extent, and political implications, of ‘deindustrialisation’ were malleable to some extent, for example, but as a broad economic wave it undoubtedly swept over Britain just as it did all other advanced industrialised nations in the late twentieth century. However, it did matter that in the British case key state decisions were taken by a government that had become convinced that it was less important to worry about the distribution of economic prosperity and security between social classes than to foster individual economic responsibility and improve the incentives for wealth creation, which is where neoliberalism enters the story once again, as the key ideological influence on this distinctive orientation of the Thatcher government.18
All of this suggests that the preoccupation in some of the historiography on Britain after the 1970s with an apparent contrast between neoliberal ideas and political or economic interests is too abstract. As Gamble has observed, it is a mistake to think about ideas ‘as some prime mover opposed to interests’ since ‘no context can be understood apart from the ideas that are constitutive of it’ (Gamble, 2012, p. 229). The most promising avenue of enquiry for historians is therefore to focus more closely on the way in which ideas (including, but not only, neoliberal ones) interact with particular social and economic contexts rather than seeking to prioritise one over the other.
Ben Jackson
Keywords: neoliberalism, Britain, think tanks, Thatcherism, intellectual history
In spite of the widespread interest in the intellectual history of neoliberalism, other historians have nonetheless expressed reservations about how influential such ideas really were. This chapter responds to this scholarship by reformulating the importance of intellectual history to our understanding of Britain after the 1970s. It does so in a way that steers the debate away from the more exuberantly idealist accounts of the 1980s towards a more constrained account of how the history of ideas can complement the important insights that we can glean from the study of high politics, the economy and social change.