Thatcher, Reagan and a little country in the Pacific

I’ve been watching The Crown. I was enjoying it for all the reasons I should – the opulence, the soap opera melodramas, the depictions of the politics of Britain in the post war period. Thatcher’s Britain came as a kick in the guts.

I think this Scottish woman’s eulogy for Mrs Thatcher sums it up nicely;

I am a child of the 80s. My first memories are of thin leather jackets, bad perms and cigarettes. Thatcher’s Britain was not too far removed, in terms of ‘look’ from New Zealand at the time – lots of shambling poverty, cups of tea and unemployment. Thatcher renovated the British economy from top to bottom (as she put it). Basically, as Britain’s colonial power declined, and with it, the money extracted from milking ‘real’ resources in its overseas territories, the country was increasingly ‘domesticated’. That is, reliant on making things within Britain. This wouldn’t be such a problem, if Britain had kept up its technological dominance, but it hadn’t, lulled, as many before it, into a false sense of security provided by a healthy stream of income from its resources obtained overseas.

Thatcher knew this. Britain was becoming less competitive and was suffering economically for it. Thatcher’s Britain aimed to shift the very structure of the economy to emphasise the one thing in which Britain still retained supremacy – a hub for financial trading. The City (of London) drew in enormous wealth for Britain. Thatcher decided to hitch the country’s fortunes to this horse, and, at the same time, embark on a radical monetarist inspired restructure of the welfare state. This was what we now refer to as neoliberalism. ‘The Washington Consensus’ and Britain’s structural adjustment signalled an enormous shift in the basis of the economy. I’m not going to summarise the details here, as many have done a far better job of that than I. However, what I think The Crown gets right is the cultural oeuvre of neoliberalism, Thatcher’s words piped into the existence of its downtrodden, penurious protagonists as they stand in line waiting to be ritually humiliated at the dole office, or in their shabby council flats.

Neoliberalism presented an economic idea as a cultural one – the idea that the economy and society were one thing, and that the individual was a discrete, atomised actor, completely in control of his or her own destiny, regardless of one’s circumstances. Success or failure was based purely on personal, individual gumption and hard work. Society, according to Thatcher, ‘did not exist’. It’s worth noting that all this individualism did not extend to taxes, which were still collected by the state.

Citizens were endlessly re-educated into this new way of thinking, the language of individualism. It was a mean-spirited thing that viewed all the workings of society – housing, healthcare, education – as economic products rather than social goods. There was no longer any ‘social’. Everything was privatised, speculated on, governed by the ‘invisible hand’ of economic rationalism.

The impact, of course, was to reduce transfer payments from the top of the economy to the bottom, thus concentrating wealth upwards. The rich got a lot richer.

New Zealand, with its dour, pinch-faced Scottish Protestant-Calvinist tut-tutted Thatcher for her gentle touch. In 1984, faced with a similar ‘traditional’ economy in decline, New Zealand embarked on a massive neoliberal experiment, known today, in the fine Kiwi tradition of austerity in naming, as The New Zealand Experiment. This was an extreme version of neoliberalism, carried out even more radically than in Britain. The country floated the dollar and embarked on a massive overhaul of the public sector. Unemployment shot up, poverty flourished, homelessness and social alienation became entrenched by the early 90s.

The results, of course, were devastating for ordinary people.

I think what’s most striking to me, having mostly grown up during this period, is that this represented a new way of thinking about ourselves as political, social and economic beings. It seeped into the way we thought about ourselves. For instance, in the 90s in NZ there was an incredibly strong stigma attached to being ‘unproductive’. Neoliberalism had unleashed an extant cruelty that fostered hatred amongst friends and neighbours. Using terms like ‘working class’ or, ‘benefit’ was openly sneered at. Working full time was the only way to be fully human, and in my opinion, this element of neoliberalism remains. For women, having a child was judged harshly and women should ‘get back out there’ as quickly as possible. Unsurprisingly, the economic arrangements of the day had the harshest judgements for women. My mother, for instance, was a ‘solo mother’ *gasp* after her husband left her. She struggled to get work and eventually, through friends, got a full time position as a telephonist (yes, in one of those phone offices with the long cord and plug thingos). Her relief was enormous as it meant she could pay a mortgage on the small house she’d managed to buy (after being refused several times by the ANZ bank because she didn’t have a husband on the paperwork.

The problem, of course, was that she had two children, which was somewhat incompatible with working full time, in the age of zero childcare. We attended every single day of school, no matter our condition. She simply had no choice otherwise. Mum had 5 days of sick leave per year, and the fact that I remember this from the age of 5 is testament to how it dominated our lives. Mum had an illness that eventually required an operation and she rationed out those sick days like gold.

In the afternoons I went to a Barnardos home and my brother went to a neighbour who had other children his age. We collected food boxes (in another woman’s car) from what Mum called ‘the vege co-op’ but I now realise was a food bank. I remember sitting cross legged in the back of an HQ stationwagon with several other kids, all of us woozy with the petrol fumes, with next to boxes of food as the car made its way around the neighbourhood. The irony is, of course, that we weren’t even considered particularly poor. I remember my Dad picking us up for a visit and discovering that Mum hadn’t packed us any clothes and he took us into Wellington city, at night, and bought us new clothes. I got a pair of jeans and a jumper. Until that point all my clothes came from my cousin Glen, who was the only cousin bigger than me. I wore boys’ clothes for my entire childhood, including Y front undies. Shoes were optional.

Unless you lived in a household with a full time employed husband, you were fucked. There were plenty of people in our situation.

New Zealand prior to 1984 wasn’t exactly rolling in cash either – there was a strict division between rural and urban kiwis, and money was almost hermetically sealed amongst those in the farming sector. Liberalisation and the removal of tariffs knocked that on the head.

I think what’s interesting to me is that Neoliberalism, for many New Zealanders under the age of 40, is just a given. It was presented as an incontrovertible set of natural laws that would govern the fortunes of the country and enable success. It tapped into New Zealanders’ Calvinist leanings, their inherent distrust of their neighbours as bludgers and leaners, their cruel racism.

There was no ‘citizenry’, no longer any sense of social contract or licence. All there was was the cut and thrust of economic primacy and success. The idea that government should support, foster, regulate, ameliorate, prime or undergird economic activity was an anathema. The government should not ‘pick winners’. Of course, this was because the winners were picking themselves. No one laughed longer than I did when New Zealanders chose John Key as their Prime Minister, a man who had colluded in the fevered currency speculation following the floating of the NZ dollar that almost bankrupted the entire country, overnight.


So suppose what I want to flag is something hopeful. Neoliberalism has, as predicted, has not guaranteed the stable economic success it promised. It was brought increased inequality and poverty. But, and this is a big but, I am now old enough to recognise changes. People are increasingly seeing it for what it was and is. They’re aware now, especially in the wake of massive social spending following the GFC and more lately, the pandemic, the role of strong governments that are integrated into the economy in a more traditional Keynesian, interventionist way. There are arguments about what this means economically, but what’s changed is an awareness of the separation of the economy and society, and that one must serve the other. As I live in Australia I increasingly witness the political consensus coalesce on what we might recognise as something like ordo-liberalism, rather than neoliberalism. It’s clear that there’s no point in simply working very hard to tip money into the top end of a FIRE economy (Finance, Insurance, Real Estate).

I’m just dribbling on now, but part of my 2021 resolution was to write more, and reflect more through writing, and so now I’m doing just that.

(I’ve written about The NZ Experiment before – here)

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