Wets
• ‘One Nation’, Keynesian
(previous PMs Macmillan,
Home and Heath).
• More consensus.
• Not prepared for tough
measures if it would lead to
unemployment.
• E.g. Carr and Walker (who
had left the Shadow Cabinet
on Thatcher’s election).
Willie Whitelaw, Ian
Gilmour, Lord Carrington,
Francis Pym, Jim Prior.
Dries
• Uncompromising measures
necessary before Britain
recovered its economic
position.
• Monetarism.
• Sacrifice unemployment for
lowering inflation.
• E.g. Thatcher, Keith Joseph,
Geoffrey Howe, Angus
Maude and John Biffen.
You can see some of these people’s
faces on page 14-15.
• Consensus politics had been the norm since WWII.
• This meant both Labour and Conservatives were in agreement over
policies such as the introduction of the welfare state, the NHS and
nationalisation of industry.
• ‘One Nation’ Conservatism (left wing, ideas) were happier with
consensus politics. ‘One nation’ Tories believe in the unity of all the
different groups within the country and social equality of opportunity.
• Some Conservatives were starting to break away from both consensus
and One Nation Toryism, blaming it for Britain’s economic woes.
• Heath was a ‘One Nation’ Tory, although some historians argue that it
was not his One Nation view but actually aloofness from backbenchers
that lost him his leadership battle with MT.
Consensus
Governments agreeing to:
• Commitment to Keynesianismtax cuts and boost state
spending.
• Acceptance and some
encouragement of the role of
the trade unions.
• Mixed economy- place for state
ownership of utilities,
intervention and planning in the
economy.
• Welfare state.
• Promotion of greater equality
through social engineering.
Conviction
• Quite different.
John Maynard Keynes:
Economist, effectively
ended laissez-faire
economics with his belief
that government
intervention could solve
struggling economies.
Named one of the 100
most influential people of
the 20th Century by Time
Magazine.
People buy
stuff
People want
to spend
wages.
Jobs/ wages
rise.
Increases
demand for
stuff.
Increases jobs
making and
supplying
stuff.
People save
money
People don’t
want to
spend wages
if they have
them.
Unemployment rises,
wages lower.
Demand for
stuff is
lessened.
Jobs making
and supplying
stuff
decrease.
Keynes
recommends...
People save
money
People don’t
want to
spend wages
if they have
them.
Injection of
government
funds
Jobs in
public
Unemploysector/
ment
rises,
welfare
wages lower.
increase.
Demand for
stuff is
lessened.
Jobs making
and supplying
stuff
decrease.
People buy
People save
stuff
money
People don’t
People
want
want
to
to
spend
spend wages
wages.
if they have
them.
Injection of
government
funds
Jobs in
public
Unemploysector/
Jobs/
wages
ment
rises,
welfare
rise.
wages lower.
increase.
Increases
Demand
for
demand
stuff is for
stuff.
lessened.
Jobs
making
Increases
and
jobssupplying
making
stuff
and supplying
decrease.
stuff.
• This was the view that the reason for inflation
was the willingness of government to create an
excessive money supply- NOT wage increases.
Therefore wage increases should be controlled
(never popular with voters).
• Wage increases were seen as happening due to
excessive trade union power- the trade unions
need squishing. This would mean that their
agreement would not be required in economic
policy and power would return to managers and
governments. Conservatives liked this- especially
traditional Conservatives who wanted “Britain as
head of a great empire run by all-knowing Tories”.
People save
money
People
don’t
More people
return
want to
to work (increased
spend wages
profits ifcan
behave
they
reinvested)
them.
Public sector
spending
controlled,
cutting taxes.
Profit motive
returns
Unemployment rises,
wages lower.
Welfare state
dependency
reducedincentives to work
increased
Demand for
stuff is
lessened.
Jobs making
and
supplying
stuff
decrease.
People
People buy
save
money
stuff
People
don’t
More people
return
want
to
want
to workPeople
(increased
spend
wages
to spend
profits ifcan
be
they have
wages.
reinvested)
them.
Public sector
spending
controlled,
cutting taxes.
Profit motive
returns
UnemployJobs/ wages
ment rises,
rise.
wages lower.
Welfare state
dependency
reducedincentives to work
increased
Demand
Increasesfor
stuff isfor
demand
lessened.
stuff.
Jobs making
Increases jobs
and
making and
supplying
supplying
stuff
stuff.
decrease.
• The new thinking meant that public spending would be
controlled, which would mean cuts in taxes and more
profits and incentives to enterprise.
• Inefficient state monopolies in nationalised industries
would be sold into the private sector and opened up to
private sector disciplines- reducing state subsidies and
eventually generating tax revenue.
• Welfare state would be reformed- increasing incentives
to work and removing or reducing dependencycontaining public spending.
• Radical- and Heath and other one nation Tories didn’t
like it. Neither did the old style Tories.