In the 24/7 canonisation of the late Margaret Thatcher, one of the greatest myths of her neoliberal ideology has come to the fore – that Thatcherism is the last word in economic and political argument. Thatcher herself coined the phrase ‘There is No Alternative’ (TINA). This idea is as ubiquitous as it is wrong, and this is how.

Thatcherism Made Britain Great Again

David Cameron paid tribute to Thatcher in the House of Commons by saying ‘she made Britain great again’. This has been parroted by former cabinet ministers, pundits and teary eyed, flag waving sycophants across the land throughout the week of imposed national mourning.

The story goes that by busting the unions, selling off loss making public services, regulating the financial services industry and cutting taxes – Margaret Thatcher transformed the fortune or our national economy.

This is a fairy tale. The reason this fairy tale is almost all you will hear in coming days is to reinforce the myth that ‘There is No Alternative’. No alternative in 1979, no alternative in 2013. Suck it up, plebs.

Entirely missing from this narrative is the role of North Sea Oil. Or, more specifically, Scottish Oil.

International Convention had already agreed that the North Sea north of the 55th Parallel, and the home to 90% of the UK’s oil and gas reserves, was the territory of Scotland. In 1975, the government was presented with The McCrone Report. The paper, written by economist Gavin McCrone, stated that the vast North Sea oil fields which would come on line over the next few years could make an Independent Scotland as wealthy as Switzerland, producing 25% of the daily production of Nigeria.

The Westminster government made this report top secret to avoid the ‘It’s our Oil’ Campaign and the Scottish nationalists succeeding in removing Scotland, and her soon to be enormously profitable oil reserves from leaving the union.

Therefore, years before Thatcher came to power is was clear that, to quote the report ‘an embarrassment of riches’ was literally in the pipeline.

The oil revenues rose from almost nothing in the mid 70’s to 3% of GDP (£45bn in today’s money) by 84-5. They made Britain an OPEC country, giving her back a place on the world stage. It also closed the balance of payments gap which had been the issue of the last half of the 70’s.

Thatcher chose to fritter this revenue away on funding her ideological tax cuts for the wealthiest, enabling her to do so without increasing public debt or cutting public services.

Alternatively, the government of the day could have followed Norway’s policy. Norway used its significant oil boom to create a sovereign wealth fund and prepare public finances for the future retirement of the baby boomer generation. It was clear that in a few decades, there would be an expanded ageing population and public policy needed to cater for this.

A report by PriceWaterhouseCoopers states that had the UK government saved its tax receipts from oil revenues, it would have a larger sovereign wealth fund today than Kuwait, Russia and Qatar combined. Thatcher missed the opportunity to create a £450bn nest egg for the nation.

Whilst modern conservatives attack Labour for ‘not fixing the roof while the sun was shining’, the accusation could equally have been made of New Labour’s ideological matriarch and the queen of neoliberalism – one Margaret Thatcher.

However, successive governments sold us the fairy tale. They genuinely believed that if they kept cutting taxes, they would stimulate growth in the economy. In reality, the oil revenues have declined and now represent only 0.5% of GDP and there is no way of soaking up the tax cuts without incurring debt or cutting public services.

The government is continuing to pursue all three avenues (tax cuts, public spending cuts, increased borrowing) in the mistaken view that these will grow the economy. So today, we have a national debt of 138%, a stalled economy and a budget deficit almost 8% of GDP.

They are acting no differently to the child who believes that by closing his eyes he has made himself invisible. They have forgotten, falling in love with their own mythology, that the growth funded the tax cuts and not the other way round.

Thatcherism Made us a Property Owning Democracy

The second most common epitaph supporting the There is No Alternative line, generally sputtered from the lips in a wistful tone is ‘she gave us the chance to own our own homes’. This was indeed a great privilege and sop to Thatcher’s children, but Thatcher’s grandchildren may well curse her for it.

Whilst a limited number of council house purchase schemes had existed prior to Thatcher, her government expanded the policy exponentially. The Right To Buy Scheme came into effect in 1980, and gave council tenants who’d lived in their homes for more than three years the right to buy them at a 33% discount. Those who had lived in their council homes for more than twenty years received a 50% discount. The scheme was wildly popular, Labour dropped its official opposition to the scheme in 1985 and by 2003 more than 1.5 million council houses become privately owned.

There is another, much darker side to this story though. The Thatcher government effectively put an end to social housing policy in the UK.

In 1979, the Labour governments of Harold Wilson and Jim Callaghan had expanded social housing to 31% of the population, but also left Thatcher a Britain where home ownership had risen to 56.6%. By the time she left office it was 67%, and by 2003 it peaked at 70.9%. Since then however, the figure has plummeted and now stands at the same levels as it was in 1987 (65.3%).

What has this whopping 9% increase in home ownership cost us?

More than a third of ex council houses now sit in the property portfolios of wealthy landlords. In fact, the son of Thatcher’s Housing Minister at the time the ‘Right to Buy’ scheme was launched is now the proud owner of no less than forty ex council houses.

The limited remaining council housing is rationed out to the poorest of the poor with council housing waiting lists and mortgages ever further out of reach, everyone else is a hostage to the private rental market dominated by these landlords.

The following decades of defunct housing policy has left the UK with a housing shortage crisis. The UK is building 100,000 homes a year less than it needs to in order to meet requirements.

The consequent boom in house prices means they are now 300% higher (in real terms) than in 1959. If the price of a dozen eggs had risen as quickly, they would now cost £19.

The restriction on social housing has seen a boom in the private rented sector, which now constitutes 20% of the total housing market, versus 10% just ten years ago. This has seen private rents across the UK rise by an average of 37% in just the last three years.

The National Housing Federation issued a report last year which showed Housing Benefit has doubled in recent years as a direct result of an astronomical increase in housing costs. The report shows an 86% rise in housing benefit claims by working families, with 10,000 new claims coming in per month.

As a final kicker, those who bought their homes from Thatcher are now finding that rather than all that hard work resulting in a financial legacy for their families, their homes are simply collateral with which to pay for extortionate end of life care costs. It is estimated that 40,000 elderly people a year are selling their homes for just this purpose, in aims to cover the average £100,000 care home costs during the final years of their lives.

It is not owning one’s own home that gives a person security, but a sound and effective welfare state. Switzerland has a home ownership rate of 44.3%, Germany 53.2%, Austria 57.4% and none of these countries is facing the endemic housing crisis of the UK.

This is not just the legacy of Thatcher, it is the legacy of Thatcherism’s ‘There Is No Alternative’ myth. By creating a reality for voter and parliamentarian alike, that the only way was Thatcherism, no one has sought or been granted the platform to challenge the ideas.

There Is ALWAYS an Alternative

The very statement ‘There Is No Alternative’ epitomises the ideological and profoundly unscientific basis for the economic and social policies of Thatcherism and Neoliberalism. From Thatcher’s ‘There Is No Alternative’ to Frances Fukuyama’s ‘The End of History’ neoliberals have crowed that the ideas of deregulation, commercialisation, property ownership and the ‘free market’ are the pinnacle of social and economic progress.

How absurd it would be if a scientist in any other field than economics made such a claim. One does not hear of it. It is a given that the technology we are using today will be superseded tomorrow. It is a given that our understanding of the physical world will be greater tomorrow than today. We accept that science exists to challenge itself and its own theories over and over, developing ever new and more efficient methods and calculations to deliver ever greater results. If it were to behave in any other way, we would call it bad science.

So why on earth do we insist that social and economic ideas reached their zenith in 1979 and refuse to move them on? Why are we encouraged to be pioneers in scientific progress but philistines in socio-economic progress?

Thatcherism and neoliberalism beat out one style of socialism thirty years ago and have actively stifled the rise of new ideas since. This is not a success story. The world is culturally and literally poorer for it.

We have been sold into a myth that ‘There Is No Alternative’ by political, economic, academic and media institutions populated by those with a vested interest in maintaining the status quo. A major cause of our current deficit of ideas is the suppression in all our institutions of a competition of ideas.

This bias has made it almost impossible to challenge TINA without being viewed as some sort of unhinged radical. This is dangerous. It is dangerous to stomp on the collective pipeline of good ideas for organising our communities, producing goods and getting them to those who need and want them, for modelling our economics effectively, for raising our children, for our method of exchange and currency.

The reality is, there is always an alternative. There are always myriad alternatives.

If our institutions do not permit such encouragement of free thought, then we should develop our new ideas elsewhere. Over time those corrupted, stagnant institutions will render themselves obsolete.

We must abandon the myth that ‘There Is No Alternative’ and free ourselves to imagine, create and build a better working world.

Take Action

Read!

Debunking Economics by Professor Steve Keen – there are many new economic models which work a far sight better than those used by neoliberal economists. These models foresaw the financial crisis that neoliberal economists like Alan Greenspan and Ben Bernanke told you was impossible.

Watch!

Inside Job – a great film which you can watch free online which shows the degree of collusion between our institutions in not only the Banking Crisis but the suppression of competing ideas.

Join!

Occupy London or Occupy Wall Street – the Occupy movement might not be in tents anymore but it continues as an amorphous breeding ground for new ideas and discussion. Follow their twitter, Facebook pages and websites to be plugged into that broader sharing of ideas.