John Major as a successor to Margaret Thatcher was always going to find life difficult. He says himself he rejected any talk of his creating 'Majorism' as Margaret created 'Thatcherism', claiming instead that "The Conservative Party does not belong to any one individual" . His priorities (at least initially) as he saw them were clear; inflation, inflation, inflation. Further to that, he aimed to reduce unemployment, although not through artificial job creation, but by preserving a climate of low inflation in which growth would be encouraged. He aimed to privatise that which was feasible and had not already been done.
But the climate in which John Major became Prime Minister was markedly different from that of 1979 and so, by necessity, the leadership and policy-making styles of Thatcher and Major were different. Significant in his priorities were consolidation and continuity; it was for this reason, primarily, he was elected by the Conservatives; and for this reason it is difficult to see a Major agenda as distinct from Thatcher. Nevertheless there were some interesting differences between the two leaders which I shall attempt to draw here, emphasising the areas in which Major departs from Thatcherism; particularly in his attitude towards EMU and industrial policy.
During this essay I shall look first broadly at monetary and fiscal policy and subsequently examine the position within and attitudes towards Europe, an issue which, by its very nature, must have a profound effect on the direction of a nation's macroeconomic policy. Their styles of leadership of course diverge greatly which is a significant factor in the differing culture of the times. Finally I shall examine the how the attitudes of the two Prime Ministers differed towards industrial policy. I shall attempt to demonstrate that macroeconomic policy remained largely consistent through over the Conservative time in office, however Major took much greater interest in the microeconomic policy which had been largely ignored under Thatcher.
The Thatcher Legacy
Where Thatcher had come in on a ticket of revolutionary policy, the general feeling when Major assumed office in 1990 was that, whilst the voters had taken as much as perhaps they could in terms of state retrenchment, there was no strong call for a radical new agenda. To this end, Major's leadership was always going to be one of consolidation and conciliation. In this respect we can draw a strong comparison with George Bush's succession of Ronald Reagan in 1989; the situations, personalities and policies of the four leaders were broadly similar. Reagan and Thatcher were conviction politicians; Major and Bush guardians.
John Major faced the problem that, without any real supporting evidence, the wider community believed Thatcher's policies to have 'transformed' the economy, rather than just seeing the late 80s boom as the natural counterpart to the severe recession that preceded it. He was thus expected to reap the fruits of this imagined miracle, and was instead seen as failing to manage them properly on coming to office at the peak of an unsustainable boom with similarly unsustainable growth in outputs.
Previous to 1992, the recession experienced can reasonably be considered the result of the Lawson inflationary boom of the late 1980s. A year and a half of stagnation were followed by a year in which inflationary pressure dropped. Nevertheless there was a real and widespread conviction that inflation targeting was necessary not only for stability but also for general economic superiority and long run growth. In this way there was continuity between Thatcher and Major; her Medium Term Financial Strategy was devised with the primary aim of reducing inflation and, although targets were almost never achieved, they had the desired effect of altering expectations thus bringing inflation gradually down, albeit in a fashion...