The nightmare haunting the Tories Don't be fooled by the spectre of the Seventies

It is hard now to appreciate just how permanently powerful the trade unions once seemed — partly because that power was founded on a shared fear that has long since faded. In the Sixties, free-market economics was a Victorian relic, unsuited to an interconnected modern economy, forever damned by the mass unemployment it had produced before the war. That memory of Thirties dole queues was the nightmare to which Britain must never return: the founding taboo of the post-war consensus, which meant governments must strive for full employment. This hugely bolstered the unions’ position. Striking is less scary if jobs are plentiful.

The long, agonising journey to the Seventies began as strikes became more frequent, and less tolerated. Labour and Conservative governments took turns to try to rein in union power — but without breaking the taboo on mass unemployment. So it was not simply the annoyance of a cancelled train or an uncollected rubbish bin that turned the imagery of the Seventies strikes into a nightmare. It was the battle for power between the unions and governments they represented, and the creeping dread that the unions were winning.

The single event that did most to sear this into ministers’ minds was a stand-off at a spectacularly tedious location: the gates of a coke depot in the Saltley district of Birmingham, at the height of the 1972 miners’ strike. On 10 February, thousands of pickets, marshalled by a young union official from Barnsley called Arthur Scargill, managed to compel the police to close the gates to the lorries queuing to collect coke — breaking the Chief Constable’s promise to the Home Secretary to keep them open.

When news reached Edward Heath’s cabinet meeting a few minutes later, the effect was devastating. The strike had already forced a state of emergency as power supplies dwindled. Heath later described Saltley as “the most vivid, direct and terrifying challenge to the rule of law that I could ever recall emerging within our own country”. A few days later, the miners forced him to surrender, and give them their pay rise. After a second miners’ strike in 1974, and the fall of Heath’s government, Labour gave the miners another raise — and to many, the country faced a choice of confrontation under the Conservatives, or capitulation under Labour.

Along with inflation, the prospect of civil war between the state and unions was becoming a nightmare to rival the old ghosts from the Thirties. This was held at bay for a while by the 1974 Labour government’s “social contract” with the unions — a last-ditch deal to keep wage demands down in return for government benevolence. But finally workers grew sick of prices outstripping their pay. It was this basic settlement that finally came apart in the Winter of Discontent. The sight of pickets outside hospitals and cemeteries allowed Margaret Thatcher to denounce the triumph of union power, and to win a mandate to reduce it. The spectres of the Thirties had finally lost the battle of nightmares.

The new settlement ushered in by the Thatcher government was based on constraining the unions — making what happened at Saltley illegal — and on liberating financial services. This produced a long period of prosperity. For some at least, that lasted all the way through to 2008, when those financial services nearly broke the economy, igniting the power struggle whose latest battle is being fought out this week.

The dominant power under attack was now not the unions but finance: in 2010, the Liberal Democrats’ Vince Cable pointedly branded bankers “pinstriped Scargills”. But just as the unions continued to hold sway through the Seventies, so has the City since the Crash. The impact of the Crash was absorbed by ordinary workers — not through mass unemployment, true, but through cuts to pay and hours, and the explosion of the gig economy and zero-hours contracts. Pay flat-lined for much of the decade that followed.

Now, under the stress of inflation, discontent has brought the post-1979 economic model under renewed pressure, just as globalisation has gone into reverse. Covid has broken old taboos on high government borrowing. The IMF has called for more to be done about inequality; the chief of the CBI has castigated the legacy of Thatcherism in northern England. Yet so far, despite the promises of levelling up and the talk of a post-Brexit move to a higher-wage economy, labour’s share of wealth remains lower than it was in the Seventies.

So, if the fundamentals remain so different, why has there been such insistence this week that we are “going back to the Seventies”? The Treasury and the Bank of England might be deeply concerned about the development of a wage-price spiral — a phenomenon that can be devilishly difficult to stop — but as the former Conservative minister David Willetts wrote this week: “Overall, pay is rising less than inflation. This is not some inflationary spiral.”

History suggests there may be another reason for this week’s warnings: “going back to the Seventies” is the nightmare that has underpinned the free-market consensus ever since 1979.

In the 1983 election, Thatcher frequently asked for copies of Winter of Discontent newspaper headlines to help her warn against letting Labour back in. She was far from the last leader to deploy this nightmare. In March 1997, Tony Blair promised “there will be no return to the Seventies”. In 2015, Boris Johnson warned Ed Miliband would do just that; as Prime Minister, he has complained that his Cabinet are too young to remember it. He needn’t worry, however: in 2012, four of his ministers co-wrote a book called Britannia Unchained, which begins and ends with fearful visions of Seventies collapse.

But something similar happened in the Seventies, and it only worked for so long. As the post-war consensus came apart, its tribunes redoubled their efforts to shore up the potency of the old nightmares. Labour’s Michael Foot endlessly invoked “the mass unemployment of the Thirties”; so did Conservative leaders whose politics were forged by the Depression, such as Harold Macmillan and Edward Heath.

However, a new generation of historians started to argue that, for those in work, the Thirties had really not been so bad — and all the while, the turn of the generations was eroding the folk memory of the dole queues. As we’ve seen, the Thirties eventually stopped haunting British politics. Likewise, today, to remember the Winter of Discontent, you’d have to be at least 50.

Yet for now, the Seventies nightmares remain tenacious. When Johnson won his 80-seat majority in 2019, it looked as though he might become a transformative prime minister, ushering in a permanently higher-spending state, focused on levelling up and securing its new bases in the Midlands and the north. Covid seemed to bolster that possibility.

For good or ill, the resurgence of inflation and strikes now appears to herald a return to Thatcherite orthodoxies. Yet paradoxically, this would make this government less like Thatcher — in terms of her determination to make a radical break from the past. Of course, the 12% swing to Labour in the Wakefield by-election may yet turbocharge the worries of Red Wall Conservative MPs with sufficient force to push levelling up up the government’s priority list. Even before his defeat, the Conservative candidate could be heard complaining the £25 million allocated to the constituency from the Towns Fund was not cutting through.

But all this presents Labour with a dilemma too — just witness the divisions between the Starmer leadership and those MPs who this week joined RMT picket lines. As John Curtice has pointed out, Labour’s share of the vote in Wakefield rose by only half as much as the Conservatives’ fell. Labour now has to decide how far it wants to risk a break with the post-1979 model of weak trade unions, and the job market that developed in the wake of the Crash. Unlike the Winter of Discontent, it is at least in Opposition, which worked so well for Thatcher. But Labour is always implicated by the actions of the trade union movement which played a huge part in the party’s creation.

Given the unions’ weakness compared with the Seventies, and government determination to face down the strikes, there is no obvious moment of transformation in sight. And yet it may be that the Seventies does offer a precedent here. Just as the remembered nightmare of mass unemployment was finally overridden, in part by the nightmare of mass picketing, it’s possible that very nightmare, now 40-years old, may now be overridden in its turn: by many ordinary people’s inability today to make ends meet, and their desperation for a pay rise. Unions are often dismissed as old-fashioned — but then so was the free market, and that went on to recover quite strongly. Perhaps, then, the most striking parallel between now and the late Seventies is the giddy, ominous feeling that something is coming to an end.

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Phil Tinline’s most recent series, Pay Freezes, is available on BBC Sounds. His book The Death of Consensus: 100 Years of British Political Nightmares has just been published by Hurst.

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Phil Tinline is a documentary-maker with BBC Radio. His most recent documentary, Back Seat Drivers, is available on BBC Sounds. His book The Death of Consensus: 100 Years of British Political Nightmares is published by Hurst.

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