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Thatcherism And New Labour Essay Contest

As to why Baroness Thatcher should be the first PM to lend her name to an ism you have to look to both the person and the times.

Those who knew her well would not describe her as an intellectual, but Baroness Thatcher was ideological by nature. She understood the importance of ideas and she saw the connections between ideas and practical consequences. Moreover, she knew where she stood – and she relished telling others where she stood too.

But her political personality might not have developed fully in this way, and would certainly not have had such an impact on British politics, if it had not been for the circumstances of the time. When she first burst onto the stage it was a time for isms.

Domestically, the 1970s had been a period of crisis. At various points, not just the economy but the whole system of democratic government in Britain seemed at the point of collapse.

At the beginning of the Labour Government in the 1960s, Harold Wilson talked about the white heat of the technological revolution but Jim Callaghan’s government of the late 1970s went out – and Thatcherism was moulded – in the grey cold of the Winter of Discontent.

Baroness Thatcher would have seen her ideological enemy then as “socialism”, which had brought the country low: excessive levels of government spending and taxation, lax financial discipline and excessive power for the trade unions.

Internationally, the enemy was communism, as the Cold War still raged and the Soviet Union seemed extremely threatening. Thatcherism, like its transatlantic offshoot, Reaganism, was cast in opposition to these prevailing isms of the day.

So what was Thatcherism about?

Much of it was just the traditional liberal economic agenda, developed in the 19th century – free markets, free trade, competition, a small state, requiring only low levels of taxation, and financial probity.

In the early stages, this concern for financial probity was allied to crude monetarism, that is to say, belief that controlling the money supply would automatically give you low inflation, but this was not integral to the philosophy and by the mid 1980s it was effectively abandoned.

Saying that this was just a retread of old 19th century liberalism doesn’t convey how radical these ideas were at the time, after decades in which markets were held under suspicion and even in a supposedly capitalist country like the UK, the state’s role in the economy was overwhelming.

The terms left and right are often inadequate to describe the relations of political and economic ideas.

Thatcherism is usually depicted as extremely right wing, but whether this is accurate depends upon your analysis of what the spectrum, on which you may be at one end or the other, is all about.

The best way of understanding Thatcherism is to appreciate that it was fundamentally anticonservative. Indeed, on some definitions of the political spectrum, it was essentially left-wing. It was not just radical; it was revolutionary.

Accordingly, it inspired opposition bordering upon hatred from two of the most conservative parts of the polity – the patricians on the “left” of the Tory party, and the Old Guard of the Labour Party and the trade unions.

In many ways the opposition of the former group is more understandable. On the whole, they were fully aware of the upset which Thatcherism would bring to the existing order and they resented it. They found both the person and the policies vulgar.

The opposition of the latter group, by contrast, reflected an intellectual failure. They seem to have been blind to the idea of markets as operating in the interests of ordinary people and giving them power. But what they could not see, swaths of what used to be called the working class did – and as a consequence, in large numbers, they came to consider themselves Thatcherite.

Moreover, as a result of repeated Conservative political success founded on this bedrock of working class self-interest, the Labour Party eventually came to accept and even embrace market forces as the people’s friend. In this respect New Labour was part of Thatcherism’s legacy.

Yet there was more to Thatcherism than simply the liberal agenda. Classical liberalism was fleshed out with some more homespun beliefs – in value for money, efficiency, self-reliance, saving and wealth accumulation.

Under Baroness Thatcher it was again acceptable – indeed admirable – to be rich. In a remark which spoke volumes, she once said that it was not enough for the Good Samaritan to be good. He also had to have money for his feelings of charity to be translatable into effective action.

One implication of self reliance, you would think, is a reduction in the size and scope of the welfare state. And this surely was one of Baroness Thatcher’s ambitions. In fact, Thatcherism’s achievements in this regard were limited.

The welfare budget continued to soar and during the Thatcher governments, large numbers of people became welfare-dependent and marginalised from mainstream society. This was due not to some weakness in Thatcherite thinking but rather to the limitations imposed by contemporary political reality. As the current disputes over welfare suggest, it would not be at all surprising if this part of Thatcherism achieved eventual fulfilment in the decades to come.

There were some aspects of Thatcherism in practice which did not sit easily with the 19th century liberal agenda, including in particular, a fondness for selected government intervention to suppress or direct the market mechanism – provided such intervention was of the “right” sort.

For instance, Baroness Thatcher’s ministers had the devil’s own job convincing her to do away with mortgage interest tax relief. She would not budge.

Indeed, against the policy of letting its real value wither on the vine, she once managed to have its value increased.

This was supposedly government assistance in favour of a good cause, namely home ownership. You were helping people to help themselves.

Anyway, as she would have seen it, the people that it benefited were “our people”.

Baroness Thatcher was also famously a patriot and sorely wanted Britain to succeed economically. But unlike many people of this type, she was not an economic nationalist. The national interest was best served by competition and free markets. This was the very opposite of mercantilism or Gaullism.

The clearest example of this, and one which arguably led to her Conservative government’s greatest achievements, was its decision to end the Stock Exchange’s cosseted existence and open up the financial markets to unfettered competition and foreign ownership.

Those initially disadvantaged by this move were “our people” – namely the serried ranks of stockbrokers, jobbers and merchant bankers who had enjoyed a very comfortable and prosperous existence, thank you very much, and whose forebears had overwhelmingly voted Conservative for generations.

The Big Bang changes undermined their comfortable existence. They also led to the 'Wimbledonisation' of the City, as almost all the old British firms were bought up by foreign entities, leaving the UK hosting the event but with no leading British players. Yet London prospered beyond imagining, to the point where it has now overtaken New York as a financial centre.

Despite these successes, what was crucially missing from the set of ideas called Thatcherism was any vision of community, save of the nation.

Thatcherism was a vision of individuals, or at most families, atomistically pursuing their own self-interest, in competition with one another.

Baroness Thatcher seemed only to embrace community values when it came to war, or civil emergencies and accidents when, rather incongruously, she would often descend on the hapless victims to offer her support, while heaping praise on the members of the emergency services who, on a strict interpretation of the Thatcherite, self-aggrandising creed, should presumably have been merely pursuing their own self-interest.

She famously once said: “There’s no such thing as society. There are individual men and women and there are families.”

These words were meant to be interpreted in opposition to the prevailing ideology of the 1970s, which still lingered on in the 1980s in hearts and minds, which attributed everything, both good and ill, to “society”, thereby leaving no scope for individual initiative and responsibility.

As such, they were well meant and well taken. But the words also suggested – and revealed – a fundamental selfishness at the heart of Thatcherism and this subsequently proved to be its undoing.

It was in reaction to widespread popular revulsion against the me-ism and blatant self-advancement of the Thatcher era that Tony Blair was able to promote the Labour Party as a party of community, shared values and collective action.

Hence David Cameron’s apparent view that his chief challenge is to represent the Conservatives also as a party of community values, if you like to reconnect it with its pre-Thatcherite past.

In fact, his real challenge is surely greater than this: it is not to ditch Thatcherism, but rather to build on it by adhering to its essential tenets while filling in its major lacuna, namely its lack of a proper view of society itself. In other words, it is to rediscover community without building up the state, thereby linking up Thatcherism with the Conservative Party’s deep traditions of community and duty. That is what his idea of the “Big Society” is all about.

So, what did Thatcherism achieve? First, it should be said that the initial economic performance was abysmal.

The rhetoric had it that tough control of the money supply would reduce inflation automatically and lower inflation would promote economic growth and employment.

How far this was genuinely believed and how far it was just a means to an end is hard to establish. But what happened is that the attempt to control the growth of the money supply achieved low inflation through a circuitous route.

It involved the imposition of very high interest rates, which were raised from 12pc to 14pc in the first budget in 1979 and then again to 17pc in November. Meanwhile, helped by the near doubling of VAT from 8pc to 15pc, inflation soared.

The money supply still did not come under control but, ironically, inflation eventually did.

Yet there was nothing revolutionary here – except in the preparedness to see the policy through, come what may. For what brought inflation down was the effects of the high interest rates and a cripplingly high pound, which devastated much of British industry, causing unemployment to soar.

The recession of 1979-81 was the worst since the 1930s and it delivered a blow from which Britain’s old-style metal-bashing industry never recovered.

This was subsequently seen as something of an achievement but at the time it was regarded as an inevitable, but largely regrettable, sideeffect of getting inflation down.

These were the days of TINA – There Is No Alternative.

The early years were also marked by failure on the size of the state. Baroness Thatcher’s governments found it devilishly hard to reduce government spending as a share of GDP.

And since they were simultaneously trying to reduce public borrowing, they did not achieve much in reducing overall taxation either.

There was an eye-catching structural move, though. In the very first budget, the top rate of income tax was cut from 83pc to 60pc and the basic rate of tax was cut from 33pc to 30pc, financed by the increase of VAT from 8pc to 15pc.

Baroness Thatcher’s economic policies made her and her government deeply unpopular. For quite a while it would have seemed incredible that she would be credited with turning round Britain’s economic performance.

Although the economy started to recover in late 1981, it wasn’t until Nigel Lawson took over as Chancellor, after the election victory of 1983, that economic performance visibly started to improve.

There were some notable successes with long-lasting consequences. Privatisation came to be regarded as one of Thatcherism’s greatest achievements.

In fact, it did not feature in the objectives of the early Thatcher government. Indeed, it was stumbled upon as a way of raising money for the Treasury and thereby reducing the public sector borrowing requirement.

Its ability to deliver massive efficiency savings came largely as a surprise. But once these benefits were discovered the government went for it with a purpose.

And the way that nationalised industries were privatised was decidedly Thatcherite – with a substantial allocation of shares available, on application, to small savers who, if gaining some shares, would secure an immediate and virtually guaranteed profit. After all, again these were “our people”.

But Thatcherism failed to recognise the appropriate borders to the public and private realms and hence to appreciate which privatisations would work and which would not. This resulted in a botched privatisation of the railways, the consequences of which are still very much with us.

Interestingly, it also resisted the logically consistent but politically threatening extension of the market into a realm of the transport system where the price mechanism did not operate, namely private travel by road.

Road pricing is in accordance with belief in markets but it would not be right to describe it as Thatcherite. Thatcherism saw unrestricted private travel by car as the expression of individual freedom – even if it amounted to the freedom to be stuck in never-ending traffic jams.

Surely Thatcherism’s greatest achievement was the freeing up of the labour market. The UK has gone from one of the highest unemployment rates in the developed world to one of the lowest.

There were three aspects of the transformation: the privatisation of large parts of the economy, as referred to above, which brought large numbers of workers who had previously been subject to the political process into the ambit of market forces; a programme of legislative change which weakened the powers of trade unions and increased employers’ flexibility, and the all important fact on the ground – the defeat of the miners’ strike in 1985.

It cannot be emphasised how important the latter was for the whole mood of the economy – and hence for what was possible in labour relations. In 1974, when the then Conservative prime minister, Edward Heath, had called a general election on the issue of who governs Britain, the government or the unions, the electorate just about gave him the verdict “the unions”.

Accordingly, the defeat of the miners in 1985 was a landmark event. It spelt the end of militant trade unionism in this country and shifted the balance of expectations – and hence the balance of power – in employers’ favour.

Taxes were right at the heart of Thatcherism and under Thatcherism the tax system was transformed, with effects on both social attitudes and the incentive to work.

It is true that the overall burden of taxation did not fall very much. In 1979 it stood at just over 40pc of GDP. When Baroness Thatcher left office in 1990 it was just over 39pc and when the Conservatives were defeated by Labour in 1997 it was still just over 37pc.

But the structure was altered. From 33pc in 1979, the headline basic rate of income tax fell from 23pc in 1997/8. More importantly, the top marginal rate was slashed.

It seems incredible now that Nigel Lawson’s 1987 decision to reduce the top rate of tax from 60pc to 40pc was so controversial but at the time it was dynamite. Despite this controversy, the 40pc rate continued under Labour until, late on, Gordon Brown hiked it to 50pc for political reasons.

There was one major Thatcherite tax failure, namely the poll tax, which made the government deeply unpopular and was eventually replaced with Council Tax. There have since been no moves to restore it.

But the revival of interest in flat taxes is clearly in the Thatcherite tradition. The adoption of flat taxes in Eastern Europe and Russia and their apparent success is putting pressure on EU members to flatten their tax systems, and as this pressure leads to effective action then so the pressure on the UK to make taxes flatter, under governments of whatever hue, will intensify. The Thatcherite agenda for the tax system is not dead and buried.

So far I have dealt only with the domestic aspects of Thatcherism. But there are key international aspects as well. Perhaps Thatcherism’s greatest impact was in eastern Europe. The Baltic States in particular adopted the Thatcherite agenda pretty much wholesale. Their subsequent success is one of Thatcherism’s enduring monuments.

Another key element of Thatcherism was opposition to the aggrandising ways of the EU. In many respects, this derived simply from Thatcherism’s endorsement of the patriotic agenda and the view of the UK as special. But it also derived from the view of the Union as inherently socialist. So wider competence and greater powers for the EU equalled defeat in the war against socialism.

In this regard, Thatcherism has had a mixed record. Baroness Thatcher was unable to keep the pound out of the ERM but Gordon Brown was steadfast in keeping it out of the euro. The Labour Government joined the Social Chapter of the Maastricht treaty, from which John Major had negotiated an exemption, but the UK labour market still remains freer than most in the Community.

History will tell whether this marks the high water mark of EU integrationism but if so, the intellectual roots of the change were laid down by Baroness Thatcher in her Bruges speech of 1988 when she said that the EU could either try to deepen its union or widen it to include more countries, but not both.

And in her view its mission was to widen the membership. The accession of 10 new members in 2004, followed by Bulgaria and Romania, is a fulfilment of this vision. Moreover, it does look as though the extension of the EU will inhibit its deepening, just as Mrs Thatcher envisaged.

So what is the overall assessment of Thatcherism’s achievements? I have a nightmare vision of the future in which countless PhD students are researching Thatcherism and they overwhelming conclude from the evidence that Mrs Thatcher did nothing to transform the British economy. After all, the point of the wave of radical reform should have been to raise the UK’s economic growth rate but there is no evidence in the economic statistics that she achieved this.

This only goes to show how misleading statistics can be. Major changes of mind and institutions do not neatly fall into periods conveniently defined by academic investigators. They take time to have their full effect and it takes imagination and insight to perceive it.

Anyone who lived through this period can be in little doubt about the importance of Thatcherism. Because of its changes, people were more strongly motivated, competitive, money-minded and harder working. Companies were more efficient and focussed on profit. The country was more open to the world and self confident about its place in it. Moreover, by and large, these changes endured.

The fulfilment of Thatcherism was to be seen in the early economic achievements of the Labour Government. Although Gordon Brown regularly trumpeted the good performance of the British economy as though this were the sole result of his policies, in fact it was the result of the Thatcher government’s micro reforms allied with his macro reforms, which themselves built on developments under the Conservatives.

Of course, this all ended in tears – partly because he took one element of Thatcherism too far, and partly because he completely flouted another. Light touch regulation emerged seamlessly from the idea that competitive markets always work well when left to their own devices – even in the fragile world of finance. Gordon Brown’s folly was to follow this notion to an absurd extreme while allowing government spending to soar to bloated levels, thereby reversing a key part of the Thatcher revolution.

Despite the failings and travails of the financial markets, the greatest legacy of Thatcherism is to be seen in the position of London. In the 1970s it was a dowdy city. The role of capital of the empire had gone and nothing had replaced it. It seemed to be overshadowed by Paris, never mind New York. Then it emerged, not just as Europe’s leading city but the world’s one truly global city, surpassing even New York, amusingly under the mayoralty of a bete noire of Thatcher’s – Ken Livingstone. This owed nothing to Livingstone and almost everything to Thatcher.

And it continues under Boris Johnson. London is now successful and exciting in a wide variety of spheres above and beyond the financial – in fashion, the arts, even food. But how could this have happened without the rejuvenation of the City as an international financial centre? And how could that have happened without low taxes, openness to foreigners and foreign capital? How could these have happened without Thatcherism?

In short, in assessing Mrs Thatcher’s economic legacy, I can do no better than quote the following, which is a translation of the Latin words inscribed on the floor underneath the dome of St Paul’s Cathedral written in relation to Sir Christopher Wren: “Reader, if you seek his monument, look around you.”

Roger Bootle is managing director of Capital Economics.

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Perhaps the only undisputed facts of Margaret Thatcher's premiership are that she first entered 10 Downing Street as prime minister on 4 May 1979 and departed with a tear in her eye on 28 November 1990.

Everything in between: how she changed Britain, what actually changed, and especially what it means for us today, has been the subject of an intermittent war of words throughout the two decades since her resignation – and it is a war that has intensified in the days since her death.

It's only by trawling through the historical reference – from census data to coal board records, from the World Bank to the Institute for Fiscal Studies, and from more than 30 years of social research – that even the basic facts about the nation reshaped during the Thatcher era take form.

What they show of Britain's new landscape is telling – but, of course, what will always be a matter for argument is how much would have happened with any prime minister, and how much was down to the Lady.

For millions of Britain's better-off working class – the famed C2s targeted by political strategists and tabloid owners alike – the most direct impact of Thatcherism was on levels of home ownership: Thatcher's dream of a nation of owner-occupiers was perhaps one of her most fully realised.

Figures from the 1981 and 1991 UK censuses show the scale of this change. In 1981, two years into Thatcher's premiership, England and Wales had 10.2 million owner-occupiers. A mere decade later, their ranks had swelled to 13.4 million.

Thatcher certainly didn't invent the ideal of home ownership, but she did an astonishing amount to boost it – and far more than any government since. Twenty years later, the 2011 census, reporting on a Britain with a population six million higher than in Thatcher's time, recorded that the number of owner-occupiers had only ticked up to 14.9m households.

Many of the new Thatcher-era first-time buyers gained their ownership through the right to buy scheme, giving council tenants the right, for the first time, to buy their homes at a hefty discount – about which Thatcher had initial reservations, due to her instinctive thrift.

In England alone, more than 970,000 local authority-owned houses were sold through the scheme during Thatcher's premiership, more than have been sold in the two decades since.

Such changes clearly came with a cost, and one of the most direct costs was the gradual decrease in the amount of social housing – and the resultant long waits on housing lists today – from a country with a growing population and atomising households (the number of people per household in the UK is slowly but steadily falling, as more of us live alone).

In 1981, England and Wales had 5.4m households in social housing. By 1991, this had dropped by 900,000 to 4.5m. In the post-Thatcher years, this gradual drop-off has endured, with 4.1m households living in social housing at the last census.

That was only the most direct effect. In addition, many of the first people to buy their council homes through right to buy almost immediately started to struggle with their mortgages.

As a result of the Thatcher government's decision to target and control inflation – seen by many people then and now as a necessary move – interest rates (and therefore mortgage repayments) never fell below about 7.4% during Thatcher's premiership, and peaked at 17%.

This is a figure unimaginable to many of today's younger adults: interest rates have not been above 6% since the turn of the millennium.

For some families these pressures were very real: James and Maureen Patterson were among the first families to buy their council home, and were visited by Thatcher as they did so. In the following years, their marriage disintegrated, apparently in part due to financial pressure on making the mortgage repayments.

Thatcher's housing policies had one other long-term legacy, hailed by some and cursed by others: house prices rocketed during and after her tenure. According to figures from the Department for Communities and Local Government, the average selling price of a house in 1979 was £19,925. By 1990, this had tripled, to £59,785. Over the next two decades, it multiplied again, reaching £251,634 by 2010.

The economy has been subject to the whims of the housing market ever since Thatcher: the housing crash and negative equity of the early 1990s were hardly unrelated to the accompanying recession, while the consumer boom of the early 2000s was fuelled by housing debt – as was the subsequent, interminable, bust.

In this, the coalition government came in to power tacking, tacitly, away from Thatcher, with a vow to rebalance the economy away from such housing-fuelled booms, of which the housewife-frugality-espousing Thatcher may not have approved but nonetheless helped fuel.

But unlike the Lady, George Osborne proved for turning, and plans to revitalise the economy with his help-to-buy policy. The echoes of Thatcher are surely not accidental.

The argument over the wider impact of Thatcherism on Britain's economy makes disagreements over housing policy look trivial.

Looking only at the core measure of economic performance – GDP growth – Thatcher's performance was slightly better than that of her predecessor, James Callaghan, but slightly worse than under Tony Blair, with average growth over her tenure standing at around 2.3% a year.

This kind of generalisation hides every argument that matters, though. Thatcher made changes to the UK's tax system, some changes to welfare, and many to the nature of British jobs, both through privatisation and economic liberalisation – not least in her battle with the unions.

Perhaps the best look at what Thatcherism meant for British families comes from a series of measures calculated by the Institute for Fiscal Studies, which calculated household incomes after tax (and any income from benefits), and put them into monetary amounts relative to 2010-11 prices, stripping out the effects of inflation.

These figures show families got richer. The median household – the household right in the middle, where half are richer, half are poorer – earned the equivalent of £270.74 a week in 1979. By 1990, this had increased by 26% to £341.58.

But, as you would expect, these gains were nowhere near evenly distributed, and the poorest got the least. A family in the bottom 10% had a weekly income of £151.58 as Thatcher came into power. Eleven years later as she left Downing Street, the family had just £158.57 – a mere 4.6% more. Such stagnation for the poorest families was not inevitable: though inequality remained high in the post-Thatcher era, by 2011 that income had risen to £215.86.

The richest families – the top 10% – did far better, with their incomes increasing from the equivalent of £472.98 in 1979 to £694.83 in 1990. The good times for high-rollers continued post-Thatcher, with 2011 incomes of £845.54 a week.

The IFS figures are stark on the dispersion of British society in income terms through the Thatcher era, and this had a knock-on effect on poverty as it is typically measured.

The common international standard for poverty is a relative one: a family earning less than 60% of the median income, meaning its members are excluded from many aspects of a nation's life. By this measure, though, a family in poverty in 1990 may be richer than one not in poverty in 1979.

It is perhaps illustrative to note that in 1981 3.7m households lacked (or had to share) either an inside toilet or bath. By 1991, only 259,000 did.

Still, the poverty figures don't look good: the number of children in poverty almost doubled under Thatcher, from 1.7 million in 1979 to 3.3 million in 1990. Pensioner poverty in the same period increased too, from 3.1 million to 4.1 million. Those numbers rise still further if housing costs are factored in.

The headline poverty figures have both since fallen back from those levels – particularly pensioner poverty. In today's Britain, 2 million pensioners live below the poverty line – half the 1990 figure – while child poverty has dropped more modesty to 2.3 million.

Incomes, of course, only tell a small part of the story when it comes to Thatcher and the workforce – not to mention the shape of the economy.

Thatcher is perhaps most associated with the death of Britain's mining industry. There is no doubt that the figures show the number of miners collapsed under Thatcher and afterwards: in 1980, the UK had 230,000 coal miners. By 1990, only 57,000 remained. By 2004, the figure was below 6,000.

But what may be missed is that even more mining jobs were lost before Thatcher ever came into power. Over the course of the 1960s and 70s, more than 300,000 coal mining jobs disappeared, while around a million vanished between 1920 and 1980.

Thatcher was the coal industry's most visible foe, but not the one who lost it the most jobs. The root of residual anger at Thatcher lies, perhaps, in that Thatcher was the first post-war prime minister to cut such jobs without finding or creating replacement roles

That isn't to say that manufacturing and mining communities didn't feel devastating change – from which some have not recovered to this day. By the World Bank's measures, industry (including manufacturing) fell from contributing 40% of the UK's GDP in 1979 to just 34% in 1990 – and has since fallen more dramatically still to just under 22%.

Such trends weren't confined to the UK, however: industry in the United States fell from 33% to 27% during the Thatcher era, and to about 20% today. Even Germany went in a similar direction – though to a lesser extent – from 42% in 1979 to 28% now.

The consequences of deindustrialisation hit huge swaths of the UK, particularly Wales and northern England, hard. Unemployment soared from 5.3% in 1979 – a level high enough for the Conservatives' "Labour isn't Working" poster to go down in the annals of great election adverts – to peak at 11.9% in 1984. In 1990, the year of Thatcher's departure, it stood slightly higher than when her era began, at 6.9%.

This, though, hides the plight of millions of Britons who would never work again – those who were listed as ill, rather than unemployed.

In 1981, 772,000 people classed themselves as being out of the labour force because they were "permanently sick". A decade later, this figure had risen to 1.6 million. In numerous towns across the country, the increases were markedly higher – with those signed off sick tripling or even quadrupling in a decade. Twenty years later, in the 2011 census, the figure remained largely unchanged, despite the UK's growing population: 1.7 million people were classed as long-term sick or disabled.

The issue around the welfare bill for supporting people with disabilities, chosen as a priority by the current coalition, owes its genesis far more to Thatcher than to either John Major or New Labour.

Elsewhere in the workforce, Thatcherism did what might be expected. It was certainly bad for union membership, which fell from 13.2 million in 1979 to 9.8 million in 1990 – and has since fallen further, to less than 7.4 million.

Overall, strikes were busted too, through the use of laws that unions still condemn today: in 1979, 6m working days were lost to strikes. This peaked at a massive 29.5m in 1983, but fell to less than 2m in the year Thatcher was ousted. By 2010, whether thanks to diminished union power or improved industrial relations, fewer than 400,000 working days were lost to industrial action.

The Thatcher period was modestly good for women in the workforce, with full-time female hourly wages rising from 72% of those of men to 76% (they have continued their slow rise and are presently at 82% of men's wages).

Thatcher also leaves an unclear legacy when it comes to public spending. When she entered office, public spending made up 44.6% of GDP. After initially rising, this was sharply cut to 39.1% of GDP by the time of her departure. Since then, that trend has been more than reversed: in 2012, public spending accounted for 46.2% of GDP.

Whether you like or loathe the results, it's hard to disagree that Thatcher won her economic battles. But economic liberalism was only part of Thatcher's brand of politics. At the core of her ideology was a social conservatism, accompanied by promotion of "traditional moral values".

Care should be taken before forcing Thatcher into the mould of the US Republican party's fringes on social issues: she voted in favour of decriminalising homosexuality and abortion. However, she was no friend to the gay rights movement, complaining to the 1987 Tory conference that "children who need to be taught to respect traditional moral values are being taught that they have an inalienable right to be gay".

Such attitudes, enshrined in law through section 28, seemed to chime with the public at the time. The British Social Attitudes survey showed the proportion of the UK population who believed same-sex relations were "always wrong" was 50% in 1983, rising – fuelled perhaps by the emergence of Aids – to 58% in 1990.

But since then, the culture wars have moved in exactly the opposite direction. Today, only 20% of the British public answer the question in such a way.

Attitudes to marriage and divorce hardly stayed conservative during Thatcher's tenure, either. The number of weddings fell from 369,000 in 1979 to 331,000 in 1990, while divorces rose from 119,000 a year to 153,000 over the same time. The proportion of the public objecting to premarital sex dropped too, from 28% in 1983, to 22% in 1990, to just 12% today.

It seems that Thatcher also never really had the public believing in the ideological shifts she was making in Britain. When pollsters asked Britons in 1989 whether they would prefer a "mostly socialist" or "mainly capitalist" society, they favoured the former by a margin of 47% to 39%.

A society "which emphasises the social and collective provision of welfare" was favoured over one "where the individual is encouraged to look after himself" by a wider margin still: 54% to 40%.

Thatcher may not have changed the majority of minds during her tenure: but in the long run, the changed Britain she helped build may have continued that work. When Ipsos MORI asked that same question on welfare in 2009, the welfare option lost out narrowly to individualism, by 47% to 49% (with the margin of error, too close to call).

The evidence suggests Thatcher's children, and those who came after, have grown up more individualistic and less supportive of state institutions than their forebears. On those issues, she may well have had the last laugh.

The legacy of Thatcher's social conservatism is modest: Britain is, by and large, a nation marrying less, more accepting of homosexuality, and more accepting of people of other races (if not of immigration). Her cultural legacy is greater. In 2013, almost no one argues about what John Major did or didn't do for the country – while the mere mention of Thatcher's name can induce either exhortations of adoration or paroxysms of utter disgust.

But it's the economic changes during Thatcher's premiership, continued in large part by her successors, that have really shaped Britain ever since.

The rise of the property market and liberalisation of the financial sector shaped the economic booms of the late 1990s and most of the 2000s, and lay at the heart of the bust which followed. The unions remain weaker, and the utilities remain privatised.

Today's levels of economic inequality are roughly the same as those when Thatcher departed. The number of people classed as long-term sick, and relying consequently on the state's support, remains the same.

Whether defined against her or not, the challenges faced by the coalition government – and the circumstances that brought them to be – almost all had their roots in the government of Thatcher. And that legacy affects millions of people every day.