Don Murray: The many myths of Thatcherism

'Casino banking,' a business-besotted Labour Party and a roiled Europe are all part of Margaret Thatcher's enduring legacy, Don Murray writes. Her gift to both galvanize and divide was unequalled among her contemporaries.

'Casino banking,' Tony Blair, a roiled Europe, all part of Margaret Thatcher's legacy

Margaret Thatcher occupied the same space in the British psyche that Pierre Trudeau did in Canada's.

Political opposites, both were unexpected leaders whose initial triumphs surprised and galvanized their countries, and whose leadership styles created great rifts in their electorates.

Both were argumentative, clever, and revelled in a fight.

But Thatcher climbed one step further in the pantheon than Trudeau: her personality, her policies and her abrasiveness became an 'ism' — Thatcherism.

Part of Thatcherism was myth, which she did her best to build and reinforce.

In Britain, a key element of the Thatcher myth is the Falklands war. Seen from the outside, this was a hurried little expedition to proclaim continued sovereignty over a couple of small islands, a few people and a lot of sheep; a war at the end of the world against a sordid junta directing a mangy army.

Seen in Britain, even today, this was the last hurrah of the British Empire, with the ghost of Nelson inspiring the expeditionary force.

The living inspiration was Thatcher herself — the Iron Lady, who gloried in the title and pursued photo-ops with the British military thereafter to add lustre to it.

'Business Britain'

The heart of Thatcherism, however, lay elsewhere, as she came to power in a country that seemed broken.

Just a few years before her first victory in 1979, Britain was only working three days a week, hobbled by energy woes and overweening union leaders who seemed to have a veto over economic policy.

She chose her target deliberately: the powerful miners' union led by a boisterous Marxist militant, Arthur Scargill; and she chose her approach, a frontal assault.

There would be no negotiations, no quarter. After an 11-month strike, the union caved in and with it so did union power in Britain.

The consequences were vast. When her Conservative Party came to power, Britain was an ideological battleground. The Labour Party still had "clause 4" in its constitution, which committed it to the nationalization of many of the country's main industries.

Thatcher's abrasive insistence on the primacy of market economics, her decision to sell off much of Britain's social housing to the tenants, and her humbling of the unions, led to the triumph of Business Britain.

Labour, cast into the wilderness in four successive elections, looked for a new leader and new ideas.

They found Tony Blair and he found Thatcherism electorally seductive.

He emptied Labour of its socialist content, wooed business with the same ardour she had, and won three elections.

Britain's ideological war was over, and Thatcherism was the uncontested victor.

Casino banking

But victory contains its own poisons. One of Thatcherism's biggest triumphs was "the big bang" in 1987, when many regulations governing the country's stock market and financial sector were loosened.

It set off a growing financial boom, turning "the City," London's financial district into the world's biggest money hub.

As the waves of money rolled in, the cry went up for lighter and lighter regulation, and Tony Blair's government complied. Thus the phenomenon of casino banking took root.

Then, in 2008, the casino blew up. Two of Britain's biggest banks went belly up and had to be bought and bailed out by the taxpayer. The country's finance minister said later that Britain came within three hours of seeing its entire monetary system seize up.

Regulations have been since been tightened again but such is the power of Thatcherism that the bankers and their banks remain largely unpunished, and even the nationalized ones carry on much as before.

No to Brussels

Thatcher's approach to Europe was equally abrasive and her impact just as lasting. Under her predecessor Edward Heath, the Conservative Party had led Britain into Europe, but she was suspicious of all things emanating from Brussels.

Margaret Thatcher with French president Francois Mitterand in 1987. His take: The smile of Marilyn Monroe and the eyes of Stalin. (Charles Platiau / Reuters)

She approached all European summits in a combative mood. Her tactic was to "handbag" her fellow leaders, demanding a British rebate on its contribution or she would veto whatever policy was under discussion.

She won her rebate and it remains in place today. Fellow leaders were fascinated and terrified.

French president François Mitterand told an aide that Thatcher had the smile of Marilyn Monroe and the eyes of Stalin.

Her policy of "neither in, nor out" when it came to Britain and Europe secreted a delayed poison whereby future Conservative leaders found themselves presiding over a party civil war.

The present Conservative prime minister, David Cameron, is so harried by the growing battalions of anti-Europeans in his party, all of whom worship at the shrine of Thatcher, that he has promised a referendum on whether to leave the European Union if he gets a majority at the next election.

The power to unsettle

Thatcherism left its mark outside Britain as well, particularly in Eastern Europe under Communist rule.

Many young people in the Soviet Union and its neighbours embraced her belief in free market economics.

Vaclav Klaus typified this group. He became Czechoslovakia's first finance minister after the fall of the Communist regime in 1989, and, later, prime minister and then president of the Czech republic.

In his office a photo of Margaret Thatcher was always on prominent display. He called her death "a huge loss for all supporters of freedom, democracy and market capitalism."

Back in Britain, her power to unsettle and divide remained even in death.

While the tributes poured in from Conservatives, the opposition Labour Leader Ed Miliband remained silent for two hours.

His tribute, when it came, was ambiguous. "The Labour Party disagreed with much of what she did and she will always remain a controversial figure. But we can disagree and also greatly respect her political achievements and her personal strength."

The blows the Iron Lady landed still hurt.