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The Conservatives and the Crisis: Three Case Studies

 The Conservatives and the Crisis: Three Case Studies

Hazel Stroud, PhD Candidate
Primary Supervisor: Professor Tim Bale

Hazel grew up in London. She has a BA in International Politics from the School of Oriental and African Studies, a Masters in Philosophy from the Open University, and a Masters in Fine Art and History of Art from the University of Edinburgh. This broad academic background has equipped her with an interdisciplinary approach to research methods. Outside her University life, Hazel enjoys working as an illustrator in her studio in East London. She also has many years experience working as a private tutor in London.

This doctoral research project compares three moments of major economic instability within the UK: the aftermath of the Great Depression in 1929, the IMF crisis of 1976, and the Global financial crisis of 2008. This study will produce an historical comparison of the Conservative Party’s response to these three moments of crisis. The project asks the following question: To what extent has the brand of Conservative politics spearheaded by Stanley Baldwin, Margaret Thatcher and David Cameron conformed to a similar ideological response? By virtue of this comparison, this research will also uncover where these three leader’s policies have differed. The three moments of economic history plot the overarching developments in the British political economy. In the course of these three crises, Britain has moved from being an industrial to a service-led economy. With the further integration of international markets, debt levels are now leveraged to unprecedented amounts. In many ways, the knock-on effect of our response to this current crisis is more significant than the previous two. It is therefore an interesting exercise to see if the Conservative Party is learning from previous mistakes. Recent developments in global markets have shown us that markets move faster than the political process. To what extent are political parties able to intervene to prevent crises from happening? How far can the policy instruments available to treasury officials and politicians alleviate the impact of these crises in their aftermath?

The austerity initiatives unfolding during Cameron’s tenure so far, have earned him the reputation of “heir to Thatcher”. The recent legacies of Cameron and Thatcher have established the public’s association of the Conservative’s response to a crisis with that of fiscal tightening. However, drawing back through time to a less remembered figure of Conservative Party history, Stanley Baldwin cut a different figure to these pro-market reformers. Baldwin’s affable relations to the leader of the Labour Party, Ramsey MacDonald, his diplomatic ability to compromise in the context of the National Government and above all, his unwavering belief in social compassion led him to support a policy response that differed greatly from the austerity approach that has so far characterised the Thatcher and Cameron legacy. Despite cuts in spending being a feature of all three leaders as an immediate policy response to each crisis, Baldwin’s leadership diverges from the other two in one major way. Rather than supporting a regional divide between North and South and a rise in overall inequality, Baldwin engaged in programs designed to alleviate poverty in the North.

If Baldwin offers us a departure from the austerity response that Thatcher and Cameron have chosen, what can we learn from the outcomes of his approach? Does the choice of relying on private verses state apparatus represent an oversimplified dichotomy? What are the limitations of a monetarist response to an economic crisis? Which figures in British politics have spent time thinking creatively about how fiscal stimuli can used to produce long- term growth? This research provides useful material for understanding both the changes in the shape of the British political economy during the twentieth century, and the impacts of monetarist verses Keynesian policies in the process of this evolution.

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