WEBVTT NOTE The Battle of Ideas from Keynes to Thatcher 1 00:00:00.000 --> 00:00:05.000 Why compare Keynes and Thatcher? The so-called Keynesism and the so-called Thatcherism. 2 00:00:05.000 --> 00:00:13.000 There is a strong sentence against Thatcher by Rothbard, I don't remember exactly, 3 00:00:13.000 --> 00:00:17.000 but the idea was a strong rhetoric and very modest result. 4 00:00:17.000 --> 00:00:24.000 So the idea is that the government of Thatcher was a government from a libertarian point of view, full of limits. 5 00:00:24.000 --> 00:00:36.000 She was not able to achieve all the aim that she was trying to achieve, in terms of policy, in terms of outcomes. 6 00:00:36.000 --> 00:00:44.000 Anyway, in spite of these limits, my idea is that Tachirism was really a big cultural change, 7 00:00:44.000 --> 00:00:53.000 because she was able not only to change the party, the conservative party, or better both of the parties, the conservative and the Labor Party, 8 00:00:53.000 --> 00:01:00.520 was not able only to change partially the economy but was able to change the culture and the values. 9 00:01:01.480 --> 00:01:09.320 So the question of my paper is how is possible such a change in a democracy? It was made 10 00:01:10.280 --> 00:01:19.000 just by a person, just by a group of people, of politicians. Another way to see this question is 11 00:01:19.000 --> 00:01:26.000 Was Margaret Thatcher creator of the change or was created by the change? 12 00:01:26.000 --> 00:01:31.000 And so what is the role of ideas in the process of cultural change? 13 00:01:31.000 --> 00:01:41.000 And also, another question is, Margaret Thatcher is the only British politician who has an ism in her last name. 14 00:01:41.000 --> 00:01:45.000 We speak about Thatcherism, but we don't speak about Churchism or Blairism. 15 00:01:45.000 --> 00:01:48.000 Okay, Blairism, but less than Thatcherism. 16 00:01:48.000 --> 00:01:54.000 So, what's a kind of ideology, Tachirism? We can see Tachirism as an ideology. 17 00:01:54.000 --> 00:02:03.000 Okay, United Kingdom was the cradle of liberalism for several times. 18 00:02:03.000 --> 00:02:10.000 We know the Scottish philosophers, Smith, Ferguson, etc. were the ancestors of the Austrians. 19 00:02:10.000 --> 00:02:21.000 and was for a long time, especially compared with other countries of course, a country with a strong individual freedom. 20 00:02:21.000 --> 00:02:32.000 This process, philosophically but also practically in the normal life, started to change in the 19th century, especially with John Stuart Mill. 21 00:02:32.000 --> 00:02:38.480 The Austrian mill thought that it is possible to keep separate the production and the distribution 22 00:02:38.480 --> 00:02:45.860 of wealth and so it is possible to redistribute the wealth by politics following moral criteria. 23 00:02:45.860 --> 00:02:50.400 So the path of collectivism, we can call this the path of collectivism in the British history 24 00:02:50.400 --> 00:02:56.800 was studied by several people, Hayek was speaking about the false liberalism, unfortunately 25 00:02:56.800 --> 00:03:02.200 We don't have time to see the explanation of this path. 26 00:03:02.200 --> 00:03:08.600 But for example, Shirley Leighton was speaking about a religion of science, referring to 27 00:03:08.600 --> 00:03:14.400 John Stuart Mill and referring to Beatrice Webb, and especially, so referring also to 28 00:03:14.400 --> 00:03:23.320 Fabian Society, a Bloomsbury group, who were the kind of think tank, we can call them with 29 00:03:23.320 --> 00:03:29.360 and the contemporary world think tanks able to influence very strongly the Labour Party 30 00:03:29.360 --> 00:03:32.240 and so all the British politics. 31 00:03:32.240 --> 00:03:38.640 So the idea, the basic idea of the Fabian Society was that the science is the only source 32 00:03:38.640 --> 00:03:47.640 of knowledge and it's possible if you combine this view of the science with a naive belief 33 00:03:47.640 --> 00:03:54.640 and the efficacy of politics as problem solving. 34 00:03:54.640 --> 00:04:04.640 The result is the idea that you can manage better by politics the economy and the society as a whole. 35 00:04:04.640 --> 00:04:07.640 Why I'm speaking about Mill and Beatrice Wood, etc. 36 00:04:07.640 --> 00:04:16.640 Because my idea is that we have to see kinesism as an element of a bigger, of a longer process. 37 00:04:16.640 --> 00:04:24.640 And the process is the idea that the human mind can solve social and economic problems by rationality. 38 00:04:24.640 --> 00:04:28.640 Of course we have also historical elements in this process, in this path. 39 00:04:28.640 --> 00:04:36.640 The crisis of 29, the World War II, for example, was very important because for two reasons basically. 40 00:04:36.640 --> 00:04:41.640 People were waiting something from the state, were waiting for a welfare state, 41 00:04:41.640 --> 00:04:55.640 But also the experience of planning during the war bring a lot of people to think that now it's possible to combat against poverty and unemployment using the planning. 42 00:04:55.640 --> 00:05:05.640 And it was, for example, the idea of Lionel Robbins, who was a classical liberal, the guy who brought Hayek and London. He changed his mind after the experience of planning. 43 00:05:05.640 --> 00:05:12.440 So, for a long time after the war in England, there was a politician who were using the 44 00:05:12.440 --> 00:05:13.440 Keynesian equation. 45 00:05:13.440 --> 00:05:18.880 The Keynesian equation is simplifying, of course, supporting salary, increase the demand 46 00:05:18.880 --> 00:05:24.920 and so have less employment and develop the economy this way. 47 00:05:24.920 --> 00:05:33.560 What Keynes did basically was destroy the idea of balancing of budget, was a very rooted 48 00:05:33.560 --> 00:05:39.000 idea in the previous government, and replies by the idea that it is possible to spend more 49 00:05:39.000 --> 00:05:45.000 today, maybe in a moment of crisis, and so it is possible if you spend less tomorrow. 50 00:05:45.000 --> 00:05:50.720 But the point is that this is maybe possible for a person, it is maybe possible for a family 51 00:05:50.720 --> 00:05:56.480 or it is for sure possible for a person or family, but it is not possible in politics, 52 00:05:56.480 --> 00:06:03.480 because when a politician spends more today and so grows the role of a state, if we can 53 00:06:03.480 --> 00:06:17.480 A politician is never ready to turn back and use less power, and so spend less money. 54 00:06:17.480 --> 00:06:26.480 So the theory of canes was not taken care of human nature, and not taken care of the 55 00:06:26.480 --> 00:06:31.480 characteristics of politics and this law of politics. 56 00:06:31.480 --> 00:06:39.000 Ok, we don't have time to see what was going on in England in that time, but another interesting 57 00:06:39.000 --> 00:06:53.400 point is that Buchanan said that if we see the kinesism in this way, is it possible to 58 00:06:53.400 --> 00:06:57.840 say that kinesism is not compatible with democracy? 59 00:06:57.840 --> 00:07:06.400 But now the question is, today we can think a democracy without Keynesian politics, without 60 00:07:06.400 --> 00:07:08.400 deficit spending. 61 00:07:08.400 --> 00:07:16.960 Because if we can't think democratic policy without Keynesian economic recipe, the problem 62 00:07:16.960 --> 00:07:28.960 is if democratic institutions are compatible with individual freedom in the long term. 63 00:07:28.960 --> 00:07:40.960 What was called the welfare consensus basically fell down in the late 16th century and was surviving in the 70s with a lot of problems. 64 00:07:40.960 --> 00:07:48.960 Let's try to understand how the paradigm was changed in favor of the free market. 65 00:07:48.960 --> 00:07:56.960 The battle of ideas is the idea that during the sixties there was a rebirth of the classical liberal theory. 66 00:07:56.960 --> 00:08:05.960 So people like Friedman, Hayek, Buchanan wrote some of the main books during the sixties. 67 00:08:05.960 --> 00:08:09.960 Also the books of Mises were more important during the sixties. 68 00:08:09.960 --> 00:08:22.200 These ideas were brought in the United Kingdom by several columnists, by people who later 69 00:08:22.200 --> 00:08:29.080 became members of the Dutch government and also by several think tanks, for example the 70 00:08:29.080 --> 00:08:34.560 Institute for Economic Affairs was the more theoretical publishing books and organized 71 00:08:34.560 --> 00:09:01.560 Conference, Adam Smith Institute, is a more technical micropolitics, the ideas of how it's possible with a technical analysis to change the public sector, and there was also the Centre for Policy Studies, was founded by Margaret Thatcher, and the last one in particular was very important in founding a new strategy of communication. 72 00:09:01.560 --> 00:09:07.240 The communication strategy is really essential to understand Tachirism, because Tachir was 73 00:09:07.240 --> 00:09:15.360 able to individuate enemies, some people responsible for the British crisis. 74 00:09:15.360 --> 00:09:22.660 So she made a link between socialistic ideology, labour party and the leader of the trade unions. 75 00:09:22.660 --> 00:09:29.160 So this is a kind of first lesson, the lesson is that if you want to change a paradigm, 76 00:09:29.160 --> 00:09:36.360 If you want a revolution without a war, without a civil war, you need a negative myth. 77 00:09:36.360 --> 00:09:40.280 And a negative myth is important as well as a positive myth. 78 00:09:40.280 --> 00:09:42.480 So the rhetoric expedient was TINA. 79 00:09:42.480 --> 00:09:43.480 What is TINA? 80 00:09:43.480 --> 00:09:47.520 TINA is an acronym for there is no alternative. 81 00:09:47.520 --> 00:09:53.160 The rhetoric strategy is the idea, maybe the free market in this moment is hard, is difficult, 82 00:09:53.160 --> 00:09:57.840 people are going to lose their job, etc., etc., but there is no alternative, it's like 83 00:09:57.840 --> 00:10:12.300 Tacherism has an ideology. Why this question is interesting? Because Tacher had not only 84 00:10:12.300 --> 00:10:19.520 or not mainly economic purpose. You can see this sentence, economic economy had gone wrong 85 00:10:19.520 --> 00:10:25.560 because something had gone wrong, spiritually and philosophically in 1676 when she was leader 86 00:10:25.560 --> 00:10:32.880 of Opposition. So, Heredia was a reestablished moral values, what she was calling Victorian 87 00:10:32.880 --> 00:10:41.400 values and individual virtues, destroyed by the long period of kinesism and by the so-called 88 00:10:41.400 --> 00:10:48.820 non-state, so a state that doesn't see individuals in front of it, but people who need help. 89 00:10:48.820 --> 00:10:54.400 Of course, the question is, can the state reestablish values? The answer is not, but 90 00:10:54.400 --> 00:11:01.600 The State can remove the socialistic mentality, and for Thatcher, the State can remove the 91 00:11:01.600 --> 00:11:05.120 socialistic mentality with the idea of popular capitalism. 92 00:11:05.120 --> 00:11:09.120 So there was a moral argument for the popular capitalism. 93 00:11:09.120 --> 00:11:17.520 The idea of the popular capitalism was the economic renaissance was a way, an instrument 94 00:11:17.520 --> 00:11:24.640 to make responsible the individuals and so to re-establish the old virtues. 95 00:11:24.640 --> 00:11:32.960 So there was a kind of equation in touch-reason between freedom, property and responsibility. 96 00:11:32.960 --> 00:11:36.120 Responsibility means values, Victorian values for us. 97 00:11:36.120 --> 00:11:43.240 So we can see basically under the light of moral aim the economic reform and in particular 98 00:11:43.240 --> 00:11:44.240 the privatization. 99 00:11:44.240 --> 00:11:54.240 Driftatization, for example, when she was privatizing the firms that the state was the owner of these firms, 100 00:11:54.240 --> 00:11:58.240 she was trying to sell these firms to many shareholders. 101 00:11:58.240 --> 00:12:03.240 Shareholders before that were 3 million and with that became 11 million, it's a lot. 102 00:12:03.240 --> 00:12:12.240 And she was tracing the moral dimension of this element, because her idea is that if a people became an owner of a part of a firm, 103 00:12:12.240 --> 00:12:17.920 is going to change his mind, is going to see the free market work, and so is going to change 104 00:12:17.920 --> 00:12:27.720 his values and his attitude, and it's the same for the policy housing. 105 00:12:27.720 --> 00:12:34.480 The British state was the owner of a lot of houses and she was selling all the houses 106 00:12:34.480 --> 00:12:35.480 to the family. 107 00:12:35.480 --> 00:12:41.560 It was not very convenient because the price was low, but the idea is that if you have 108 00:12:41.560 --> 00:12:46.560 When you have a family, you become more responsible in front of your family, so you change your values. 109 00:12:46.560 --> 00:12:53.560 Anyway, we have some paradoxes when we see Tachirism. It is the paradoxes of a charismatic leadership. 110 00:12:53.560 --> 00:13:02.560 The problem is, Tachir, the role of the government is not find an agreement between lobbies, but is realize the common good. 111 00:13:02.560 --> 00:13:10.560 So, she was working for a nation as a whole. She was trying to reduce the task of the state and so improve the economy. 112 00:13:10.560 --> 00:13:17.560 But if we take a look at the style of the government, we can see that the government was her personal government. 113 00:13:17.560 --> 00:13:23.560 So she didn't trust also the closer member of the cabinet of her team. 114 00:13:23.560 --> 00:13:29.560 And she thought that she knows what the people want or what the people need. 115 00:13:29.560 --> 00:13:32.560 And she was returning the power to the people. 116 00:13:32.560 --> 00:13:36.560 The way was the privatization and fighting against Lopez. 117 00:13:36.560 --> 00:13:46.560 So she was designing a kind of special relation between the leader and the people without mediators, without intermediatory. 118 00:13:46.560 --> 00:14:00.560 Maybe it's interesting because the leader became the only interpreter of the will of the people and it's a kind of Jacobinism if you think what she was doing. 119 00:14:00.560 --> 00:14:12.560 But maybe it's the only way by politics to bypass the lobbies and so to bypass the problem of traditional politics and of public spending. 120 00:14:12.560 --> 00:14:24.560 So another point, our government was extremely active, it was near intrusive, it was doing a kind of inverse planning for the free market. 121 00:14:24.560 --> 00:14:29.560 So the idea to force the market to work and she was doing it by the state. 122 00:14:29.560 --> 00:14:34.560 So, of course, this activism of the state doesn't fit well with the liberalism. 123 00:14:34.560 --> 00:14:37.560 For liberalism, the less the state does, the better it is. 124 00:14:37.560 --> 00:14:45.560 But for her, as a politician, it was not a contradiction, because the point is not important how much the government does, 125 00:14:45.560 --> 00:14:47.560 but how it works. 126 00:14:47.560 --> 00:14:54.560 And when we have a situation that is the result of historical problems, 127 00:14:54.560 --> 00:15:02.160 So a big welfare state, we must ask if maybe this idea is true also in theory, if we can 128 00:15:02.160 --> 00:15:04.840 use this idea. 129 00:15:04.840 --> 00:15:11.080 So the problem in any way still remains, because it is possible to achieve liberalism using 130 00:15:11.080 --> 00:15:16.520 tools which are not liberal, which are not classical liberal. 131 00:15:16.520 --> 00:15:23.840 So it is possible to achieve a free society using the state, is the big question. 132 00:15:23.840 --> 00:15:34.160 To conclude, what can be the lesson of toucherism? First of all, we can't explain toucherism 133 00:15:34.160 --> 00:15:40.280 only with the figure of Margaret Thatcher. She was an essential ingredient, essential 134 00:15:40.280 --> 00:15:47.120 but not sufficient. It's not enough, Thatcher and her personality, to explain the change. 135 00:15:47.120 --> 00:15:55.540 She was for many aspects the matter fruit of her time, so the consequence of the battle 136 00:15:55.540 --> 00:15:56.540 of ideas. 137 00:15:56.540 --> 00:16:03.780 And you have to remember Fink Tank who gave her the tools also to realize this program. 138 00:16:03.780 --> 00:16:11.480 So what is the lesson of Tacherism in order to explain how change the culture? 139 00:16:11.480 --> 00:16:17.200 I think the first point is the idea counts in the historical process but interests count 140 00:16:17.200 --> 00:16:18.200 as well. 141 00:16:18.200 --> 00:16:23.560 The idea of popular capitalism, when the people have a property they change the values and 142 00:16:23.560 --> 00:16:28.240 the mind and in this way you can change the value and the culture of a country. 143 00:16:28.240 --> 00:16:31.500 So you need the experience of private property. 144 00:16:31.500 --> 00:16:39.520 And also that we need cultural and political strategy in order to combine ideas with interests. 145 00:16:39.520 --> 00:16:49.520 There is a sentence in the Rothbard Strategy for Liberty, the Appendix of Ethics of Liberty. 146 00:16:49.520 --> 00:16:54.520 The sentence is, libertarianism is a philosophy seeking for a policy. 147 00:16:54.520 --> 00:17:00.520 It's a kind of, let me say, a Leninistic theory, Rothbard theory. 148 00:17:00.520 --> 00:17:06.520 Just a group of people can change the system, can change the world basically. 149 00:17:06.520 --> 00:17:25.520 I think the experience of Thatcher is different because he was a politician, but in a sense it confirms the theory of Rothbard, because the idea of Jacobinism, the only way to bypass the lobbies, is a kind of confirmation of the theory of Rothbard. 150 00:17:25.520 --> 00:17:36.520 And of course, Tachirism is not the policy for libertarianism, that's for sure, and of course Tachirism is probably not enough. 151 00:17:36.520 --> 00:17:49.520 But anyway, I think we can have a good lesson from Tachirism to understand what can be the way to change the situation and to have more freedom in this society. 152 00:17:49.520 --> 00:17:51.520 Thank you and sorry for my English. 153 00:17:55.520 --> 00:17:57.520 Thank you very much.