Mrs Thatcher set the tone for the following 18 years when she dismissed the report on the grounds that its recommendations were too expensive. She then proceeded to implement a raft of policies that worsened the situation. By winding down the outgoing Labour government's council house building programme of 150,000 a year to virtually zero, she cut off the supply of new housing to the poorest sections of the community.
By then encouraging tenants to buy the best of the public-sector stock, she turned what remained into ghettos of poverty and crime.
Attacks that savaged subsidies to public transport; privatisation; and the creation of out-of-town superstores; all meant that those who could not afford a car were left at the mercy of high prices in run-down high streets.
Education, the long-established route out of poverty for previous generations, took a series of blows that ranged from savage cut-backs in local government funding, to attacks on teachers' pay and morale. Introducing so-called parental choice in schooling allowed middle-class parents to move children away from schools with a high proportion of pupils from the black communities, which also usually happened in those areas where Labour councils had suffered proportionately bigger cuts in central government funding.
But, without doubt, the biggest factor in increasing ill health was Thatcher's use of the 1981 recession to create a pool of 3 million unemployed, in order to undermine the bargaining power of trade unions. The increase in marital break-up arising from unemployment, with its knock-on effect on ill health and even suicide, has been well documented throughout the last 20 years.
We should not be shocked by the portrait painted by Sir Donald Acheson; these are merely the casualties that have inevitably arisen as a consequence of Mrs Thatcher's attempt to roll back socialism, trade unions and the state.
The problem for the left is how to respond, given that the standard of public services has been eroded so dramatically in many areas, with a consequent loss of public sympathy and an increasing tendency of the middle classes to opt out into private-sector provision in education, health care, housing and pensions. Rather than working ourselves into a fit of despair and assuming that the decline of public services is inevitable, we could try to look across the Channel to our European partners to see what we can learn from those countries that specifically rejected the neo-liberal lunacies of Thatcher and Reagan.
By maintaining public services at a standard that is attractive to the middle classes, the government of Francois Mitterrand left a legacy that Jacques Chirac was unable to dismantle. French citizens are sufficiently impressed by their high-speed trains, decent pensions and high-quality health care that when Chirac's government tried to make major cuts in public spending there was massive middle-class support for the wave of strikes that forced Chirac to back down.
Services of a similar quality occur across Germany, Scandinavia and the Low Countries, largely because people there are prepared to pay taxes that guarantee a decent level of public provision.
Those who argued for a proper welfare state during previous Labour governments had no doubt about the importance of providing services that appealed to both the middle classes and the poor. Aneurin Bevan is remembered for creating the health service, but he was also responsible for the post- war housing programme. He always insisted that council housing must be built to such a standard that doctors and lawyers would be happy to live on the estates he was building.
Whereas Bevan always resisted cutting standards in order to stretch the available materials to build more homes, the Tories won the 1950 election promising to build 300,000 council houses, and promptly set out to supply smaller, cheaper homes.
Constant pressure from the Treasury to cut costs led successive governments to impose on councils the demand for system block building. The consequences are with us today. Although many of the nightmare blocks of recent decades will now have to be demolished, the homes built by Bevan immediately after the war are still popular, and are much sought after on councils' transfer lists.
The same principle of avoiding cheap, second-rate standards applies to the National Health Service. Here in Britain 8 per cent of our GDP is spent on health, compared to 10 per cent in France and Germany. More spending is not simply the answer, however, as health costs in America have so inflated profit margins that health care now consumes 12 per cent of US GDP. Because of the dedication and low wages of many doctors and nurses, we in fact get excellent value for the money we put into the NHS, but the patience and morale of those who care for our health are clearly now at breaking-point. When we decide that the health of all our people is of sufficient priority, we will be prepared to raise the taxes in order to provide the service we require.
While the under-funding of the public sector has been a major factor in the growth of poverty, Tony Blair's government is right to point out that it is not just an issue of how much you spend, but of how you spend it. The post-war governments that spanned the years from Attlee to Wilson saw a dramatic improvement in the quality of life of the British people, but there were still areas of poverty and neglect that had not been tackled before the era of high unemployment struck.
The failure of the British left from the Sixties onwards was the inability to recognise that British society had undergone rapid change. This required a decentralised and democratised public sector that encouraged public participation and control. The Wilson and Callaghan governments were led by those whose thinking had been formed in the Thirties. They saw the public merely as grateful recipients of state largesse. They never understood that improved education and economic security had led to an increasing confidence among the British people.
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