Pre-'Iron Lady' Margaret Thatcher Was as Steely as Ever

A U.S. News interview depicts quintessential Margaret Thatcher two years before her reign began.

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In an exclusive interview with U.S. News two years before her reign as England's longest-serving prime minister of the 20th Century began, Margaret Thatcher sketches the hardline views and rigid resolve that would later define her 11-year stint running Great Britain.

Responding to questions on communism, economics and her gender, Thatcher does not gloss over her staunch beliefs as politicians often seem to do today.

[PHOTOS: The Life of Margaret Thatcher]

"Here in Britain, at long last, we may have grasped the point that deficit financing cannot and will not bring about long-term prosperity," Thatcher told U.S. News. "The trouble in Britain is the level of tax," she said later in the interview, foreshadowing the supply-side revolution she used to revitalize Great Britain's economy.

On communism, "The Iron Lady" is just as steely.

"All Communism worries me. Fundamentally, it's not very different wherever it occurs, because it is a creed which allows only one political view," Thatcher says.

[READ: Three Economic Lessons From Margaret Thatcher]

And in another Thatcher hallmark, she dismisses attempts at being defined by her gender. "Does your gender pose a special problem for you?" she is asked.

"Not in any way," Thatcher responds. "In some ways, it gives special advantages."

The woman President Ronald Reagan called "the best man in England" proved right on that issue too.

This article originally ran in the Sept. 12, 1977, edition of  U.S. News & World Report.

How the Conservatives Would Deal With Britain's Troubles

Speaking out in advance of her visit to the United States, a potential Prime Minister outlines what's wrong with Britain—and gives a prescription for a cure. Also: strong views on human rights, NATO and Communism.

LONDONInterview With Margaret Thatcher, Top Tory Politician

Q. Mrs. Thatcher, the Carter Administration believes that Western Europe is facing its worst political, economic and social crisis since the 1950s. Do you share that view?

A. Crisis, no; problems, yes.

We're having a lot of difficulty in getting genuine growth going again. This is not altogether surprising, because every country in Europe is suffering from inflation—just as you are in America.

The important thing is that we don't get another period of inflation on top of the one we've already had. But I would not say that this is Europe's worst economic crisis: it was worse after World War II.

Q. And the social crisis?

A. I'm not sure what you mean by that. Do you mean that the Western world doesn't seem to have quite the same confidence in itself that it used to have in previous years? That may be right. But there is no good reason for it. The truth is that our Western way of life—a free society with political freedom backed by economic freedom—is far superior to any other system the world has ever known.

Just look at the alternatives. Opposed to our way of life, there's the tyranny you see operating behind the Iron Curtain. In their system, only one view is tolerated; only one economic path is permitted. No freedom. No dignity. Surely the free Western system is better than that. It serves us better in terms of prosperity, and in my view it's morally superior. So there is no cause for despair. On the contrary, we ought to have supreme confidence in our way of life.

So, all right, there are certain things wrong with it. You can't avoid that in any society that is based on choice—where there is freedom to do good or freedom to do a certain amount of evil. But this we can improve. That is the virtue of freedom: We can put wrong things right. But basically I believe we have the better political and economic system. Let us have confidence in it.

Q. Several Western European countries are afflicted by the same economic and social troubles. Does this suggest that our system itself is falling apart?

A. No. Our system isn't falling apart at all. It has come up against certain economic realities. The basic economic reality is that we cannot pay ourselves more than we earn. Nor can we afford to generate higher expectations than our society can fulfill.

We need to produce more. But unless you give people incentives, you don't get the increased production. And if you don't get increased production, all you can do is shuffle around and redistribute the inadequate resources you've got. These lessons I think we are learning.

Here in Britain, at long last, we may have grasped the point that deficit financing cannot and will not bring about long-term prosperity.

Q. Does Britain need a drastic overhaul of its social and economic system—mostly, in regard to trade-union practices?

A. Our problem is different from yours. Many of our trade unions, unlike yours in America, are linked with a single political party. Historically, they have largely financed the Labor Party. To a great extent they control the Labor Party Executive, where 18 of the total of 25 places are reserved for the unions. Then there is the Labor Party Conference. A majority of the votes are in the hands of those who represent the unions, so that, often, they call the tune.

I doubt if anywhere else in the Western world there is that close linkup between one political party and the trade-union leaders. In other countries, including America, the unions prefer to have their links with a variety of different political parties. So far, we have never had that in Britain. I think this is a pity because, with lots of Conservatives joining the trade-unions, they cannot be fully represented by union leaders unless some of those leaders share their political view.

The other thing that's different in Britain is that we seem to have too much of the "us" and "them" attitude in management union relations. It may be that we have got into this very difficult situation because Britain was first in the Industrial Revolution, and many of the "us" and "them" attitudes are an overhang from some of the ugly features of that period.

Whatever the reasons, there is a tendency to feel that if the boss puts up a new idea in a factory, people automatically have to resist it, or view it with suspicion. That is a great problem in British industry, though in many of our factories I think it's disappearing.

We badly need to get out of the habit of thinking of ourselves as "us" and "them," and instead to see ourselves as one nation with a common interest in increasing prosperity. Once we can do that again, we shall get that co-operation among workers and management that is needed to bring the very best out of industry.

Another problem I should mention is overmanning. That, too, stems back to the unemployment of the '30s. But, my goodness, you in America had unemployment even greater in the '30s than we had, but, as far as I can see, you do not have the same degree of overprotectiveness about your jobs in America.

So, yes, I agree that we have problems, serious problems. But we're steadily getting over them, I think, because reality is a very powerful tutor.

Q. Do you see genuine labor co-operation developing and expanding in Britain?

A. There is progress in many,many firms and factories that I visit. There is a far greater dialogue between management and the shop floor now, discussing what needs to be done and how to do it. Frequently, the shop floor has a great contribution to make—particularly about new methods, new equipment and how it can best be operated. The man or woman at the workbench often has the best idea about what needs to be done and what will be the consequences if his firms doesn't do it. He should be listened to, and he also is entitled to have the where and why of new things explained—carefully and in advance.

Management don't just do things; they do them for a reason, and it is up to all concerned to communicate those reasons and discuss them. My experience is that kind of communication is greatly improving in the private sector. Ironically enough, I think, there are more problems in the public sector, that is, in the nationalized industries where in theory the state is owner.

Q. Do you agree with critics who claim that the British are so satisfied with what they've got that they resist changes and don't ever work very hard?

A.Not at all. Change is the normal thing. The question is: How do you manage change and the speed at which it occurs?

As for work: Almost everyone I know, whatever his standard of living, wants a little more than he's got and, given incentives, most people are prepared to work for it.

The trouble in Britain is the level of tax. Our direct taxation is among the highest in the world. It's not only high at the top levels—it's high at the low levels of income. So that means that at all income levels, including the lowest, many people are saying, "It's not worthwhile to work." We've got to get rid of that. I have no doubt about it: When it pays them to work, the British people will work harder and better.

Q. If and when the Conservative Party takes power, how would the Government use its North Sea oil wealth?

A. Basically, to provide more incentives, re-equip our older industries and to start up new ones. It must not be used merely to put up public expenditure in the nonproductive sector, nor to subsidize yesterday's jobs.

North Sea oil has got to be used to help build a much healthier industrial base. That must be our objective, so that when the oil has gone, we are equipped to earn the higher standard of living to which we became accustomed during the period when the oil flowed.

Q. Would a Conservative leadership denationalize any industries?

A. It depends when we get back to power. We certainly would like to reduce the area of public ownership. It would have been a lot better if we had got back earlier. We could for example, have stopped the aircraft industry going into public ownership.

But once an industry has been nationalized, it is never easy to sell it back to the private sector. You have to tackle this problem rather differently. What we will be considering is how far we may be able to introduce a much bigger private-equity element into at least some of our public-sector industries.

Q. Would you, as a Conservative Prime Minister, nationalize more industries under any circumstances?

A. Not if we can help it. But take Rolls-Royce. Rolls-Royce cars were not nationalized, but the aero-engine branch was taken into public ownership because it had big international contracts, especially in the defense field, which we felt had to be honored to the hilt in the interests of the whole of British industry. It was an exceptional case because there were exceptional problems.

The approach I prefer is much more selective. If, from time to time, a vital industry gets into difficulty, then perhaps the Government will have to give it some help, but not with a view to keeping it in public ownership permanently. There is seldom any need to do that.

Q. What, in your opinion, should Britain do about its membership in the European Common Market—stay in or pull out?

A. Oh, no, no. We're much better off being in European Community. Of course, there are complaints—some of them justified—but I don't think it would be seriously suggested that we get out. If we did, Britain would be completely isolated and alone. I think, too, that we haven't handled our membership very well.

Of course, when you get nine countries together, some are bound to be dissatisfied with the system. There are some aspects of it, especially agriculture and bureaucracy, that need to be overhauled. But it's no good just moaning about the entire system. You don't pull down the whole house merely because you don't like the decorations in the sitting room. What matters is steadily to improve, by negotiation, those parts which you don't like.

Q. What about Euro-Communism? Do you accept the claims by some of the Communist parties that they believe in democracy and are not controlled by the Soviet Union?

A. All Communism worries me. Fundamentally, it's not very different wherever it occurs, because it is a creed which allows only one political view. Wherever the Communists get into power, they prevent anyone else from having any other kind of politics but their own. Then, too, it is a creed that's based on economics—controlled economics at that. There's no thought for the dignity of the individual or for his place in society.

So, of course, Communism worries me. I take Euro-Communism very seriously.

Q. Could a Conservative Government in Britain get along with a France or an Italy that had Communists in its Government?

A. What do you mean, "get along"? Obviously we have to have a relationship and practical negotiations with Communist governments. But there's a different question of our relations with internal Communist parties. But in France I doubt if there would be a Euro-Communist Government. In Italy they haven't got one, either.

The question is how to deal with Communism as part of an internal political front. But Euro or otherwise, it's still Communism. The creed is the same everywhere.

Q. Do you think the Atlantic Alliance is letting down its guard toward Russia?

A. I watch with some alarm the way in which the Warsaw Pact countries are increasing their expenditure on armaments at a time when in this country we appear to be reducing ours. Most of us, I think, agreed with the last NATO communique, when it called on the member countries to spend more on NATO defense if we deterrent. This is a duty from which we mustn't flinch. A nation which is not prepared to defend its freedoms will soon cease to have any to defend.

Q. Should the Allies continue to develop and deploy new weapons like the neutron bomb?

A. Most of us would be reluctant to use any kind of nuclear bomb, but it would not be a deterrent unless there was some possibility of its use in extreme circumstances. But there is no humane weapon of war. All our efforts, whether conventional or nuclear, are to prevent the outbreak of another worldwide conflict.

Q. In your opinion, are the Western Allies giving President Carter enough support in his human-rights campaign?

A. Well, certainly I have. For example, in my speech in Rome, I gave him full support. I said then, and I repeat, that we should support the human-rights commitment at the Belgrade Conference [on European security and co-operation]. I don't believe that we help our own case by closing our eyes to what is happening behind the Iron Curtain. Neither does it promote better relations with the Communists to have a false relationship with them—a relationship based on a pretense that we don't care what is happening to human rights in their countries. We do.

And don't forget that, as far as the Helsinki Pact was concerned, the Communists themselves put their signatures to the clauses about safeguarding human rights. So it's not only a question of individual rights as a universal concept. In this case, they are part of an international agreement to which the Communists committed themselves in return for other things which they got from that agreement. I think that is very important.

The Russians signed up for human rights because, by doing so, they were able to bargain for something else they wanted: trade and credits and so on. So they can't therefore just ignore them. They must not expect to take advantage of those parts of Helsinki which suit them, while turning their backs on the parts they find embarrassing. They said they would do something to improve human rights in return for other things they wanted. The West at Belgrade cannot and must not forget that.

Q. Do you consider Soviet expansion in Africa a danger to the West?

A. Yes. Communist-bloc expansion anywhere is dangerous. Many of the vital supplies for Western industry come from southern Africa: chrome, uranium, diamonds, etc. And much of the oil for the free world comes round the Cape. The Soviets may be tempted to try to cut us off from these supplies, or to let us have them on their terms.

They don't just attack in one way. They use all kinds of approach. Military strength is only one of them. Fear is another. So is the Communist doctrine of Marxist inevitability: "Don't try to stop us," they say. "Our advance is historically ordained."

To make sure, of course, they increase their arms production and put themselves in a position where they get their own way by threat.

Q. Is there anything Britain and the U.S. should do to check Soviet expansion in Africa?

A. Rhodesia is the most urgent question. My party has consistently made its views known.

Democracy means having the Government which the people inside the country want. But too little attention has been given so far to the feelings and views of the Rhodesians themselves—black and white.

Another point is security. We believe the present Rhodesian security forces will support a new Government that is truly constitutional and democratically elected. This point would be crucial to its stability.

Q. How far should Britain and the U.S. press ahead in trying to bring about political change in South Africa?

A. We both fundamentally disagree with apartheid. But it's no use just hitting out the whole time. Far better to try to encourage change in the direction you want it to go. Often things happen quicker if you do it that way.

Economic and political realities are bringing changes. Add to this the pressures that arise from what most of use feel about individual rights, and I think there must be a chance that the pace of change will quicken in the right direction. And solving the Rhodesian problem with a stable democratic Government could help so much with South Africa's political development

Q. Does being a woman pose any special problem for you as prospective Prime Minister of Britain?

A. Not in any way. In some ways, it gives special advantages.

First, I think many people think it would be rather exciting to have a change.

Secondly, there aren't very many of us—women at the top in politics—and most people feel that women should have more say than we do now.

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