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To what extent has Labour economic policy since 1997 been consistent with Tory ideas 1979 - 1997?
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To what extent has Labour economic policy since 1997 been consistent with Tory ideas 1979 - 1997? When the Conservative party gained power in 1979, they were converted to the belief that control of the money supply, was key to controlling inflation. Margaret Thatcher accepted Milton Friedman's argument, that rising inflation, which was proving very damaging to the economy and British competitiveness, was a direct result of government's neglect of monetary targets. The result of this was 'Monetarianism,' which resulted in rising interest rates, cuts in public spending, and VAT was almost doubled to try and curb the money supply. By the time Major was in power, the 'Monetarist' approach was all but scrapped, but it was accepted that control of interest rates was key to controlling the economy. This is what bought about the 'Ken and Eddie' show, where the Chancellor, Kenneth Clarke, and the Governor of the bank...
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