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Privatiser and nationaliser

Margaret Thatcher’s laissez-faire economics weakened industrial R&D in the UK, while her suspicion of the universities meant more central control. Our economy is still suffering from the consequences.

Margaret Thatcher was the first prime minister to have a science degree, studying chemistry at Oxford before a brief career in industrial research. The persistent and silly belief that more scientists in high office means more money for science and greater enthusiasm for its results suggests, therefore, that she should have been good for research. But she wasn’t.

Across government and industry, with the exceptions of universities and the military, research budgets were cut back. By pulling out of the market, the state ensured that there would be no more Concordes, and there weren’t many. Nuclear research was unnecessary
when you could buy a pressurised water reactor designed in the US.

Economic liberalism and a lack of concern for the country’s balance of payments undercut the techno-nationalism of the post-war years. This was an economic revolution, which profoundly affected the private sector supplying the state and private firms more generally. Companies no longer felt obliged to do research for national reasons, and national champions and their R&D programmes went by the board.

An overvalued pound that made exports more expensive, competition from abroad and the active avoidance of an industrial policy transformed the UK’s technological landscape.

Universities and their research suffered an initial budget cut, which bred a personal hostility towards Thatcher even in her alma mater. What would have been routine honours for a prime minister, such as honorary degrees and a fellowship of the Royal Society, became contentious. Yet universities would soon be expanding rapidly, with public money, and research budgets would rise.

As pointed out by Terence Kealey—perhaps the only openly Thatcherite scientist of the time, now vice-chancellor of the private but non-profit University of Buckingham—university labs were overflowing even as the scientific elite pleaded poverty. Kealey also observed, gleefully and rightly, that the scientists and science policy experts complaining that the proportion of world research coming from the UK was shrinking apparently couldn’t work out that the country’s absolute research output was going up.

The paradox was twofold. First, government increased the proportion of the national research budget spent by the research councils, when it seemed to want to emphasise economic growth. Second, it wanted to direct research council funding towards the priorities for UK PLC, when it did not believe in UK PLC. In pursuing a techno-nationalist policy for the research councils while eschewing one more generally, government got itself into an absurd position that endures today.

These contortions were adopted not in the name of economic development, but to force universities to focus on the government’s ideology. For political reasons, there was a great nationalisation and centralisation of universities and research policy. Thatcher and the Thatcherites saw universities as centres of leftist anti-capitalist sentiment.

The primacy of political motives remains evident in policymakers’ focus on process to avoid discussing outcomes, and in the degraded language, reeking of bad faith, of policy programmes from the Higher Education Funding Council for England and the research councils.

For all the talk of evaluation and accountability, it is rarely asked whether the transformation of the universities and research councils, the policies to push academia closer to industry, and the drive to create new industries and firms actually worked. Surely more than 30 years of these policies should have produced evidence of great new firms and technologies? 

But they are not there. The software company Autonomy has become an embarrassment both to Hewlett Packard, which acquired it, and to those who lauded it as the flagship of British innovation.

Think of the defining entrepreneurs of the Thatcher era, and figures such as Richard Branson and Alan Sugar spring to mind. Thomas Edison they ain’t. The money, in immense quantities, has gone not to entrepreneurs, but to bankers—to parasites, not creators.

What British industry we have left is largely owned by multinational firms such as Tata of India and state-owned enterprises such as France’s EDF. It is sad to consider that research policy today is aimed at aerospace, cars and pharmaceuticals. Even in 1979, these were hardly new industries; now they are hardly entirely British, either.

As we reflect on Thatcher’s legacy, it is time to call the bluff of the supposed economic benefits of research council policies. Doing so would help begin to deliver those benefits and many of the other rewards of research that have been relinquished in the search for chimerical profits.

David Edgerton leads the Centre for the History of Science, Technology and Medicine at Imperial College London, soon to move to King’s College London. His book England and the Aeroplane: Militarism, modernity and machines has just been published by Penguin.

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