Tag Archives: Thatcher

But What About…? Part 3a: The Coal Industry, Part 1

I thought long and hard about what topic to pick to kick this series off with. One of the “usual suspects” that always get dragged up when talking about taxes, like healthcare, police, education, roads, state-provided post-retirement payouts? Or perhaps something that hides behind these things, like warfare or the surveillance state?

I decided to start on a different tack. Something vaguely remembered from childhood, and now better remembered from movies.

In 1947, the coal industry was commandeered by the British government. At the time, it was an important resource.

By the 1980s, the industry was in trouble. Coal wasn’t as important a resource as it once was. Coal from abroad was cheaper than British coal (in part, the true cost of the coal was obscured through subsidies). Far from being a contributor to the economy, it became a drain.

The government of the time, then, was in a difficult position: continue to prop up a dying industry at the expense of all the other taxpayers, or cut them loose and put the workers, and the local economies built around them, in severe jeopardy?

A theme of this series is “Should the government be doing that?” In this case, should the government really be running the entire coal industry?

I think it is obvious that my opinion is “no, they shouldn’t”.

But consider, if the earlier government hadn’t taken control of the industry, the later one wouldn’t have been saddled with the problem. If the industry had been exposed to market forces, then it would have had to react earlier to the changing conditions. Would there still have been closures and layoffs? Most likely, but they would have come more gradually rather than All At Once, thus not overloading the safety net.

The problem government faced in the ’80s, was caused by the government of the late ’40s. It was also affected by foreign governments of the ’80s.

I can’t claim any particular fondness for Thatcher or her government, but never have I heard anyone suggest how this apparent lose-lose situation could have been turned into a win-win, or even a potential win-win.

Tomorrow, I will throw some ideas around to suggest how a better outcome could have been achieved.