Three comments - comments on article by Anthony Hartley in this issue, p. 36

Michael Elliott: ANTHONY HARTLEY'S essay is squarely within a school of modern British studies best called "Regrets Only." All the tell-tale signs are there: the supposed loss of purpose that followed the end of Empire, the lament about economic decline, the head-shaking over the Swinging Sixties, the disaffection with the grubbiness of Thatcherite capitalism. I agree with some of the analysis. I think, for example, that Hartley is right in thinking that the Empire brought out the best not just of the British establishment, but also of the middle-class in Scotland and the North of England. Sometimes Hartley is just wrong; the poll-tax which proved Margaret Thatcher's nemesis in 1990 was not so much "insufficiently prepared" as just mad. As a staff member in the Cabinet Office, I was part of a team working on local government reform in 1982; if you give yourselves eight years preparation on something, you should get it right.

More broadly, I think that Hartley misunderstands the recent economic history of Britain in an important way; and fails to specify the very difficult "strategic" choices that Britain must now face. He is confused--and he is not alone--about the central "problematic" of recent history, which, shortly put is this: what did Margaret Thatcher do, and what didn't she do?

It is no good complaining, as Hartley does, about "the entrepreneur, with all his disadvantages." For the "Regrets Only" crowd, the 1980s were full of ugliness and meretricity (personally I loved them). But the plain truth is that by 1979 Britain had become a society in which it was not respectable to be rich unless you had earned your money the old-fashioned way: by inheriting it. Mrs Thatcher's economic achievement--flawed but significant--was twofold. First, she espoused a set of supply-side policies which opened up a space for risk-taking behavior. Second, she changed the political climate so that those who worked in the private sector, men and women who were not particularly interested in politics but very interested in increasing the prosperity of their families, no longer felt despised.

The transformation of the British economy was (rather than "is," since I think it is just about over) wrenching and painful. Moreover, since Britain is just about the most open economy in the developed world, it tends to be "hypercyclical," doing very well in global booms (like the mid-1980s) and very badly in global busts (the early 1990s). But notwithstanding the pain and uncertainty, most commentators, I think, accept that the competitiveness of the British economy has fundamentally improved, with inflation just about controlled and productivity showing strong gains. That is Mrs. Thatcher's achievement.

But Mrs. Thatcher was much less surefooted in assessing what Britain's place was likely to be in the post-Cold War world. This failing goes beyond the common claim that Mrs. Thatcher was a "Euroskeptic." There are very good reasons to be skeptical of the European Union, not least its scandalous unconcern (which she would surely have challenged) for the fate of people and countries to its east. For the original signatories of the Treaty of Rome, European unity was a way of exorcising the ghosts of old and deadly conflicts. Britain, whose territory had never been invaded in modern times and whose institutions had never been delegitimated, could never have the emotional attachment to unity seen in France or Germany. Moreover, Britain has always lived by trade, and alone of all the major European states, has seen continued emigration since 1945. Hence it has close ties of commerce and sentiment to places far from the European landmass. "Being European" is just more difficult for Britain than for anyone else.

What Mrs. Thatcher failed to see was that the special relationship with the United States could never be an alternative to the gradual integration of Britain into European structures. To those of us who have been based in Washington for years it was plain by the late 1980s that the dogged--and often commendable--loyalty of London to Washington was a wasting asset.

In a strategic sense, Britain under both Mrs. Thatcher and John Major has fallen into the trap of being more royalist than the King. A new generation of American officials, Republican and Democrat, believes that Europe's prosperity (and hence America's export markets) will be enhanced by continental economic integration; they are less interested than their elders in a time-consuming policy of "divide and conquer" among the Europeans; and they want the Europeans to shoulder a heavier share of the defense burden, anywhere in the world, than they now do. All of this suggests that America's traditional ambivalence about the virtues of European unity have been decisively resolved in its favor.

This modern American bias towards European unity may turn out to be a colossal mistake: but that is for the Americans to find out. It does Britain no good whatsoever in Washington to seem to be mealy-mouthed about symbols of European unity; to pour cold water, for example, on the Franco-German army corps, or to dismiss the French penchant for grand diplomatic gestures as mere grandstanding. The British would claim that their foreign policy has been dominated by that most overrated of all British habits, pragmatism. But pragmatism without a vision of where Britain's interests lie and how they can be protected is not enough. Difficult though the strategic choice in favor of European unity may be for Britain (and genuinely it is difficult), it is hard to see what Britain gains by not making it.

Michael Elliott is the diplomatic editor of Newsweek.

Martin Walker:

THE PROBLEM with Britain is the country's stubborn insistence on winning its wars. Germany and Japan were required to overhaul their political, social and economic systems after their defeat in 1945. Russia is doing the same today. Rocked by defeat and occupation in 1940, and by colonial defeats in Vietnam and Algeria, France turned (not for the first time) to a general, who saved a kind of democracy by becoming a kind of dictator.

For centuries now, Britain's right little, tight little island has, by its exertions and its good sense, been spared the great climacterics which shook a country into transformation. Not for nine centuries has Britain known enemy occupation dividing the nation between the patriots and the collaborators. And not for three centuries has it experienced the kind of violent revolution which cleaves new divisions between the disinherited and their dispossessors.

Instead, we have had to make do with elections. In this century we have endured heroic efforts to transform the structures of the old homestead by the Liberals' Lloyd George, Labour's Clement Attlee and the Conservatives' Margaret Thatcher. None, as Mr. Hartley depressingly explains, has done much more than re-decorate the rooms, shift the furniture around and spruce up the raiment and modify the employment conditions of the retainers. What he dubs "the ethos of retreat and the pessimism it engendered" may have been spruced away for a time, but never for long.

Could it be that something is wrong with the foundations, with the very institutions that our political moderation and military heroics have been able to protect?

Our great institutions have not served us well of late. Indeed, their embarrassments have added to what Mr. Hartley sees as the demoralization of the Establishment. Our Monarch presides over a dysfunctional family. Three broken marriages out of three is no doubt a private unhappiness, but if the Royal Family cannot discipline itself to set a decent example to the taxpayers who loyally sustain them, then what is their point?

The Crown is the keystone of a great edifice which sinks deep. Through the House of Lords, the Crown legitimizes the unelected half of our legislature. As head of the Established Church; as the object of the oath taken by the Officers corps of the armed forces; as the legal embodiment of the national system of justice with its Queen's Bench and Law Lords; and as the reason why the proper title of the elected prime minister is "Her Majesty's First Lord of the Treasury," the symbolism of the Throne weighs heavy upon us.

Mr. Hartley talks of "a twenty year loss of nerve by the governing classes." After their performance, the governed can be forgiven a loss of faith. Her Majesty's courts have to admit the perversion of justice which locked up innocent Irishmen. Her Majesty's Cabinet ministers have to admit lying to permit businessmen to be imprisoned for selling arms to Iraq, when they had been secretly licensed to do so. The Bank of England has to apologize for its unsavory kindness to the Bank of Crooks and Criminals International. The loosening ethics of Lloyd's of London has bankrupted half the gentry.

And at that other end of society, which Mr. Hartley hardly addresses, the demoralization has gone beyond the loss of imperial responsibilities and the erosion of the public school ethic. We have reinvented an underclass of the hard-core unemployed, the homeless, and the hopeless young.

The most interesting thrust of Mr. Hartley's essay is less his elegiac lament for the glorious past (with which few Brits would much disagree) than his arresting implication that Britain might be at last readying itself for an overdue climax of reform not through foreign war or domestic riot, but through a wave of national self-disgust. Mr. Hartley sees one answer in "Thatcherite values," where I can neither identify them, nor agree. He sees another in education, where few will quibble. Finally, he sees in our history "a source of strength," and he is reasonably right.

What we need now is finally to accept that verdict of another great British victory two centuries ago, when British settlers defending British rights fought and trounced German mercenaries fighting for a German King. Naturally, the British side won, thanks in part to the skills of George Washington. It is not too late to bring home the results of that victory: A Republic, a written Constitution, a Bill of Rights and a separation of powers too long entwined, too long abused, and too often mishandled.

Martin Walker is the U.S. Bureau Chief for The Guardian (London), and author of The Cold War: a History, to be published in the United States by Holt in April.

Ambrose Evans-Pritchard:

CLUSTERED AROUND a paraffin lamp, we tried to learn our Latin gerunds and study maps of colonial Africa. There were power cuts most nights, and we had to wear our duffle coats indoors because the heating thermostat was down in the fifties. The railways were on strike so the school had to charter buses to take us home at half-term. Everybody else was on strike too, it seemed. Rubbish piled up in huge mounds on the pavements, and industry was on a three day week. It was like living in a country at war, except of course that there was no war. There was no excuse whatsoever.

For an English child coming of age in the late 1970s, this memory of hopelessness is the standard against which all subsequent experiences must be judged, and seen from that point of view, things are not going as badly for Britain as Anthony Hartley, in his blacker moments, seems to fear. I would even argue that there has been something of a national revival over the last fifteen years, at least in Britain's comparative performance with other European countries--which is what matters most to the British sense of self-worth. Given the long lead time in changes of this kind, the improvement is not immediately obvious from published statistics. The signs are to be found in the grey zone of behavior. On a recent tour of car factories in Europe I discovered that the absenteeism rate at the General Motors plant in Luton, England, was half the level of Russelsheim, Germany, where GM manufactures the same car. At Japanese car transplants in England and Wales the productivity rate compares favorably with the best in the world. There is nothing wrong with the British worker these days.

In the late 1970s I can remember looking at those charts they publish in the back of The Economist, and despairing that Britain always seemed to have the worst profile in the industrial world: the highest unemployment, the highest inflation or thereabouts, the lowest growth rate, horrendous debt, and on and on. But this is no longer the case. British fundamentals are now better than the European average. While Belgium, Italy and possibly even Germany (which hides many of its government liabilities off its books) face the risk of a debt trap, as compound interest spirals out of control, Britain boasts remarkably healthy public finances with a debt to GNP ratio of under 40 percent.

The early 1980s were a painful time, surgery without anaesthesia in Hartley's words. Under the Thatcher retrenchment the state sector fell from a peak of 49.5 percent of GNP to 39.5 percent--a figure that includes health coverage--arguably making the British public sector as efficient as any in the world. Privatized British Steel is now the most competitive major producer of steel in Europe. British Airways, once a disaster case, is now the biggest international airline in the world, and has continued to make profits throughout the airline slump. The better British companies are as well managed as any in the global market. The problem is that there are not enough of them. But the demonstration effect is working its way through the whole of British industry.

We did what had to be done. Other countries put off the fateful day and they will pay the price for it. Germany and Italy, with their bad practices and bloated welfare regimes are perilously close to the condition of Britain in the 1970s, with one added disadvantage, political systems that are far more brittle. Both countries produce superb goods, of course, but they rely heavily on refinements of yesterday's success stories--cars, for instance, which they cannot sell so easily any more. Where are they in computer software, information technology, biotechnology?

I am convinced that Britain will prove to be the stellar performer of Western Europe over the next few years, and that Margaret Thatcher will be vindicated. But whether that is much comfort is another matter, for European society as a whole is in sharp decline, having drawn down its moral and cultural capital to the point of bankruptcy. But if any country in Europe can adapt to the challenge coming from Asia and the developing world, Britain has as good a chance as any with its outward looking traditions, its global diaspora network, and its Methodist-Quaker spirit of dissent that fosters inventiveness. The imperial experience may indeed have been the leaven of "Britishness" for two hundred years. But there is an older island character that predates the aberration of empire: the proud, brave, and feisty Elizabethan. That wasn't half bad either.

Ambrose Evans Pritchard is the Washington correspondent for the Sunday Telegraph (London).

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