The Cabinet in Conflict: Loan from the IMF

A reconstruction of the cabinet discussion over the 1976 loan from the IMF to the UK

[@s.patrick9268]

You know, these fellows are all journalists yet their acting skills are very good for amateurs, especially the ones playing Callaghan and Healy, David Watt and Hugh Stephenson

[@robbibittybob20]

I wish British TV did more of this. Far more interesting than newsnight or the daily politics show.

[@keithmartin1328]

It would be interesting to see such a programme done today, given what has happened over the last few months.

[@aarondavis8943]

They don't do anything close to being this creative. Our media are a bunch of compromised plodders.

[@jeffreythomas-on6cq]

I wish we had these here in the United States.

[@jasonuren3479]

Who owns the media? Maybe they don't want the public to know that these people haven't got an original idea between them

[@zeddeka]

Roy Hattersley discussed this documentary in his autobiography - he said he hadn't spoken to any journalists about the meetings but he was astonished how a lot of his colleagues had clearly been giving out very detailed briefings

[@manaih5652]

It’s a good book.

[@MrGoneTroppo]

If they only knew the current deficit!

[@majorsharpe5208]

Hardly a surprise that Reg Prentice supported this! Ironically of course, years later, Denis Healey was firmly of the view that the Treasury had misled him to a great extent regarding the severity of the deficit and the level of cuts required.

[@iainrobertson5194]

These events emphatically paved the Way for Margaret Thatcher, to sweep into power

[@johnmoore9862]

Yes, & we’ve never recovered from market led Thatcherism.

[@billybabu]

Yes Minister 😀

[@zeddeka]

Roy Jenkins set out in his autobiography the main problems which led to this situation. The incoming Labour government in 1974 had inherited an appalling economic situation from the Heath government. The oil shock and the Barber Boom had trashed the economy. Jenkins felt that Healey had been way too slow to comprehend the scale of the problem (saying Healey's actions as chancellor in 1974 and 1975 had been like "throwing snowballs at an avalanche") and that Healey should have been cutting public expenditure from the very start (much as Jenkins had done in his stint as Chancellor in the 60s). Healey himself admitted that it took him a while to get on top of things, and his time as chancellor is often now divided into "Phase 1" Healey who thought he could get away with carrying on with high public expenditure, and "Phase 2" Healey when it became apparent to him what he'd actually have to do to stabilise the economy. Roy Jenkins wrote that most Labour governments need two chancellors - one to get them into trouble and one to get them out of it. But Healey had been both.

[@adlam97531]

Tony Benn in his diaries said that in fact they did not need the loan as North Sea revenues came in with a large surplus and Healey had said in his diary after he had been misinformed. Of course, there was the hand of international banks and 'interests' at hand in the background

[@The4preston]

They should have started saving money by cutting the size of cabinet, which is archaic and full of sinecures and positions with overlapping mandates. Do they really need a Chancellor of the Duchy of Lancaster? Ridiculous.

[@zeddeka]

The "Chancellor of the Duchy of Lancaster" is an archaic title. In essence it is a "Minister without portfolio" that the prime minister brings into cabinet to focus on specific issues. Under the last Conservative government, the holder of the office was given the task of focusing on policy development.

[@robin231176]

Such a loss to British politics that Tony Crosland died without ever having been Chancellor.

[@camusandinternet]

Dennis as leader and Crosland as chancellor would have been a great combo following the loss of '79. Alas, we all know what really happened!

[@kevinbill9574]

On the basis of this? What is there to suggest that we would have been in any better position if he had? Not to mention he helped destroy one of the most progressive institutions ever founded, the grammar schools.

[@camusandinternet]

Well, Labour was in a woeful state throughout the 80s. Healey would have been a stronger opposition leader and would have also fought the left of the party. There's no way of knowing if he would have a won a GE (maybe not), but he would have made a greater effort to protect British manufacturing whilst still opening up Britain to world markets. His version of monetarism was softer than Thatcher's (he called it sado-monetarism) and he would have made an effort to do something about unemployment and poverty. Also, he wasn't allergic to borrowing, would have kept moderately high taxes on the highest rates and this would have meant that public services and infrastructure wouldn't have been in such a parlous state throughout the 1980s. Crosland had sound knowledge of economics, so he would have been a competent chancellor. Calling grammar schools progressive is bizarre - they held back social mobility and, whilst they were good for a minority, more individuals went to university and mobilised upwards after the extension of comprehensive schools. The Conservatives recognised that they were unfair and accepted Labour's reforms. Thatcher didn't do anything to increase the number of grammar schools and, when Theresa May proposed to build more, it was quashed by the majority of her own party.

[@kevinbill9574]

I have a lot of respect for Healey and Callaghan, but they were good men in a totally intellectually bankrupt and idiotic party. Unfortunately for the country, there was hardly anyone else around them of their calibre and all through that period the party was being infiltrated by the likes of Ken Livingstone and his mates. I agree Healey should have been leader. It would have forced a split with the Bennite left, instead of forcing those on the 'right' out into the SDP, as happened. However, I would concede, the Tories of the period weren't much better, Thatcher included. I agree that a Healeyesque approach may have been more beneficial for the country long term, but he couldn't have delivered what was needed through the vehicle of the Labour party... certainly not at that time, pre the well deserved drubbing that Thatcher gave them. Your comments on the grammar schools are borderline insane, I'm afraid. They gave opportunities to the brightest working class kids that no generation had had before. The reason more people are going to university now is because higher education has become a business and courses have been devalued

[@alisdairhamilton-wilkes5394]

Sadly the infiltration had happened in the '70s and Labour were no longer a serious party of government, very much like to today under Corbyn. It's become a sort of super pressure group full of activists trying to signal their virtue -doesn't make for a healthy democratic system. Same for the industry, it was really murdered in the late '60s and '70s much of what happened in the '80s under Thatcher was merely putting it out of its misery.

[@conscienceaginBlackadder]

20:47 "I"ve got no coalition coming up" - the Lib-Lab pact! They were already at this date a minority govt.

[@insertclevername4123]

"....and the arguments of Shirley Williams will be put forth in an outrageous falsetto by Jonathan Dimbleby."

[@khairulnaeim756]

Understood this... politics is politics.. talking about economy that business..a business words being use not politics...do not send politics people even though they had business background...

[@khairulnaeim756]

Wonder why not one person try to find solution about politics people that take money (over do)....

[@khairulnaeim756]

Inherit problem... maybe had a solution about it... how about create a new one with... different views... like this(let them have position and salary but take their authority)... maybe can use as inspiration...for my view was better not clean inherit problem but use other way around...is a back up plan if lose politics.... lots of thing can do if had politics power...

[@khairulnaeim756]

Why they not talking about... lesson history... country bankrupt... after war...not to shame of ...they always say learn from history... better learn not to over spending or corruption....it is not U turn but crash already need to call someone....

[@erickleefeld4883]

The various political and economic crises of Britain in the 1970s show the real flaw of democratic socialism. (And no, it’s not “running out of other people’s money.”) The problem is that if the organized political forces of labor take over the running of the economy, then at that moment they cease to truly be “labor” - they are now the management.

[@channelfogg6629]

Of course. And the absurd idea that to reach socialism you have to get the capitalist economy 'right'. Socialism is intended to replace capitalism, not patch it up.

[@zeddeka]

So many of Britain's problems in the 1970s were caused by the oil shock, made worse by the bust following the "Barber Boom" when the previous Conservative government had let the economy seriously overheat. A Conservative government that Margaret Thatcher was a senior member of, and which the released records now show was preparing to go to the IMF itself before it lost office in 1974, leaving the Labour party to deal with the mess.

[@erickleefeld4883]

@@zeddeka Yes, the problems were caused by the oil shocks. But then the Labour Party was unable to make the tough economic decisions with its union base.

[@tubularbill]

@@erickleefeld4883- it wasn’t just oil shocks but declining productivity. The UK was losing out economically to the likes of Germany, France and the Nordic states (excluding Norway due to oil).

[@khairulnaeim756]

Honestly I really do not like this ..try to dig money this way(part 2)... cut there cut this... nothing about country or create new economy...

[@khairulnaeim756]

Maybe this British think people that try make investment are fools do not know how this British do... Every time ...had a problem... lots of people hear and see ...they can fools local people but not this people...ever wonder why outside investment is total weak.. they need to go a ask...if country very good not to ask they will come....

[@jasonuren3479]

If they had programs like this nowadays i wonder if things would be any better, because people would have a better understanding of what's actually happening.

[@ashthebash66]

Ian Aitkin should have been James Callighan because he sounded like him

[@J2020-sv3fq]

Roy Hattersley really doesn't come out well from this. He simply views, expresses and argues everything through a social-democratic ideological lens, as if he's read the definition of social democracy in a book, decided that was the philosophy for him, and then adopted and applied every position of it in conversation.

[@khairulnaeim756]

Given up ...this man ...in my book... thorns inside meat... weak politics security... enemy already inside and what worst was on the same table....a mouth can lie but what they do around them show the truth...

[@khairulnaeim756]

Tells your limit about country is not a good words...so what is good words.. maybe you can say no with a reason...

[@erickleefeld4883]

When Tony Benn started talking about Ramsay MacDonald in 1931, somebody should’ve pointed out to him that his Alternative Economic Strategy looked more like Oswald Mosley.

[@channelfogg6629]

'... somebody should’ve pointed out to him that his Alternative Economic Strategy looked more like Oswald Mosley.' - But that was when Mosley looked more like Keynes than Mussolini. He was driven to the absurd blackshirt extreme by Labour's cowardice.

[@Adam-zq2mw]

They've lost control! It reminds me of the committee meetings from Chernobyl!

[@dimwit3006]

Right! The chancellor looks like Vasily legasoz

[@tubularbill]

It’s like a skit out of Spitting Image

[@Stafford674]

Interesting that Cabinet Ministers thought that they would be able to dictate to the IMF the terms on which they would borrow money. 40 years later the Greeks were making the same mistake. Why are socialists so resistant to learning from experience?

[@channelfogg6629]

'Why are socialists so resistant to learning from experience?' You seem to have completely misunderstood the arguments in the programme and also the Greek situation.

[@hickster222]

@@channelfogg6629 you've just proved his point with that answer.

[@zeddeka]

You clearly don't know much of what happened. They actually had a significant amount of success in altering the terms offered by the IMF. Denis Healey famously threatened the IMF with a general election, in which Labour would campaign as "The people versus the IMF"

[@Stafford674]

@@zeddeka You are right. I don't know much of what happened. It is quite difficult to get details. I don't see how Healey's threat to call a general election would have been effective. Election held; Labour return to power; UK Gov to IMF - lend us money on our terms. IMF reply - NO!. Tsipras tried something like that when dealing with EU/IMF terms of loan to Greece. He held a referendum, which he won. And on the night of victory the EU told him to accept the terms of the loan or Greece would be ejected from the Euro. He capitulated. But thanks for the reply.

[@darrenjeffries6290]

​@@channelfogg6629yes, Greece didn't even meet the criteria for being accepted into the EU, which alas, meant they had Greece by the short and curlies.