From devastation to Thatcherism and Brexit: what Britain went through under Elizabeth II

David JackySeptember 11, 2022

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On September 8, the oldest monarch in modern history, Queen Elizabeth II of Great Britain, passed away. She was 96 years old, more than 70 of which she spent on the throne. During this time, the country’s economy has experienced both post-war devastation, and prosperity during the premiership of Margaret Thatcher, and a protracted recession after the 2008 crisis, and Brexit. The Queen saw a stormy surge of free enterprise, the transformation of London into a world financial center. How the UK economy has changed over the past 70 years – in the review of Gazeta.Ru.
Postwar decline
After the death of King George VI on February 6, 1952, his daughter, Elizabeth, became the new monarch of Great Britain. At that time, the country’s economy had not yet had time to really recover from the consequences of the Second World War – there was not enough food and labor. Until 1954, food was issued on cards. The budget has not yet recovered from the huge military spending of £25bn, and the national debt has reached £23bn.

Leading the country out of economic decline fell to the lot of the first post-war prime minister, Clement Attlee , who headed the government in 1945. He carried out large-scale nationalization of key sectors of the economy, including financial, industrial and energy.
Attlee laid the foundation for an economic policy to create a welfare state, which was based on a fundamentally new social security system – the pension system was changed, the authorities introduced benefits related to illness, childbirth, unemployment, and even funerals.

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Police at the gates of Buckingham Palace, where people bring flowers after the news of the death of Queen Elizabeth, 8 September 2022 Police at the gates of Buckingham Palace, where people bring flowers after the news of the death of Queen Elizabeth, 8 September 2022 People came to say goodbye to Queen Elizabeth at Buckingham Palace, 8 September 2022
People came to say goodbye to Queen Elizabeth at Buckingham Palace, 8 September 2022
People gathered outside Buckingham Palace in London after reports of ill health of Queen Elizabeth, 8 September 2022
People gathered outside Buckingham Palace in London after reports of ill health of Queen Elizabeth, 8 September 2022
A message about the death of the Queen was posted on the fence of Buckingham Palace, September 8, 2022A message about the death of the Queen was posted on the fence of Buckingham Palace, September 8, 2022Image of Elizabeth II in Piccadilly Circus, London, 8 September 2022 Image of Elizabeth II in Piccadilly Circus, London, 8 September 2022
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Police officers at the gates of Buckingham Palace, where people bring flowers after the announcement of the death of Queen Elizabeth, September 8, 2022
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Police officers at the gates of Buckingham Palace, where people bring flowers after the announcement of the death of Queen Elizabeth, September 8, 2022 People came to say goodbye to Queen Elizabeth at Buckingham Palace, September 8, 2022
People gather outside Buckingham Palace in London after reports of Queen Elizabeth’s illness on September 8, 2022.
A message announcing the death of the Queen was posted on the fence of Buckingham Palace, September 8, 2022 Image of Elizabeth II in Piccadilly Circus, London, September 8, 2022 Police officers read a message about the death of Queen Elizabeth on a screen, September 8, 2022. People bring flowers to Holyrood Palace after the announcement of the death of Elizabeth II, Edinburgh, September 8, 2022 Keepers of the Palace of Holyrood with flowers after the announcement of the death of Elizabeth II, September 8, 2022 West Ham and Steaua Bucharest players on the field during a moment of silence after the death of Queen Elizabeth II before a Europa Conference League football match at the stadium in London, September 8, 2022 People bring flowers to Holyrood Palace after the announcement of the death of Elizabeth II, Edinburgh, September 8, 2022
Keepers at the Palace of Holyrood place a ‘Closed’ sign after the announcement of Queen Elizabeth’s death, September 8, 2022 People came to say goodbye to Queen Elizabeth at Buckingham Palace, September 8, 2022 People gathered outside Buckingham Palace after the announcement of the death of Elizabeth II, September 8, 2022 Double rainbow over Buckingham Palace on the death of Queen Elizabeth II, September 8, 2022 Flowers at Buckingham Palace, September 8, 2022 People gathered outside Buckingham Palace after the announcement of the death of Elizabeth II, September 8, 2022 People gather at the Queen Victoria Memorial after the announcement of the death of Elizabeth II, September 8, 2022 Flowers at Buckingham Palace, September 8, 2022 Flowers near Windsor Castle, September 8, 2022 Flag at half-mast over Buckingham Palace after the death of Queen Elizabeth II, September 8, 2022
However, despite all Attlee’s reforms, the country still felt a lack of production capacity – the technological lag behind the countries of continental Europe affected. British goods could not compete on equal terms with German, French and Italian because of the high cost and insufficient quality. The British economy, in fact, was trapped – the welfare state could not provide rapid growth due to large social spending.

This was the state of affairs in Britain at the time of the accession of Elizabeth II. The problem could not be solved either by Winston Churchill, who returned to the post of head of government and became the first prime minister of the young queen.

Churchill was at first horrified that a 25-year-old girl had ascended the throne. The prime minister, who was always in opposition to the monarchs, believed that Elizabeth was too young and naive. However, he was able to imbue her with respect after a closer acquaintance. Contemporaries wrote that in the young queen, the old bulldog struck not only the mind, but also a sense of duty and devotion to the people.

Record economic recession in 150 years
Due to post-war deindustrialization in the mining, heavy and manufacturing industries, the UK’s share of global production fell to 4.9% by 1973, a low figure not seen in the country for 150 years since the Industrial Revolution in the 1870s.

Such a sharp decline was due to the banal desire to survive at any cost – the British budget was sorely lacking in cash receipts. Control over the colonies was lost, including India, Palestine, Ceylon and others. As a result, there is a shortage of cheap raw materials and an increase in the cost of British products. The absence of high-tech production did not allow for the growth of workers’ wages. Moreover, the rapid development of the trade union movement hit back at the authorities – more and more strikes began to occur.

The crisis peaked in the mid-1970s, when world oil prices quadrupled. The British economy has fallen into a long recession. In 1973-74 there was a stock market crash and a banking crisis led to 20 percent inflation. As a result, Labor Prime Minister Harold Wilson was forced to apply to the International Monetary Fund for a loan of £2.3 billion in exchange for lower government spending.

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Elizabeth II in the garden of Balmoral Castle with one of corgis, 1952 Elizabeth II in the garden of Balmoral Castle with one of corgis, 1952 Когда принцесса Елизавета в 1926 году появилась на свет, никто не ожидал, что ей суждено занять британский трон, поскольку он должен был перейти к ее дяде принцу Эдварду, который должен был жениться и обзавестись наследниками. Однако в 1936 году тот, пробыв после смерти своего отца Георга V королем меньше года, отрекся от престола ради любви к разведенной американкеКогда принцесса Елизавета в 1926 году появилась на свет, никто не ожидал, что ей суждено занять британский трон, поскольку он должен был перейти к ее дяде принцу Эдварду, который должен был жениться и обзавестись наследниками. Однако в 1936 году тот, пробыв после смерти своего отца Георга V королем меньше года, отрекся от престола ради любви к разведенной американкеКороль Великобритании Георг VI (в центре) с женой королевой Елизаветой (справа в центре), дочерьми — принцессой Елизаветой (на переднем плане в центре) и Маргарет, и другими членами королевской семьи после его коронации, Лондон, 15 мая 1937 годаКороль Великобритании Георг VI (в центре) с женой королевой Елизаветой (справа в центре), дочерьми — принцессой Елизаветой (на переднем плане в центре) и Маргарет, и другими членами королевской семьи после его коронации, Лондон, 15 мая 1937 годаПринцесса Елизавета и ее сестра Маргарет, родившаяся в 1930 году, учились частным образом. Домашнее обучение фокусировалось на истории, английском языке, литературе и музыке. На фото королева Великобритании Елизавета со своей предшественницей, королевой Марией Текской, и дочерьми, принцессами Елизаветой и Маргарет, в 1937 году
Принцесса Елизавета и ее сестра Маргарет, родившаяся в 1930 году, учились частным образом. Домашнее обучение фокусировалось на истории, английском языке, литературе и музыке. На фото королева Великобритании Елизавета со своей предшественницей, королевой Марией Текской, и дочерьми, принцессами Елизаветой и Маргарет, в 1937 году
Одним из увлечений Елизаветы II всегда был конный спорт. Еще в прошлом году во время карантина 94-летняя королева была сфотографирована во время прогулки по Виндзорскому парку — она ехала верхом на 14-летнем уэльском пони по имени Балморалский папоротник. На фото 13-летняя принцесса после конной прогулки по Большому Виндзорскому парку в 1939 годуОдним из увлечений Елизаветы II всегда был конный спорт. Еще в прошлом году во время карантина 94-летняя королева была сфотографирована во время прогулки по Виндзорскому парку — она ехала верхом на 14-летнем уэльском пони по имени Балморалский папоротник. На фото 13-летняя принцесса после конной прогулки по Большому Виндзорскому парку в 1939 году
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Elizabeth II in the garden of Balmoral Castle with one of her corgis, 1952
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Elizabeth II in the garden of Balmoral Castle with one of her corgis, 1952 When Princess Elizabeth was born in 1926, no one expected that she was destined to take the British throne, since he was supposed to pass to her uncle Prince Edward, who was supposed to marry and acquire heirs. However, in 1936, having been king for less than a year after the death of his father George V, he abdicated for the love of a divorced American woman. King George VI of Great Britain (in the center) with his wife Queen Elizabeth (right in the center), daughters – Princess Elizabeth (in the foreground in the center) and Margaret, and other members of the royal family after his coronation, London, May 15, 1937 Princess Elizabeth and her sister Margaret, born in 1930, studied privately. Home schooling focused on history, English, literature and music. Pictured is Queen Elizabeth of Great Britain with her predecessor, Queen Mary of Teck, and daughters, Princesses Elizabeth and Margaret, in 1937
One of the hobbies of Elizabeth II has always been equestrian sport. Back last year during quarantine, the 94-year-old Queen was photographed walking through Windsor Park riding a 14-year-old Welsh pony named Balmoral Fern. In the photo, the 13-year-old princess after a horseback ride in Windsor Great Park in 1939 Queen Elizabeth in service during World War II Queen Elizabeth II examines her collection of foreign postage stamps at Buckingham Palace, 1946 Elizabeth II on horseback, 1951 Queen Elizabeth II with her husband Prince Philip, 1952 The news of the death of her father, King George VI, Princess Elizabeth received in February 1952, while with her husband in Kenya. From that moment began the process of preparation for the coronation. It took place on June 2, 1953, despite the fact that a few months earlier, in March, the Queen’s grandmother, Mary of Teck, had died. In the photo, Elizabeth II during the coronation ceremony at Westminster Abbey in 1953
The Archbishop of Canterbury in the foreground delivers a blessing to Queen Elizabeth II during her coronation ceremony in London, June 2, 1953. Любовь Елизаветы II к собакам породы корги сейчас общеизвестна. Она влюбилась в этих животных еще в 1933-м — корги по имени Дуки был у ее отца. Собственную собаку по имени Сьюзан она получила в подарок на 18-летие в 1944-м — и с тех пор у нее сменялись поколения потомков той самой корги. Недавно после смерти последних корги Елизавете II вновь подарили щенков — правда, они уже не связаны со Сьюзан родственными узами. Теперь у нее есть Фергюс и Мик. На фото Елизавета II с матерью во время прогулки с корги в 1956 году
За время своего правления Елизавета II посетила 120 стран. В одной только Канаде, которой она официально правит, королева побывала 22 раза. На фото Елизавета II и герцог Эдинбургский Филипп в машине во время визита на Карибы в 1966 году
В 1994 году состоялся исторический визит королевы Великобритании Елизаветы II и ее супруга принца Филиппа в Россию — они провели в нашей стране четыре дня. Королева открыла мемориальный камень на стройплощадке нового здания британского посольства в Москве, посетила Большой театр в компании Бориса Ельцина, побывала в одной из элитных школ, приняла участие в открытии музея «Старый английский двор» на Варварке неподалеку от Кремля. Последние два дня путешествия в Россию Елизавета II и принц Филипп провели в Санкт-Петербурге — сходили в Мариинский театр и Эрмитаж, побывали на экскурсии в Петропавловской крепости. Прощальный банкет Елизавета II и герцог Эдинбургский устроили на яхте «Британия», пришвартованной в порту Петербурга. На фото Елизавета II, российский президент Борис Ельцин и мэр Москвы Юрий Лужков на Красной площади во время визита королевы в Россию в 1994 году
Королева Великобритании Елизавета II приветствует капитана сборной Дэвида Бекхэма на приеме до церемонии открытия Игр Содружества в Манчестере, 2002 год Королева Великобритании Елизавета II в разные годы своего правления, 1966 и 2006 гг. Королева Елизавета II во время конной прогулки, 2014 год Елизавета II во время посещения мемориальной инсталляции в Тауэре, посвященной столетней годовщине вступления Великобритании в Первую мировую войну, 2014 год Елизавета II смотрит на Железный Трон в тронном зале в Королевской гавани — в павильоне, в котором снимается знаменитый на весь мир сериал «Игра престолов» , 2014 год Елизавета II во время визита в Берлин, 2015 год С 45-м президентом США Дональдом Трампом Елизавета II встречалась трижды. Она принимала его в Букингемском дворце в 2018-м и 2019 г. (во второй раз он прибыл с государственным визитом вместе со всей семьей, включая дочь Иванку и ее мужа Джареда Кушнера). В конце 2019-го Трамп прилетал в Лондон на саммит НАТО — тогда для глав государств тоже был устроен прием в резиденции королевы. На фото Елизавета II и президент США Дональд Трамп во время мероприятия в Виндзорском замке в 2018 году Американская телевизионная актриса Меган Маркл вошла в королевскую семью 19 мая 2018 года — тогда в часовне Святого Георгия состоялась ее свадьба с принцем Гарри. На фото Елизавета II с внуком, принцем Гарри, и его супругой, герцогиней Сассекской Меган, в 2018 году On April 17, 2021, Elizabeth II buried her husband, Prince Philip. She is pictured in St George’s Chapel at Windsor Castle. Prince Charles, Elizabeth II, Kate Middleton, Prince Louis and Princess Charlotte on the balcony of Buckingham Palace during the celebration of the Queen’s Platinum Jubilee – the 70th anniversary of her accession to the throne, June 2, 2022 Queen Elizabeth II before meeting new Prime Minister Liz Truss at Balmoral Castle in Scotland on September 6, 2022
The discovery of oil reserves on the shelf of the North Sea for some time led to the growth of the British economy. However, the sharp rise in the pound sterling led to higher prices for exports and cheaper imports. And the increase in the cost of oil led to an even greater decrease in the profitability of production, which caused massive discontent among the workers. Numerous strikes hit the public sector and led to early government elections. The result was a change in the economic course – from the Labor government to a neo-liberal form.

“Thatcherism” and the rise of the British economy
Margaret Thatcher won the general election in 1979 . She became the first woman in the history of Great Britain as prime minister and made a real revolution in the country’s economy.

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At the same time, according to biographers, the relationship between the “iron lady” and Elizabeth II was, to put it mildly, strained. Fuel was added to the fire in 1986 by an editorial in The Sunday Times, in which the newspaper, citing anonymous sources at court, reported that the queen was extremely dissatisfied with the prime minister’s policies. And he considers Thatcher’s initiatives “irresponsible, conflicting and dividing society.”

In contrast to the concept of the welfare state, Thatcher, from the first days of her reign, announced her intention to build a society of private owners. It was during the years of her premiership that entrepreneurial flourishing took place. Enormous support was received by small and medium-sized businesses, and the share of the public sector gradually began to decline.

In 1981, Thatcher lifted foreign exchange controls, which made London open to foreign investment and the UK the leading financial power. In fact, the modern City of London is the brainchild of Thatcher. The prime minister also more than halved the top income tax rate, from 83% to 40%. Help to cope with the budget deficit helped reduce social spending, including spending on education, housing and communal services and cutting subsidies to subsidized regions.

The headache for Thatcher was always the trade unions, which by that time had reached the peak of activity. Mutual distrust of Thatcher and the workers eventually led to a miners’ strike in 1984-85. The damage from the performances was estimated at £1.5 billion and could lead to the closure of 20 state mines. However, Thatcher did not compromise, and the miners surrendered.

Another economic victory for the Prime Minister was the privatization of the UK’s largest companies. Giants such as British Airways, British Steel, British Gas and British Airports Authority were in the hands of private business. Thatcher did not believe in the effectiveness of government. To encourage private enterprise, she lowered taxes for the wealthy and cut rates for ordinary Britons as well. So, in 1988, the top tax rate was reduced from 60% to 40%, and the standard rate – from 27% to 25%. At the same time, the shares of companies that were advertised on television were becoming increasingly popular. This led to the fact that by the end of Thatcher’s rule, there were from 12 to 15 million shareholders in the country.

By 1987, the unemployment rate in the UK had fallen to 3 million people, and by the end of 1989 it had fallen to 1.6 million. The wages of the population grew by about 2% annually. Thus, Thatcher managed the seemingly impossible – to please both big businessmen and ordinary workers. As a result – the maximum rate of development of the British economy since the post-war period.

“Third way”, crisis-2008 and Brexit
The first Prime Minister of Great Britain, who managed to link two opposing economic concepts – “Thatcherism” and the welfare state – was Laborist Tony Blair, who came to office in 1997. He tried to find the necessary balance between private business and state participation. The combination of socialist and capitalist models in the UK has been called the “Third Way”. According to the new concept, the Bank of England received the right to conduct its own monetary policy, which to a large extent influenced the decline in inflation.

In Blair’s 10 years in office , there were 40 consecutive quarters of economic growth that continued until the 2008 global financial crisis.

But Blair’s relationship with the Queen did not work out from the very beginning. It is reported that after the death of Princess Diana, the prime minister, as the press wrote, went to the Scottish Balmoral to give a “praise to Elizabeth II ” on how to behave in a crisis. This conversation left an unpleasant aftertaste with the monarch. And after Blair left office, relations deteriorated even more: the ex-prime minister released memoirs in which he described in detail his relationship with the royal family. Often speaking not in the most flattering way about the Windsors.

In March 2009, the Bank of England lowered its key rate to a historic low of 0.5 percentage points and began actively injecting money into the economy to stimulate its growth. In a year and a half, the UK experienced the longest recession since the Second World War. The decline lasted six quarters in a row. However, the consequences of the “great recession” were felt for a long time. Thus, in 2011, household debts amounted to 420% of GDP. Wages fell 10% in real terms in eight years, the worst level since the 1860s.

The Brexit exit of the UK , which was voted on in 2016, added to the problems. The country finally left the EU at the end of the transition period – January 1, 2021. However, even before that, London faced a number of difficulties.
Half of all food in the country came from imports, and 60% of foreign goods before Brexit came from Europe. As a result, Britain faced a shortage of a number of products, including mineral water, lettuce, and cheese. In addition, there was a shortage of spare parts and building materials. London’s trade losses were estimated at billions of pounds.

Thus, after 70 years of the reign of Queen Elizabeth II, Great Britain is gradually returning to its original positions of the post-war crisis. In the medium term, the country may lose about 4% of economic growth, and according to non-state forecasts – 6-7%. Without a return to the model of active state support for production in the coming years, the UK will find it extremely difficult to overcome the crisis. History moves in circles.