• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

To what extent has Labour economic policy since 1997 been consistent with Tory ideas 1979 - 1997?

Extracts from this document...


To what extent has Labour economic policy since 1997 been consistent with Tory ideas 1979 - 1997? When the Conservative party gained power in 1979, they were converted to the belief that control of the money supply, was key to controlling inflation. Margaret Thatcher accepted Milton Friedman's argument, that rising inflation, which was proving very damaging to the economy and British competitiveness, was a direct result of government's neglect of monetary targets. The result of this was 'Monetarianism,' which resulted in rising interest rates, cuts in public spending, and VAT was almost doubled to try and curb the money supply. By the time Major was in power, the 'Monetarist' approach was all but scrapped, but it was accepted that control of interest rates was key to controlling the economy. This is what bought about the 'Ken and Eddie' show, where the Chancellor, Kenneth Clarke, and the Governor of the bank of England, Eddie George, met regularly to set interest rates, something which didn't use to involve the BOE and was solely a political tool. ...read more.


This is very consistent with Tory ideas regarding Trade Unions, ands I believe it is a big step away from Labours roots and traditional principals. Traditionally Labour has nationalised, Tories have privatised, and as the two parties have been in and out of power they have done exactly this to key industries such as coal gas and steel. In 1997 at the Labour party conference, John Prescott announced that Labour would not re-nationalise the train networks. This further confirmed the new orthodoxy, but also seemed to be Labour following in Tories footsteps. When Railtrack demised Labour replaced it with Network Rail, a government appointed board. Conservative may try and claim this is re-nationalisation, but it is more likely to be a sensible response to the problem. An area, which on the surface appears to be consistent with Tory ideas, is that of taxation. In opposition Labour promised not to raise the base rate, or the top rate of tax, as they didn't want to alienate the (usually Tory voting) ...read more.


This made them appear to be similar to the Conservatives, but as time has passed, it has become clearer that Labour is redistributive, and has made changes, that the Tories simply wouldn't have. In April 2002 they introduce Child Tax Credit, Paid for by the increased NIC. Also the introduction of working family tax credit ensures that people who work will be better off than if they stay unemployed and claim benefits. Other areas where Labour policy has appeared to be strongly departing from Tory ideas are the Minimum wage, which Tories would say is bad for business, and joining the social chapter, which was opposed by the Conservatives, who also oppose joining the ESC, but only for this government. Labour has made many changes which appear to be following Tory ideas and principles closely. They have been helped by a good economy to implement the changes that they've wanted to. I believe that they are moving away from the Conservative, as time goes on this will be even more noticeable. George Austin ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our GCSE Economy & Economics section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related GCSE Economy & Economics essays

  1. Retailing In India - A Government Policy Perspective

    The Indian retailing system may be grossly inefficient when compared to global benchmarks, but it should be noted here that we have a system in place that ensures that products reach every nook and corner of this country. Considering the geographic and cultural diversity and complexity of India that is no mean achievement.

  2. To what extent was Nazi economic policy ideologically driven?

    they did at Slzgitter in the Ruhr showed that the Nazis were 100 per cent committed to their ideology. Big business was undoubtedly driven by ideology and in particular the aim of autarky and rearmament. By 1936 Hitler had realised his major objective was to sustain rearmament, the economy was in such a position that this was now possible.

  1. Living Wage

    What is often referred to as free market often is not free at all. Government plays a rule-setting role, seeking to promote market efficiency, while also containing the social costs stemming from a completely unfettered market. For example, the Government tries to manage economic growth and control inflation by manipulating interest rates.

  2. Monetary policy of a globalised economy

    International trade and finance involve the use of different national currencies, which are linked by relative prices called foreign exchange rates. A very important exchange rate system is floating exchange rates, in which a country's foreign exchange rate determined by market forces of supply and demand.27 The untied states, Europe and Japan today operate floating exchange rate systems.

  1. Discuss the extent to which the economic theories in the Market's Reader can be ...

    It may have higher costs, and price to the consumer are higher than they need be, also the quality of the product/service may be is not good. The Government's role revolves around the development of a national policy, legislation and regulations to increase the competition.

  2. The division of labour.

    Since trading will not change the total output, they will both have the increased production and their needs satisfied. In addition, they will know what others want, and how much more they should produce through the process of trading. Therefore this small business achieves the allocative efficiency.

  1. Discuss the extent to which the economic theories in the Market's Reader can be ...

    wages, will fall if unemployment increases. The demand for labor will then rise, and the original level of employment will be retained. this view has been strongly criticized since the level of wages is often slow to fall. A wage cut can be difficult to implement for political, social, historical and/or institutional reasons.

  2. Supply side policy.

    By doing this it was felt that the firms would become more efficient, competitive and better able to provide a consistent service of high quality. Such privatised industries would no longer be a drain on the public purse. Companies like British Airways, British Telecom, British Gas, the electricity and water companies, National Air Traffic Services (NATS)

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work