John Redwood Popular Capitalism Analysis

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This source is an extract from John Redwood’s book Popular Capitalism which was published in 1988. The extract above discusses property ownership and how this can equate to freedom. On a whole, Redwood’s book explores economic growth on a worldwide scale and how the mechanisms that have been implemented in Britain can be transferred to other countries. Redwood’s focus on property ownership in this extract is relevant to the time as Thatcher’s premiership had focused on large scale privatisation and increasing the property owning democracy. The years prior to 1988 would have seen the impact of the 1980 Housing Act in which the ‘Right to Buy’ policy was implemented.
Redwood’s background up to this point highlights his political stance. He was a conservative whilst Thatcher was in office and in 1983 he was made director of Thatcher’s policy unit which gave policy advice directly to the Prime Minister. A key element of this role would have been advising on privatisation. Insight into why Redwood was such a strong advocate of privatisation is given in an interview he did with the BBC in 2004. He quotes coming from a poor background and growing up in a council house. He attributes the family breakthrough to when his parents bought their own house, which gave them a better quality of life. Redwood states that the new conservatives believe man “will only truly be enfranchised as a full citizen… when he also has a stake in its land.” It is this belief on which the ‘Right to Buy’ policy was based. It involved the selling of council houses to their tenants at a discount. People who had lived in properties for three years were given a 33% discount on the price of the house. This increased to 50% if the tenant had lived there for longer than 20 years. Another feature of the 1980s Housing Act was that people could put down £100 deposit to stagnate the price of the house for two years, and then pay the same market original price. The short term success of the policy is clear. Home ownership was 55% in 1980 and grew to 64% in 1987. By 1990 1.5 million council houses had been sold, which continued to increase. ‘Right to Buy’ can be seen as part of the general privatisation
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Richard Stevens argues this case in 'The Evolution of Privatisation as an Electoral Policy, c.1970-90'. He states that the ‘two foundation pillars of privatisation’ were ‘denationalisation and the extension of ownership’ and stresses that the sale of council houses were viewed as ‘symbiotic’ with denationalisation as part of the privatisation scheme. Although not a traditional example, the ‘Right to Buy’ effectively saw the transfer of business from public to private hands and thus fits into the privatisation narrative. Thatcher herself alludes to the ‘Right to Buy’ being based on the same principles of privatisation. In a 1981 speech to the Young Conservative Conference she stated “the perpetuation of large Council-owned fiefdoms means that millions… have no chance to acquire a capital asset for themselves or their children.” One of the key aims of privatisation was to reduce the economic responsibility of the government so that people could make their own capital and rely on their own money. With council house reduction, this was much more likely to happen in the realm of property ownership and not just

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