annual percentage of only 0.9 per cent. During
the 1970s and early 1980s the gap between the
performance of Britain and its neighbours in
manufacturing grew rather than decreased, and
its manufacturing output fell steeply, creating
large-scale unemployment.
In relative terms, Britain was not doing well;
but people compared their living standards with
earlier years, not with those of their continental
neighbours. During the Conservative years from
1957 to 1964 these standards were rising signifi-
cantly, with improved housing, more effective
social services, a National Health Service that
removed financial worries from illness, higher real
wages, better education and better provision for
the old-age pensioner. The blessings of full
employment came to be regarded as the norm.
There were more vacancies for the skilled and new
openings in the professions and the civil service.
More university places and increased provision of
grants made it easier to cross class barriers, espe-
cially for the ex-servicemen. Complete equality of
opportunity did not exist any more then than it
does now, but there were no insuperable barriers
for the talented, the hardworking and the highly
motivated. Compared with before the war, Britain
had become a much better country to live in.
Harold Wilson’s years as prime minister from
1964 to 1970 were remarkable for new thinking
and experimentation to improve Britain’s perfor-
mance in a mixed economy, combining state and
private enterprise. Wilson believed that govern-
ment had to become more interventionist and to
copy the indicative planning that had proved so
successful in Germany and France. Central to this
aim was the attempt to establish a link between
higher wages and productivity. Prices and incomes
were compulsorily regulated by a government-
appointed board set up in 1965. In March 1966
Wilson went to the country and succeeded in mas-
sively increasing Labour’s majority. But the fol-
lowing year the economy ran into severe trouble,
and sterling was belatedly devalued. The attempt
to coordinate national economic planning with a
Department of Economic Affairs (headed by the
deputy Labour leader George Brown) was in
ruins. Britain’s foreign and military commitments
‘east of Suez’ were cut in 1968. Wilson extended
state control and renationalised steel, a move
which in the long term cost the taxpayer dear in
subsidies. Low wages and workers’ discontent led
to many strikes. With the Labour Party financially
dependent on the trade unions, the government
could not put in place effective legislation to curb
their power, which was unbalancing industrial
relations. That was the biggest hole in Labour’s
planning for a more efficient Britain. Direct state
investment was not always successful, though pri-
vate industry did not always choose the right path
either. The merger of British car manufacturers
into Leyland only accelerated the downward path
of this once highly competitive and successful
industry. Wilson also tried to obtain Britain’s
entry into the European Economic Community,
but was blocked a second time when de Gaulle
vetoed the application in November 1967.
Labour paid particular attention to policies
designed to equalise opportunities for all Britain’s
young people. Schools were reorganised into
mixed-ability ‘comprehensives’; more successful
was Labour’s continuing commitment to the
expansion of university and higher education first
launched by the Conservatives. But the continu-
ing flaw was the lack of attention given to techni-
cal education: it was not accorded an academic
esteem equal to that of other subjects – which it
has long received in Germany, for instance. The
privileged private ‘public schools’ were not abol-
ished and so continued to underpin a class-based
society, though mobility between the classes did850 WESTERN EUROPE GATHERS STRENGTH: AFTER 1968
Gross national product, 1951–78 (average annual percentage rates of growth)Japan US Britain West Germany France Italy Netherlands
1951–73 9.5 3.7 2.7 5.7 5.0 5.1 5.0
1973–8 3.7 2.4 0.9 1.9 2.9 2.1 2.4