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Margaret Thatcher leaves lasting fiscal legacy

Londoners on Monday marked the death of Margaret

Londoners on Monday marked the death of Margaret Thatcher, who led Britain through war, a miners’ strike and poll tax riots. (April 8, 2013) Credit: Getty Images

Margaret Thatcher transformed Britain's economy over her 14 years as prime minister.

She introduced free-market policies to help the country throw off a postwar malaise. She shook up the cozy world of banks and brokers with a flurry of deregulation that made London one of the world's pre-eminent financial centers.

But while Thatcher ushered in an era of unprecedented economic growth, her legacy on economic issues remains divisive. Some argue her policies sowed seeds for the 2008 fiscal crisis. And she is still reviled by unions who say she ignored the needs of workers and the poor.

"To supporters, she changed Britain from a nation in long-term industrial decline to an energetic, dynamic economy. To opponents, she entrenched inequalities between the regions and classes, and placed the free market above all other concerns," Richard Carr, a political historian at Anglia Ruskin University said in statement.

When Thatcher arrived at 10 Downing Street in May 1979, Britain's first woman prime minister set about smashing the existing economic order. She rejected the way economic policy had been conducted since the end of World War II in favor of a free market ideology prevalent in the world today.

The woman who said she learned to be careful with money by watching her greengrocer father, sought to reduce the government's footprint in the economy, diminished labor unions' powers and overhauled London's financial center.

In 1986, Thatcher pushed through a flurry of reforms, the so-called Big Bang, which broke up the "boys' club" culture that dominated the City of London. "The Big Bang paved the way for the spectacular growth of the financial services industry in the U.K.," said Iain Begg, a professor from the London School of Economics.

Those free market policies were embraced by subsequent governments, even by the left-wing Labour Party administrations under Tony Blair and Gordon Brown.

Her commitment to free markets led her to sell off a raft of state-owned industries and to cut taxes. Britain's economy started growing again and unemployment fell. But society was riven with huge divides, and many of the state resources that ordinary people relied upon were starved of cash.

On one issue many Britons would still agree with Thatcher: Her stubborn rejection of the euro, Europe's common currency. Thatcher famously rejected any notion that Britain might give up the pound.

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