By 1978 the UK's economy was improving and it had been four years since the last general election, so Prime Minister James Callaghan's decision not to call an election was as a surprise to many at the time. He thought that the economy would improve further in 1979 and therefore waiting would strengthen his Labour Party's chances, but the opposite occurred and Margaret Thatcher's Conservatives came to power after a no confidence vote triggered an election. What if, as expected, Callaghan had called an election for the fall of 1978?
WI: Callaghan Calls a General Election in 1978
- Thread starter Amadeus
- Start date
Narrow Labour victory. More moderate MPs survive, so when Callaghan steps down in 1980 or so, he gets Healey, his preferred successor. North Sea oil can be used to buy off the Left. The Falklands are averted because Thatcher's defence cuts never happen.
Thatcher gets rolled by the Tories, and becomes little more than a historical footnote.
Thatcher gets rolled by the Tories, and becomes little more than a historical footnote.
Either that or a hung Parliament, and Labour is forced to form a coalition with the Liberals.
The polls were showing a mixed picture, to the extent that Callaghan wasn't confident enough of a positive outcome to go for it. I tend to think that Labour would have had a close call between a hung parliament and a small overall majority. In other words, an outcome similar to October 1974, which would have led to a collective thought of 'what was the point?'?
Nevertheless, this would open up the possibility of a 1980s Labour government with something of an economically rationalist agenda; Callaghan had made hints towards this in his 1976 conference speech, in which he essentially dismissed Keynesian orthodoxy.
Nevertheless, this would open up the possibility of a 1980s Labour government with something of an economically rationalist agenda; Callaghan had made hints towards this in his 1976 conference speech, in which he essentially dismissed Keynesian orthodoxy.
A couple of points:
- Callaghan's OTL 1979 campaign was brilliant. Doomed, of course, but brilliant. I'd back him over Thatcher in a 1978 campaign, where the "it's not broken, don't fix it" line would have far more resonance.
- I think the best analogy for a 1980s Labour Government would be the Hawke-Keating Government in Australia. Left-wing grumpiness about deregulation would be bought off with North Sea Oil and electoral success (though I doubt UK Labour would ever dabble with privatisation).
I agree that you're probably looking at a hung parliament or narrow Labour majority. In Labour's favour, and contrary to some early accounts, Labour narrowed the Tories' support in the polls during the 1979 election from 50% to 43% and Callaghan was consistently more popular than Thatcher. So I wouldn't take the 1978 polls as gospel and think that Labour could have done better and secured a majority.
I disagree with the optimism about a continued Callaghan government - an election delays the Winter of Discontent due to union support but a similar event in 1979-80 is highly likely as government attempts to restrain pay had reached breaking point and a new generation of union leaders was less willing to compromise. The failure crushed Callaghan OTL and it's difficult to see what meaningful action the government could take at this point other than to muddle through and tolerate a return to the inflation of the Heath period. I can't see Callaghan securing support from his party for trade union reforms. North Sea Oil will help with balance of payments but at the expense of the exchange rate and industry, so possible that unemployment continues to rise slowly, but not reaching quite the heights it did under Thatcher. IIRC Callaghan had plans for Owen to be Chancellor and Healey Foreign Secretary if Labour won an election, and also proposed splitting the Treasury into two separate finance and economic ministries.
Conservatives probably win comfortably in 1982-83, either under Thatcher if she can hang on or Whitelaw. Perhaps even Heseltine but that may be wishful thinking as he was never hugely popular in the parliamentary party.
I disagree with the optimism about a continued Callaghan government - an election delays the Winter of Discontent due to union support but a similar event in 1979-80 is highly likely as government attempts to restrain pay had reached breaking point and a new generation of union leaders was less willing to compromise. The failure crushed Callaghan OTL and it's difficult to see what meaningful action the government could take at this point other than to muddle through and tolerate a return to the inflation of the Heath period. I can't see Callaghan securing support from his party for trade union reforms. North Sea Oil will help with balance of payments but at the expense of the exchange rate and industry, so possible that unemployment continues to rise slowly, but not reaching quite the heights it did under Thatcher. IIRC Callaghan had plans for Owen to be Chancellor and Healey Foreign Secretary if Labour won an election, and also proposed splitting the Treasury into two separate finance and economic ministries.
Conservatives probably win comfortably in 1982-83, either under Thatcher if she can hang on or Whitelaw. Perhaps even Heseltine but that may be wishful thinking as he was never hugely popular in the parliamentary party.
Last edited:
Would the Falklands War still happen under a Callaghan government, and if it did how would a Labour government respond?
It's less likely, Callaghan was a naval man who took a close interest in the Falklands: https://en.wikipedia.org/wiki/Operation_Journeyman
If there is no Falklands war, then the Tories would have a good chance of winning in 1982. An important question is whether or not Thatcher resigns after losing in 1978.
Also, I wonder what Callaghan's relationship with Reagan would've been like.
He did have good relations with Ford and Carter but Reagan's background might have been tricky.
Reagan might be more likely to contrast his conservative vision of America with Callaghan's socialist government in England in order to discredit liberal critics at home.
So, Callaghan calls an election in 1978 and the most likely results are either a Labour majority or a Labour-Liberal coalition. Callaghan continues into the 1980's as PM. The next election would probably be held in 1982. I think the early 1980's British economy would be better without Thatcher, but economic conditions still wouldn't be very good. As a result the Tories have a decent chance of re-taking power in 1982, unless the Falklands War breaks out on Callaghan's watch and the election is held afterwards - in which case Labour might be able to win a third term. But by 1986/87 the Tories would probably return to power.
Given how chaotic things had been in the 1974-78 period, people would see it as humiliating that the Tories couldn't make any significant gains. So she would probably have to resign, and the right of the party would be discredited also. The Tories would probably win back power next time around, and some form of monetarism would be implemented (probably by the Labour government at first) but 'Thatcherism' wouldn't be a thing, which likely means a less divisive 1980s, even if the UK ends up in a broadly similar situation at the end of it.
Maybe not at the same time as IOTL, but the mixture of highly unionised workforce, a declining industry, the fact that the NUM was led by an uncompromising hardliner like Scargill, and the precedent of 1974 which shows that the miners can bring down the government will be highly likely to combine to create some form of major industrial action from the miners sooner or later. The big difference will be in how the government might approach the situation if there is a Tory Wet or even Labour PM.
