The Iron Lady

by John Campbell

  When in February 1990 de Klerk announced the immediate release of all remaining political prisoners, including Mandela, and the unbanning of all political organisations, including not only the ANC but the South African Communist Party, she regarded it as the vindication of her lonely struggle. To the Commons the day after Mandela’s release she insisted: ‘I do not think sanctions have achieved anything.’23 She immediately lifted those measures which Britain could rescind unilaterally and pressed European and Commonwealth leaders to follow suit. She was correspondingly disappointed that Mandela’s first speech before the massed cameras of the world’s press rehashed all ‘the old ritual phrases’ about socialism and nationalisation. She had hoped that he would now distance himself from the ANC; she should have realised that this was the last thing he was likely to do.24

  They finally met in July when Mandela visited London and called on the Prime Minister in Number Ten. Tactfully, he recognised that Mrs Thatcher had opposed apartheid in her own way, and thanked her for her efforts to get him released. He also thanked her for her role in Zimbabwe and in improving East – West relations, but urged her again to maintain the pressure on de Klerk for a negotiated settlement. She in turn urged him to give up the armed struggle, talk to Buthelezi and abandon the ANC’s commitment to nationalisation. When a reporter asked Mandela how he could talk to someone who had once denounced him as a terrorist, he replied that he was working with South Africans who had done much worse things than that. For her part, Mrs Thatcher found Mandela dignified and impressively unbitter, but still ‘stuck in a kind of socialist time warp’; she still feared he might turn out a ‘half-baked Marxist’ like Mugabe.25

  South Africa showed Mrs Thatcher at her best and worst. She was principled and courageous, but at the same time stubborn and self-righteous. She had a good case against sanctions but failed to win support for her view, preferring to lecture and thereby alienate potential allies rather than try to persuade them. Rather, she seemed to glory in her isolation, as if the fact of being isolated made her right. Her only powerful ally outside South Africa was President Reagan: but while he personally shared her Cold War perspective, South Africa was not an issue on which he wished to upset black America or pick a fight with Congress, so she got less help there than she might have hoped.

  Was she right? The outcome might suggest so. But most of those who supported sanctions still believe that they were an essential part of the pressure that eventually compelled white South Africa to change. Undoubtedly she played a part in persuading de Klerk to move as far and as quickly as he did. The night before his historic speech in February 1990 he passed a message via Renwick to tell Mrs Thatcher that she would not be disappointed. But her role should not be exaggerated: there were bigger forces at play. As with Gorbachev in Russia, she was lucky that a leader came along at the right moment whom she could appear to influence.

  The Middle East

  By the 1980s Britain had no remaining direct responsibility in the Middle East, but it was still a part of the world in which Mrs Thatcher took a close interest. She regarded Israel – like South Africa – as essentially part of the West: the only true democracy in the region, with a prosperous and enterprising economy, ringed by hostile neighbours and threatened by Palestinian terrorism. Her instinct was to class the PLO with the IRA and the ANC as terrorist organisations which should be treated as international pariahs until they abjured the use of violence. At the same time, however, she knew that the State of Israel had itself been founded in terrorism. She could not forget that the current Israeli Prime Minister, Menachem Begin, had been the leader of the Irgun gang which bombed the King David Hotel in Jerusalem, killing ninety-one British soldiers, in 1946, and swore never to shake his hand – though eventually she did. She also recognised that Israel had seized Palestinian territory by force in 1967 and had occupied it ever since in defiance of the UN. She was sympathetic to the fate of the displaced Palestinians – she had visited a refugee camp in Syria when she was Leader of the Opposition in 1976 – and believed, as a friend of Israel, that the Israelis would only secure peace when they were prepared to give up some of the occupied territory to get it. Her hope – as in South Africa – was to encourage ‘moderate’ Palestinians to come forward with whom the Israelis could negotiate.

  Whenever she visited the region, or received Middle Eastern leaders in London, she made a point of reporting to President Reagan her conversations and impressions. After visiting the Gulf in September 1981, for instance, she sent Reagan what his staff described as ‘a rather somber assessment of views she picked up during her recent talks with a variety of senior Arab political figures’. Richard Allen told the President he should read the whole letter, but summarised its main points for him:

  • A mood of disappointment and alienation now dominates moderate Arab thinking about the US. (Arabs hesitate to express the true strength of their feeling directly to us.)

  • The view prevails that we are one-sidedly committed to Israel and ignore the Palestinians.26

  This message, an aide noted, ‘calls for a response’. But two more letters followed before the White House got round to drafting a reply in which the President thanked her for ‘the candid insights that you have shared with me’.

  I understand the perceptions of the Arab leaders on the peace process alluded to in your letter. A comprehensive Middle East peace remains our objective, and I agree fully that one cannot be achieved unless it addresses the Palestinian problem.27

  The next month Reagan assured her that Israeli withdrawal must be ‘the fundamental basis of a settlement on the West Bank and Gaza’;28 and this was the premise of proposals which he set out in September 1982. But Mrs Thatcher never felt the Americans put enough pressure on Israel. The following year she was again giving Washington ‘her read-out on meetings with King Hussein in London… She makes a powerful case that the President weigh in with the Arabs to demonstrate again that we are committed to the September 1 proposals.’29 She was critical of Israel’s bloody invasion of southern Lebanon in June 1982, but equally sceptical of the value of the multinational – predominantly American – UN peace-keeping force sent to Beirut, and restricted British participation to a token contribution of just one hundred troops. The killing of 300 American and French troops by a suicide bomber in October 1983 only confirmed her view that they were a sitting target: she urged Reagan not to retaliate but to withdraw the multinational force.30 The next year he did so. In her memoirs she described the American intervention in Lebanon as a lesson in the folly of military action without a clearly attainable objective.31

  By February 1984, following the massacre of refugees in southern Lebanon, Mrs Thatcher’s patience with Israel was wearing thin. ‘Whenever there was a problem’, she told Caspar Weinberger, ‘it seemed that Israel annexed what it wanted. She urged that there should be a reappraisal of Israeli policy.’32 An opportunity arose later that year when Yitzhak Shamir’s hard-line Likud Government was replaced by a Labour – Likud coalition to be headed by Shimon Peres and Shamir in turn. At Camp David before Christmas she told the Americans that ‘she personally knew the new Israeli Prime Minister very well and favourably. Prime Minister Peres wanted to be constructive, and if we are to get anywhere in the Middle East we should attempt to do it while he is Prime Minister.’33

  In September 1985 she visited Egypt and Jordan to encourage President Mubarak and King Hussein to keep up the momentum for peace. ‘I felt that President Mubarak and I understood one another’, she wrote. She confessed to ‘some sympathy’ with his view that ‘the Americans were not being sufficiently positive’, and believed that King Hussein, too, had been taking ‘a real risk’ in trying to promote a peace initiative, but was being let down by the Americans.34 Before leaving Jordan she and Denis made a point of visiting another refugee camp. The following spring she paid her first visit as Prime Minister to Israel, where she was again impressed by Peres, but dismayed by Shamir – another former terrorist – who rejected any questio
n of giving up Jewish settlements on the West Bank in exchange for peace.

  In 1986 Shamir took over as Prime Minister.Visiting Washington the next year Mrs Thatcher again vented her frustration with Israeli intransigence and chided the Americans for acquiescing in it.

  She regretted that there had been no major Western initiative since the Camp David accords; noted that President Reagan’s 1982 speech had been superb but had been rejected by Begin; characterised Peres and Hussein as two positive figures who are doing everything possible to advance the peace process and deserve our support; and… asked rhetorically whether it was not timely to move forward by promoting an international conference.

  Shultz replied that it was no good promoting a new initiative without Likud support: the American approach was ‘to seek to find a way of getting Shamir and Likud on board’.

  Mrs Thatcher asked the Secretary whether he thought that Shamir ever intends to negotiate over the West Bank or Jerusalem or whether in fact it is Shamir’s view that all of biblical Israel belongs to modern Israel. If the latter, Shamir is simply holding the entire world ransom and there will never be negotiations…

  Mrs Thatcher characterised this position by Shamir as hypocritical because it denies basic rights to the Arabs and removes Israel’s credibility as the only Middle East democracy.35

  Mrs Thatcher got nowhere on the Middle East, but she deserves credit for trying. Despite her instinctive admiration for Israel and substantial dependence on her own large Jewish vote in Finchley, she saw that there would be no serious pressure on Israel to negotiate so long as successive US administrations were terrified of offending the powerful American Jewish lobby. She told the Americans so, with her usual frankness, but this was one area in which they did not listen to her. Far from withdrawing from the occupied territories, the Israelis carried on planting more Jewish settlements in the West Bank and Gaza. President Clinton made more effort than any of his predecessors to broker a real compromise. But nineteen years after Mrs Thatcher’s fall, hope of an Arab-Israeli settlement was as distant as ever. In her memoirs she reflected on the paradox of modern Jews denying others the rights they were so long and tragically denied themselves:

  I only wished that Israeli emphasis on the human rights of the Russian refuseniks was matched by proper appreciation of the plight of landless and stateless Palestinians.36

  Aid and arms

  Mrs Thatcher viewed the whole world through Cold War spectacles as a battleground for conflict with the Soviet Union, a struggle for geopolitical advantage to be waged by all means – political, cultural, economic and military. Whatever might be the particular local circumstances of different countries, she saw Britain’s role in every corner of the globe as helping the Americans to combat those they classed as Communists and support those regimes – however undemocratic and repressive – approved by Washington as friends of the West. As well as taking a high-profile role as a global evangelist for the wealth-creating benefits of free enterprise, she had two practical means of exerting influence in the developing world: the provision of aid and the sale of military equipment. She was sceptical of the former, and Britain’s aid budget declined sharply during her years in power. But she was a great enthusiast for the latter, and Britain’s share of the world arms trade grew spectacularly.

  Her attitude to aid mirrored on a global scale her suspicion of the welfare state at home. In defiance of the international liberal consensus which inspired the ‘North-South Commission’ chaired by Willy Brandt in the late 1970s, she believed that handouts from rich countries to poor countries merely propped up corrupt regimes and perpetuated dependency, instead of promoting free trade and enterprise which would enable the underdeveloped to develop prosperous economies of their own. Far from trying to meet the target agreed by all the industrialised countries (except the US and Switzerland) that they should raise their aid budgets to 0.7 per cent of GNP, she allowed Britain’s performance to decline from 0.52 per cent in 1979 to 0.31 per cent in 1989. Moreover, most of the aid that Britain did give was tied to British trade.

  What she most resolutely opposed was coordinated international action. In October 1981 a global summit in Cancún, Mexico, chaired jointly by the Mexican President and Pierre Trudeau, raised exactly the sort of hopes she was determined to dash. Mrs Thatcher only attended – and persuaded Reagan to attend – because she thought it important that they should be there to argue the free-market case; specifically, she was anxious to block proposals to place the International Monetary Fund and the World Bank under direct UN control. She and Reagan deliberately set out to ensure that the conference imposed no new commitments, and by that standard she was happy to pronounce it ‘very successful’.37

  A particularly effective way of killing two birds with one stone was by linking aid to the sale of arms. By this means she could boost an important British industry while simultaneously supporting regional allies and helping to counter Soviet influence. The arms trade was a perfect marriage of her two primary concerns. Particularly after the Falklands, Mrs Thatcher took a close interest in the products of the defence industry. Acting as a saleswoman for British arms manufacturers also gave her a useful entrée to Third World kings and presidents: she had something to sell which they wanted, and she enjoyed dealing personally, leader to leader, trading in the very symbols and sinews of national power. Normally the Defence Secretary was the frontman in negotiating these sales; but Mrs Thatcher’s role, as Michael Heseltine recalled, was ‘not inconspicuous’. Her part in clinching sales to Saudi Arabia, the Gulf States and Malaysia was widely reported, and he found her always very supportive. ‘I knew I had only to ask my office to contact No. 10 to wheel in the heavy guns if they could in any way help to achieve sales of British equipment.’

  In 1985 Heseltine, with Mrs Thatcher’s support, appointed Peter Levene, the managing director of his own arms-trading company, at an unprecedented salary to become head of defence procurement at the MoD. As a poacher-turned-gamekeeper, Levene earned his salary over the next six years by forcing down the prices the Government paid for military equipment. One way of cutting the manufacturers’ costs was by helping them sell their products around the world. Partly as a result of his efforts Britain climbed during the 1980s from being the fifth- to the second-largest supplier of military equipment after the United States. But Mrs Thatcher herself set up many of the biggest and most contentious deals, including major contracts with King Hussein of Jordan, General Suharto of Indonesia and General Augusto Pinochet of Chile. She lubricated these deals by soft loans and vigorous use of the export credit system. The result was a less good deal for the taxpayer than at first appeared. Many of the arms supposedly purchased – by Jordan, Iraq and probably others – were never paid for at all. Even before the Gulf war intervened, Nicholas Ridley admitted that Iraq owed £1 billion and the true figure may have been nearer £2.3 billion.38 In practice Mrs Thatcher was subsidising British companies with public money – something she refused to do in other areas of industry.

  Her greatest coup was the huge Al-Yamamah contract with Saudi Arabia, negotiated in two parts in 1985 and 1987, said to be the biggest arms deal in history, worth something like £40 billion to British Aerospace and other British companies, and partly paid for in oil. Mrs Thatcher met Prince Bandar, a nephew of King Fahd and son of the Saudi Defence Minister, at least twice in 1985, once in Riyadh in April, the second time in Salzburg in August, when she was supposed to be on holiday. On the announcement of the first part of the deal – for forty-eight Tornado fighter/bombers, twenty-four Tornado air-defence aircraft, thirty Hawk advanced training aircraft and thirty basic training aircraft – Heseltine told the press that Mrs Thatcher’s contribution ‘cannot be overstated’.39 She secured the second part at a stopover in Bermuda on her way to Australia in 1988. Given her usual readiness to boast of her achievements, however, it is curious that this went unmentioned in her memoirs.

  The obvious reason was embarrassment over reports which soon emerged of huge c
ommissions, running into millions of pounds, paid to middlemen – among them her own son. Mark’s business interests had already attracted attention in 1984, when questions were raised about a large contract for the building of a university in Oman, which Mrs Thatcher had personally secured on her visit – with Mark in attendance – in 1981. The company principally concerned was Cementation Ltd, for which Mark was then acting as a ‘consultant’. With no relevant qualifications or experience, his only possible value was his contacts, and specifically his name. ‘We did pay him,’ the company admitted, ‘and we used him because he is the Prime Minister’s son.’40 In the Commons and on television Mrs Thatcher indignantly denied any impropriety: she had been ‘batting for Britain’ not for any individual company, and Mark’s activities were his own affair.41 In fact, since Cementation was the only British company bidding for the university contract, this defence was disingenuous. Mrs Thatcher must have known that her son stood to profit if Cementation won the contract, though that is not necessarily to say that she should therefore not have lobbied for them. The allegation that Mark was enriching himself on the back of his mother’s patriotic salesmanship, however, did not go away. Much bigger sums were involved five years later in the Al-Yamamah contract, from which Mark was alleged to have pocketed £12 – 20 million for his role as a ‘facilitator’. There is no doubt that he became inexplicably wealthy around this time, nor that he and his partner were active in the arms trade and in the Middle East.42 The evidence is only circumstantial, however, since an investigation of the Al-Yamamah deal by the National Audit Office was never published.