Smith-Saville criticizes Thatcher for another incentive she jettisoned. Before she took office, businesses received a 100% capital-investment credit against taxes. "If you were growing a company fast and buying a lot of equipment, you could offset that against your taxes," he says. "You could put your money into expanding the business."
Back in London, the brain trust at Advent Ltd. -- a sister corporation of Advent International Corp., based in Boston -- raises different concerns about the depth of the Thatcher revolution. Advent is one of the largest of Britain's venture capital firms. It has plenty of money -- more than $200 million. What it does not have are enough capable managers to run the companies it wants to finance.
Much of the U.K. intelligentia works in the City of London, Britain's Wall Street. Law and accounting firms skim off much of the rest. Business gets the leftovers, and most of them are ensconced in large companies, held in place by big salaries and pensions.
John Nash, an Oxford-educated lawyer, is managing director of Advent Ltd. and the new chairman of the British Venture Capital Association. He sees the shortage of entrepreneurial managers as a potential obstacle to the country's continued growth.
"The venture capital industry in the U.K. has grown faster than the U.S. industry has ever grown in relation to the economy," Nash says. "There are many proposals, but the strike rate of investing in deals is quite low, and the reason most often given for not investing is the lack of adequate management. So we have got to attract managers out of big companies and into small companies, but it is hard."
Advent has done that in many cases. "On day one, that small company is really overmanaged," Nash says. "But the principle is that if it grows quickly, it won't stay overmanaged for long. After a month, most of these chaps will tell you it was the most dreadful mistake they had ever made. The culture shock is extreme. But nine months later, they all say it was the best thing they've ever done. They wish they had done it years ago."
How Britons react to this culture shock may determine if Thatcherism will outlive the Iron Lady and make a lasting impact on Britain. "If you scratch most English people, they would like to have the manor house in the village with the pub around the corner," says John Bates. "So the longevity of this sudden business craze is very much in question. To sustain it means looking constantly at business, at cost positions, at marketing.
"You can't just get there and think it's all done, which is the English disease. It's this 'squirarchy' thing again -- that one day you will have made it and you can sit back and do nothing."
That there even exists a new role model to fuel this debate is a startling development for Britain. A decade -- Thatcher's tenure to date -- is not much time to bring about fundamental change in a country like Britain. But it's clear she has started.
THATCHER'S BRITAIN: BY THE NUMBERS
1979-80 1988
Inflation rate 13.4% 4.8%
Unemployment rate 5.2% 8.2%
Real GNP £20 bil. £93 bil.
Venture Capital (1981
data) £66.3 mil. £894 mil.
1979-80 1988
Net business formations 16,100 45,000
Interest rates 13.6% 12%
Output/person employed 104.1 146.5
Top income-tax rate 83% 40%
* * *
THE DARK SIDE OF THATCHERISM
The new prosperity has deepened Britain's social divisions
Every revolution has its losers, and Margaret Thatcher's is no exception. Under her leadership, Britain has grown wealthier and more entrepreneurial. But the rising tide has not lifted all boats.
In Britain today, one hears repeatedly about the great divide between the prosperous south and the depressed north. The heyday of British manufacturing saw the flourishing of the big cities in the north -- Liverpool, Manchester, Glasgow, and others. But as heavy industry declined, these cities slid into decay. And saddled as they are with the decrepit infrastructures of a bygone era, they have not fared well in an economic resurgence built largely on a boom in the service, financial, and high-technology sectors.
"Those cities are depressing environments in which to launch a new business," says Robin J. Smith-Saville, who established his satellite-equipment company in the aesthetically pleasing Cambridge Science Park, in the south. "It's nice to get a fresh start."
While overall unemployment in the United Kingdom is 8.2%, it is more than 10% in Scotland and in the old northern industrial cities. While the government has spent heavily to rebuild the region, Thatcher still preaches self-help, thrift, and discipline. Addressing one Scottish group, the prime minister quoted St. Paul: "If a man will not work, he shall not eat."
It's not that Britain has resorted to Darwinian survivalism; social welfare programs still take a third of the national budget. But cutbacks such as those in housing and university scholarships have angered many Britons.
Many people are frozen out of the housing market in southeast England, where a surge in prices has brought valuations to the levels of such expensive U.S. cities as San Francisco or Boston. Even in London, the epicenter of the boom, there are signs of dismay. Prince Charles himself has decried the antiseptic coldness of the tinted-glass office buildings rising along the Thames River.
A change in spiritual values, a degradation of manners and dignity, also trouble people there. In a recent column in The New York Times, writer Bernard Nossiter concluded that it is "impossible to write any longer of civility as a distinguishing British characteristic."
Social commentator John Rae, former headmaster of Westminster School, says Thatcher "has enabled the English to realize that they are not a very nice people. You musn't have the impression that England is full of gentlemanly people -- it's not. They are a greedy, acquisitive lot. That part of the English ch
