She, like Ronald Reagan, thought that business owners were so much better at running things, and they wouldn’t waste money. Therefore the government wouldn’t have to tax people so much, and then people would grow more prosperous, and everybody would live happily ever after.
This is the grand lie of neoliberalism and it hinges entirely on the belief that a sovereign currency-issuing government functions like our own financial budgeting. Because people have a very thin grasp of economics, especially at the federal/national level. It was a fairly easy sell to explain why a "wasteful" government took assets from the people/taxpayers without returning a good value.
Thatcher even explicitly said, "There is no "public money", only taxpayer money" in her attack on her government's spending. This completely ignores the role of government as a service and its ability to create unlimited amounts of money after the gold standard was made obsolete in '71 when America left the Bretton-Woods agreement. America had been using a fiat money system domestically since '34 to fund the programs needed to overcome the depression, which was largely responsible for its post-war stability.
This level of ignorance cannot be written off by "misunderstanding" how monetary systems work. At the level where experts are available to politicians on demand, it can only be explained by a willing disregard for the "people and their economic well-being" in deference to the wealthy investor class and their corporations. The "people's" economy has suffered in extremes while the wealthy seem only able to accumulate more wealth.
Because they were lied to, the people missed the "FACT" that every dollar their government spends in deficit (without being taxed away) is a payment to the private sector for the real resources and labor their governments demand use. A balanced budget is another way to say "steal" because their tax payments cannot both fund their government AND reduce the debt that created the money.
ALL new spending is newly created money and the debt is nothing more than a record of money in circulation. Collecting taxes, or borrowing via bonds, destroys money and new spending creates money. End of story at the federal level. Every dollar/pound spent above tax collections becomes someone's monetary asset in the private sector, not a debt the government must, or even can, repay.
This means that austerity to "save" money results in "FEWER" dollars/pounds in the private sector economy, not more. ANY suffering in a fiat currency economy that can be mitigated by creating more currency is a "POLITICAL CHOICE" made by someone in power that WANTS that suffering to continue.
