Britain's honeymoon with Mrs. Thatcher on the wane

Nine months after the general election that brought Prime Minister Margaret Thatcher's government to power, the honeymoon appears to be over. Mrs. Thatcher is an admirable woman," said an executive for a British battery manufacturing firm in the Midlands, "but . . ." The "buts" are surfacing -- not only from trade unionists and Labour Party supporters, but also from the Conservative-voting, center-right business community that helped her to power.

This correspondent's conversations with businessmen in and out of London uncover doubts that the government's monetary policy -- particularly visible in high interest rates, reduced public spending, and increased sales tax -- will really be able to arrest the country's 17 percent inflation rate and gradual economic decline.

Many, echoing a recent speech by Home Secretary William Whitelaw urging supporters not to be "cast down," still side with the government.

A director of a world-famous pottery firm calls this "a period of adjustment." A Birmingham automotive executive sees it as "a hiccup." But the old post-election zest is tempered with serious uncertainty.

As in public, so in the Cabinet. After months of apparent unanimity, the veil of Mrs. Thatcher's government is beginning to rend. Observers now are catching glimpses of some deep internal disagreements among her close associates.

The cause of the rent is a fairly mild employment bill now grinding its way through parliamentary gears. The principals in the tug of war are lining up behind two strong men: Employment Secretary James Prior, who preaches moderation and a gradual wooing of trade union support, and Chancellor of the Exchequer Sir Geoffrey Howe, known for his hawkishly right-wint views and for having Mrs. Thatcher's ear.

The bill, promised in the Conservative Party election platform last spring, seeks to redress what many see as the lopsided imbalance of power favoring unions over employers.

Mr. Prior's bill promotes secrets ballots in union elections, reduces the power of the "closed shop" by allowing individuals broader grounds for refusing to join a union, and curtails "secondary picketing" at places of work other than one's own.

Because it does little more, it is controversial. To Cabinet hawks, Mr. Prior's approach (he once endured the label "Pussyfoot Prior") offers too little , too late.

The six-week-old steel strike is sprawling over into other industrial territory through secondary picketing. And promising talks between unions and British Steel Corporation (BSC) management collapsed Feb. 8 into a heap of bitter recriminations. Tory hardliners are calling for either a tough new act driven through Parliament at breakneck speed or a considerably sharper set of teeth imbedded in Mr. Prior's bill.

But the employment secretary, who has staked his reputation on his ability to get along with unions, argues strongly for what the press calls his "softly, softly" approach. "The great mistake," he told a small group of American journalists at a recent luncheon, "is to think that you've only got to change the law to get the right answers." Promising stronger laws later, he counsels gradual wooing of support now. "It's the pace of change rather than change itself that sometimes worries me," he said.

So far, he has won several victories -- including one at a meeting of the right-leaning 1922 Committee of conservative backbench members of Parliament. His debate with them included what some observers called the best speech of his career.

But the hawks are still circling. In a speech Feb. 9, Sir Geoffrey took his case beyond the Cabinet chambers and into public view. "It would be fatal to Britain's chances," he said in undisguised reference to his colleagues on the dovecote, "if this government lost its nerve and neglected its clear duty to take in hand the necessary reform of the law." Particularly galling is the fact that Sir Geoffrey did not secure the customary approval of the speech by his Cabinet colleagues.

Mr. Prior is known to feel that the economic ministers, and Industry Secretary Sir Keith Joseph, are not true representatives of the label "conservative" -- that they are headed down a radical path sloping too steeply to the right. In this, he apparently has support from Sir Ian Gilmour, the Lord Privy Seal; who argued in a recent speech at Cambridge that pure "economic liberalism" -- of a sort dear to hawkish hearts -- is dangerous "because of its starkness and its failure to create a sense of community."