(FORTUNE Magazine) – ALL THAT Margaret Hilda Thatcher wanted to do was change ''everything,'' as she once snapped to a questioner. She hasn't. But Thatcher has come closer to her goal than anyone would have imagined when she became Prime Minister in May 1979. Bookies, pollsters, and international investors who have sent London stock prices skyward are betting that when British voters go to the polls June 11, they'll give her an unprecedented third consecutive term, five more years at No. 10 Downing Street. The election is a referendum on the policies as well as the forceful personality of the woman called the Iron Lady. It is worth looking back to assess just what she has wrought. By the macro numbers, it doesn't look like much of a revolution. Between 1979 and 1986, Britain's economy grew at an inflation-adjusted rate of only 1.4% a year. That's an indistinguishable improvement on the 1.3% a year from 1973 to 1979. And it trails average growth rates of 2% in the U.S. and 1.7% in the rest of Europe since 1979. Though inflation dropped from 22% in 1980 to a low of 3.4% last year, the price was a wrenching recession. Nearly two million workers, mostly in manufacturing, were shoved onto the dole in her first two years. Stubbornly high unemployment -- 3.1 million in a labor force of nearly 30 million are out of work -- remains Thatcher's biggest electoral liability. But those numbers hardly tell the whole story. If Thatcher cannot yet claim to have reversed Britain's decades-old decline in competitiveness, she can at least boast of halting it. Since Britain pulled out of recession in May 1981, the economy has grown at an annual rate of 3% a year -- second only to Japan among industrial economies. And unlike Ronald Reagan, she has proved herself a model of fiscal rectitude. Since peaking at 6% of gross domestic product in 1981, Britain's budget deficit has been trimmed to just 1%. The U.S., which uses GNP, a measure that includes income from overseas investments, is still saddled with a deficit of around 5%. Thatcher shrank Britain's deficit mostly by using the $16-billion windfall from selling state-owned companies, as well as North Sea oil revenues, rather than by pushing through spending cuts of the sort no modern welfare-state politician seems able to deliver. Still, the lower deficit does provide Thatcher -- or her would-be successors -- with a solid foundation for future economic expansion. Most significantly, this self-described ''conviction politician'' and devotee of ''Victorian values'' has, as even her fiercest critics acknowledge, profoundly changed the social and political climate. No longer, for example, do thinking Britons wonder whether any elected leader can govern without the consent of the miners or the transport workers. In a poll taken just before the 1979 election, 73% of respondents declared that union power was the most serious problem facing the new government. Now only 1% think so. Thatcher wasted little time taking on the militant labor leaders, whose constant wildcat strikes and insistence on restrictive work practices helped make British industry the world's laughing stock. She pushed through Parliament legislation that among other things forced union leaders to poll members before calling a strike. So-called sympathy strikes by other unions were banned. To ensure that the new laws would not be deliberately flouted, she successfully withstood a tumultuous and costly year-long strike led by avowed Marxist Arthur Scargill of the National Union of Miners. Scargill's union had brought down two governments in the 1970s -- one Conservative, one Labour. Manufacturing productivity picked up sharply. Since 1979 output per worker has climbed at an annual average rate of 3.5%. Though most industrial countries have experienced similar rises, Britain's improvement has been particularly significant when compared with the country's Sobering Seventies, when manufacturing productivity grew at a pale 0.75% a year. Thatcher can claim a lot of the credit. Over the past eight years her policy of privatization has transferred from public to private hands 14 big companies and scores of smaller ones, employing some 600,000 workers and accounting for roughly 5% of national output. At the same time Thatcher has generally hewed to the principle -- rarely observed by either her Tory or Labour predecessors -- that managers in private industry as well as Britain's remaining state- controlled companies should be free to determine work rules and employment levels without political interference. The benefits of these policies have reached most sectors of the economy. In a recent study the Institute for Economic Affairs found that the productivity of Britain's nationalized industries grew faster between 1978 and 1985 than at any time since 1960, and in most cases surpassed the average for all manufacturing. British Steel, not so long ago Britain's most expensive white elephant, is now exporting 40% of its output even though it is still nationalized. It earned some $250 million last year with just one-third of the work force of 1980, when it lost $1.5 billion. Jaguar, privatized in 1984, last year earned more than $180 million -- vs. a loss of $62 million in 1981. Having laid off some 15% of its work force, chemical giant ICI, Britain's leading exporter, reports that profitability per employee has risen 260% over the past six years. For those with jobs, the productivity increase since 1979 has produced a 15% rise in real disposable income -- an increase that goes a long way toward explaining Thatcher's appeal to a sizable segment of voters. For the unemployed, however, the payoff will come only if Britain's manufacturers can expand capacity -- something they have not yet been able to do -- and still keep pushing up productivity at 4% to 5% a year. ''Unless that happens, it's premature to talk about a productivity miracle in Britain,'' says Keith Skeoch, chief economist for James Capel, a top London brokerage house. In ways that never appear in the macroeconomic statistics, Thatcher has reduced the intrusiveness of the state and increased individual freedom. Gone are the rigid controls on foreign exchange that conventional wisdom said couldn't be lifted without devastating the economy -- until Thatcher lifted them early in her first term. Gone also are the price and income controls used by both Tories and Labour to fight inflation. Though she's no Arthur Laffer -- she defended a decision to raise taxes in the depths of the 1980 recession by declaring that ''taxation is the only moral way to pay for higher spending'' -- Thatcher did reduce Britain's top tax rate from 83% on salaries and 98% on unearned income to a less confiscatory 60%. By establishing an atmosphere in which the creation of wealth is applauded rather than derided, the grocer's daughter from the small town of Grantham, Lincolnshire, has prompted a revival of entrepreneurship. The ranks of Britain's self-employed, which shrank by 100,000 during the 1970s, have swelled by some 800,000 the past eight years. The rate of net new business start-ups is about 600 per week. With Thatcher's blessing, if not her active intervention, thriving new over-the-counter markets and independent venture capital funds have sprung up to fuel small companies and help ambitious managers get rich. THATCHER'S CRITICS charge that her rigid faith in the free market and her emphasis on individual responsibility have somehow ''polarized'' the populace -- a strange charge in a country where class consciousness is still remarkably strong. If anything, one important thrust of the ''ism'' known as ''Thatcherism'' has been to try an end run around traditional Tory paternalism and the welfare-state dependency of Labour by swelling the ranks of the country's property-owning capitalists -- expanding the middle class. Thatcher has sold off some one million government-built houses to their former tenants. Through a combination of razzle-dazzle P.R. and bargain-basement pricing, her privatization program has tripled the number of individual Britons who own stock. Perhaps the best measure of Margaret Thatcher's impact is the extent to which she has nudged the economic debate in Britain rightward. Both the Labour party, under the leadership of moderate Neil Kinnock, and Britain's rising third party, the Social Democratic/Liberal Alliance, led by David Owen and David Steel, stress fiscal responsibility. Labour has ceased insisting that it would renationalize everything Thatcher privatized -- now it calls for ''social control'' only of two utilities, British Gas and British Telecom. Kinnock says he would not increase the top tax rate, and the party no longer talks of reimbursing unions that paid fines for violating Thatcher's labor laws. The opposition leaders mostly resort to attacks on Thatcher's unfeeling style and her very un-British bossiness. They have plenty of company. A foreigner is constantly struck by how many Britons, even among those who say they plan to vote for her, volunteer their dislike for Thatcher's arrogance. & Yet it may be that very trait that has given them something they have lacked since the end of World War II -- pride.