"The most important shifts in policy since 1945 have not occurred at elections, but between them." If so, why?

Sir Lewis Namier, the great parliamentary historian, once described elections as "locks on the river of British history, controlling the flow of events." In terms of historians' landmarks, it used to be the case that the key dates in history were given by the crowning of new monarchs. This has since changed to the timing of general elections as an increase in Parliament's power vis-�-vis the monarch has occurred and the extension of the franchise has turned Britain into a modern democracy (current arguments for constitutional reform notwithstanding). Yet it appears to be the case that this is no longer a satisfactory explanation in deciding where to look to find the key events in politics over time. Since 1945, the growing interdependence of countries, especially in economic terms, has left them exposed to external shocks that has left a great deal of uncertainty surrounding the ability of a government to implement the programme it was elected to do, as it may be too busy dealing with these new crises to maintain a clear sense of direction. It certainly seems when examining a chronology of the major events in post-war history that few of them coincided with elections, which suggests that the latter may not decide as much as initially appears the case (and certainly less than campaign rhetoric would indicate). Events in both economic and political spheres such as the devaluations of sterling in 1949, 1967, and 1992, the Korean, Falklands, and Gulf Wars (1950, 1982, and 1991 respectively), industrial unrest throughout the 1970s and early 80s have not been associated with elections, yet have often produced changes in and/or reversals of policy from the government of the time. Thus, unless we can determine that there were key changes in political direction at the majority of the post-war elections, it is clear that the hypothesis in the title above is correct.
Perhaps the only important election results where it is possible to say that the victory of one party resulted in a radically different set of policies being pursued than would have been the case had the election gone the other way are Labour's landslide in 1945 and Mrs. Thatcher's victory in 1979. At these elections, there were clear differences in the programmes being pursues by both parties. In 1945, the Conservative party was not committed in any way to Labour's vision of a mixed economy with a widely extended welfare state; instead, if Churchill's caretaker government established in the run-up to the election is any indicator, its programme would have been highly orthodox and cautious, lacking serious content; neither progressive nor innovative. Again in 1979 there was a clear divergence between the new-Right monetarist philosophy being espoused by Thatcher in comparison with the contemporary orthodoxy of a discredited Labour government that had presided over the "Winter of Discontent." Apart from these two instances, elections gave rise to a transition between administrations that were broadly agreed on many policy issues, and thus there was no abrupt change in the country's direction synonymous with discontinuous policies pursued by radically different governments. The reason behind this continuity lies in the new middle-ground of politics created by World War II on which the parties must now compete for the votes of the middle-classes that research has shown carry the balance of power in most constituencies. This necessity for moderation, driven by the desire to gain power, lead to a gravitation towards the centre by both parties. Even when the electoral shocks outlined above occurred, the result was a gravitation towards the policy of the victor; hence by the 1950 election, the Conservatives had accepted the mixed economy and welfare state, and despite a lunge to the left in the 1980s, Labour had moved back to the right towards the Conservatives position by 1997, which played a large role in explaining their victory. Thus it is reasonable to conclude that elections do not produce radical changes in policies, or at least not on the macroeconomic and foreign policy fronts (perhaps the most important policy areas of any government). The question therefore is to decide what factors constrain a change of policy whilst in office.
The first set of reasons concern purely selfish political issues and domestic politics. Firstly, a party is elected to government in order to carry out the policies it campaigned on during the general election. Its mandate is to pursue these policies, and look after the interests of the country in the case of any unexpected circumstances arising. Were it to alter significantly its policies without any compelling reason to do so, it can safely be argued that it is not within its remit to do this, and thus could reasonably expect losses at the subsequent election. Secondly, an administration that seems to be prevaricating and indecisive is immediately vulnerable to attack from the opposition; strong government is preferred by the electorate, who entrust a lot to their elected leaders. Thirdly, the ability to pass controversial legislation is constrained by the likelihood of securing a majority in parliament, which in certain cases where a party's majority is small or there is dissent within the party, cannot be guaranteed. Fourthly, ministers when in office are immersed in their official duties, and lack time to develop new programmes or policies. Even when this duty is passed to think-tanks, focus groups, or even the Civil Service, the relevant minister then must evaluate the proposals, again, a time-consuming task when set against the minutiae that must be addressed just to ensure that the machinery of government is proceeding smoothly. So another constraint is the time available to ministers to actually generate and think through new policies. Finally, there is the difference between being in government and being in opposition. Elections are for governments to lose, and not oppositions to take. The electorate will judge the government in its record in power, and not the opposition's likely fate. It is easy when having lost an election to alter policies in order to regain support lost; when winning an election, it is difficult to ignore the status quo and reverse policies that have proven popular when enacted by the previous government. Yet even opposition parties will not alter policies in the run-up to an election - again, this indicates indecisiveness, which will not endear the party to the electorate.
As was alluded to above, it is external and unexpected events that occur mid-way through a term of office that are the most common cause of changes in policy, and can be damaging enough to provoke a response that is sometimes entirely the opposite of what was initially the stated course of action of the government. Attlee's administration was seen by some at the time to be working towards the goal of a social commonwealth, that would be achieved initially through policies of a mixed economy and the welfare state. However, the economic problems of the late 1940s, exacerbated by the severe winter of 1946-7 forced a reassessment of the party's policies and priorities. The dogmatic pursuit of ideology gave way to pragmatism that saw the abandonment of physical planning in favour of demand-management primarily through fiscal means. In this way, the mixed economy became an end rather than a means, and was to be a point of consensus until the mid-1970s. Due to this forced pragmatism which to some extent all government's must adopt when involving themselves in the daily routine of the exercise of power, is the difficulty involved in maintaining a sense of direction amidst the short-term crises. Another point that can be drawn from the experience of the Attlee government, and indeed, Thatcher's forced retreat from dogmatic monetarism in the early 80s because of recession, is that even those who have a radically different programme are affected by external factors as much as those with a "steady-as-she-goes" approach to policy-making. The effects of a U-turn are, however, as acutely embarrassing for either type of regime. For evidence of this, we need only look to the indignity suffered by the Wilson, Heath and Callaghan governments, forced respectively into humiliating climb-downs over sterling, industrial relations, and an IMF rescue package respectively. What is noteworthy about these instances is the source from which the tension came, namely the economy, which indicates the long history, dating from at least as early as 1947, of policy changes provoked by industrial unrest or inadequacy, which in turn were the result of the relative decline in Britain's international economic standing. It is perhaps a historical irony that the pressure for political conformity failed to produce clear initiatives for halting this economic decline, and thus there was a sense in which the policy-changes mid-term were inevitable due to the reluctance to address this issue in a decisive manner for fear of electoral failure. However, there is also an argument that says that it was simply a matter of misidentification that led to this self-fulfilling prophecy; had anyone identified policies for arresting the long-term slide in the economy, they could have adopted them and redefined the economic consensus in a similar manner to Attlee and Thatcher, thereby hopefully preventing the need for such costly reversals of policy on economic grounds.
The above analysis may give the disconcerting impression that elections are irrelevant and thus unnecessary in determining the direction of the country. Lending this argument weight would appear to be the similarity in government policies between countries, regardless of the political creed of the party in office; witness the same reforms implemented in Britain under Thatcher being acted on in Australian and New Zealand by the Labour parties in those respective countries. This is, however, a fallacy. Elections may offer less of a choice than many would like, and the differences between the parties may not be as great, but there is a danger of going to far in offering divergences between choices, such that if victory for one side of the population threatens a large proportion of the other, the latter may not accept the legitimacy of the election, and thus democracy breaks down leading to chaos and anarchy. The narrow differences between the parties simply reflects the fundamental unity of a nation such as Britain, and any party that has strayed too far from these norms has suffered electoral disaster. Elections are still important for educating and informing the electorate, as the manifestos produced at this time will, ceteris paribus, be used as an agenda for the government for the next parliament. If it is accepted that Labour lost power in 1951 because it had implemented all of the items in its manifesto and had no new ideas, then this provides a defence for elections as a litmus test of the electorate's opinions on a number of issues, given that conditions will allow for the implementation of those policies. However, it is also clear that elections alone do not decide the "fate of the country," which lies in economic and social factors on both the national and international levels. Elections determine what policies are to be broadly implemented in the next term; whether these are all achieved is contingent on the number of external shocks that force reappraisals by governments between elections.