Topic 1 (Britain): A changing political and economic environment

Changing Party Fortunes

• Liberal decline was damaged by the Asquith-Lloyd George split

• Liberals failed to appeal to a broader electorate an lost support to Labour by 1924

• Labour linked to trade unions and working class issues

• Conservatives had efficient organisation and strong middle class support; they dominated government for much of the decade

• 1918 - 1928: working class voters increased

• 1918: Representation of the People’s Act

• Labour gained union and worker backing → rise of class based politics

• After WW2, state control and national unity challenged liberal individualism

National Government (1931)

• Wall Street Crash in 1919 led to global depression

• Labour government collapsed under pressure and coalition with the Conservatives was formed, known as the ‘ National Government’

• National Government was led by Macdonald (Labour) but was dominated by Conservatives

• Aimed to address unemployment and economic crisis

• Baldwin and Chamberlain dominated during the 1930s - focused on economic recovery and avoiding political extremes

• 1940: Churchill forms all-party coalitions

• National unity during WW1 masks ideological divisions

• Public desire for untiy and stability - supported centrist and broad base governments

• Threat of war and fascism increased the need for cross-party unity

Rise of consensus politics, 1945 - 79

• WW2 strengthened belief in state intervention and national unity

• Labour introduced NHS, nationalisation and social reforms + Beveridge Report (1942)

• 1945: Labour landslide

• Post war consensus continued by Conservative Government =, 1951 - 64

• Wide acceptance of welfare state and full employment

• Wilson (Labour): introduced modernisation and social reforms

• Economic struggles and industrial unrest increased

• 1970s: economic problems such as inflation and strikes

• 1976 IMF expose limits of Keynesianism

• Public frustration of trade unions and inefficiency

Boom, Crisis and Recovery, 1918 - 1931

• Post WW1 economic instability such as inflation and debt

• 1919 - 1920: short lived consumer boom

• 1921: 2 million unemployed

• 1921: Geddes Axe meant that £87 million in public spending was cut

• Aim to balance the budget which led to reduced services and higher unemployment

• Return to Gold Standard (1925) by Churchill who was the chancellor at the time

• This overvalue the pound which hrt exports and increased unemployment even further

• General Strike (1926): rooted in coal industry decline

• Decline in other staple industries such as steel and textiles

• Lack in international competition and innovation

Response to Economic Problems of the Great Depression

• Economic policy shifted during WW2 ton full state control

• 1931 budget cuts - 10% cut in unemployment benefits

• This was to restore confidence in the sterling pound and avoid devaluation

• Limited public work schemes in depressed regions such as Special Area Act (1934)

• Generally inadequate in scope and funding

• Rearmament led to boosted industries such as coal and shipbuilding

• Unemployment fell significantly by 1939

• Wartime economic policy: rationing and nationalisation of industries

• State planning ensured full employment and economic coordination

Response to Economic Challenges, 1951 - 1979

• Post war boom during the 1950s and 60s was due to the ‘stop and go’ policies

• ‘Stop and go’ economics alternated between growth and restraint

• Conservative and Labour Governments used interest rates and credit control to manage economy

• Wilson aimed to modernise the economy through technology and planning however the National Plan (1965) largely failed due to lack of industrial cooperation

• Pound devalued by Labour (1967) which did little to improve the trade deficit

• IMF Crisis (1976): Labour sought loan due to falling confidence and inflation; it required public spending cuts

• 1972 and 1974 miner strikes = power cuts

• Rising stagflation

Industrial Change and Changing Industrial Relations, 1918 - 1939

• Britain emerged from WW1 with an outdated industrial base

• Governments were unsure of how to balance market stability with labour demands

• Over 4 million men returned from war = job competition

• Women workers were pushed out of wartime roles

• Over 8 million unions members by 1920; growth especially in coal and transport sectors

• General strike (1926): triggered by falling wages and poor conditions in coal industry

• Government response to the general strike was the Emergency Powers Act

• Trades Disputes and Trade Unions Act (1927): limited strike activity

Changing Working Opportunities and Conditions

• Essential Work Orders directed workers to vital industries

• Women were recruited into heavy industries, munitions and transport

• Full employment was a central goal of the post war consensus

• New jobs in the public sector, health and education

• Equal Pay Act (1970) and Sex Discrimination Act (1975) introduced

• Rising female employment in clerical and part time roles

• Rise in white collar jobs and consumer based jobs

• Youth culture and short term jobs increased by the late 1960s

Industrial Relations, 1939 - 1979 and the reasons for their breakdown, 1960s and 70s

• 1970s: consensus broke down due to economic crisis and industrial unrest

• 1940s and 50s: TUC worked with the government during war and post war construction

• Strong union presence = necessary for industrial peace

• 1960s: rising militancy

• Labour introduced ‘In Place of Strife’ (1969) - failed reform attempt

• 1970s: Conservative Industrial Relations (1971) - limited strike powers = largely ineffective

• Miners strike in 1972 and 1974 led to power cuts, three day week and downfall of Heath

• Winter of Discontent (1978 -79): strikes over pay caps = public backlash