Three-party politics

CONTENTS

THREE-PARTY
POLITICS, 1922-5…………………………………………………  2

THE
PRIME MINISTER………………..……………………………………………   2

THYE
LABOR PARTY………………………………………………………………  3

REMSAY
MACDONALD…………………………………………………………… 4

DEBTS
AND REPARATIONS………………………………………………………   5

BALDWIN…………………………………………………………………………… 6

BALDWIN
AND PROTECTION……………………………………………………   6

FIRST
LABOR GOVERNMENT….…………………………………………………  7

EDUCATIONAL
REFORMS………………………………………………………… 8

UNEMNPLOYMENT…………………………………………………………………            9

THREE-PARTY 
POLITICS,   1922-5

Politics
after the fall of
Lloyd George seemed far from the tranquillity which Law had promised. There
were three general elections in less than two years (^November 1922; 6 December 1923; 29 October 1924), and the terrible portent of a Labor government. The
turmoil was largely technical. Though Labor had emerged as the predominant
party of the Left, the Liberal party refused to die; and the British electoral
system, mainly of one-member constituencies, was ill adapted to cope with three
parties. The general elections of 1931 and 1935 were the only ones in which a
single party (the Conservatives) received a majority of the votes cast.¹
Otherwise a parliamentary majority was achieved more or less by accident, if at
all. How­ever, there was no profound cleavage between the parties, despite much
synthetic bitterness. They offered old policies which had been their
stock-in-trade before the war. Labor offered social reform; the Conservatives
offered Protection. The victors in the twenties were the Liberals, in policy
though not in votes. The old Liberal cause of Free Trade had its last years of
triumph. If Sir William Harcourt had still been alive, he could have said: 'We
are all Liberals nowadays.' By 1925 England was back, for a brief period, in
the happy days of Gladstone.

The government which Law formed
was strikingly Con­servative, even obscurantist, in composition. There had been
nothing like it since Derby's 'Who? Who? ' ministry of 1852. The great figures
of the party—Austen
Chamberlain, Balfour, Birkenhead—sulkily repudiated the decision at the Carlton
Club: 'The meeting today rejected our advice. Other men who have given other
counsels must inherit our burdens.' The only minister of established
reputation, apart from Law himself, was Curzon, who deserted Lloyd George as
successfully as he had deserted Asquith and, considering the humiliating way in
which Lloyd George treated him, with more justification;² he
remained foreign secretary. Law tried to enlist McKenna as chancellor of
the exchequer—an
odd choice for a Protectionist prime minister to make, but at least McKenna,
though a Free Trader, hated Lloyd George. McKenna doubted whether the
government would last and refused to leave the comfortable security of the
Midland Bank. Law then pushed Baldwin into the vacant place, not without
misgiving. Otherwise he had to make do with junior ministers from Lloyd
George's government and with holders of historic names. His cabinet was the
most aristocratic of the period,¹ and the only one to contain a duke
(the duke of Devon­shire) . Churchill called it 'a government of the second
eleven'; Birkenhead, more contemptuously, of second-class intellects.

The general election of 1918
had been a plebiscite in favour of Lloyd George. The general election of 1922
was a plebiscite against him. Law's election manifesto sturdily promised
negations. 'The nation's first need', it declared, 'is, in every walk of life,
to get on with its own work, with the minimum of interference at home and of
disturbance abroad.' There would be drastic economies and a foreign policy of
non-interference. The prime minister would no longer meddle in the affairs of
other ministers. Law returned the conduct of foreign affairs to Curzon. He re­fused
to meet a deputation of the unemployed—that was a job for the ministry of labor. In the first
flush of reaction, Law announced his intention of undoing all Lloyd George's
innova­tions in government, including the cabinet secretariat. He soon thought
better of this, and, though he dismantled Lloyd George's body of private
advisers, 'the garden suburb', he kept Hankey and the secretariat. The cabinet
continued to perform its work in a businesslike way with prepared agenda, a
record of its" decisions, and some control on how they were carried out.

THE
PRIME MINISTER

This preservation of the
cabinet secretariat was Law's con­tribution as prime minister to British
history. The contribution was important, though how important cannot be gauged
until the cabinet records are opened. The cabinet became a more formal, perhaps
a more efficient body. Maybe also there was an increasing tendency for a few
senior ministers to settle things between themselves and then to
present the cabinet with a vir­tual fait accompli, as MacDonald did with
J. H. Thomas and Snowden or Neville Chamberlain with Halifax, Hoare, and Simon.
But this practice had always existed. A cabinet of equals, discussing every
question fully, was a legend from some imagin­ary Golden Age. On the other
hand, the power and authority of the prime minister certainly increased in this
period, and no doubt his control of the cabinet secretariat was one of the
causes for this. It was not the only one. Every prime minister after Lloyd
George controlled a mighty party machine. The prime minister alone determined
the dissolution of parliament after 1931, and the circumstances of 1931 were
peculiar. Above all, the loaves and fishes of office, which the prime minister
dis­tributed, had a greater lure than in an aristocratic age when many of the
men in politics already possessed great wealth and titles. At any rate, Law,
willingly or not, helped to put the prime minister above his colleagues.

Gloomy as ever, Law doubted
whether the Conservatives would win the election and even thought he might lose
his own seat at Glasgow. When pressed by Free Trade Conservatives such as Lord
Derby, he repudiated Protection, much to Beaver-brook's dismay, and gave a
pledge that there would be no funda­mental change in the fiscal system without
a second general election. The other parties were equally negative. Labor had a
specific proposal, the capital levy, as well as its general pro­gramme of 1918;
but, deciding half-way through the campaign that the capital levy was an
embarrassment, dropped it, just as Law had dropped Protection. The independent
Liberals, led by Asquith, merely claimed, with truth, that they had never
supported Lloyd George. The Coalition, now called National Liberals, hoped to
scrape back with Conservative votes. Beaver-brook spoilt their game by
promoting, and in some cases financ­ing, Conservative candidates against them;
fifty-four, out of the fifty-six National Liberals thus challenged, were
defeated. The voting was as negative as the parties. Five and a half million
voted Conservative; just over 4 million voted Liberal (Asquithians 2-5 million,
National i-6 million); 4-2 million voted Labor. The result was, however,
decisive, owing to the odd working of three- or
often four-cornered contests. The Conservatives held almost precisely their numbers at the
dissolution: with 345 seats they had a
majority of 77 over the other parties combined. Labor won 142 seats; the Liberals, with almost exactly
the same vote (but about 70 more
candidates), only 117. All the National Liberal leaders were defeated except Lloyd George in his pocket borough at Caernarvon. Churchill, who had
just lost his appendix, also lost his seat at Dundee, a two-member consti­tuency,
to a Prohibitionist and to E. D. Morel, secretary of the Union of Democratic Control. This was a striking
reversal of fortunes.

THE
LABOR PARTY

The Conservatives and
Liberals were much the same people as before, with a drop of twenty or so in the number of
company directors—mainly due
no doubt to the reduction of National Liberals by half. Labor was so
changed as to be almost a differ­ent party. In the previous parliament the
Labor members had all been union nominees, as near as makes no odds (all
but one in 1918, all but three at the dissolution); all were of working-class
origin. Now the trade unionists were little more than half (80 out of 142), and
middle-class, even upper-class, men sat on the
Labor benches for the first time.³ In composition Labor was thus more of a national party than before and
less an interest group. In outlook it
was less national, or at any rate more
hostile to the existing order in economics and in nearly everything else. The
old Labor M.P.s had not much to distin­guish them except their class, as
they showed during the war by their support
for Lloyd George. The new men repudiated both capitalism and traditional foreign policy.

There were combative
working-class socialists of the I.L.P., particularly from Glasgow. These Clydesiders, as they were called, won twenty-one out of twenty-eight seats in their region. They imagined that they were about to launch the
social revolution. One of them, David
Kirkwood, a shop steward who ended in
the house of lords, shouted to the crowd who saw him off: 'When we come back, this station, this railway, will
belong to the people!' The men from the middle and upper classes had usually
joined the Labor party because of their opposition to the foreign policy
which, in their opinion, had caused and pro­longed the war.
Often, going further than the U.D.C. and its condemnation of secret diplomacy, they
believed that wars were caused by the
capitalist system. Clement Attlee,¹ who entered parliament at this election, denned their attitude
when he said: 'So long as they had
capitalist governments they could not trust them with armaments.'²

The cleavage between
old Labor and new was not absolute. Not all the trade unionists were
moderate men, and the mode­rates had turned against Lloyd George after
the war, even to the extent of promoting a general strike to
prevent intervention against Russia. All of them, thanks to Henderson, had accepted a foreign policy which was almost indistinguishable from
that of the U.D.C.³ On the other hand, not all the I.L.P. members were
extremists: both MacDonald and Snowden, for example, were still I.L.P.
nominees. The new men understood the need for trade union money and appreciated
that they had been re­turned mainly by working-class votes. For,
while Labor had now some middle-class adherents at the top, it had few
middle-class voters; almost any middle-class man who joined the Labor party found himself a
parliamentary candidate in no time. More­over, even the most assertive
socialists had little in the way of a coherent
socialist policy. They tended to think that social reform, if pushed hard enough, would turn into socialism
of itself, and therefore differed from
the moderates only in pushing harder. Most
Labor M.P.s had considerable experience as shop stew­ards or in local government, and they had changed
things there simply by administering
the existing machine in a different spirit.
The Red Flag flew on the Clyde, in Poplar, in South Wales. Socialists expected that all would be well when
it flew also at Westminster.

Nevertheless, the advance of Labor and its
new spirit raised an alarm of 'Bolshevism'
particularly when two Communists now appeared in parliament—both
elected with the assistance of Labor votes.¹ The alarm was
unfounded. The two M.P.s represented the peak of Communist achievement.
The Labor party
repeatedly refused the application of the Communist party for affiliation and gradually excluded individual
Communists by a system more elaborate
than anything known since the repeal
of the Test Acts.² Certainly there was throughout the Labor movement much interest in Soviet Russia, and
even some admiration. Russia was 'the workers' state'; she was build­ing socialism. The terror and dictatorship, though
almost uni­versally condemned, were
excused as having been forced on Russia by the Allied intervention and the
civil war. English socialists drew
the consoling moral that such ruthlessness would be unnecessary in a democratic country.

Democracy—the
belief that the will of the majority should prevail—was in their
blood. They were confident that the majority would soon be on their side. Evolution was now the
universal pattern of thought: the idea that things
were on the move, and always upwards.
Men assumed that the curve of a graph
could be proj ected indefinitely in the same direction: that national wealth, for example, would go on
increasing auto­matically or that the
birth rate, having fallen from 30 per thousand
to 17 in thirty years, would in the next thirty fall to 7 or even o. Similarly, since the Labor vote had
gone up steadily, it would continue to rise at the same rate.
In 1923 Sidney Webb solemnly told the Labor annual conference that 'from the rising curve of Labor votes it
might be computed that the party would obtain
a clear majority . . . somewhere about 1926'.' Hence Labor had only to wait, and the revolution would come of itself. Such, again according to Webb, was
'the inevitability of gradualness'.

RAMSAY MACDONALD

When
parliament met, the Labor M.P.s elected Ramsay MacDonald as their
leader. The election was a close-run thing: a majority of five,
according to Clynes, the defeated candidate; of two, according to
the later, perhaps jaundiced, account by Philip Snowden. The
Clydesiders voted solid for MacDonald to their subsequent
regret. The narrow majority was misleading: it reflected mainly the jealousy of
those who had sat in the previous parliament against the newcomers. MacDonald was in­deed the predestined leader of Labor. He had
largely created the party in its first years; he had already led the party
before the war; and Arthur Henderson
had been assiduously preparing his restoration.² He had, in some
undefined way, the national stature
which other Labor men lacked. He was maybe vain, moody, solitary; yet, as Shinwell has said, in presence a prince among
men. He was the last beautiful speaker of the Gladstone school, with a
ravishing voice and turn of phrase. His rhetoric, though it defied
analysis, exactly reflected the emotions of the Labor movement, and he dominated that movement as long as he led it.

There were
practical gifts behind the cloud of phrases. He was a first-rate chairman of the cabinet,
a skilful and successful negotiator, and he had a unique grasp of foreign
affairs, as Lord Eustace Percy, by no means a sympathetic judge, recognized as late as 1935.³ With all his faults, he
was the greatest leader Labor has had,
and his name would stand high if he had not outlived his abilities. MacDonald's election in 1922 was a por­tent in another way. The Labor M.P.s were no longer
electing merely their chairman for
the coming session. They were electing the
leader of a national party and, implicitly therefore, a future prime minister. The party never changed its leader again
from session to session as it had done even between 1918 and 1922. Henceforth
the leader was re-elected each year until old age or a major upheaval over
policy ended his tenure.

Ramsay
MacDonald set his stamp on the inter-war years. He did not have to wait
long to be joined by the man who set a stamp along with him:
Stanley Baldwin. Law doubted his own physical capacity when he took office
and did not intend to remain more than a few months. It seemed
obvious at first who
would succeed him: Marquis Gurzon,¹ foreign secretary, former viceroy of India, and sole survivor in
office (apart from Law) of the great war cabinet. Moreover, in the brief period
of Law's premiership, Curzon enhanced
his reputation. Baldwin, the only possible rival, injured what reputation he
had. Curzon went off to make peace with the Turks at the conference of Lausanne. He
fought a lone battle, almost without resources and quite without backing from home, in the style of Castle-reagh; and he
carried the day. Though the Turks recovered Constantinople and eastern Thrace, the zone of the Straits re­mained neutralized, and the Straits were to be
open to warships in time of peace—a
reversal of traditional British policy and an implied threat to
Soviet Russia, though one never operated. Moreover, the Turks were bewitched by
Curzon's seeming moderation and laid aside the resentment which Lloyd George had
provoked. More important still, Curzon carried off the rich oil wells
of Mosul, to the great profit of British oil companies and of Mr.
Calouste Gulbenkian, who drew therefrom his fabulous 5 per cent.

DEBTS AND
REPARATIONS

Baldwin, also in
search of tranquillity, went off to Washington to settle Great Britain's debt to the United States. Law held firmly to the
principle of the Balfour note that Great Britain should pay her debt
only to the extent that she received what was owed
to her by others. Anything else, he believed, 'would reduce the standard of
living in this country for a generation'. Baldwin was instructed to settle only on this
basis. In Washing­ton he lost his nerve, perhaps pushed into surrender by his
com­panion, Montagu Norman, governor of the
bank of England, who had an incurable
zest for financial orthodoxy. Without securing
the permission of the cabinet, Baldwin agreed to an unconditional settlement on
harsh terms² and, to make matters worse, announced the terms
publicly on his return. Law wished to
reject the settlement: 'I should be the most cursed Prime Minister that ever held office in England if I accepted those terms.' His
opposition was sustained by the two independent experts whom he consulted, McKenna and Keynes. The cabinet, however, was for acceptance. Law found himself
alone. He wished to resign and was persuaded to stay on by the pleas of his colleagues. He satisfied his conscience by
publishing an anonymous attack on the
policy of his own government in the columns of The Times.

As things
worked out, Great Britain was not ruined by the settlement of the
American debt, though it was no doubt irk­some that France and Italy later settled their debt on easier terms. Throughout the
twenties the British collected a balancing amount from their own
debtors and in reparations. The real harm lay elsewhere. While the
settlement perhaps improved relations with the United States, it
compelled the British to col­lect their own debts and therefore to insist
on the payment of reparations by Germany both to others and to themselves. This
was already clear in 1923. Poincare, now French premier, attempted
to enforce the payment of reparations by occupying the Ruhr. The Germans took
up passive resistance, the mark tumbled to nothing, the finances of central Europe were again in chaos. The British government protested and acquiesced. French troops were allowed to
pass through the British zone of occupation
in the Rhineland. While the British condemned Poincare's
method, they could no longer dispute his aim: they were tied to the
French claim at the same time as they opposed it.

The debt
settlement might have been expected to turn Law against Baldwin. There were powerful
factors on the other side. Law knew that
Curzon was unpopular in the Conservative party—disliked both for his pompous arrogance and his weak­ness. Curzon lacked resolution,
despite his rigid appearance. He was one of
nature's rats. He ran away over the Parliament bill; he succumbed to women's suffrage. He promised to
stand by Asquith and then abandoned
him. He did the same with Lloyd George.
Beaverbrook has called him 'a political jumping jack'. Law regarded the
impending choice between Curzon and Bald­win with more than his usual gloom. He
tried to escape from it by inviting Austen Chamberlain to join the
government with the prospect of being his
successor in the autumn. Chamberlain appreciated
that his standing in the Conservative party had been for ever shaken by the
vote at the Carlton club, and refused.

The end
came abruptly. In May Law was found to have incurable cancer of the throat. He
resigned at once. Consoled by the misleading precedent of what happened
when Gladstone resigned in 1894, he made no recommendation as to his suc­cessor. He
expected this to be Curzon, and was glad that it would be none of his
doing. However, the king was led to believe, whether correctly or
not, that Law favoured Baldwin, and he duly followed what he supposed to be the
advice of his retiring prime minister as the
monarch has done on all other occasions since 1894.3 Law lingered on until 30 October. He was buried in Westminster Abbey—the
first prime minister to follow Glad­stone there and with Neville
Chamberlain, so far, as his only successor. The reason for this distinction is
obscure. Was it because he had
reunited the Conservative party? or because he had overthrown Lloyd
George?

BALDWIN

Baldwin did not follow Law's example of waiting to accept
office until he
had been elected leader of the Conservative party. He became prime minister on 21 May, was elected leader on 28 May. Curzon proposed the election with phrases
adequately fulsome. Privately he is reputed to have called Baldwin 'a man of the utmost insignificance'. This was Baldwin's
strength. He seemed, though he was
not, an ordinary man. He presented himself
as a simple country gentleman, interested only in pigs. He was in fact a wealthy ironmaster, with
distinguished literary connexions.²
His simple exterior concealed a skilful political operator. Lloyd George, after bitter experience,
called him 'the most formidable
antagonist whom I ever encountered'—no mean tribute.
Baldwin played politics by ear.  He read few official documents,
the newspapers not at all. He sat on the treasury bench day
after day, sniffing the order-paper, cracking his fingers, and
studying the house of commons in its every mood. He had in his
mind a picture, no doubt imaginary, of the patriarchal relations
between masters and men at his father's steel  works,  and  
aspired   to  establish  these   relations   with Labor on a national
scale. This spirit met a response from the other side. MacDonald
said of him as early as 1923: 'In all essentials, his outlook is very close
to ours.' It is hard to decide whether Baldwin or MacDonald did more to fit
Labor into constitutional
life.

Baldwin
did not set the Conservative pattern alone. He acquired, almost by
accident, an associate from whom he was never parted:
Neville Chamberlain.³ The two were yoke-fellows rather
than partners, bound together by dislike of Lloyd George and by
little else.  Chamberlain was  harsher than Baldwin, more impatient with
criticism and with events. He antagonized where Baldwin
conciliated. He was also more practical and eager to get things
done. He had a zest for administrative reform. Nearly all the
domestic achievements of Conservative govern­ments between the
wars stand to his credit, and most of the troubles also. Active
Conservatives often strove to get rid of Baldwin and to put Chamberlain in his
place. They did not suc­ceed. Chamberlain sinned against Napoleon's
rule: he was a man of No Luck. The cards always ran against him. He was humiliated
by Lloyd George at the beginning of his political career, and cheated
by Hitler at the end. Baldwin kept him in the second place,
almost without trying.

Chamberlain's
Housing Act (introduced in April, enacted in July) was the one
solid work of this dull government. It was pro­voked by the complete stop in house
building when Addison's programme ended.
Chamberlain believed, like most people, that Addison's unlimited
subsidies were the main cause of high building
costs. He was also anxious, as a good Conservative, to show that private enterprise could do better than
local authori­ties. His limited subsidy (Ј6 a year for twenty
years) went to private and public builders alike, with a preference for
the former; and
they built houses only for sale. Mean houses ('non-parlour type' was the technical phrase) were built for those who could afford nothing better. Predominantly, the
Chamberlain act benefited the lower
middle class, not the industrial
workers. This financial discrimination caused much bitterness. Chamberlain was
marked as the enemy of the poor, and
his housing act lost the Conservatives more votes than it gained.

BALDWIN AND
PROTECTION

Still, there seemed no reason why the
government should not jog on. Its majority was solid; economic conditions were
not markedly deteriorating. Without warning,
Baldwin raised the ghost which Law
had exorcized in 1922. On 25 October he announced that he could fight unemployment only if he had a free hand to introduce Protection. His motives for
this sudden decision remain obscure.
Protection had been for many years at
once the inspiration and the bane of the Conservative party. There would hardly have been a lively mind or a
creative person­ality on the Conservative benches without it. On the
other hand, it had repeatedly brought party
disunion and electoral defeat. Hence
Balfour had sworn off it in 1910, and Law in 1922. There seemed little reason to revive this terrible controversy
now. An imperial conference was indeed in session, principally to ensure that
no British government would ever take such an initiative as Chanak
again. The conference expressed the usual pious wish for
Imperial Preference. This meant in practice British tariffs on foreign
food, while foodstuffs from the Dominions came in free. There would be Dominion
preferences for British manufactures only in
the sense that Dominion tariffs, which were already prohibitively high, would
go up further against the foreigner.
This was not an attractive proposition to put before the British electorate, and Baldwin did not attempt it. He
pledged himself against 'stomach taxes'. There would be 'no tax on wheat or meat'. Imperial Preference was
thus ruled out.

Later, when
Protection had brought defeat for the Con­servatives, Baldwin
excused himself on grounds of political tactics. Lloyd
George, he alleged, was returning from a trium­phal tour of North
America with a grandiose programme of empire development. Baldwin 'had to get
in quick'. His cham­pioning
of Protection 'dished the Goat' [Lloyd George].¹ Austen Chamberlain and other Conservatives who had adhered
to Lloyd George swung back on to
Baldwin's side. This story seems to
have been devised after the event. Chamberlain and the rest were already swinging back; there was no serious
sign that Lloyd George was inclining towards
Protection. Perhaps Baldwin, a man
still little known, wished to establish his reputation with the Conservative rank and file. Perhaps he wished
to show that he, not Beaverbrook, was
Law's heir. The simplest explanation is probably the true one. Baldwin, like
most manufacturers of steel, thought
only of the home market. He did not grasp the problem of exports and hoped merely that there would be more sale
for British steel if foreign supplies were reduced. For once, he took the initiative and learnt from his failure
not to take it again.

Protection involved a
general election in order to shake off Law's pledge of a year
before. The cry of Protection certainly brought the former associates of Lloyd
George back to Baldwin. This was more than
offset by the resentment of Free Trade Conservatives,
particularly in Lancashire. Defence of Free Trade at last reunited the
Liberal party, much to Lloyd George's discomfiture—though this was
hardly Baldwin's doing. With Free Trade the dominant issue, Lloyd George was
shackled to the orthodox Asquithian remnant. Asquith was once more undisputed
leader; Lloyd George, the man who won the war, merely his unwilling
lieutenant. It was small consolation that the Asquithians had
their expenses paid by the Lloyd George Fund.

The election of
December 1923 was as negative as its pre­decessor. This time
negation went against Protection, and doing nothing favoured the
once-radical cause of Free Trade. Though the overall vote remained much
the same— the
Conservatives received about 100,000 less,³ the Liberals 200,000,
and Labor 100,000 more—the results were startlingly different. The
Conservatives lost over ninety seats, the Liberals gained forty, and Labor fifty.⁴ The dominant groups of 1918
were further depleted, relatively in one case, absolutely in the other. The trade unionists, once all-powerful,
were now a bare majority in the Labor
party (98 out of 191). The National (Lloyd
George) Liberals, already halved in 1922, were now halved again, despite
the Liberal gains. There were only twenty-six
of them. Their former seats nearly all went to Labor, evidence that they had formed the Liberal Left wing. The
outcome was a tangle: no single party
with a majority, yet the Liberals barred from coalition by their dislike of
Protection on the one side, of socialism on the other.

FIRST LABOR GOVERNMENT

It was obvious that
the government would be defeated when parliament met. Then, according to
constitutional precedent, the king would send for the leader of the next
largest party, Ramsay MacDonald. Harebrained schemes were aired for averting
this terrible outcome. Balfour, or Austen Chamberlain, should take Baldwin's
place as Conservative premier; Asquith should head a Liberal-Conservative
coalition; McKenna should form a non-parliamentary government of
'national trustees'. None of these schemes came to anything. Asquith was clear that Labor should be put in, though he also assumed
that he would himself become prime minister when, as was bound to happen soon, they were put out. In any case, George V
took his own line: Labor must be given 'a fair chance'. On 21 January the Conservative
government was defeated by seventy-two votes.¹ On the following day MacDonald became prime
minister, hav­ing first been sworn
of the privy council—the only prime minister to need
this preliminary. George V wrote in his diary: 'Today 23 years ago dear
Grandmama died. I wonder what she would have thought of a
Labor Government!'; and a few weeks later to his mother: 'They
[the new Ministers] have different ideas to ours as they are all
socialists, but they ought to be given a chance & ought to be
treated fairly.'²

MacDonald
was a man of considerable executive ability, despite his lack of
ministerial experience; he had also many years' training in
balancing between the different groups and factions in the Labor
movement. On some points he consulted Haldane, who became lord chancellor,
principally in order to look after the revived committee of imperial defence. Snowden, MacDonald's longtime associate and rival in the
I.L.P., became chancellor of the
exchequer. MacDonald himself took the foreign office, his consuming interest;
besides, he was the only name big enough
to keep out E. D. Morel. The revolutionary Left was almost passed over. Lansbury, its outstanding
English figure, was left out, partly
to please George V, who disliked Lansbury's threat to treat him as Cromwell treated Charles I. Wheatley, a. Roman
Catholic businessman who became minister of health, was the only Clydesider in the government; to
everyone's sur­prise he turned out its
most successful member. Broadly the cabinet
combined trade unionists and members of the U.D.C. It marked a social revolution despite its
moderation: working men in a majority, the great public schools and the old
univer­sities eclipsed for the first
time.

 The Labor
government recognized that they could make no fundamental changes,
even if they knew what to make: they were 'in office, but not in power'. Their
object vas to show that Labor could govern,
maybe also that it could administer in a
more warm-hearted way. The" Left did not like this tame out­look and set up a committee of backbench M.P.s to
control the government; it did not
have much effect. The Labor ministers hardly
needed the king's exhortation to 'prudence and sagacity'.¹ All, except Wheatley, were moderate men, anxious
to show their respectability. They
were willing to hire court dress (though not knee-breeches) from Moss Bros. It was a more serious difficulty that they lacked experience in government
routine. Only two (Haldane and
Henderson) had previously sat in a cabinet. Fifteen out of the twenty had never occupied any ministerial post. Inevitably they relied on the civil servan:s
in their depart­ments, and these, though personally sympathetic, were not run­ning over with enthusiasm for an extensive
socialist programme.

EDUCATIONAL
REFORM

Wheatley
was the only minister with a creative aggressive outlook. His Housing
Act was the more surprising in that it had no background in
party discussion or programme, other than Labor's dislike of
bad housing conditions, Unlike Neville Chamberlain or even
Addison, Wheatley recognized that the housing shortage was a long-term problem.
He increased the subsidy;² put the main responsibility back on the
local authori­ties; and insisted that the houses must be built to rent. More important
still, he secured an expansion of the building industry by promising that the
scheme would operate steadily for fifteen years. This was
almost the first cooperation between govern­ment and industry in peacetime; it
was also the first peacetime demonstration of the virtues of planning. Though the full Wheatley programme was broken off short in 1932 at
the time of the economic crisis,
housing shortage, in the narrowest sense, had by then been virtually overcome. Wheatley's Act did not, of course, do anything to get rid of the slums. It
benefited the more prosperous and
secure section of the working class, and slum-dwellers were lucky to find old houses which the council tenants had vacated. The bill had a passage of hard argument
through the house of commons. Hardly anyone opposed its principle
outright. Men of all parties were thus imperceptibly coming to agree
that the provision of houses was a social duty, though they differed over the
method and the speed with which this should be done.

One other landmark
was set up by the Labor government, again almost unnoticed. Trevelyan, at the
board of education, was armed with a firm statement of Labor policy, Secondary
Education for All, drafted by the historian R. H. Tawney, who provided
much of the moral inspiration for Labor in these years. Trevelyan
largely undid the economies in secondary education which had been made by the
Geddes axe, though he also discovered that Labor would be effective
in educational matters only when it controlled the local authorities as
well as the central government. More than this, he instructed the
consulta­tive committee of the board, under Sir Henry Hadow, to
work out how Labor's full policy could be applied, and he deserves most of the credit for what
followed even though the committee did not
report until 1926. The Hadow report set the pattern for English publicly
maintained education to the present day. Its ultimate ideal was to raise the school-leaving age to 15. Failing this
(and it did not come until after the second World war), there should be an immediate and permanent innovation: a
break between primary and secondary
education at n.¹ Hence the pupils
at elementary schools, who previously stayed on to 14, had now to be provided for elsewhere or, at the
very least, in special 'senior
classes'. Here was a great achievement, at any rate in principle: a clear recognition, again imperceptibly accepted by men of all parties, that the entire
population, and not merely a
privileged minority, were entitled to some educa­tion beyond 'the three R's'. It was less fortunate that the new system of a break at 'eleven plus' increased the
divergence be­tween the publicly
maintained schools and the private schools for the fee-paying minority where the break came at 13.

The reforms
instituted by Wheatley and by Trevelyan both had the  advantage 
that,  while  they involved considerable expenditure over a
period of years, they did not call for much money in the
immediate future. This alone enabled them to survive the scrutiny
of Philip Snowden, chancellor of the ex­chequer. Snowden had
spent his life preaching social reforms; but he also believed
that a balanced budget and rigorous economy were the only foundation for
such reforms, and he soon convinced himself that the reforms would have
to wait until the foundation had been well and truly laid. His budget would
have delighted the heart of Gladstone: expenditure down, and taxes also, the 'free breakfast
table' on the way to being restored,¹ and the McKenna Duties—pathetic remnant of wartime Protection —abolished.
No doubt a 'Liberal' budget was inevitable in the circumstances of minority
government; but it caused no stir of protest in the Labor movement. Most
Labor men assumed that finance was a neutral subject, which had nothing to
do with politics. Snowden himself wrote of Montagu Norman: 'I know nothing
at all about his politics. I do not know if has he any.' Far from
welcoming any increase in public spending, let alone advocating it,
Labor had inherited the radical view that money spent by the
state was likely to be money spent in­competently and corruptly: it would
provide outdoor relief for the aristocracy or, as in Lloyd George's time, undeserved wealth for profiteers. The social reforms in which Labor
believed were advocated despite the
fact that they cost money, not because of it, and Snowden had an easy time checking these reforms as soon as he pointed to their cost.

UNEMPLOYMENT

The Labor
government were peculiarly helpless when faced with the problem of unemployment—the unemployed remained at well over a million. Labor theorists had no
prepared answer and failed to evolve
one. The traditional evil of capitalism had been poverty: this gave Labor its
moral force just as it gave Marxists
the confidence that, with increasing poverty, capitalism would 'burst asunder'. No socialist, Marxist or
otherwise, had ever doubted that poverty could be ended by means of the rich
resources which capitalism provided. Mass unemployment was a puzzling accident, perhaps even a mean trick
which the capitalists were playing on
the Labor government; it was not regarded as an inevitable outcome of
the existing economic sys­tem, at any rate
for some time. Vaguely, Labor held that socialism would get rid of unemployment as it would get rid of all other evils inherent in the capitalist system. There
would be ample demand for goods, and therefore full employment, once this
demand ceased to be a matter of 'pounds, shillings, and pence'. The socialist economic
system would work of itself, as capitalism
was doing. This automatic operation of capitalism was a view held by
nearly all economists, and Labor accepted their
teaching. Keynes was moving towards the idea that un­employment could be conquered, or at any rate
alleviated, by means of public works.
He was practically alone among pro­fessional economists in this. Hugh
Dalton, himself a teacher of economics, and soon to be a Labor M.P.,¹
dismissed Keynes's idea as 'mere Lloyd George
finance'—a damning verdict. Such a policy was worse than useless;
it was immoral.

Economic
difficulties arose for the Labor government in a more immediate way.
Industrial disputes did not come to an end merely because
Labor was in office. Ramsay MacDonald had hardly kissed hands before there
was a strike of engine drivers—a strike fortunately
settled by an intervention of the T.U.C. general council. Strikes first of dockers, then of
London tramwaymen, were not dealt with so
easily. The government planned to use against these strikes the
Emergency Powers Act, which Labor had
denounced so fiercely when introduced by Lloyd George. It was particularly
ironical that the proposed dictator,
or chief civil commissioner, was Wedgwood, chancellor of the duchy of Lancaster, who was generally held
to be more an anarchist than a
socialist. Here was fine trouble in the making. The unions provided most of the money for the Labor party, yet Labor in
office had to show that it was fit to govern. Both sides backed away. The
government did not actually run armed lorries through the streets of London,² and Ernest Bevin, the men's
leader, ended the strikes, though indignant at ‘having to listen to appeal of
our own people. The dispute left an ugly memory. A joint committee of the
T.U.C. general council and the Labor party executive condemned the government’s
proposed action. MacDonald replied that ‘public doles, Poplarism, strikes for
increased wages, limitations of output, not only are not Socialism, but may
mislead the spirit and policy of the Socialist movement.