1930's Britain - Government/Politics

1930s Labour Government
1. End of 1929-31, value of British exports fell by half.
2. Unemployment rose until it was around 2.5 million by 1931 and 3 million by the end of 1931
3. In 1930, MacDonald set up Economic advisory council of industrialists and economists to provide advice.
4. The labour party was divided over how to deal with the economic crisis
5. MacDonald was not convinced that Mosley's ideas (same as Keynes) would work, he was fearful that such radical measures would undermine confidence in the British economy overseas and create even more unemployment.
6. Mosley resigned in May 1930
7. As a result of the Banking crisis in May 1931, the Liberals proposed a committee to consider how the government might curb its expenditure, MacDonald then appointed the May Committee.
8. May report was an unwelcomed bombshell, it predicted a deficit of £120million and recommended cuts of £96.5 and a 20% cut in unemployment benefits, this deepend the financial situation
9. The Cabinet was bitterly divided and 11 to 9 votes on approval to substantial cuts split the party. On 24th August MacDonald went to resign to the King
National Government
1. Agreed that MacDonald would continue as PM in new National Government based on support from the main political parties. Seen as a "government of persons" rather than a full coalition
2. Snowden, Thomas and Sankey chose to follow MacDonald, resting on support of the Conservatives and some Liberals.
3. Labour MPs and trade unionists accused MacDonald of treachery in abandoning the cause of the working man and was accused of:
  1. Set up May Committee instead of following Economic Advisory Council as he was not brave enough to consider new ideas and ignored Mosley
  2. Slow to respond to crisis and allowed it to get worse

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1930's Britain - Government/Politics

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