13: Response to the economic crisis part 1 Flashcards
What did Macdonald set up in 1930?
The Economic Advisory Council
What did the AEC include? (2)
Industrialists and economists
Why was unemployment benefits important to the Labour government?
The Labour party stood for welfare and the working man so the provision of benefits was an integral part of its beliefs
What was controversial about increasing unemployment benefits? (3)
- It would put a strain on government finances
- It would undermine MacDonald’s belief in “balancing the budget”
- It would appear irresponsible at a time when the party desperately wanted to be viewed as capable and trustworthy
What was Philip Snowden’s opinion? (2)
He accepted that a balanced budget and maintaining the golden standard were fundamental principles
What would balancing the budget mean at this time?
Retrenchment- which would mean reducing expenditure on welfare
Who was Oswald Mosley?
A junior minister
What was Oswald Mosley’s opinion? (2)
- He called for an expansionary government spending policy, financing public works schemes and social reforms through government loans
- Argued that this was the only way the Labour Government should behave- putting the working men’s needs first
Who agreed with Mosley?
John Maynard Keynes
Why was Macdonald fearful of Mosley’s radical measures? (2)
- They would undermine confidence in the British economy overseas
- They would create even more unemployment
When did Mosley resign and why? (2)
- May 1930
- When his “Mosley Memorandum” was rejected
How was the situation of the party being split not helped?
They needed to win over the opposition party leaders too which was essential to pass anything through the commons
When was the banking crisis?
May 1931
What did the Liberals propose as a result of the banking crisis?
A committee to consider how the government might curb its expenditure and to restore confidence
