chapter 2 Flashcards
economics 51-64
why was the post-war consensus needed
fear from the great depression of the 30s and great wars that more economic trouble would follow
when did food rationing end
july 1954
how many were unemployed in 1955
200,000 or less than 1% of the workforce
which working areas saw economic/employment growth
steel, cars, engineering & services
why was there a growth in income and what did it create
-economic growth and low unemployment caused real wages to rise
-affluence and consumerism
which economic area did uk globally top
-higher income per head than any other major country exc. USA
-did not necessarily top in any other industrial growth rates
what unstable economic system was used and why
-stop-go economics
-economy was in danger of overheating as consumerism outsold production
how do stop-go economics work
-high interest rates to stop spending and lower demands
-output decreases and interest drops
-demand increases & imports rise
-imports exceed exports on balance of payments
-repeat
what economic trouble did the suez crisis create
-‘run on the pound’
a rapid fall in the value of the pound in international currency markets
why were stop-go economics an issue
-unpredictable and hard to manage in something eg. rotp.
-not long term
-causes arguments within the party
what is an example that the economy had grown by 1959
-april tax cuts of £370million
-probably why macmillan was re-elected in october
when did the economy hit its peak?
-1960-64
what is the ‘pay pause’ of 1961
-worried about the economy overheating
-hold down wage inflation and ask for a loan from IMF
-again, balance of payments and stop-go caused this.
what was an issue that caused the desire to be in the eec
-clear that britain was falling behind europe’s economy - especially west germany
-macmillan decides its essential to join economy with europe
what was the reaction to being rejected from the eec
-1963
-shows extent of failure to modernise economically
-cut backs in public expenditure. eg. closing 30% of the railnetwork & many rural areas were left isolated
why was britain rejected from the eec
-other countries accepted the application but french president DeGaulle rejected as britain was a liability
what were the growth and export rates of the early 60s
4% 1963
6% 1964
exports rose 10% 1961-64 but imports remained 20% higher
synopsise the economics of the 50s
satisfied population as real wages and spending remained high
weak economy based on unstable stop-go method, also backwards as not accepted to EEC
