Politics and economic developments Churchill - macmillan Flashcards
1
Q
Atlee legacy
A
- Three issues plagued Britain by 1951 and led to consensus politics:
- They did not want to ever return to misery caused by the great depression in the 1930’s.
- They did not want another terrible war to tear the country apart, they wanted victory to lead to a better fairer Britain
- The third was much more positive and that was the establishment of the welfare state under labour.
2
Q
Post war consensus
A
- The central issue whereby the parties agreed was the idea of the mixed economy.
- Labour already said they did not want a command economy and had accepted private enterprise and capitalist system.
- The conservatives were quick to privatise the steel industry and road transport in 1951 but left the rest of Atlee’s nationalisation alone
- The conservative majority was slender and leadership didn’t feel as though they were in a strong enough position to set about dismantling Atlee legacy. (people faithful were not pleased and opposed consensus but Churchill, Eden and Macmillan knew there was little choice)
3
Q
Churchill government 1951-5
A
- Churchill was 77 when he became prime minister for the second time and so was to old to be anything more than a figurehead
- He did not do much but in this period there were many important developments
4
Q
developments under Churchill
A
- Rationing ended
- The steel industry was denationalised
- The conservative party committed itself to building 300,000 houses a year
- The government continued with Keynesian policies
- The accession of Queen Elizabeth ushered in a new ‘Elizabeth age’
- Britain declared its first atomic bomb in 1952
- The Korean war ended in 1953
5
Q
Age of affluence:
A
-Conservatives come in at a lucky time at the beginning of Britain’s improving economy
Butskellism
- Age of affluence is where ownership of consumer goods grew
- Men’s weekly wages grew from £8.30 in 1951 to £15.35 by 1961
- Huge increases in savings, boom in car ownership as well as home ownership with cheap mortgages
- The economy continued to improve and there waws a higher standard of living
- Trade accelerated and more exports and investments increasing employment
6
Q
However age of affluence Churchill
A
Butler faced problems: huge debt as a result of borrowing money and continued buying defence materials as forced by the US. (So Britain were strong for the cold war)
^ This led to a balance of payments deficit (when more money is going out on imports then received by exports)
- Many criticised war governments for over stretching themselves, trying to hard to make a modern industrial economy eg Welfare state
- Butlers ideas also criticised for being to similar to Labours eg Butskellism
7
Q
Butskellism
A
Butskellism
- The key figure in Churchill’s campaign was his chancellor of exchequer R.A. Butler
- Butler held all the other major offices of state and was a formative influence in the development of modern conservatism, pushing the party in a progressive direction.
- Responsible for the education act of 1944
- During the Atlee years after conservatives crushing defeat, Butler played an active role and studied ways in which they could modernise their party’s attitude and policies
- The industrial charter document presented in 1947 led to mixed economy (a system in which the private and public sectors of the economy both operate) policy in their party.
- Butlers policies from 1951-1955 showed he had accepted the new Keynesian economics
8
Q
Butler continued Labours main aims of:
A
- Trying to maintain full employment
- expanding the welfare state
- keeping to Britain’s heavily committed military defence programme
- developing a nuclear weapons’ programme
- Keynesian economics
- deflationary policies (so other countries would buy from them because it’s cheaper)
- Tax cuts (to win the middle class over right before the next election)
9
Q
Butler and Gaitskell
A
- Butlers ideas were close to Labours so his name ‘Butskellism’. Joining Butler and Hugh Gaitskell (key figure of labour) names.
- differences between the two men were financial matters. Gaitskell favoured high direct taxation (taxes on individual incomes) and Butler favoured interest rates (a mechanism for raising or lowering the cost of borrowing money by adjusting the amount of interest charged on loans)
- The two men shared a similar approach: a coherent attempt to maintain a social liberalization, lower taxation and decontrol without dismantling the welfare and industrial fabric of the Atlee years.
1955 - Churchill retires and Eden called a general election seeking his own mandate
- A relaxed and lowkey election, the press where overwhelmingly supporting
- Although conservatives won it was not an overwhelming defeat and labour was not far behind
10
Q
Eden’s government 1955-57
A
- Anthony Eden had long been regarded as the heir apparent to Churchill as Conservative leader, however Churchill did not retire till 1955 so Eden had to wait a long time
- Election was held soon after he became prime minister and an increased conservative majority (showing his success in a short time)
- Eden held the prestige office of foreign secretary for 10 years
- By the time he reached office in 1955 he was irritated by criticism in the Tory press that his uninspiring domestic policies lacked ‘the smack of firm government’ (Eden’s habit of smacking the palm of his hand, an image the press used to mock) This means he really doesn’t care.
- Eden was determined to silence criticism by achieving success in foreign affairs leading him to the ill-fated Suez affair
- Did not care about domestic affairs
11
Q
Eden’s downfall
A
- Downfall was foreign affairs, his decision to launch military action against the new nationalist leader of Egypt Colonel Nasser, in October 1956 which ended in disaster and national humiliation
- The Anglo-French military operation had to be called off in humiliation circumstances with Britain being virtually commanded to withdraw by American pressure. (Threatening Britain with the money they owed them)
- The suez affair was a diplomatic and military fiasco, a turning point for Britain’s illusions of maintaining imperial power.
- It was also a political crisis, and Eden seemed exceptionally weak and he came under attack from the Labour party in parliament and the national press most notable the Manchester guardian.
- He had denied his collusion with France and Israel in orchestrating the Suez crisis, which meant he had lied to the house of commons, his prestige was badly tarnished due to lying in the house of commons
12
Q
The Suez crisis 1956
A
- The president of Egypt Nasser, had at first been on good terms with the west and had been promised US and British loans for the construction of the Aswan Dam. However, when the USA learned that Nasser had approached the Soviet bloc (countries under the USSR) it withdrew its original offer
- Eden declared that Nasser should not be allowed to threaten the essential oil supplies that came to Britain from the Middle east so began plans to bring Nasser down
- The French were very willing to join and Eden hoped the USA would favour such a policy and they did indeed join in seeking to apply pressure to Egypt by the creation of a Canal Users’ association
- Nasser refused to budge
13
Q
Implications of the Suez crisis
A
- Suez also split the Conservative Party. The Colonial Minister, Anthony Nutting, resigned from the cabinet.
- There was a rebellion from nearly 40 Conservative MPs. Even the chief whip, Edward (Ted) - Heath, was opposed to Eden’s actions and he was the man responsible for Conservative discipline.
- The pressure America exerted, exposed Britain’s weak financial position and it started a ‘run on the pound’ where there is a rapid fall in the value of the pound in relation to the dollar in international currency markets.
- This had forced Macmillan to lead the campaign to abort the Suez invasion (which he had initially supported)
14
Q
Run on the Pound
A
A run on the pound is a situation of increased nervousness towards the value of sterling and sterling-linked assets, including UK government bonds. In such a scenario, investors and traders quickly begin to sell their assets to limit losses, causing the price of the pound to decline rapidly. A run on the pound may occur when markets feel the Pound is overvalued and likely to fall quickly. If markets expect the pound to fall, they will sell quickly before making a loss
15
Q
Eden resigns – 1957
A
- Never recovered from the Suez crisis however is was on the grounds of serious ill health that he resigned
- Party units restored without lasting splits
- Conservative party recovered quickly and Harold Macmillan emerged as PM.
- Economic prosperity continued to gain support from votes
- In 1959 Macmillan was named ‘Supermac’ led to the Conservatives winning another election
16
Q
Harold Macmillan 1957-63
A
- Surprising Macmillan established a strong political grip so swiftly
- The labour party had internal problems of their own which made them look weak and less electable.
- Suez crisis blamed on Eden not the conservatives
- Conservatives showed control when changing leader swiftly
- “We have never had it so good” – what Macmillan always said
17
Q
Why Macmillan and not Butler?
A
- Butler had been considered the likely succeeded Eden until Suez.
- Butler was not interested in ‘battling’ for the position.
- He had stood in for Eden during the Suez Crisis and had not impressed his fellow MPs.
- Macmillan on the other hand had a much sharper political sense, though he had initially supported Eden in his quest in the Suez, but stopped when things turned sour
- He made a rallying speech to cabinet in 3rd January 1957(before Eden had stood down) in which he admitted the suez had swollen Britain’s debts by £564 million and said lessons needed to be learnt from it rather than overwhelmed by it. This truthful and open speech helped his bid for leadership and a week later he became PM.
- Macmillan benefited from the undemocratic, secretive leadership system
