The 'Devil's Decade' - 1929 to 1939 Flashcards
What was the Young Plan in 1929?
A plan set up by Macdonald and Henderson with the USA which eased Germany’s reparations and advanced it a loan of $300 million.
What legislation and reforms did Labour attempt to introduce before they had to be abandoned due to the economic/financial crisis in 1931?
- Agricultural Marketing Act (1931)
- Greenwood’s Housing Act (1931)
- Coal Mines Act (1930)
- Attempt to repeal of the 1927 Trade Disputes Act
- London Transport Bill (1931)
- Education Bill (1930)
What did the Agricultural Marketing Act do?
It established a series of marketing boards to help producers arrange supplies more efficiently.
What impact did Greenwood’s Housing Act in 1931 have?
Extended house-building subsidies and there was a new slum clearance scheme
What did the Education Bill aim to do and why did was it never passed?
Aimed to increase the school leaving age to 15 and initially it failed die yo lack of Liberal support however the financial crisis in 1931 caused the act to suffer further
What was the London Transport Bill introduced by Herbert Morrison?
Created a public corporation responsible for providing cheap and efficient public transport in London. It did not become law until 1933.
What did Rowntree’s studies show?
That the average family income was £1.50 and that 31.3% of families were in poverty.
What % of families were in poverty in 1931 according to Rowntree?
31.3%
By the end of 1931, what were the levels of unemployment?
2.5 million
Give an example on how the cabinet were split and indecisive on how to deal with the economic crisis after the 1929 Wall Street Crash in America
Mosley resigned in May 1930, when his ‘Mosley Memorandum’ was rejected - he agreed on putting the working men’s needs first.
What did Snowden believe to be fundamental principles in maintaining the economy?
The balance budget and staying on the gold standard
Why did Macdonald set up the Economic Advisory Council of industrialists and economists in 1930?
As he had little to no idea on how to tackle the unemployment problem and needed advice, but he remained weary of ‘new’ ideas
What did the May Committee Reports in July 1931 recommend?
Pay cuts for public workers and cut in unemployment of 20% - this was rejected and TUC’s strongly opposed
How did the economist John Maynard Keynes describe the May Report?
‘the most foolish document I have ever had the misfortune to read’ due to its high exaggeration and unrealistic changes.
Why was Macdonald seen as a traitor to the Labour party in August 1931 during the political crisis?
Macdonald agreed to 10% cuts in unemployment benefit and only 11-9 were in favour so Macdonald announced he was prepared to resign. HOWEVER, King George V persuaded him to continue as Head of a national Government with 4 Labour, 4 Conservative and 2 Liberals.
QUOTE: How does historian H. Pelling describe the 1929 Labour Government?
‘Singularly Unsuccessful’
QUOTE: How did the later Labour leader, Clement Attlee, describe Macdonald’s actions?
‘the greatest betrayal in the political history of this country’
What was Macdonald accused of?
- He was seen to have abandoned the ‘working man’ and only thinking of his career ambitions
- A slow response to the crisis causing it to get worse
- He was too ready to ignore the trade unions and the advice of his own cabinet ministers (e.g. Mosley Memorandum)
- He called an election in 1931 even though he promised not to do so, caused an electoral disaster for Labour
- Was not brave enough to consider ‘new’ ideas and needlessly set up the May Committee
When was Macdonald finally removed for the ‘spotlight’?
In 1935 when Baldwin at last took over the reins
QUOTE: Adelman view on the 1929 labour Government:
‘the Government’s record was uninspiring’
What plans did Lloyd George and the Liberals draw up to tackle unemployment?
Plan for public works consisting mainly of the construction of roads and town planning
In September 1931, after the National Government took over, that dramatically changed the economy?
There was another run on the pound which depleted the country’s gold reserves to such an extent that the Bank of England decided that the Gold Standard would have to be suspended.
Who described the 1930s as ‘the devil’s decade’
Claud Cockburn
What benefit did coming off the Gold Standard in 1931 have?
- Encouraged exports, abandoned free trade and attracted investors to put money into Britain.
- The 30% devaluation of the pound turned out to beneficial for Britain as it made British exports cheaper and easier to sell.
- Britain sold more exports to the Empire, within the ‘sterling area’
What was the policy ‘Cheap Money’ to do with?
Interest rates decreasing which made it easier for industries to borrow money to invest in modern machinery and for consumers to borrow money on mortgages to buy new houses.
What were interest rates reduced to in 1932?
Interest rates were reduced from 6% in 1931 to 2% in 1932
What is the ‘multiplier’ effect that Keynes suggested?
where money invested in the economy would be used over and over again.
What negative impacts did coming off the Gold Standard cause?
- The ‘cheap money’ policy did not cause an immediate increase in investment and when it came to 1934
onwards - Its effectiveness was limited because other currencies also left the gold standard and they depreciated in value also. Many countries also introduced protective tariffs, which made exporting difficult.
Was coming off the Gold Standard generally good or bad for the British economy?
Good
How many houses were built due to the private house boom in the 1930s?
2 million
How did the private house-building boom benefit the economy?
This provided work and created a demand for furniture and fittings, which helped create a revival in the construction industry. Mainly benefitted the middle and upper class