The Story of Britain: From the Romans to the Present (95 page)

Britain did not have the severe problems suffered by some European countries. Germany lacked half her heavy industry and was bent under the huge weight of reparations. France was only beginning to rebuild her agriculture and industry, and she had to do that with almost a third of her manpower missing. Strikes had crippled Italy to the point where she feared a communist workers’ takeover. In 1922 terrified of revolutionary chaos Italy abandoned Parliamentary democracy for one-party or totalitarian rule at the hands of violent ex-servicemen in the Fascist party under their leader Benito Mussolini. Parliamentary government had been discredited by a peace settlement which brought her none of the colonies she desired in Africa to add to Libya, and gave much of what she had been promised by the Treaty of London to Yugoslavia. Named after the
fasces
or bundle of twigs that Roman senators carried as a symbol of their authority, the intensely nationalistic fascists were anti-capitalistic and anti-clerical, but also abhorred socialism and communism. Awash with comforting and simplistic slogans in the nihilistic post-war atmosphere, paying lipservice to the certainties of monarchy and Church, the fascists’ squads of paramilitaries restored order, purpose and international prestige to an extremely unstable country. The consequence was that by the end of the decade the Fascist party had become completely entwined with all Italian institutions, from social clubs to town councils.

But though the British might be free to take their usual pleasure in expressing their political opinions, the country was deeply burdened by America’s insistence on being repaid her war loans immediately. Britain had financed much of the war for her European allies, but she had not demanded prompt payment of her debts, because most European countries were in no position to comply. Hampered by shortage of money, diminished populations and the need to work on the ruined land to make it fit for cultivation, the European economies were only slowly getting back to pre-war production levels.

In Britain the coal and cotton export markets collapsed. The businessman Sir Ernest Geddes, appointed to work out where the government could save money, and known as the Geddes Axe, hacked back many of Lloyd George’s promises. ‘A land fit for heroes’ became an ironic saying. The general post-war discontent manifested itself in strikes and lockouts. In industries where she had led the world, Britain was falling behind because she had not invested in new machinery. Nevertheless she remained the world’s leading shipbuilder for another forty years, as befitted a country whose navy had been the best in the world for over a century.

But even that bit of glory had come to an end. The Washington Naval Agreement at the end of 1921 was a sign of the changing times when Britain agreed to parity with America in warships. She could no longer afford to build the ships or bases to defend the empire in its entirety. For the next twenty years Singapore, which was meant to be a great defensive naval base for the empire east of Suez, was not fortified properly or supplied with an adequate number of ships to defend herself.

All of the Royal Navy’s ships were built in Britain, where her welders and engineers had an expertise envied by all other advanced countries. However, especially on what became known as ‘red’ Clydeside near Glasgow, the home of so much of Britain’s shipbuilding since the nineteenth century, a fiery love of striking and militant socialist trade unionism proved fatal to the industry. A smaller navy, and the strikes which lost the yards business, combined to put shipbuilding in Britain into continuous decline.

Lloyd George lived on until 1945, but by 1922 his political day was drawing to a close amid a great deal of bitterness. He had been absent too much in Paris at the peace conference trying to hold back the French, and the Conservatives were beginning to chafe under his grip. He had split the Liberal party when he ousted Asquith, so he had few followers there. His reputation began to be harmed by tales about his honours list, about how as in the days of James I a baronetcy was to be had for £10,000, a peerage for £50,000 and so on. In the grim atmosphere of the slump tongues wagged about how well his entrepreneurial friends had done out of the war. Moreover, many Conservatives did not like the way Lloyd George had relinquished southern Ireland.

Lloyd George’s fall was engineered by the ‘knights of the shires’, as Tory backbenchers have often been known, over the Chanak Crisis. They were worried that Lloyd George was about to resume the war against Turkey, whose republican government under Mustapha Kemal had refused to accept the peace treaty which gave Greece Smyrna. In a revolt in October 1922 they voted at the Carlton Club to resume independence as Conservatives. As Kemal’s victorious army advanced towards the Dardanelles, where a neutral zone had been created, the danger of a collision with the British garrison at Chanak was averted only by the tact of General Charles Harington. The Treaty of Lausanne in July 1923 restored to Turkey at the expense of Greece much of the European territory of which she was to have been deprived.

The Chanak Crisis was the final nail in Lloyd George’s coffin. He resigned, the coalition ended and the Conservative leader Bonar Law briefly formed a Conservative ministry from 1922 to 1923 until ill-health forced him to retire. The genial pipe-smoking iron manufacturer Stanley Baldwin, the epitome of British pragmatism, became prime minister for a year. He made the mistake of abandoning free trade at the December 1923 election which he had called to shore up his position, hoping that tariff reform would help the disastrous level of unemployment. But although the Conservatives returned to power as the party with the largest number of seats in the House of Commons, and Baldwin remained prime minister, he lacked a majority. With a puff of ancient free trade breath, the fading Liberals reunited under Asquith joined with the Labour party to extinguish tariff reform by a vote of no confidence. As the largest of the opposition parties, Labour was then asked by George V to form a minority government pending a general election. On 23 January 1924 Ramsay MacDonald, the illegitimate son of a Scottish farmworker, was sworn in as leader of the first Labour government. He became foreign secretary as well as prime minister.

The excitement within the Labour party at achieving office for the first time after the disappointments of the post-war period was tremendous, though the government lasted for only eight months. Being dependent on the Liberals to remain in power, the Labour government could not bring in some of its more extreme ideas, such as taking key industries into state ownership, as Clause 4 of their 1917 manifesto demanded, or ‘the gradual building up of a new social order’ by wealth redistribution, as their constitution decreed. In the privacy of his diary George V wondered what his grandmother Queen Victoria would have thought of a government whose members were ‘all socialists’, but he believed that they should ‘be given a chance’.

Nonetheless, the conservatively minded feared the Labour government as if it were the prelude to a Bolshevik Revolution. In the recent past, Labour councils such as Clydeside and the London Borough of Poplar had flown the red flag of revolution. Under the high-minded idealist George Lansbury, who in the 1930s briefly became leader of the Labour party, Poplar Council became a byword for the defiance of central government by local authorities. Poplar Labour councillors were frequently imprisoned or otherwise in trouble for refusing, because theirs was a poor council, to pay as much as rich local authorities towards the upkeep of the London County Council. They made a habit of paying out more poor relief than their rates afforded.

In fact the short-lived Labour minority government was decent, sensible and constructive. Its members were anxious to prove themselves trustworthy and responsible custodians of government. Such policies as they implemented in their eight months were for the most part a continuation of Lloyd George’s. Many of the Labour party’s leaders, including home secretary Arthur Henderson, were vehemently opposed to the tyranny and ideology of the communist system in Russia, which some of them had seen at first hand. They were determined that Britain with her Parliamentary democracy should not adopt anything like it. Labour constantly refused to allow the few thousand members of the British Communist party (founded in 1920) to link up with Labour. Communists were not permitted to be Labour candidates or even to be members of the Labour party.

With the former professions of ministers ranging from engine-driving to furnace-stoking, their principal aim was to raise the expectations of the working class. A new Education Bill made a first tier of secondary education the right of the many instead of the preserve of the few who could afford private education. It became the state’s duty to provide senior classes for children up to the age of fourteen, not just primary schooling. It was hoped to raise the school-leaving age to fifteen, though costs would make this impossible for some years. Labour once more attempted to tackle the housing shortage by committing the government to a fifteen-year scheme of expanding council housing available to rent. The bill passed easily through Parliament. The duty of the government to provide houses was becoming part of the post-war consensus, part of the ever greater expansion of the state’s responsibilities for its citizenry. But although insurance for the unemployed was extended, Labour could find little more to do for them. Their number was still hovering about the one-million mark. It was an issue that Britain, the workshop of the world, had never had to tackle before.

Prime Minister Ramsay MacDonald, like many Labour people, was an idealistic socialist and committed internationalist. He had voted against Britain entering the war, believing that wars benefited only imperialists and arms merchants and destroyed the working classes, who were used as cannon fodder. He was a fervent proponent of international organizations to ensure that no war ever happened again and he attended League of Nations gatherings at Geneva which he hoped would remedy what was unsatisfactory about the peace treaties.

For Franco-German relations continued to be destructive and fraught with hatred. America and Britain were not part of the European continent, which had been menaced by Germany for half a century, so their statesmen possessed no intuitive understanding of France’s feelings about her neighbour. She had agreed to a peace treaty which did not bring her frontier up to the Rhine because she believed that she had America’s wing to shelter under. Once America refused to join the League of Nations, France, terrified once again for her security, became trigger-happy. Thus when Germany in 1923 defaulted on her reparations payments to France, French troops were rushed into the Ruhr Valley, Germany’s industrial heartland, to make her pay. For a year the French occupied the Ruhr while German industry came to a halt in a show of defiance against the invader. The French left in 1924, but they had already inflicted the damage on the German economy which made the German mark collapse. By the end of 1923, inflation was so out of control that one American dollar was worth hundreds of millions of marks. With the mark worth so little, people had to bring wheelbarrows full of paper money to pay even small bills. Germany was meanwhile bedevilled by assassination attempts and coups.

Nevertheless the internationalists in Europe like MacDonald were determined to help. Germany was not left to sink. In 1924 an American scheme, the Dawes Plan, adjusted the reparations burden to make it less harsh. By 1929 the Allied Reparations Commission had found the reparations to be disproportionately heavy on Germany, and they were reduced to less than a third of the total established in 1921. By the mid-1920s not all seemed bad. The German mark recovered.

A better era seemed to be ushered in for Germany under the gifted republican statesman Gustav Stresemann. Though Germany had never ceased to campaign to revise Versailles, in 1925 she at last appeared to have officially accepted her western frontier with France when she signed the Locarno Treaty. Germany was admitted to the League of Nations and the Rhineland was demilitarized. By 1926 she was no longer seen as a pariah nation. In 1928 the Kellogg–Briand Pact, produced by an American and a Frenchman, attempted to eliminate war as an instrument of national policy. Its multilateral treaty almost made up for America not joining the League.

The first Labour government had shown itself to be moderate and unexceptionable and contained reassuring personnel from Asquith’s last Cabinet, such as Lord Haldane who became lord chancellor. Nevertheless a trade treaty and a loan which Labour tried to negotiate with Soviet Russia and what purported to be revolutionary instructions from the Soviet government did for the government. Four days before the general election in October 1924 the
Daily Mail
’s publication of a letter from one of the Russian Bolshevik leaders named Zinoviev which appeared to be addressed to Labour gave the country a fright.

The Conservatives returned to power under their new leader Stanley Baldwin. Although Labour was out, only forty Liberals were returned as opposed to 151 Labour and 413 Conservatives. The 1924 election is therefore interesting because it marks the real eclipse of the Liberal party. Labour had received one million more votes and had effectively become the second party in the British two-party system.

Baldwin now had a decent overall majority. Always seen chewing on his pipe he was a reassuring figure in troubled times, although his comfortable image disguised a mind like a trap. He was a formidable Parliamentary operator. The economic depression which began in 1921 had not ended, and indeed was about to get worse. Among Baldwin’s Cabinet was Winston Churchill as chancellor of the Exchequer. He had last been a Conservative in 1903 when he had resigned over tariff reform. Many in the Conservative party believed that the only way to defeat the depression was to return to the pre-1914 monetary system, by which the pound sterling was fixed at a price reflecting its gold reserves. In 1925 therefore with Churchill as chancellor the country returned to the gold standard. It was a disaster that resulted in massive deflation and the overvaluing of the pound. Manufacturers exporting abroad found their order books diminishing because the strong pound made their products too expensive.