Scraping a Very Narrow Conservative Party Victory: A timeline from 1929

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The Labour cabinet was very much aware of the seriousness of the economic situation. In May 1931 Ramsay MacDonald appointed a committee of five economists, chaired by John Maynard Keynes, to report to him on unemployment policy.

In July 1931 the reductions and restrictions in unemployment benefit made by the Conservative government in April and June 1930 were reversed. Unemployment benefit was increased from 15 shillings and 3 pence to 17 shillings a week for men, and from 13 shillings and sixpence to 15 shillings a week for women. Also unemployment benefit was restored to part-time and seasonal workers, and to married women who were not entitled to it following the changes in June 1930.

The Keynes committee reported in September 1931. It proposed public work schemes, the introduction of a general tariff on imports, and restrictions on unemployment benefit. The cabinet accepted the need for public works, and restrictions on unemployment, but rejected a general tariff. The Chancellor of the Exchequer, William Graham, was in favour of a revenue tariff. Other cabinet ministers also supported a revenue tariff, or tariffs to protect specific industries. The cabinet agreed to a revenue tariff of 10 percent on all imports, except food, on 13 October 1931. Philip Snowden, the Lord Privy Seal, resigned in protest.

MacDonald made the following changes to his government:
Thomas Johnston from President Board of Trade to Lord Privy Seal,
Frederick Pethick-Lawrence from Financial Secretary to the Treasury to President Board of Trade,
George Gillett from Secretary Overseas Trade Department in Board of Trade to Financial Secretary to the Treasury.

The Anomalies Bill removed the right to unemployment benefit from part-time and seasonal workers, and from many married women workers. It received a second reading on 3 December 1931. Forty-one Labour MPs voted against it, including Aneurin Bevan, Ellen Wilkinson, and Jennie Lee and others in the Independent Labour Party (ILP) group. Conservative and Liberal MPs voted for it. After passing through all its stages in the House of Commons, and House of Lords, it received the royal assent and became law on 19 January 1932.

 

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The election for the London County Council (LCC) was held on 5 March 1931. Labour gained control of the council from the Municipal Reform Moderates, the name under which the Conservative Party stood in LCC elections. The number of councillors elected for each party were as follows (1928 election):
Labour: 63 (42)
Municipal Reform Moderates: 54 (77)
Liberal: 7 (5)
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Total: 124 (124)
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Lewis Silkin became leader of the LCC. In OTL the Municipal Reform Moderates kept control of the LCC and increased their number of councillors.

William Graham, the Chancellor of the Exchequer, became ill with pneumonia in December 1931. He resigned from the government on 28 December, and died on 8 January 1932. His death was a great loss to the government and Labour party, Historians think he was a potential leader of the Labour Party. MacDonald made the following changes in the subsequent government reshuffle:
John Clynes from Home Secretary to Chancellor of the Exchequer,
Arthur Greenwood from Minister of Health to Home Secretary,
Clement Attlee from Postmaster-General to Minister of Health and promoted to the cabinet,
Herbert Morrison from Parliamentary Ministry of Transport to Postmaster-General.

 

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The first Round Table Conference on constitutional reforms in India was held in London from November 1930 to January 1931. The Indian National Congress (INC) and Indian business leaders did not attend the conference. All groups attending it supported the concept of an All-India Federation.

The second Round Table Conference took place in London from September to December 1931. Mahatma Gandhi attended as the only official representative of the INC. He claimed that it 'alone represented political India; that the Untouchables were Hindus and should not be treated as a "minority "; and that there should be no separate electorates or special safeguards for Muslims or other minorities. These claims were rejected by the other Indian participants.' (1)

Ernest Bevin, the General Secretary of the Transport and General Workers Union, was elected Labour MP for Gateshead in the by-election on 29 October 1931, caused by the death of Herbert Evans (Labour).

The Dominions Secretary, James Thomas, resigned from the cabinet on 15 October 1931 because he believed that the 10 percent revenue tariff on all non-food imports did not go far enough. He wanted imperial preference and resigned to advocate for it outside the constraints of government. Ramsay MacDonald promoted Hugh Dalton from Under-Secretary Foreign Office to Dominions Secretary, and moved William Lunn from Under-Secretary Dominions Office to Under-Secretary Foreign Office.

Following continual pressure on the pound and an outflow of gold from London, Britain left the gold standard on 18 January 1932. The pound was now on a fluctuating rate and fell from US$4.86 to one £ to about US$ 3.40 to one £. The Conservative Party blamed the failure of the financial policies of the Labour government for Britain leaving the gold standard. The Liberal Party supported it.

(1) The first and second Round Table Conferences were as in OTL. See http://en.wikipedia.org/wiki/Round_Table_Conferences_(India), from which the above quotation is taken.

 

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Jennie Lee, Frank Wise and other Independent Labour Party (ILP) MPs tabled an amendment to the King's Speech in April 1931. It proposed Children's Allowances and the nationalisation of coal mines, gas and electricity. It received only 27 votes. Most Labour MPs voted against it. The Conservatives and Liberals abstained.

In December 1931, Ramsay MacDonald made the Colonial Secretary, Arthur Ponsonby, a hereditary peer. The subsequent by-election in Sheffield Brightside was held on 26 January 1932. The percentage votes for each party were as follows (1931 general election):
Labour: 47.5 (57.8)
Liberal: 26.4 (20,5)
Conservative: 26.1 (21.7)
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Labour majority: 21.1% (36.1%
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Winston Churchill returned to the House of Commons as Conservative MP for Henley at the by-election on 25 February 1932, in which the Liberals kept their second place. He bought a house in the constituency. His paintings of the River Thames and the countryside around Henley show considerable talent. He was a fairly accomplished painter. He and his wife, Clementine, attended the Henley Regatta each year.

Other former Conservative government ministers who lost their seats in the 1931 general election, returned to the House of Commons in by-elections. Duff Cooper in Richmond (Surrey) on 13 April 1932. William Ormsby-Gore and Kingsley Wood in Marylebone, and Eastbourne respectively on 28 April.

When MacDonald appointed his cabinet he made the Lord Privy Seal, Philip Snowden, responsible for government policy on employment. He was assisted by the First Commissioner of Works, George Lansbury, and the Chancellor of the Duchy of Lancaster, Sir Oswald Mosley. When Snowden resigned on 13 November 1931, his successor as Lord Privy Seal, Thomas Johnston, took over responsibility for employment policy.

 

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Mosley published his Memorandum on 9 March 1932. This 'proposed a programme to enlarge home demand and home markets: create public works, increase pensions to take the elderly out of the labour market and add to their purchasing power, and raise the school-leaving age - the package to be secured by nationalizing the banks and ringed by tariff protection.' (1). Johnston and John Clynes, the Chancellor of the Exchequer, agreed with some of it. But Ramsay MacDonald and the majority of the cabinet rejected it. Mosley resigned from the government on 2 May 1932. MacDonald promoted Alfred Short from Under-Secretary Home Office to Chancellor of the Duchy of Lancaster.

From early February a group of eight cabinet ministers plotted to overthrow MacDonald as Prime Minister. They knew that his resignation was necessary to achieve the changes in government policy they wanted, to reflation and large scale public works, financed by redistrbutive taxation. Much like that advocated by the economist John Arthur Hobson. The ministers were Noel Buxton, Minister of Agriculture and Fisheries, John Clynes, Arthur Greenwood, Home Secretary, Arthur Henderson, Foreign Secretary, Tom Johnston, George Lansbury, Frederick Pethick-Lawrence, President of the Board of Trade, and Sir Charles Trevelyan, President of the Board of Education. They called themselves the network. They agreed that when MacDonald resigned, as they hoped he would, they would back Henderson to become leader of the Labour Party and Prime Minister. They were a minority of the cabinet, but expected more ministers would join them when the crunch came.

The network met and plotted in the House of Commons tea room and bar, and in Johnston's flat in London. They made contact with the ILP, through Johnston who was a member, including with Jennie Lee and Frank Wise, who were lovers. Also with Aneurin Bevan, he and Lee were friends.

With unemployment continuing to rise, the National Insurance Fund deficit and the budget deficit kept growing. The cabinet meeting in the morning of Tuesday 24 May 1932 discussed the financial situation. MacDonald proposed cuts of £78 million in government spending, removing unemployment benefit from part-time and seasonal workers, and a ten per cent reduction in unemployment benefit. The network rejected the proposals on unemployment benefit and proposed that the budget deficit be financed by increases and government borrowing.

After a long and lively discussion, the cabinet voted on the two proposals. MacDonald's received nine out of twenty-one votes. Twelve ministers voted for the network's proposals. In addition to the network they were William Adamson, Scotland Secretary, Albert Alexander, First Lord of the Admiralty, Clement Attlee, Minister of Health, and Lord Ponsonby, Colonial Secretary. That afternoon MacDonald resigned as leader of the Labour Party and Prime Minister. Clynes as deputy leader of the Labour Party became caretaker Prime Minister until the Labour Party elected a new leader.

(1) Quotation taken from the book Jennie Lee: A Life by Patricia Hollis. Oxford University Press 1997.

 

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I have decided to make the following changes to my previous message. In the cabinet meeting on 24 May, the network proposed cuts of £56 million in government spending, instead of having no cuts. This was to get a majority of ministers on their side. MacDonald's proposal received eight out of twenty votes. Hugh Dalton, Dominions Secretary, voted for the network's proposal. Because Lord Ponsonby was absent, twelve ministers voted for it.

 

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I have threadmarked my posts and will do so in the future.

The cabinet and the Chief Whip decided that the election for leader by Labour MPs of the their party leader and therefore Prime Minister, would take place on 31 May 1932. The candidates were George Gillett, Financial Secretary to the Treasury; Arthur Henderson, Foreign Secretary; and Sir Oswald Mosley. Gillett was the candidate of MacDonald loyalists, who would have liked him not to have resigned as Prime Minister.

 

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The number of votes for each candidate in the Labour leadership election were:
Arthur Henderson: 241
George Gillett: 39
Sir Oswald Mosley: 26
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Total: 306
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So Henderson was elected leader of the Labour Party and became Prime Minister. He made the following changes to his government;
Hugh Dalton from Dominions Secretary to Foreign Secretary
Lord Thomson from Secretary of State for Air to Dominions Secretary,
Sir Oswald Mosley appointed Secretary of State for Air,
Lord Parmoor resigned as Lord President of the Council,
Lord Ponsonby from Colonial Secretary to Lord President of the Council,
Drummond Shiels promoted from Under Secretary Colonial Office to Colonial Secretary,
Earl de la Warr from Under Secretary Ministry of Agriculture and Fisheries to Under Secretary Colonial Office,
Margaret Bondfield resigned as Minister of Labour,
Susan Lawrence promoted from Parliamentary Secretary Ministry of Health to Minister of Labour,
Ellen Wilkinson appointed Parliamentary Secretary Ministry of Health,
George Gillett resigned as Financial Secretary to the Treasury,
John Lawson from Parliamentary Secretary Ministry of Labour to Financial Secretary to the Treasury.

 

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Thomas Johnston, the Lord Privy Seal, appointed Jennie Lee as his Parliamentary Private Secretary (PPS). They were both Scottish and members of the ILP. Sir Oswald Mosley appointed John Strachey as his PPS.

In his April 1932 budget, Clynes had introduced a Land Value Tax. (1) But it would be some years until it raised a significant amount of money. In his second budget of 1932, on 8 November, Clynes increased the standard rate of income tax from 4 shillings and six pence in the pound to five shillings and six pence, and the maximum rate of surtax from 7 shillings and six pence on amounts of over £50,000 to 9 shillings on amounts of over £30,000. He also announced an extensive programme of public works financed by government borrowing.

(1) For Land Value Tax see http://en.wikipedia.org/wiki/Land_Value_Tax.

 

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Marion Phillips, the Labour MP for Bristol East and Chief Woman Officer of the Labour Party, died on 23 January 1932. She was only fifty years old (date of birth 29 October 1881). The subsequent by-election on 25 February 1932 was won for Labour by George Gilbert Desmond, a barrister and author of children's books. (1) He contested Bath in the April 1931 general election, and other elections for Labour.

The Coal Industry Nationalisation 1932 established the National Coal Board. The Housing Act 1932 extended subsidies to local authorities for slum clearance, and instructed them to draw up five-year plans for slum clearance.

(1) Here is his biography in Wikipedia: http://en.wikipedia.org/wiki/George_Gilbert_Desmond.

 

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The Bank of England was nationalised in 1932. The Trade Unions Act 1932 repealed the Trade Disputes and Trade Unions Act 1927, which made a strike or a lockout intended to coerce the government illegal, and imposed restrictions on political activities of trade unions, and limited the political levy to workers who 'contracted in'. The Education Act 1933 raised the school leaving age from 14 to 15 with maintenance grants.

The World Disarmament Conference opened in Geneva on 2 December 1932. The Chairman was Sir Austen Chamberlain, Foreign Secretary from 1924 to 1929.

The British government had a cautious attitude to the appointment of Adolf Hitler as German Chancellor on 30 January 1933. It didn't know what the new German government, in which Nazi ministers were a minority, would do, or whether it would be just another short-lived German government.

However by April 1933, with the Enabling Act which established the Nazi dictatorship, the banning of political parties, the persecution of the Jews and the establishment of concentration camps, the nature of the Nazi regime was clear. The Home Secretary, Arthur Greenwood, said that refugees from Nazi Germany would be welcome in Britain.

Sir Horace Rumbold, British ambassador to Germany since August 1928, wrote a 5,000 word dispatch to the Foreign Secretary, Hugh Dalton, on 26 April 1933. In it he stressed the 'importance Hitler placed on building a mighty military' to regain Germany's lost provinces, and 'his assertion that Germany must not repeat her mistake in the last war of fighting all her enemies at once but must pick them off one by one. Rumbold was convinced that a deliberate policy was now being pursued the aim of which was to bring Germany to......a jumping off point from which she can reach solid ground before her adversaries can interfere. Germany's neighbours he warned must be vigilant.' (1)

Dalton gave Rumbold's dispatch to the Prime Minister, who circulated it to the cabinet,

(1) Taken fron the book Appeasing Hitler: Chamberlain, Churchill and the Road to War by Tim Bouverie, London: The Bodley Head, 2019.

 

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In a memorandum which Brigadier Arthur Cecil Temperley, a British delegate to the Geneva Disarmament Conference, sent to the Foreign Office on 10 May 1933, he 'urged the Government to abandon disarmament and call Germany out on her illegal military. It would be madness, Temperley argued, to consider further disarmament at a time when Germany was in a delirium of reactivated nationalism and of the most blatant and dangerous militarism.. .,, The Germans, Temperley wrote, already possessed 125 fighter aeroplanes - in contravention of the Treaty of Versailles, which provided a German Air Force.'

Could the British government 'afford to ignore what was happening in Germany.,,,,,.there was only one solution, Britain and France, together with the United States, should tell Germany that there would be no relaxation of Versailles and no moves towards equality of status unless a complete reversion of her present military preparations and tendencies took place. Admittedly this ran the risk of starting a war but, as Temperley pointed out, it was a small risk since there was no way that Germany could confront the combined might of the French Army and the Royal Navy. Germany's bluff should thus be called and Hitler, for all his bombast, must give way.' He concluded that 'the only altetnative'..,,.. was to allow things to drift for five years by which time there would either be a new regime in Germsny or war.'

(1) Taken from Appeasing Hitler: Chamberlain, Churchill abd the Road to War [/I] by Tom Bouverie.

 

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On Thursday 2 May 1934, Arthur Henderson announced that he would resign as leader of the Labour Party and Prime Minister, when Labour MPs had elected a new leader. He said that he made his decision because his health was not good, and he wanted to give his successor time in the job before the next general election, which must be no later than 28 April 1936.

The candidates in the leadership election were Hugh Dalton, Foreign Secretary; Arthur Greenwood, Home Secretary; and Herbert Morrison, Postmaster-General. The first ballot of Labour MPs was held on 9 May. The number of votes for each candidate were:
Greenwood: 182
Morrison: 74
Dalton: 47.
As Greenwood received a majority of votes, there was no need for a second ballot and he became leader of the Labour Party and Prime Minister.

Greenwood made the following changes to his government:
Frederick Pethick- Lawrence from President Board of Trade to Colonial Secretary,
Drummond Shiels from Colonial Secretary to Home Secretary,
Clement Attlee from Health Secretary to President Board of Trade,
Herbert Morrison from Postmaster-General to Health Secretary,
John Lawson from Financial Secretary to the Treaury to Postmaster-General. Ernest Bevin joined the government as Financial Secretary to the Treasury.

 

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At the beginning of February 1935, the Foreign Secretary, Hugh Dalton, and the French Foreign Minister, Pierre Laval, met in London. They decided that the armaments clauses of the Treaty of Versailes should be abolished. They would be replaced by a new agreement, in particular on airforces. Also Germany would accept its eastern frontiers. In return Hitler would be asked to be part of a multilateral promise to maintain Austrian independence, and return Germany to the League of Nations.

Because there was nothing to be gained by rejecting the Anglo- French proposals, Hitler said that he would welcome talks and invited the British but not the French to Berlin. The British government accepted the invitation.

 

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On 7 March 1935, Dalton, and the Lord Privy Seal, Thomas Johnston, travelled by plane to Berlin. The next morning, Hitler welcomed them and the British ambassador to Germany, Sir Horace Rumbold. He gave a long speech in which he said that his life work was reviving the German people. But National Socialism was for Germany only. Dalton pressed Hitler on an eastern pact which would guarantee Europe's eastern borders, to which Hitler objected. He refused any participation by Lithuania, which he claimed was abusing the German minority in Memel. Besides, Communist Russia was the great threat to European peace. Johnston said that Russia was not able to, nor wanted to wage war. Hitler asked him not to under estimate the threat from the Soviet Union, the strongest power on land and air. He assured his British guests that he would never contemplate war against either Russia or Czechoslovakia.

 

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In the afternoon session, Hitler denied any intention of violating Austrian independence. He said that Germany wanted an agreement with both France and Britain, but while one with France was full of difficulties, one with Britain would be mutually beneficial. Great Britain could not defend all her colonies and would one day be glad to have the help of Germany's armed forces. He wanted Germany to have friendly relations with Great Britain. Dalton told him that any good relations with Germany would not be at the expense of Britain's friendship with France.

 

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The Franco-Italian Agreement on 7 January 1935 happened as in OTL.

The Nazis had organised a lavish banquet in an ornately decorated with hordes of flunkies with powdered hair. The whole hierarchy of German government was there. In his memoirs, Hugh Dalton wrote about the talks with Hitler and the banquet. Goring wore a sky-blue uniform with lots of gold braid. Hitler wore a badly cut evening suit.

The talks resumed the next day, 9 March 1935. Hitler said he was in favour of a ban on indiscriminate bombing, but insisted on reaching parity with Britain or France, whichever was the greater. Dalton asked him about the size of the German Air Force. He replied untruthfully that it had attained parity with Britain. (1) Dalton and Thomas Johnston then challenged Hitler on several aspects of German government policy.

Dalton asked about the assassination of the Austrian Chancellor, Englebert Dollfuss, by Austrian Nazis on 25 July 1934. Hitler asserted that he and the German government had nothing to do with it, and was as much as shock to he and them as to everyone else. Germany would respect the independence of Austria. It had no territorial claims in Europe.

Johnston asked about the Night of the Long Knives from 30 June to 2 July 1934, in which officially 85 people died, but estimates range up to a 1,000. Was the murder of Elisabeth von Schliecher, wife of former Chancellor, General Kurt von Schliecher, in accordance with National Socialist values? Hitler said that her death was a tragic accident. He had not authorised it. The SS were responsible for it. Johnston then asked who authorised the murders of Kurt von Schliecher; Edgar Jung, a close associate of Vice Chancellor, Franz von Papen; Erich Klausener, the leader of Catholic Action; and Gregor Strasser, who resigned from the Nazi Party in 1932. Hitler declared that they were executed because they were enemies of the German people. It was solely a German matter.

Dalton then asked about the concentration camps and the conditions in them, with the brutal treatment of prisoners. Did not their existence and the murders of critics and rivals in the Night of the Long Knives show that the German government allowed no opposition Hitler said that conditions in the camps were not easy, but prisoners were reasonably well treated. But they were enemies of the German people, and deserved to be there. Dalton commented that they were opponents of the German government.

(1) The banquet and talks up to here are taken are from the OTL talks in Berlin in March 1935, between the Hitler and the Foreign Secretary, Sir John Simon, and the Lord Privy Seal, Anthony Eden, as described in the book Appeasing Hitler: Chamberlain, Churchill and the Road to War by Tim Bouverie, London: The Bodley Head 2019.

 

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Thomas Johnston raised the matter of the persecution of Jews in Germany. Hitler assured him that Jews had their place in Germany, and were safe there. They were not being persecuted and no harm would come to them. Johnston said he hoped what Hitler said about the safety of Jews in Germany was true.

Hugh Dalton said that the Nazi regime was a gangster regime. In the last two years it had shown its true colours. The light of freedom had gone out in Germany. Great Britain wanted peace with Germany, as long as it stayed within its borders. But there could never be friendship between the two nations, while Germany was ruled by the Nazi Party. He and Johnston had no illusions about the real nature of the Nazi regime. There was no point in continuing the meeting. So they left the room and the building.

 

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When Hugh Dalton and Thomas Johnston returned to London, they gave a full report of their talks with Hitler to the cabinet and the House of Commons. At its meeting on 18 March 1935, the cabinet agreed to publish a White Paper which announced an increase of £10 million pounds in defence spending. (1) George Lansbury, First Commissioner of Works, and Lord Ponsonby, Lord President of the Council resigned in protest. The Prime Minister, Arthur Greenwood, made the following changes to his government:
Lord Thomson from Dominions Secretary to Lord President of the Council,
Earl de la Warr from Under-Secretary Colonial Office to Dominions Secretary,
John Strachey appointed Under-Secretary Colonial Office,
Wilfrid Paling from Parliamentary Secretary Ministry of Fuel and Power to First Commissioner of Works,
Aneurin Bevan appointed Parliamentary Secretary Ministry of Fuel Power.

(1) In OTL the National government cabinet published a White Paper which increased defence spending by 10 per cent, It was opposed by the Labour Party.

 

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Arthur Greenwood, the British Prime Minister, and the French Prime Minister, met Mussolini near the town of Stresa in northern Italy from 11 to 14 April 1935. They agreed to a League of Nations resolution which would respond with sanctions to any violation of the Treaty of Versailles. 'They reaffirmed their commitment to the Locarno Treaty - which included the maintenance of the demilitarised Rhineland - and declared their determination to oppose, by all practicable means, any unilateral repudiation of treaties which may endanger the peace of Europe, and [to] act in close and candid collaboration for this purpose.' (1)

In June 1935, Joachim von Ribbentrop, Hitler's Ambassador at Large, arrived in London for talks with the British government. The British accepted Hitler's demand for a German fleet which would be 35 per cent of the Royal Navy. The reason for this was that in December 1934, the Japanese had given notice that they would not be renewing the Washington Naval Treaty 1922, which gave Britain and the USA each a 5:3 ratio of naval superiority over Japan. This would mean a naval race with Japan which Britain decided it could not afford. The Admiralty, which did not want a naval arms race with Germany, persuaded the cabinet to accept Hitler's offer. (2)

Though there were sound military reasons for the Anglo-German Naval Agreement, it was a diplomatic disaster. The British had unilaterally repudiated the Treaty of Versailles. This was contrary to the agreement reached at Stresa ten weeks earlier. Pierre Laval, who became Prime Minister of France on 7 June, which remaining Foreign Minister, was furious. Mussolini drew the conclusion that Britain no longer supported collective security. (3)

(1) This was as in OTL. See the book Appeasing Hitler: Chamberlain, Churchill and the Road to War by Tim Bouverie.

(2) As in OTL.

(3) As in OTL.