How Successful Was The 1945-51 Labour Government Essay, Research Paper

To judge success, we need to look at what we are comparing

their success or failure with. In this case, success is judged by how Labour

achieved their aims, and if the present situation in Britain improved. There

are also many different areas that success can be judged in. These are

economical, political and social. From studying these individual areas, an

overall judgment can be made. Also who is judging this success? Varying views

were seen depending on the political stance of the judge. However, Labour

success shall be judged from the point of view of an historian studying this

topic many years later. Clement Atlee came to power in 1945 with many hopes for

brightening Britain?s future. His most important aim was to radically reform

Britain?s economy and therefore improve social conditions. Labour being

socialist envisioned privatisation and aid to all, no matter what class. He

also dreamed of free healthcare for all and more jobs to help unemployment.

These had long since been Labours aims, but Atlee had reformed them for his

1945 manifesto. He believed that everything would fall into place, with a

government led economy, it would strengthen so producing jobs and improving

social conditions. However, to have been successful, he needed to have achieved

these aims. Labours first 18 moths of office appeared to run smoothly enough,

and they managed to nationalise the Bank of England and the coal industry. This

nationalisation didn?t effect operations within the bank, however it showed

Labours commitment to controlling the economy and not allowing private

investments to dominate and so therefore steady the economy. The

nationalisation of coal was also proving Labours determination to stick to

policy as during the war this industry was inefficient due to its private

enterprise. Nationalisation improved conditions for workers and showed how the

future would be under Labour. Coal was detrimental to Britain?s economy, and

the speed in which Labour brought it under public ownership shows Labours

commitment. It also reduced unemployment and so decreased the amount of

benefits needed. Another early success for Labour was the formation of the

National Health Service. Created by Aneurin Bevan, it came into operation in 1946.

This was paid for by taxes and gave all people access to health care without

cost. This was a major triumph for Labour as it had been a pipe dream for many

years and this government achieved it with little strain. This is a strong

indication of Labours determination and ability to deliver its promises.? It also gained respect and support from the

influential trade unions that were hostile towards the left. As all trade

unions feared communism, the Labour party had continuous support. Also in 1946, the National Insurance Act was passed, giving

social insurance. This gave benefits to all whom for whatever reason could not

work. This was set up using the Beveridge report as its inspiration. Unlike the

NHS, it was not free for all, the amount of money given to an individual,

depended upon his/her employment history and how much they had contributed to

social security. This however was only the beginning of a major plan, and in

1948, the Assistance Act aimed to help those who fell through the national insurance

net. However, there were problems with this scheme. Benefit

levels that had been agreed could not support people as much as they needed.

This was due to the flat rate contribution system which kept the benefit level

to that of the lowest paid. However, this was not instantly noticeable and

other plans did make up for this failing. Labour also promised the people of Britain a new housing

scheme to rebuild those cities that had been blitzed in the war. They set a

five-year target to build a million houses. This project was quickly started

but soon hit problems. The first one being that to build lots of houses, one

needs a large workforce. However Britain?s labour was being concentrated upon

the coal and textile industries. They also needed lots of wood, which at that

time was being exported and imports were not welcome. Unfortunately for the new

government, the building industry was uncooperative and they focused on more

profitable ventures and before the end of 1946 it was apparent that Labours target

would not be reached, this was not blamed on Labour as they had started to

resolve a situation that had been desperate for a long time. School and hospital building was cut back as the iron and

steel needed for such tasks, were desperately needed for exports and home

investment. The result being that little improvement was made in the physical

standards. Worse, no hospitals at all were built under the labour government. This first year in parliament was a great one for Labour,

promising a bright future. All early policies had been carried out and the

public felt that Labour were delivering their promises and were trustworthy.

Labour seemed strong as they capitalised on the conservative?s successes, which

were often forgotten. The conservatives offered Labour a coalition government

before the election, Labour turned this down and ran a successful campaign,

which made them appear strong and capable. They were also optimistic and looked

to the future creating a new society, which contrasted to the conservatives as

they were always looking in the past. Atlee also gained independence for Burma and India. This was

a success as it showed a reforming Britain moving away from traditional values

and warming towards freedom and independence. It also freed up a considerable

amount of money, as they no longer needed to support their economy and pay for

diplomats. It also freed up the military for use in Korea, although that may be

looked upon as a disaster! Independent historians, generally agree that Atlee?s

government was the most successful Labour government, and possibly one of

Britain?s most influential governments. At that point in time, even left and

right wing historians believed that Labour had been successful in this first

year. However, Labours success was short lived.? During the winter months of 1947, the newly

nationalised pits suffered a coal shortage. Many industries were shut down, as

generating stations were not receiving enough coal. This had detrimental

effects on morale and production. The government could do nothing about his and

it turned into a public relation fiasco and doubt was placed upon the

government?s economical abilities. This problem was eventually solved when the

spring arrived. But more followed in its wake. A major crisis was to hit the Labour Government. After loans

taken from the USA, they promised to allow the pound to float on the stock

market and be able to be converted into international currencies. This however

was not as successful as it was thought it should be. Due to the weakness of

the British economy, people poured all their money into American dollars, this

caused the value of the pound to plummet. Labour realised this was due to their

balance of payments, and the supplies didn?t equal the production. To combat this, the government set up the Ministry of

Economic Affairs to be controlled by Cripps and also reshuffled the central

government. This however didn?t solve the problem, and later in that year,

Labour started to use the national budget stringently to reduce overall demand

in the economy. But the government was wary, and started to take more out of

the economy through taxation than put back in with public expenditure.?? Labour started to take the keynsian

approach, which meant total consumption, and the government tightly controlled

investment. The second of these methods slowly became dominant and faith was

lost in their planning skills.? From 1947, it was felt that a crisis was around the corner

and a massive campaign was designed to persuade the public that exports needed

to dramatically increase. The government also set up the Anglo-American

council, which brought on the adoption of American methods, which were seen as

superior in producing more from less.?

This method was effective, but many people wanted to concentrate on

their own business rather than national effort.? The government justified this as an improvement to the balance of

payments that had been set out incompletely in the economic survey for 1947. It

was an accurate portrayal of the problems, it just didn?t give relevant

details. The problems were not just a result of imports or necessities, other

factors such as military ambitions and overseas politics were also relevant.

These led to massive expenditures world over. Atlee was committed to Britain?s

world status, so he believed it was justified. He also determined that Britain needed to lose its

dependence on America to become economically strong on their own merit. He

wanted to raise investment so consumption fell in its priority. To keep

consumption low, wartime measures were still enforced. This was managed, as

consumption only rose as third as fast as the output of the British economy.

However, part of his crack down on consumption meant rationing, and this was

unpopular with the public. Many illegal responses were made, by the black

market and stealing. But more worrying was the political response made by the

women?s groups, especially the British Housewives League who held marches and

rallies which gained much public attention forcing the government to constantly

defend themselves, instead of concentrating on other issues. Also many

companies were hit by rationing of goods and raw materials as it affected their

profit margins. After the crisis of 1947, the government?s confidence and

reputation was never fully regained. The main reason another external crisis

didn?t occur was due to the Marshall aid received from America. But not all was

well, this measure was only temporary. The government still had the problem of

balance of payments. This caused a new and serious external crisis in 1949.

High levels of exports and controls on imports meant the balance of payments

had improved. Britain was able to compete in dollar markets as they could

devalue the currency, however uncertainty and quarrels within the party meant

this took longer than necessary and the devaluation was larger than it needed

to have been. However, improvements were seen in North America, but this was

created by cuts in government expenditure which affected public spending making

the government seem incompetent to deal with economic affairs.Labour achieved all of their 1945 manifesto aims by 1950,

such as nationalisation, NHS, welfare state and a rise in industrial

investment. Austerity was still in place, this made the government unpopular,

especially as the conservatives used it to their advantage and called it an

example of ?socialist mismanagement.? For the 1950 election no major changes

were made to their manifesto. Labour gained huge majorities in industrial and

urban heartlands and they retained their working class voters, only losses in

marginal seats occurred. The Korean War, which the government only entered to pacify

America, and internal squabbling about socialist directions overshadowed the

governments last year in power. Gaitskell made a point about limiting NHS

expenditure, especially due to the Korean crisis, this was not well received by

Bevan, who eventually lost the argument and resigned in a public fervour. Two

other members resigned and a split emerged in the cabinet, most wanted another

election so they didn?t have to deal with internal problems. Overall, these failures and successes need to be weighed up

to determine whether Labour were successful. It can e said that Labour was

generally successful, as they achieved the major aims that had been set out in

1945. Nationalisation was in place in major industries, the NHS, although not

hugely successful, was running and benefits had improved. Labour had not

achieved their goal for housing, although the project had been started and the

reason for its failure was the economic situation in Britain. They had just

finished a costly war that had nearly financially crippled them and they were

financially dependent upon America for loans. Which also caused the pound to

devalue significantly as they allowed it to float in 1947 and it crashed. This

was to have major repercussions as Labour struggled to rectify that mistake.

Labour was incompetent economically, they made many mistakes and had to reduce

benefits and public spending to try and improve the situation, which went

against their policies. However, it is possible that Labours failings were due

to a poor economic state when they came into office, and a weakened world

economy made it hard for a total recovery, however some ground was made. At a

time when the world was weak anyway, due to war costs, Britain would struggle

anyway to recover, and only the help from America made survival possible. Atlee

had not succeeded, in the sense that Britain was on its feet and economically

stable, however, the state of Britain had improved, and it can be said that had

Labour had another five years, they might have achieved their aims.