James Ramsay MacDonald, the illegitimate son of Anne Ramsay, a maidservant, was born in Lossiemouth, Morayshire, on 12th October, 1866. His father, James MacDonald, was a ploughman on a farm some miles away. Anne's mother, Isabella, held firm Calvinist beliefs and objected to James and Anne marrying: "The young couple, however, were exonerated by their local free kirk as they were not living in sin, in a rural area which had a high incidence of births out of wedlock." (1)
MacDonald went to the parish school at Drainie. At fifteen, after a few months working on a nearby farm, MacDonald was appointed as a pupil teacher. His appointment saved him from a lifetime working on the land. During his time as pupil teacher he read widely including Progress and Poverty, by Henry George. The author believed that higher taxes on the rich could help to deal with the increasing number of people living in poverty. MacDonald was also influenced by the political radicalism of the fishermen and farm workers and by 1884 considered himself to be a Christian Socialist. (2)
In 1885, MacDonald left Scotland to take up a position as an assistant to a Bristol clergyman who planned to establish a Boys' and Young Men's Guild at St Stephen's Church. He hoped to become a social worker or a teacher. He was to admit several years later: "Something is constantly saying to me that I will do nothing myself but that I will enable someone else to do something." (3)
Later that year MacDonald joined the Social Democratic Federation (SDF), the first Marxist political group in Britain. MacDonald became the librarian, organizing the sale of the SDF's newspaper, Justice. MacDonald later recalled that the small group met in a workmen's cafe. "We had all the enthusiasm of the early Christians in those days. We were few and the gospel was new. The second coming was at hand." (4)
MacDonald left a couple of months later after he heard that during the 1885 General Election, two of the SDF leaders, Henry M. Hyndman and Henry H. Champion, without consulting their colleagues, accepted £340 from the Conservative Party to run parliamentary candidates in Hampstead and Kensington. The objective being to split the Liberal vote and therefore enable the Conservative candidate to win. MacDonald claimed that the actions of Hyndman and Champion "lacked a spirit of fairness". (5)
In his resignation letter he wrote: "If practical Socialism means an autocracy or the Government of a Cabal I for one will have nothing to do with it... To read that paper (Justice) one would think the SDF's hand was against all other Socialist societies in England and that its duty was to heap slander of all sorts upon them... We have over and over again had to read arguments in favour of Socialism that never went deeper than calling an opponent an 'outrageous old hypocrite', 'a bloodsucker', 'ignorant, and many other epithets as delicious as the fumes of a Billingsgate market... It has been plainly shown in the history of the Federation that the great virtues it recognises are unscrupulousness, unfairness and slander. Be it so! I hope there may be many who can now see to what they have been trusting, and how they have been used, many who love the grand principles of Socialism more than the distorted doctrines of the Federation and who have the courage and manliness to act accordingly." (6)
In 1886 MacDonald moved to London and obtained a job as an invoice clerk in a city warehouse. Living in cheap lodgings in Kentish Town and attended evening classes where he studied for a science scholarship in the Birkbeck Institute and the City of London College. He hoped to win a scholarship to train as a teacher at a school South Kensington. "When his health broke down from poverty and overwork he lost the chance of bettering himself through formal education." (7)
After he recovered his health, MacDonald was employed as private secretary to Thomas Lough, the Liberal Party candidate for West Islington. Lough, an Irish nonconformist and tea merchant was a loyal follower of William Ewart Gladstone. According to his biographer, "the 21-year-old Scot entered the world of metropolitan middle-class Liberalism but also moved among the radical and Labour figures who dominated the local party." (8)
Soon after arriving in London he joined the Fabian Society. Another member, George Bernard Shaw, said he had the bearing of an army officer. Beatrice Webb, a founder member of the group, agreed to employ MacDonald as a "lecturer in the provinces". MacDonald wanted to give talks in London but Webb rejected that idea: "He is not good enough for that work; he has never had the time to do any sound original work, or even learn the old stuff well. Moreover he objects altogether to diverting 'socialist funds' to education... The truth is that we and MacDonald are opposed on a radical issue of policy." (9)
In the 1880s working-class political representatives stood in parliamentary elections as Liberal-Labour candidates. MacDonald had hopes of becoming the Lib-Lab candidate for Dover. A local newspaper made it clear that MacDonald was on the extreme left of the Liberal Party: "Mr. MacDonald... with true Scotch sturdiness he stuck to his guns, and in a speech of over an hour's duration, during which he was subjected to continual interruptions, he explained the relationship of the Labour party to the Liberal party and the programme on which he should fight the next Parliamentary election... In conclusion, Mr. MacDonald said that he had kept them rather long but he had done so mainly for the purpose of teaching certain interests in Dover a lesson, and if the same policy were adopted at every meeting he should do exactly as he had done that night." (10)
After the 1885 General Election there were eleven of these Liberal-Labour MPs. Some socialists like Keir Hardie, began to argue that the working class needed their own independent political party. This feeling was strong in Manchester and in 1892 Robert Blatchford, the editor of the socialist newspaper, the Clarion joined with Richard Pankhurst to form the Manchester Independent Labour Party. (11)
The activities of the Manchester group inspired Liberal-Labour MPs to consider establishing a new national working class party. Under the leadership of Keir Hardie, the Independent Labour Party was formed in 1893. It was decided that the main objective of the party would be "to secure the collective ownership of the means of production, distribution and exchange". Leading figures in this new organisation included Robert Smillie, George Bernard Shaw, Tom Mann, George Barnes, Pete Curran, John Glasier, Katherine Glasier, Henry H. Champion, Ben Tillett, Philip Snowden and Edward Carpenter. (12)
Ramsay MacDonald joined in 1894 and the following year was selected as the ILP candidate for Southampton. At a meeting in May 1895, Margaret Gladstone attended one of his meetings. She noted that his red tie and curly hair made him look "horribly affected". However, she sent him a £1 contribution to his election fund. A few days later she became one of his campaign workers. At the 1895 General Election, MacDonald, along with the other twenty-seven Independent Labour Party candidates, was defeated and overall, the party won only 44,325 votes. (13)
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The following year Ramsay and Margaret began meeting at the Socialist Club in St. Bride Street and at the British Museum, where they both had readers' tickets. In a letter she admitted that before she met him she had been terribly lonely: "But when I think how lonely you have been I want with all my heart to make up to you one tiny little bit for that. I have been lonely too - I have envied the veriest drunken tramps I have seen dragging about the streets if they were man and woman because they had each other... This is truly a love letter: I don't know when I shall show it you: it may be that I never shall. But I shall never forget that I have had the blessing of writing it." (14)
They decided to get married and in a letter she wrote to MacDonald on 15th June, 1896 about her situation: "My financial prospects I am very hazy about, but I know I shall have a comfortable income. At present I get £80 allowance (besides board & lodging, travelling and postage); my married sister has, I think about £500 all together. When my father dies we shall each have our full share, and I suppose mine will be some hundreds a year... My ideal would be to live a simple life among the working people, spending on myself whatever seemed to keep me in best efficiency, and giving the rest to public purposes, especially Socialist propaganda of various kinds." (15)
After they married in 1897, Margaret MacDonald was able to finance her husband's political career from her private income of £500 a year. "The marriage was a political partnership, albeit an uneven one. Margaret continued with her own public work, but she also coped with her husband's social awkwardness. About once every three weeks, they were 'at home' to progressive trade unionists and Labour activists, Socialist leaders and radical intellectuals and later to foreign Socialists, dominion Labour leaders and colonial nationalists. These gatherings were important for MacDonald's political career." (16)
The marriage was a very happy one, and over the next few years they had six children: Alister (1898), Malcolm (1901), Ishbel (1903), David (1904), Joan (1908) and Shelia (1910). Bruce Glasier wrote: "Margaret MacDonald might easily have been taken for the nursemaid in a small middle-class family. Her naivete, simplicity, unselfishness and amazing capacity for organisation and helpful work made her one of the best liked women I have known. There was little in her to attract men, as men, but everything to attract women and men who had enthusiasm for public work." (17)
Keir Hardie, the leader of the Independent Labour Party and George Bernard Shaw of the Fabian Society, believed that for socialists to win seats in parliamentary elections, it would be necessary to form a new party made up of various left-wing groups. On 27th February 1900, representatives of all the socialist groups in Britain met with trade union leaders at the Congregational Memorial Hall in Farringdon Street. After a debate the 129 delegates decided to pass Hardie's motion to establish "a distinct Labour group in Parliament, who shall have their own whips, and agree upon their policy, which must embrace a readiness to cooperate with any party which for the time being may be engaged in promoting legislation in the direct interests of labour." To make this possible the Conference established a Labour Representation Committee (LRC). This committee included two members from the Independent Labour Party (Keir Hardie and James Parker), two from the Social Democratic Federation (Harry Quelch and James Macdonald), one member of the Fabian Society (Edward R. Pease), and seven trade unionists (Richard Bell, John Hodge, Pete Curran, Frederick Rogers, Thomas Greenall, Allen Gee and Alexander Wilkie). (18)
Whereas the ILP, SDF and the Fabian Society were socialist organizations, the trade union leaders tended to favour the Liberal Party. As Edmund Dell pointed out in his book, A Strange Eventful History: Democratic Socialism in Britain (1999): "The ILP was from the beginning socialist... but the trade unions which participated in the foundation were not yet socialist. Many trade union leaders were, in politics, inclined to Liberalism and their purpose was to strengthen labour representation in the House of Commons under Liberal party auspices. Hardie and the ILP nevertheless wished to secure the collaboration of trade unions. They were therefore prepared to accept that the LRC would not at the outset have socialism as its objective." (19) Henry Pelling argued: "The early components of the Labour Party formed a curious mixture of political idealists and hard-headed trade unionists: of convinced Socialists and loyal but disheartened Gladstonians". (20)
Ramsay MacDonald was chosen as the secretary of the LRC. One reason for this was as he was financed by his wealthy wife, he did not have to be paid a salary. The LRC put up fifteen candidates in the 1900 General Election and between them they won 62,698 votes. Two of the candidates, Keir Hardie and Richard Bell won seats in the House of Commons. Hardie was the leader of the ILP but Bell, the General Secretary of the Amalgamated Society of Railway Servants, once in Parliament, associated himself with the Liberal Party. (21)
Ramsay MacDonald was totally against the Boer War as he saw it as a consequence of imperialism. He wrote that "further extensions of Empire are only the grabbings of millionaires on the hunt". He joined forces with John Hobson to move a resolution condeming the war at a meeting of the Fabian Society. It was defeated and George Bernard Shaw wrote to MacDonald claiming: "I don't believe that the causes of the war menace our democracy. Quite the contrary. I don't believe that the capitalists have created or could have created the situation they are now exploiting for all its worth." After failing to win the vote, MacDonald, along with thirteen others, including Walter Crane and Emmeline Pankhurst, resigned from the Fabian Society. (22)
Ramsay MacDonald became the Labour Representation Committee candidate for Leicester. The constituency elected two members and the other candidate expected to win was Henry Broadhurst, who represented the Liberal Party. The local newspaper was impressed with MacDonald: "Mr MacDonald is a tall, strong, vigorous young man, and has evidently got a lot of fight in him. He appears to have a great deal of nervous electric energy as well as abundant muscular force. He stands upright with every inch of his measurement - with conscious power." (23)
In February, 1903, Ramsay MacDonald and Keir Hardie had meetings with Herbert Gladstone and other leading members of the Liberal Party about the possibility of an electoral pact. As a result of these discussions it was agreed that such a deal would prove very harmful to the Conservative Party: "An arrangement would mean that the future for both the Liberals and the LRC would be very bright and encouraging. It would mean votes for the Liberals from erstwhile Liberal working men and even from Tory working men. The main benefit, however, would be the effect on the public mind of seeing the opponents of the Government united." (24)
At its conference that year it increased subscriptions which gave it an annual income approaching £5,000. The LRC also established a compulsory parliamentary fund for the payment of members of the House of Commons. At that time MPs were not paid a wage. This move provided an effective way of making members of Parliament and parliamentary candidates toe the party line. (25)
The LRC did much better in the 1906 General Election with twenty nine successful candidates winning their seats. MacDonald won his seat and other successes included James Keir Hardie (Merthyr Tydfil), Philip Snowden (Blackburn), Arthur Henderson (Barnard Castle), George Barnes (Glasgow Blackfriars), Will Thorne (West Ham) and Fred Jowett (Bradford). At a meeting on 12th February, 1906, the group of MPs decided to change from the LRC to the Labour Party. Hardie was elected chairman and MacDonald was selected to be the party's secretary. (26)
This success was due to the secret alliance with the Liberal Party. This upset left-wing activists as they wanted to use elections to advocate socialism. (27) However, of their 29 MPs only 18 were socialists. Hardie was elected chairman of the party by one vote, against Shackleton, the trade union candidate. His victory was based on recognition of his role in forming the Labour Party rather than his socialism. (28)
Some people in the party were worried about the new dominance of the trade union movement. The Clarion newspaper wrote: "There is probably not more than one place in Britain (if there is one) where we can get a Socialist into Parliament without some arrangement with Liberalism, and for such an arrangement Liberalism will demand a terribly heavy price - more than we can possibly afford." (29)
Labour MPs campaigned to reverse the Taff Vale judgment. In 1901 the Taff Vale Railway Company sued the Amalgamated Society of Railway Servants for losses during a strike. As a result of the case the union was fined £23,000. Up until this time it was assumed that unions could not be sued for acts carried out by their members. This court ruling exposed trade unions to being sued every time it was involved in an industrial dispute. As a result of Shackleton's efforts the House of Commons passed the 1906 Trades Disputes Act which removed trade union liability for damage by strike action. (30)
This was seen as a great victory for the Labour Party. The historian, Ralph Miliband, has argued: "The only issue on which the Labour Party was unambiguously pledged was the legislative reversal of the Taff Vale decision of 1901, which had seriously jeopardized the unions' right to strike, but which had also been of crucial importance to the LRC, since it was this above all else which had persuaded more unions that they did indeed require independent representation in the House of Commons, and who therefore agreed to affiliate to the LRC. The Trades Dispute Act... ultimately met the Trade Unions' demands could legitimately be claimed as a success for the Parliamentary Labour Party." (31)
At first Keir Hardie was chairman of the party in the House of Commons, but was not very good with dealing with internal rivalries within the party, and in 1908 resigned from the post and Arthur Henderson became leader. However, it was Ramsay MacDonald who held the most power. As David Marquand has pointed out: "The LRC conference unanimously elected him as secretary of the new body. He was the only person in the entire LRC whose responsibility was to the whole rather than to any of the constituent parts. He had no salary, little formal power, and few resources. But on the strategic questions that determined its fate, his was the decisive voice." (32)
In 1909 David Lloyd George announced what became known as the People's Budget. This included increases in taxation. Whereas people on lower incomes were to pay 9d. in the pound, those on annual incomes of over £3,000 had to pay 1s. 2d. in the pound. Lloyd George also introduced a new supertax of 6d. in the pound for those earning £5000 a year. Other measures included an increase in death duties on the estates of the rich and heavy taxes on profits gained from the ownership and sale of property. Other innovations in Lloyd George's budget included labour exchanges and a children's allowance on income tax. (33)
Ramsay MacDonald argued that the Labour Party should fully support the budget. "Mr. Lloyd George's Budget, classified property into individual and social, incomes into earned and unearned, and followers more closely the theoretical contentions of Socialism and sound economics than any previous Budget has done." MacDonald went on to argue that the House of Lords should not attempt to block this measure. "The aristocracy... do not command the moral respect which tones down class hatreds, nor the intellectual respect which preserves a sense of equality under a regime of considerable social differences." (34)
During this period the Labour MPs gave its support to the Liberal government. The chief whip reported in 1910: Throughout this period I was always able to count on the support of the Labour Party." One Labour supporter asked: "How can the man in the street, whom we are continually importuning to forsake his old political associations, ever be led to believe that the Labour Party is in any way different to the Liberal Party, when this sort of thing is recurring." (35)
Arthur Henderson did not have the full-support of the party and in 1910 he decided to retire as chairman. Henderson thought that MacDonald should become the new leader. As David Marquand, the author of Ramsay MacDonald (1977) pointed out: "It is unlikely that he did so out of a sudden access of personal affection, or even out of admiration for MacDonald's character and abilities. He wanted MacDonald as chairman, partly because he wanted to be party secretary himself and believed correctly that he would be a good one, partly because he believed - again correctly - that MacDonald was the only potential candidate capable of reconciling the ILP to the moderate line favoured by the unions." (36)
Ramsay MacDonald was expected to become the new leader but in February he suffered two shattering emotional blows. On 3rd February his youngest son, David, died of diphtheria. On 4th July, 1910, MacDonald wrote: "My little David's birthday... Sometimes I feel like a lone dog in the desert howling from pain of heart. Constantly since he died my little boy has been my companion. He comes and sits with me especially on my railway journey and I feel his little warm hand in mine. That awful morning when I was awakened by the telephone bell, and everything within me shrunk in fear for I knew I was summoned to see him die, comes back often too." (37) Eight days later his mother also died. It was therefore decided that George Barnes should become chairman instead of MacDonald. A few months later Barnes wrote to MacDonald saying he did not want the chairmanship and was "only holding the fort". He continued, "I should say it is yours anytime". (38)
The 1910 General Election saw 40 Labour MPs elected to the House of Commons. Two months later, on 6th February, 1911, George Barnes sent a letter to the Labour Party announcing that he intended to resign as chairman. At the next meeting of MPs, Ramsay MacDonald was elected unopposed to replace Barnes. Arthur Henderson now became secretary. According to Philip Snowden, a bargain had been struck at the party conference the previous month, whereby MacDonald was to resign the secretaryship in Henderson's favour, in return for becoming chairman."
On 20th July 1911, Ramsay MacDonald arranged for Margaret MacDonald to meet William Du Bois in the House of Commons. He later explained: "A little after noon she joined me at the House of Commons with one whom she had desired to meet ever since she had read his book on the negro, Professor Du Bois; that afternoon we went to country for a weekend rest. She complained of being stiff, and jokingly showed me the finger carrying her marriage and engagement rings. It was badly swollen and discoloured, and I expressed concern. She laughed away my fears... On Saturday she was so stiff that she could not do her hair, and she was greatly amused by my attempts to help her. On Sunday she had to admit that she was ill and we returned to town. Then she took to bed."
According to Bruce Glasier she was treated by Dr. Thomas Barlow, who told MacDonald that he could not save her. "When she heard that she was doomed, she was silent, and said with a slight tremble in her voice, I am very sorry to leave you - you and the children - alone. She never wept - never to the end. She asked if the children could be brought to see her. When the boys were brought to her, she spoke to each one separately. To the boys she said, I wish you only to remember one wish of your mother's - never marry except for love." (39)
Margaret MacDonald died on 8th September 1911, at her home, Lincoln's Inn Fields, from blood poisoning due to an internal ulcer. Her body was cremated at Golders Green on 12th September and the ashes were buried in Spynie Churchyard, a few miles from Lossiemouth. His son, Malcolm MacDonald, later recalled: "At the time of my mother's death... my father's grief was absolutely horrifying to see. Her illness and her death had a terrible effect on him of grief; he was distracted; he was in tears a lot of time when he spoke to us... it was almost frightening to a youngster like myself." (40)
Ramsay MacDonald wrote a short memoir of his wife, which was privately printed and circulated to friends. He told Katharine Glasier: "I felt myself hearing her approval of it, so much so that I seemed to see her hand on your shoulder as you wrote - and grew foolishly weakly blind with tears for the pain that was there." Katharine encouraged him to remarry. He rejected the idea and when his son, Malcolm MacDonald, made the same suggestion he replied: "My heart is in the grave." The income from Margaret's trust fund - now around £800 a year - was paid to him. This enabled him to employ a woman to look after the children and the household at Lincoln's Inn Fields.
The Liberal government's next major reform was the 1911 National Insurance Act. This gave the British working classes the first contributory system of insurance against illness and unemployment. All wage-earners between sixteen and seventy had to join the health scheme. Each worker paid 4d a week and the employer added 3d. and the state 2d. In return for these payments, free medical attention, including medicine was given. Those workers who contributed were also guaranteed 7s. a week for fifteen weeks in any one year, when they were unemployed. (41)
MacDonald declared in the House of Commons that the premiums were too high and the balance between state, employer and employee was unfair. However, he believed that the Labour Party should try to get the measure modified. Some leading figures in the movement, including Keir Hardie, Philip Snowden, Will Thorne and George Lansbury, disagreed and called for the bill to be rejected. MacDonald was furious about this rebellious behaviour. He continued to negotiate with David Lloyd George and managed to get important concessions including low-paid workers exempted from contributions. (42)
Lloyd George's reforms were strongly criticised and some Conservatives accused him of being a socialist. There was no doubt that he had been heavily influenced by Fabian Society pamphlets on social reform that had been written by Beatrice Webb, Sidney Webb and George Bernard Shaw. However, some Fabians "feared that the Trade Unions might now be turned into Insurance Societies, and that their leaders would be further distracted from their industrial work." (43)
John Bruce Glasier argued that Ramsay MacDonald gave him the impression that he had lost faith in socialism and wanted to move the Labour Party to the right: "I noticed that Ramsay MacDonald in speaking of the appeal we should send out for capital used the word 'Democratic' rather than 'Labour' or 'Socialist' as describing the character of the newspaper. I rebulked him flatly and said we would have no 'democratic' paper but a Socialist and Labour one - boldly proclaimed. Why does MacDonald always seem to try and shirk the word Socialism except when he is writing critical books about the subject." (44)
Ramsay MacDonald clashed with some members of the party over votes for women. He had argued for many years that women's suffrage that was a necessary part of a socialist programme. He was therefore able to negotiate an agreement with the National Union of Women's Suffrage Societies for joint action in by-elections. In October, 1912, it was claimed that £800 of suffragist money had been spent on Labour candidatures. (45)
However, some leaders of the Labour Party, including Keir Hardie and George Lansbury, supported the campaign of the Women's Social and Political Union (WSPU), MacDonald rejected their use of violence: "I have no objection to revolution, if it is necessary but I have the very strongest objection to childishness masquerading as revolution, and all that one can say of these window-breaking expeditions is that they are simply silly and provocative. I wish the working women of the country who really care for the vote ... would come to London and tell these pettifogging middle-class damsels who are going out with little hammers in their muffs that if they do not go home they will get their heads broken." (46)
MacDonald also pointed out, the WSPU wanted votes for women on the same terms as men, and specifically not votes for all women. He considered this unfair as at this time only a third of men had the vote in parliamentary elections. MacDonald's friend, John Bruce Glasier, recorded in his diary after a meeting with Emmeline Pankhurst and Christabel Pankhurst, that they were guilty of "miserable individualist sexism" and that he was strongly against supporting the organisation. (47)
In 1912 MacDonald formed a friendship with Margaret Sackville. It has been claimed that she was his mistress for fifteen years. Under the influence of MacDonald, Sackville became a socialist and a pacifist. The surviving letters, which date from 1913, show that MacDonald proposed at least three times to Sackville, but each time he was rejected. In one letter MacDonald wrote: "Dearest beloved, it is such a beautiful morning that you ought to be here and we should be walking in the garden. And if we were walking in the garden, what more should we do where the bushes hid us?" (48)
Patrick Barkham has pointed out: "It was a passion they could not make public, a love doomed to be declared in scribbled letters or stolen moments when they walked together. Ramsay MacDonald was the ambitious, illegitimate son of a farm labourer... Lady Margaret Sackville was the youngest child of the seventh Earl de la Warr, a poet and a society beauty who became his lover. They were separated not only by class but by religion. Born in Lossiemouth, Morayshire, MacDonald was raised in the Presbyterian church and, as an adult, joined the Free Church of Scotland. Born in Mayfair, London, and nearly 15 years his junior, Lady Margaret was Roman Catholic." (49)
The Labour Party was completely divided by their approach to the First World War. Those who opposed the war, included Ramsay MacDonald, Keir Hardie, Philip Snowden, John Bruce Glasier, George Lansbury, Alfred Salter, William Mellor and Fred Jowett. Others in the party such as Arthur Henderson, George Barnes, J. R. Clynes, William Adamson, Will Thorne and Ben Tillett believed that the movement should give total support to the war effort. (50)
Keir Hardie made a speech on 2nd August, 1914, where he called on "the governing class... to respect the decision of the overwhelming majority of the people who will have neither part nor lot in such infamy... Down with class rule! Down with the rule of brute force! Down with war! Up with the peaceful rule of the people!" (51)
Ramsay MacDonald agreed and stated that he would not encourage his members to take part in the war. "Out of the darkness and the depth we hail our working-class comrades of every land. Across the roar of guns, we send sympathy and greeting to the German Socialists. They have laboured increasingly to promote good relations with Britain, as we with Germany. They are no enemies of ours but faithful friends." (52)
On 5th August, 1914, the parliamentary party voted to support the government's request for war credits of £100,000,000. Ramsay MacDonald immediately resigned the chairmanship and the pro-war Arthur Henderson was elected in his place. (53) MacDonald wrote in his diary: "I saw it was no use remaining as the Party was divided and nothing but futility could result. The Chairmanship was impossible. The men were not working, were not pulling together, there was enough jealously to spoil good feeling. The Party was no party in reality. It was sad, but glad to get out of harness." (54)
Five days later MacDonald had a meeting with Philip Morrel, Norman Angell, E. D. Morel, Charles Trevelyan and Arthur Ponsonby. They decided, in MacDonald's words, "to form a committee to voice our views". A meeting was held and after considering names such as the Peoples' Emancipation Committee and the Peoples' Freedom League, they selected the Union of Democratic Control. Other members included included J. A. Hobson, Charles Buxton, Frederick Pethick-Lawrence, Arnold Rowntree, Morgan Philips Price, George Cadbury, Helena Swanwick, Fred Jowett, Tom Johnston, Philip Snowden, Ethel Snowden, David Kirkwood, William Anderson, Isabella Ford, H. H. Brailsford, Israel Zangwill, Bertrand Russell, Konni Zilliacus, Margaret Sackville and Olive Schreiner.
It was agreed that the main reasons for the conflict was the secret diplomacy of people like Britain's foreign secretary, Sir Edward Grey. They decided that the UDC should have three main objectives: (1) that in future to prevent secret diplomacy there should be parliamentary control over foreign policy; (2) there should be negotiations after the war with other democratic European countries in an attempt to form an organisation to help prevent future conflicts; (3) that at the end of the war the peace terms should neither humiliate the defeated nation nor artificially rearrange frontiers as this might provide a cause for future wars. (55)
Ramsay MacDonald came under attack from newspapers because of his opposition to the First World War. On 1st October 1914, The Times published a leading article entitled Helping the Enemy, in which it wrote that "no paid agent of Germany had served her better" that MacDonald had done. The newspaper also included an article by Ignatius Valentine Chirol, who argued: "We may be rightly proud of the tolerance we display towards even the most extreme licence of speech in ordinary times... Mr. MacDonald' s case is a very different one. In time of actual war... Mr. MacDonald has sought to besmirch the reputation of his country by openly charging with disgraceful duplicity the Ministers who are its chosen representatives, and he has helped the enemy State ... Such action oversteps the bounds of even the most excessive toleration, and cannot be properly or safely disregarded by the British Government or the British people." (56)
In May 1915, Arthur Henderson, became the first member of the Labour Party to hold a Cabinet post when Herbert Asquith invited him to join his coalition government. John Bruce Glasier commented in his diary: "This is the first instance of a member of the Labour Party joining the government. Henderson is a clever, adroit, rather limited-minded man - domineering and a bit quarrelsome - vain and ambitious. He will prove a fairly capable official front-bench man, but will hardly command the support of organised Labour." (57)
Horatio Bottomley, argued in the John Bull Magazine that Ramsay MacDonald and James Keir Hardie, were the leaders of a "pro-German Campaign". On 19th June 1915 the magazine claimed that MacDonald was a traitor and that: "We demand his trial by Court Martial, his condemnation as an aider and abetter of the King's enemies, and that he be taken to the Tower and shot at dawn." (58)
On 4th September, 1915, the magazine published an article which made an attack on MacDonald's background. "We have remained silent with regard to certain facts which have been in our possession for a long time. First of all, we knew that this man was living under an adopted name - and that he was registered as James MacDonald Ramsay - and that, therefore, he had obtained admission to the House of Commons in false colours, and was probably liable to heavy penalties to have his election declared void. But to have disclosed this state of things would have imposed upon us a very painful and unsavoury duty. We should have been compelled to produce the man's birth certificate. And that would have revealed what today we are justified in revealing - for the reason we will state in a moment... it would have revealed him as the illegitimate son of a Scotch servant girl!" (59)
In his diary, MacDonald recorded his reaction to the article. "On the day when the paper with the attack was published, I was travelling from Lossiemouth to London in the company as far as Edinburgh with the Dowager Countess De La Warr, Lady Margaret Sackville and their maid... I saw the maid had John Bull in her hand. Sitting in the train, I took it from her and read the disgusting article. From Aberdeen to Edinburgh, I spent hours of the most terrible mental pain.... Never before did I know that I had been registered under the name of Ramsay, and cannot understand it now. From my earliest years my name has been entered upon lists, like the school register, etc. as MacDonald. My mother must have made a simple blunder or the registrar must have made a clerical error." (60)
Ramsay MacDonald received many letters of support, including this one from a long-term opponent to his anti-war activities: "For your villainy and treason you ought to be shot and I would gladly do my country service by shooting you. I hate you and your vile opinions - as much as Bottomley does. But the assault he made on you last week was the meanest, rottenest lowdown dog's dirty action that ever disgraced journalism." (61)
In August 1915, a group of members of the Moray Golf Club, of which he was a member, submitted a motion demanding that MacDonald should be removed from the roll of members because of his opposition to the First World War. The motion was carried by 73 votes to 24. MacDonald wrote to the club secretary: "I am in receipt of your letter informing me that the Moray Golf Club has decided to become a political association with the Golf Course attached, and that it has torn up its rules in order that some of its members may give rein to their political prejudice and spite. Unfortunately, for some years, the visit of any prominent Liberal or Radical to the Moray Golf Club has been resented by a certain section which has not concealed its offensiveness either in the Club House or on the Course. Though I am, therefore, not sorry that the character of a number of members of the Moray Golf Club has been advertised to the world, I cannot help regretting that the Club, of which I was one of the earliest members, should be held up to public ridicule and contempt." (62)
After the overthrow of Tsar Nicholas II in Russia, socialists in Britain, France, Germany, Austria-Hungary, United States and Italy called for a conference in a neutral country to see if the First World War could be brought to an end. MacDonald wrote in his diary: "The great service which the Russian Revolution could render to Europe would be to bring about an understanding between the German Democracy and that of the Allied countries." He felt that "a sort of spring-tide of joy had broken out all over Europe." (63)
Arthur Henderson was sent by David Lloyd-George to speak to Alexander Kerensky, the leader of the Provisional Government in Russia. At a conference of the Labour Party held in London on 10th August, 1917, Henderson made a statement recommending that the Russian invitation to the Stockholm Conference should be accepted. Delegates voted 1,846,000 to 550,000 in favour of the proposal and it was decided to send Henderson and MacDonald to the peace conference. However, under pressure from President Woodrow Wilson, the British government had changed his mind about the wisdom of the conference and refused to allow delegates to travel to Stockholm. As a result of this decision, Henderson resigned from the government. (64)
Ramsay MacDonald warned repeatedly that if the British government and its allies, continued to insist on a military victory, the moderate socialists would lose control in Russia. He was therefore not suprised when Alexander Kerensky was deposed and replaced by Lenin and the Bolsheviks. He added that it was Britain's fault that "Russia now negotiates alone with Russia".
Herbert Tracey has argued that Henderson's resignation marked an important change in the development of the Labour Party: "The divergence of policy between him and the War Cabinet thus became clear, and he resigned from the Government, feeling that his future course of action must be guided by the decision of the party to which he belonged... One thing is certain: Mr Henderson's resignation from the War Cabinet had a vitally important and permanent effect upon the development of the political Labour Movement, by restoring its independence and enabling it to begin reorganising in preparation for the coming of the peace." (65)
William Adamson replaced Arthur Henderson as chairman of the party in October 1917. David W. Howell has argued: "His experience as effectively party leader in the Commons was unhappy. Many felt that he lacked the necessary qualities." Beatrice Webb commented in her diary: "He is a middle-aged Scottish miner, typical British proletarian in body and mind, with an instinctive suspicion of all intellectuals or enthusiasts... He has neither wit, fervour nor intellect; he is most decidedly not a leader, not even like Henderson, a manager of men." (66)
Ramsay MacDonald was the Labour candidate for Leicester East in the 1918 General Election. He did not consider he had much chance of winning has he had suffered four years of hostile press coverage. "Four years indignity, lying, blackguardism, have eaten like acid into me. Were I assassinated before it is all over would give no one who has followed the attacks cause for wonder." (67)
The coalitionist candidate, Gordon Hewart, concentrated on MacDonald's opposition to the war. He argued that MacDonald had "put an odious stain and stima upon the fair name of Leicester". He went on to say that this was not "an indelible stain" and "the citizens of Leicester now had the opportunity of wiping it away and of meting out to its author his well-merited reward." MacDonald lost the election by 15,000 votes. (68)
Other opponents of the war such as Philip Snowden, George Lansbury and Fred Jowett, also lost their seats. At the Party Conference that year the Labour Party decided to make a statement of objectives. This included: "To secure for the producers by hand or by brain the full fruits of their industry, and the most equitable distribution thereof that may be possible, upon the basis of the common ownership of the means of production and the best obtainable system of popular administration and control of each industry and service." (69)
The new Constitution had been drafted by Sidney Webb. It presented the case for a minimum standard of life for all, for full employment, public ownership and greater equality. (70) G.D.H. Cole described the Constitution as "an historic document of the greatest significance" because "it unequivocally committed the Labour Party to Socialist objectives". (71) Clement Attlee agreed and called it "an uncompromisingly Socialist document". (72)
Ramsay MavDonald, deprived of his £400 parliamentary salary, found work as a writer and lecturer. He gradually rebuilt his political reputation. David Low, was a cartoonist from New Zealand, who had just arrived in Britain. He later wrote about he was "greatly impressed by Ramsay MacDonald, who looked to me a real leader. He seemed taller in those days and more craggy, as he stalked up and down. A handsome figure, fine voice, shabby blue serge suit, handlebar moustache solid black against solid white of hair forelock." (73)
At a meeting on 18th October, 1922, two younger members of the government, Stanley Baldwin and Leo Amery, urged the Conservative Party to remove David Lloyd George from power. Andrew Bonar Law disagreed as he believed that he should remain loyal to the Prime Minister. Two other senior ministers, Austen Chamberlain and Arthur Balfour also defended the coalition. However, it was a passionate speech by Baldwin: "The Prime Minister was described this morning in The Times, in the words of a distinguished aristocrat, as a live wire. He was described to me and others in more stately language by the Lord Chancellor as a dynamic force. I accept those words. He is a dynamic force and it is from that very fact that our troubles, in our opinion, arise. A dynamic force is a terrible thing. It may crush you but it is not necessarily right." The motion to withdraw from the coalition was carried by 187 votes to 87. (74)
David Lloyd George was forced to resign and call a General Election. MacDonald had been forgiven for his opposition to the First World War by the time and was elected to represent Aberavon. Lloyd George's party only won 127 seats in the 1922 General Election. The Conservative Party now dominated the House of Commons with 344 seats and formed the next government. The Labour Party promised to nationalise the mines and railways, a massive house building programme and to revise the peace treaties, went from 57 to 142 seats, whereas the Liberal Party increased their vote and went from 36 to 62 seats. (75)
At a meeting of the Parliamentary Labour Party on 21st November, 1922, Emanuel Shinwell proposed Ramsay MacDonald should become chairman instead of John R. Clynes, who had held the position since 1918. David Kirkwood, a fellow Labour MP, commented: "Ramsay MacDonald fascinated me. His head was a thing of beauty. Black hair waved and rolled over a fine brow, one curl almost touching his straight, strong eyebrows, from under which his eyes glowed. His voice was rugged, but soft, and, as he spoke, there came into it a throb. It was the natural instrument of an orator. Standing upright, he was a splendid figure of a man, and his appearance of height and strength was increased by his habit of rising on his toes and throwing back his head..... Nature had dealt unevenly with them. She had endowed MacDonald with a magnificent presence, a full resonant voice, and a splendid dignity. Clynes was small, unassuming, of uneven features, and voice without colour." (76)
Fenner Brockway, who worked with MacDonald in the peace movement during the war also supported him against Clynes: "Ramsay MacDonald was a born leader, with a commanding personality and a magnificent presence; the most handsome man in public life. He was a great orator whose deep, resonant voice and sweeping gestures added to the force of his words." (77) John Beckett described him as having a "handsome face" with a "organ-like voice". After much discussion, John R. Clynes received 56 votes to MacDonald's 61. Clynes, "with characteristic generosity, declared that the whole party was determined to support the new leader". (78)
On 17th May, 1923, Andrew Bonar Law was told he was suffering from cancer of the throat, and gave him six months to live. Five days later he resigned and was replaced by Stanley Baldwin. It was a difficult time for the government and it was faced with growing economic problems. This included a high-level of unemployment. Baldwin believed that protectionist tariffs would revive industry and employment. However, Bonar Law had pledged in 1922 that there would be no changes in tariffs in the present parliament. Baldwin came to the conclusion that he needed a General Election to unite his party behind this new policy. On 12th November, Baldwin asked the king to dissolve parliament. (79)
During the election campaign, Baldwin made it clear that he intended to impose tariffs on some imported goods: "What we propose to do for the assistance of employment in industry, if the nation approves, is to impose duties on imported manufactured goods, with the following objects: (i) to raise revenue by methods less unfair to our own home production which at present bears the whole burden of local and national taxation, including the cost of relieving unemployment; (ii) to give special assistance to industries which are suffering under unfair foreign competition; (iii) to utilise these duties in order to negotiate for a reduction of foreign tariffs in those directions which would most benefit our export trade; (iv) to give substantial preference to the Empire on the whole range of our duties with a view to promoting the continued extension of the principle of mutual preference which has already done so much for the expansion of our trade, and the development, in co-operation with the other Governments of the Empire, of the boundless resources of our common heritage." (80)
The Labour Party election manifesto completely rejected this argument: "The Labour Party challenges the Tariff policy and the whole conception of economic relations underlying it. Tariffs are not a remedy for Unemployment. They are an impediment to the free interchange of goods and services upon which civilised society rests. They foster a spirit of profiteering, materialism and selfishness, poison the life of nations, lead to corruption in politics, promote trusts and monopolies, and impoverish the people. They perpetuate inequalities in the distribution of the world's wealth won by the labour of hands and brain. These inequalities the Labour Party means to remove." (81)
In the 1923 General Election, the Labour Party won 191 seats. David Marquand has pointed out that: "The new parliamentary Labour Party was a very different body from the old one. In 1918, 48 Labour M.P.s had been sponsored by trade unions, and only three by the ILP. Now about 100 members belonged to the ILP, while 32 had actually been sponsored by it, as against 85 who had been sponsored by trade unions.... In Parliament, it could present itself for the first time as the movement of opinion rather than of class." (82)
Although the Conservative Party had 258 seats, Herbert Asquith announced that the Liberal Party would not keep the Tories in office. If a Labour Government were ever to be tried in Britain, he declared, "it could hardly be tried under safer conditions". The Daily Mail warned about the dangers of a Labour government and the Daily Herald commented on the "Rothermere press as a frantic attempt to induce Mr Asquith to combine with the Tories to prevent a Labour Government assuming office". (83) John R. Clynes, the former leader of the Labour Party, argued: "Our enemies are not afraid we shall fail in relation to them. They are afraid that we shall succeed." (84)
On 22nd January, 1924 Stanley Baldwin resigned. At midday, the 57 year-old, Ramsay MacDonald went to Buckingham Palace to be appointed prime minister. He later recalled how George V complained about the singing of the Red Flag and the La Marseilles, at the Labour Party meeting in the Albert Hall a few days before. MacDonald apologized but claimed that there would have been a riot if he had tried to stop it. (85)
Robert Smillie, the Labour MP for Morpeth, believed that MacDonald had made a serious mistake in forming a government. "At last we had a Labour Government! I have to tell you that I did not share in that jubilation. In fact, had I had a voice in the matter which, as a mere back-bencher I did not, I would have strongly advised MacDonald not to touch the seals of office with the proverbial bargepole. Indeed, I was very doubtful indeed about the wisdom of forming a Government. Given the arithmetic of the situation, we could not possibly embark on a proper Socialist programme." (86)
G.D.H. Cole pointed out that MacDonald was in a difficult position. If he refused to form a government "it would have been widely misrepresented as showing Labour's fears of its own capacity, and it would have meant leaving the unemployed to their plight and - what weighed even more with many socialists - doing nothing to improve the state of international relations or to further European reconstruction and recovery." Left-wing members of the Labour Party suggested that MacDonald should accept office and invite defeat by putting forward a Socialist programme. The problem with that argument was the party could not financially afford another election, nor would they have been likely to win any more seats in the House of Commons. (87)
MacDonald agreed to head a minority government, and therefore became the first member of the party to become prime minister. He had the problem of forming a Cabinet with colleagues who had little, or no administrative experience. MacDonald's appointments included Philip Snowden (Chancellor of the Exchequor), Arthur Henderson (Home Secretary), John R. Clynes (Lord Privy Seal), Sidney Webb (Board of Trade) and Arthur Greenwood (Health), Charles Trevelyan (Education), John Wheatley (Housing), Fred Jowett (Commissioner of Works), William Adamson (Secretary for Scotland), Tom Shaw (Minister of Labour), Harry Gosling (Paymaster General), Vernon Hartshorn (Postmaster General), Emanuel Shinwell (Mines), Noel Buxton (Agriculture and Fisheries), Stephen Walsh (Secretary of State for War), Jimmy Thomas (Secretary of State for the Colonies), Ben Spoor (Chief Whip) and Sydney Olivier (Secretary of State for India).
John R. Clynes wrote in his Memoirs (1937): "An engine-driver rose to the rank of Colonial Secretary, a starveling clerk became Great Britain's Premier, a foundry-hand was charged to Foreign Secretary, the son of a Keighley weaver was created Chancellor of the Exechequer, one miner became Secretary for War and another Secretary of State for Scotland." (88)
However, others claimed that the Labour Party had changed dramatically since before the First World War and had been taken over by middle-class elements. The German journalist, Egon Ranshofen-Wertheimer, pointed out: "The party which before the war had been a definite proletarian organisation in spite of intellectual leadership, became overrun by ex-Liberals, young-men-just-down-from-Oxford guiltless of any socialist tradition, ideologists and typical monomaniacs full of their own projects." (89)
The Labour government was not represented in the House of Lords. However, Herbrand Sackville, the 23 year-old, the 9th Earl De La Warr, who had expressed socialist beliefs while at Eton, told MacDonald that he was not a wholehearted supporter of any party "but my sympathies are all with yours... I fully realise... that the Labour Party will need support in the next Parliament, and I shall gladly help, by constant attendance and vote whenever possible." (90)
MacDonald felt he was unable to appoint such a young man to a government post, and caused great controversy when he gave Cabinet jobs to Charles Cripps, 1st Baron Parmoor (Lord President of the Council) and Frederic Thesiger, 1st Viscount Chelmsford (First Lord of the Admiralty), two men who had previously supported the Conservative Party. (91) Chelmsford was asked why he had accepted this post from a political arrival. He replied: "I enquired, naturally, when the offer was made, as to what the Labour policy was likely to be in the immediate future... I had to satisfy myself that that policy, so far as disclosed to me, was such as I could reasonably help to promote." (92)
The Parliamentary Labour Party had a meeting to debate the motion that it was "contrary to the best interests of the Movement to have in a Labour cabinet to the best interests of the Movement to have in a Labour cabinet two peers whose policies have always been identified with the Tory Party, and requests the Prime Minister to ask Lords Parmoor and Chelmsford to resign from the cabinet." This idea was rejected by MacDonald and they remained in the Cabinet. (93)
Jimmy Thomas was impressed with the help he received from the civil servants. (94) John R. Clynes also claimed that he always "found the permanent officials extraordinary helpful and kind". He saw nothing sinister in the fact that: "They were always beside me, advising, coaching and checking; and in a short time I gained a measure of knowledge necessary in matters where, perhaps, national safety or the spending of millions of money was concerned." (95)
Ramsay MacDonald well understood the power of the unelected official over the minister. He rejected a Labour Party suggestion that the government should appoint its own advisors. He argued that "a Civil Service told quite frankly that we have no confidence in it would never work at all." (96) According to one of his leading critics: "In answer to the question - 'who captured whom?' - the answer was quite clear. The state had captured the Labour Party. A new relationship between the Labour Party, the ruling class and the workers was about to emerge." (97)
MacDonald also took the post of foreign secretary but he had the capable Arthur Ponsonby as his deputy in the department. Both men had been strong opponents of the First World War. Ponsonby wrote to MacDonald: "The incredible seems about to happen. We are actually to be allowed by an extraordinary combination of circumstances to have control of the Foreign Office and to begin to carry out some of the things we have been urging and preaching for years." MacDonald used Ponsonby to carry out negotiations with the Bolshevik government in Russia. (98)
George Lansbury was not offered a post in his Cabinet. MacDonald had not been fully supportive of the Poplar Councillors in their dispute with Stanley Baldwin and the London County Council since he thought that "public doles, Popularism, strikes for increased wages, limitation of output, not only are not Socialism but may mislead the spirit and policy of the Socialist movement." Apparently, King George V also opposed his appointment as he "recalled Lansbury's sympathy for the Bolshevik regime". (99)
John Wheatley, the new Minister of Health, had been a supporter of the Poplar Councillors. Edgar Lansbury wrote in The Labour Leader that he was sure that Wheatley would "understand and sympathise with them in this horrible problem of poverty, misery and distress which faces them." Lansbury's assessment was correct and as Janine Booth, the author of Guilty and Proud of It! Poplar's Rebel Councillors and Guardians 1919-25 (2009), has pointed out: "Wheatley agreed to rescind the Poplar order. It was a massive victory for Poplar, whose guardians had lived with the threat of legal action for two years and were finally vindicated." (100)
MacDonald had great doubts about appointing Wheatley because of his strong socialist views and has been described as the Cabinet's "solitary left-winger" and was the only one who attempted to introduce radical legislation. (101) MacDonald wrote in his diary that it was necessary to have one representative of the left but feared that he might not "play straight". (102) As one historian commented: "So grudging a view of, arguably, his most able and successful minister was an indication of his poor judgement. His choices had been made for their political utility rather than for executive competence." (103)
Wheatley was determined to introduce socialist measures to deal with the housing crisis. "This had three distinct aspects - the provision of more houses for letting at rents within the means of ordinary working-class tenants, the prevention of unduly high costs of construction, and the more effective control of rents for existing houses... Wheatley successfully negotiated a treaty with the building operatives' Trade Unions, allowing for special entry and training in the building crafts in order to ensure an adequate supply of labour." (104)
Wheatley's Housing Act became law in August 1924, and involved developing a partnership between political parties, local authorities and specially appointed committees of building employees and employers. The plan was to build 190,000 new council houses at modest rents in 1925, and that this figure would gradually increase until it reached 450,000 a year. He told the House of Commons: "I am the defender of private enterprise and one of its best friends. I am completely frank and honest about it... It requires Labour proposals, Socialist proposals if you like, in order that private enterprise can get going again." (105)
As Ian S. Wood has pointed out: "Wheatley's Housing (Financial Provisions) Act was the only major legislative achievement of the 1924 Labour government. Until its subsidy provisions were repealed by the National Government in 1934, a substantial proportion of all rented local authority housing in Britain was built under its terms and sixty years later there were still people in Scotland who spoke of Wheatley houses. The act was a complex one, bringing together trade unions, building firms, and local authorities in a scheme to tackle a housing shortage which was guaranteed central government funding provided that building standards set by the act were adhered to. The act did little for actual slum clearance but it hugely enhanced Wheatley's reputation despite the loss of a companion measure, the Building Materials Bill, which would have given central government a wide range of controls over supplies of building materials to local councils operating the Housing Act." (106)
Charles Trevelyan was also a success at the Board of Education. He told his wife that "I no longer have six children - I have six million." (107) Trevelyan argued for a reduction in educational inequalities. "During his term of office, approval was given to forty new secondary schools; a survey was instituted in order to provide for the replacement of as many as possible of the more insanitary or obsolete elementary schools; the proportion of free places in secondary schools was increased; state scholarships, which had been in suspense, were restored, and maintenance allowances for young people in secondary schools were increased; the adult education grant was tripled; and local authorities were empowered, where they wished, to raise the school-leaving age to fifteen." (108)
According to his biographer, Trevelyan was "a sound administrator, he was not overawed, as were many of his colleagues, by his civil servants... his performances at the dispatch box won back his father's approval." (109) Trevelyan's main objective was to provide "the children of of the workers to have the same opportunities as those of the wealthy". He proposed to do so by expanding secondary education and raising the school-leaving age. He reversed the cuts in education spending imposed in 1922, increased the number of free places at grammar schools, and encouraged (but could not require) local authorities to raise the school leaving age to fifteen. He also declared that there would be a break between primary and secondary education at the age of 11. (110)
Ramsay MacDonald received a salary as prime minister of £5,000 a year. At this time the prime minister was not given an entertainment allowance and had to pay out of own pocket for such items of household equipment as linen and china. To save coal, the MacDonald family ate their meals not in their private quarters but in the official banqueting-rooms which were centrally heated at the Government's expense. (111)
MacDonald was told that he had to wear a special uniform of black evening dress and knee breeches when he appeared before the king. The cost of this was £30 from Moss Brothers. He was informed that if any of his cabinet ministers refused to wear this uniform they would not be allowed to attend official functions. "When the parliamentary party discussed whether members should accept invitations to Windsor and the palace, members voted thirty-eight to thirty-seven in favour of acceptance." (112)
Some members of the government complained about the demand to wear special clothes but MacDonald found the request acceptable: "These braids and uniforms are but part of an official pageantry and as my conscience is not on my back, a gold coat means nothing to me but a form of dress to be worn or rejected as a hat would be in relation to the rest of one's clothes. Nor do I care a fig for the argument that it is part of a pageantry of class, or royalty or flunkeyism... The King has never seen me as a Minister without making me feel that he was also seeing me as a friend." (113)
George Lansbury feared this kind of compromise would undermine its radicalism and doubted whether "the Labour Party fulfils its mission by proving how adaptable we are and how nicely we can dress and behave when we are inofficial, royal or upper-class circles." (114) Robert C. Morrison, the Tottenham North MP, complained that to attend court functions without buying a complete set for £57 "including nine guineas for the regulation sword". He added: "If I had known that such gorgeous dresses would be worn I would have gone to Tottenham Fire Brigade and borrowed a helmet and tunic for the occasion." (115)
The Labour Party received constant criticism from the newspapers that were controlled by a group of wealthy individuals who strongly supported the Conservative Party. In return they had been given titles and places in the House of Lords. This included Alfred Harmsworth, Lord Northcliffe (The Daily Mail and The Times), Harold Harmsworth, Lord Rothermere (The Daily Mirror), Harry Levy-Lawson, Lord Burnham (The Daily Telegraph) and William Maxwell Aitken, Lord Beaverbrook (The Daily Express). (116)
The Daily Mail claimed during the election campaign that it was under the control of the Bolshevik government in the Soviet Union: "The British Labour Party, as it impudently calls itself, is not British at all. It has no right whatever to its name. By its humble acceptance of the domination of the Sozialistische Arbeiter Internationale's authority at Hamburg in May it has become a mere wing of the Bolshevist and Communist organisation on the Continent. It cannot act or think for itself." (117)
According to the historian, Gill Bennett, the "intelligence community" in the form of MI5 and MI6, and the entire ruling elite was appalled by the idea of a Prime Minister who was a socialist. "It was not just the intelligence community, but more precisely the community of an elite - senior officials in government departments, men in 'the City', men in politics, men who controlled the Press - which was narrow, interconnected (sometimes intermarried) and mutually supportive. Many of these men... had been to the same schools and universities, and belonged to the same clubs. Feeling themselves part of a special and closed community, they exchanged confidences secure in the knowledge, as they thought, that they were protected by that community from indiscretion." (118)
Two days after forming the first Labour government Ramsay MacDonald received a note from General Borlass Childs of Special Branch that said "in accordance with custom" a copy was enclosed of his weekly report on revolutionary movements in Britain. MacDonald wrote back that the weekly report would be more useful if it also contained details of the "political activities... of the Fascist movement in this country". Childs wrote back that he had never thought it right to investigate movements which wished to achieve their aims peacefully. In reality, MI5 was already working very closely with the British Fascisti, that had been established in 1923. (119)
Maxwell Knight was the organization's Director of Intelligence. In this role he had responsibility for compiling intelligence dossiers on its enemies; for planning counter-espionage and for establishing and supervising fascist cells operating in the trade union movement. This information was then passed onto Vernon Kell, Director of the Home Section of the Secret Service Bureau (MI5). Later Maxwell Knight was placed in charge of B5b, a unit that conducted the monitoring of political subversion. (120)
It soon became clear that the intelligence community was working very closely with the press barons to undermine the Labour government. In April 1924, MacDonald recommended Alexander Grant, the managing director of McVitie and Price, for a baronetcy. This was a surprise as Grant was a lifelong supporter of the Conservative Party. On 11th September, 1924, the Daily Mail reported that Grant had given MacDonald a Daimler car and was the holder of £30,000 worth of shares in McVitie and Price. (121) MacDonald replied that the shares simply covered the running of the car. This was hardly convincing and the story caused considerable embarrassment to the Labour government. He eventually agreed to give the car back to the company. (122)
On 25th July 1925, the Worker's Weekly, a newspaper controlled by the Communist Party of Great Britain, published an "Open Letter to the Fighting Forces" that had been written anonymously by Harry Pollitt. The article called on soldiers to "let it be known that, neither in the class war nor in a military war, will you turn your guns on your fellow workers, but instead will line up with your fellow workers in an attack upon the exploiters and capitalists and will use your arms on the side of your own class." (123)
After consultations with the Director of Public Prosecutions and the Attorney General, Sir Patrick Hastings, it was decided to arrest and charge, John Ross Campbell, the editor of the newspaper, with incitement to mutiny. The following day, Hastings had to answer questions in the House of Commons on the case. However, after investigating Campbell in more detail he discovered that he was only acting editor at the time the article was published, he began to have doubts about the success of a prosecution. (124)
The matter was further complicated when James Maxton informed Hastings about Campbell's war record.
In 1914, Campbell was posted to the Clydeside section of the Royal Naval division and served throughout the war. Wounded at Gallipoli, he was permanently disabled at the battle of the Somme, where he was awarded the Military Medal for conspicuous bravery. Hastings was warned about the possible reaction to the idea of a war hero being prosecuted for an article published in a small circulation newspaper. (125)
At a meeting on the morning of the 6th August, Hastings told MacDonald that he thought that "the whole matter could be dropped". MacDonald replied that prosecutions, once entered into, should not be dropped under political pressure". At a Cabinet meeting that evening Hastings revealed that he had a letter from Campbell confirming his temporary editorship. Hastings also added that the case should be withdrawn on the grounds that the article merely commented on the use of troops in industrial disputes. MacDonald agreed with this assessment and agreed the prosecution should be dropped. (126)
On 13th August, 1924, the case was withdrawn. This created a great deal of controversy and MacDonald was accused of being soft on communism. MacDonald, who had a long record of being a strong anti-communist, told King George V: "Nothing would have pleased me better than to have appeared in the witness box, when I might have said some things that might have added a month or two to the sentence." (127)
On 10th October 1924, MI5 received a copy of a letter, dated 15th September, sent by Grigory Zinoviev, chairman of the Comintern in the Soviet Union, to Arthur McManus, the British representative on the committee. In the letter British communists were asked to take all possible action to ensure the ratification of the Anglo-Soviet Treaties. It then went on to advocate preparation for military insurrection in working-class areas of Britain and for subverting the allegiance in the army and navy. (128)
Hugh Sinclair, head of MI6, provided "five very good reasons" why he believed the letter was genuine. However, one of these reasons, that the letter came "direct from an agent in Moscow for a long time in our service, and of proved reliability" was incorrect. (129) Vernon Kell, the head of MI5 and Sir Basil Thomson the head of Special Branch, were also convinced that the Zinoviev Letter was genuine. Desmond Morton, who worked for MI6, told Sir Eyre Crowe, at the Foreign Office, that an agent, Jim Finney, who worked for George Makgill, the head of the Industrial Intelligence Bureau (IIB), had penetrated Comintern and the Communist Party of Great Britain. Morton told Crowe that Finney "had reported that a recent meeting of the Party Central Committee had considered a letter from Moscow whose instructions corresponded to those in the Zinoviev letter". However, Christopher Andrew, who examined all the files concerning the matter, claims that Finney's report of the meeting does not include this information. (130)
Kell showed the letter to Ramsay MacDonald, the Labour Prime Minister. It was agreed that the letter should be kept secret until it was discovered to be genuine. (131) Thomas Marlowe, who worked for the press baron, Alfred Harmsworth, Lord Rothermere, had a good relationship with Reginald Hall, the Conservative Party MP, for Liverpool West Derby. During the First World War he was director of Naval Intelligence Division of the Royal Navy (NID) and he leaked the letter to Marlowe, in an effort to bring an end to the Labour government. (132)
The newspaper now contacted the Foreign Office and asked if it was a forgery. Without reference to MacDonald, a senior official told Marlowe it was genuine. The newspaper also received a copy of the letter of protest sent by the British government to the Russian ambassador, denouncing it as a "flagrant breach of undertakings given by the Soviet Government in the course of the negotiations for the Anglo-Soviet Treaties". It was decided not to use this information until closer to the election. (133)
David Lloyd George signed a trade agreement with Russia in 1921, but never recognised the Soviet government. On taking office the Labour government entered into talks with Russian officials and eventually recognised the Soviet Union as the de jure government of Russia, in return for the promise that Britain would get payment of money that Tsar Nicholas II had borrowed when he had been in power. (134)
Edmund D. Morel, the Labour Party MP for Dundee, was involved in these negotiations. He told his friend, Bob Stewart, that it was very difficult to reach a negotiated agreement with the Soviet representatives because of the demands being made by the Conservative Party: "The Tories vehemently against. They demanded compensation for British property in the Soviet Union which had been nationalised by the Soviet government, and also trading rights for British firms on Soviet territory. The first was realisable, but naturally the Soviet government would not entertain the latter." (135)
A conference was held in London to discuss these matters. Most newspapers reacted with hostility to these negotiations and warned of the danger of dealing with what they considered to be an "evil regime". in August 1924 a wide-ranging series of treaties was agreed between Britain and Russia. "The most-favoured-nation status was given to the Soviet Union in exchange for concessions to British holders of Czarist bonds, and Britain agreed to recommend a loan to the Soviet government." (136)
Stanley Baldwin, the leader of the Conservative Party, and H. H. Asquith, the leader of the Liberal Party, decided to being the Labour government down over the issue of its relationship with the Soviet Union. On 30th September, the Liberals condemned the recently agreed trade deal. They claimed, unjustly, that Britain had given the Russians what they wanted without resolving the claims of British bondholders who had suffered in the revolution. "MacDonald reacted peevishly to this, accusing them of being unscrupulous and dishonest." (137)
The following day, Conservatives put down a censure motion on the decision to drop the case against John Ross Campbell. The debate took place on 8th October. MacDonald lost the vote by 364 votes to 198. "Labour was brought down, on the Campbell case, by the combined ranks of Conservatives and Liberals... The Labour government had lasted 259 days. On six occasions the Conservatives had saved MacDonald from defeat in the 1923 parliament, but it was the Liberals who pulled the political rung from under him." (138)
The Daily Mail published the Zinoviev Letter on 25th October 1924, just four days before the 1924 General Election. Under the headline "Civil War Plot by Socialists Masters" it argued: "Moscow issues orders to the British Communists... the British Communists in turn give orders to the Socialist Government, which it tamely and humbly obeys... Now we can see why Mr MacDonald has done obeisance throughout the campaign to the Red Flag with its associations of murder and crime. He is a stalking horse for the Reds as Kerensky was... Everything is to be made ready for a great outbreak of the abominable class war which is civil war of the most savage kind." (139)
Dora Russell, whose husband, Bertrand Russell, was standing for the Labour Party in Chelsea, commented: "The Daily Mail carried the story of the Zinoviev letter. The whole thing was neatly timed to catch the Sunday papers and with polling day following hard on the weekend there was no chance of an effective rebuttal, unless some word came from MacDonald himself, and he was down in his constituency in Wales. Without hesitation I went on the platform and denounced the whole thing as a forgery, deliberately planted on, or by, the Foreign Office to discredit the Prime Minister." (140)
Ramsay MacDonald suggested he was a victim of a political conspiracy: "I am also informed that the Conservative Headquarters had been spreading abroad for some days that... a mine was going to be sprung under our feet, and that the name of Zinoviev was to be associated with mine. Another Guy Fawkes - a new Gunpowder Plot... The letter might have originated anywhere. The staff of the Foreign Office up to the end of the week thought it was authentic... I have not seen the evidence yet. All I say is this, that it is a most suspicious circumstance that a certain newspaper and the headquarters of the Conservative Association seem to have had copies of it at the same time as the Foreign Office, and if that is true how can I avoid the suspicion - I will not say the conclusion - that the whole thing is a political plot?" (141)
Bob Stewart claimed that the letter included several mistakes that made it clear it was a forgery. This included saying that Grigory Zinoviev was not the President of the Presidium of the Communist International. It also described the organisation as the "Third Communist International" whereas it was always called "Third International". Stewart argued that these "were such infantile mistakes that even a cursory examination would have shown the document to be a blatant forgery." (142)
The rest of the Tory owned newspapers ran the story of what became known as the Zinoviev Letter over the next few days and it was no surprise when the election was a disaster for the Labour Party. The Conservatives won 412 seats and formed the next government. Lord Beaverbrook, the owner of the Daily Express and Evening Standard, told Lord Rothermere, the owner of The Daily Mail and The Times, that the "Red Letter" campaign had won the election for the Conservatives. Rothermere replied that it was probably worth a hundred seats. (143)
David Low was a Labour Party supporter who was appalled by the tactics used by the Tory press in the 1924 General Election: "Elections have never been completely free from chicanery, of course, but this one was exceptional. There were issues - unemployment, for instance, and trade. There were legitimate secondary issues - whether or not Russia should be afforded an export loan to stimulate trade. In the event these issues were distorted, pulped, and attached as appendix to a mysterious document subsequently held by many creditable persons to be a forgery, and the election was fought on 'red panic' (The Zinoviev Letter)". (144)
After the election it was claimed that two of MI5's agents, Sidney Reilly and Arthur Maundy Gregory, had forged the letter. It later became clear that Major George Joseph Ball, a MI5 officer, played an important role in leaking it to the press. In 1927 Ball went to work for the Conservative Central Office where he pioneered the idea of spin-doctoring. Christopher Andrew, MI5's official historian, points out: "Ball's subsequent lack of scruples in using intelligence for party political advantage while at Central Office in the late 1920s strongly suggests... that he was willing to do so during the election campaign of October 1924." (145)
Stanley Baldwin, the head of the new Conservative Party government, set up a Cabinet committee to look into the Zinoviev Letter. On 19th November, 1924, the Foreign Secretary, Austin Chamberlain, reported that members of the committee were "unanimously of opinion that there was no doubt as to the authenticity of the Letter". This judgement was based on a report written by Desmond Morton. Morton came up with "five very good reasons" why he thought the letter was genuine. These were: its source, an agent in Moscow "of proved reliability"; "direct independent confirmation" from CPGB and ARCOS sources in London; "subsidiary confirmation" in the form of supposed "frantic activity" in Moscow; because the possibility of SIS being taken in by White Russians was "entirely excluded"; and because the subject matter of the Letter was "entirely consistent with all that the Communists have been enunciating and putting into effect". Gill Bennett, who has studied the subject in great depth claims: "All five of these reasons can be shown to be misleading, if not downright false." (146) Eight days later, Morton admitted in a letter to MI5 that "we are firmly convinced this actual thing (the Zinoviev letter) is a forgery." (147)
Following Labour's defeat in the 1924 General Election, Philip Snowden and other leading figures in the movement tried to persuade Arthur Henderson to stand against MacDonald as leader of the party. Henderson refused and once again became chief whip of the party where he tried to unite the party behind MacDonald's leadership. Henderson was also the main person responsible for Labour and the Nation, a pamphlet that attempted to clarify the political aims of the Labour Party. However, the left of the party was not convinced and John Wheatley commented: "If the Tories were an intelligent Party, they would make MacDonald their leader." (148)
MacDonald continued with his policy of presenting the Labour Party as a moderate force in politics and refused to support the 1926 General Strike. MacDonald argued that strikes should not be used as a political weapon and that the best way to obtain social reform was through parliamentary elections. He was especially critical of A. J. Cook. He wrote in his diary: "It really looks tonight as though there was to be a General Strike to save Mr. Cook's face... The election of this fool as miners' secretary looks as though it would be the most calamitous thing that ever happened to the T.U. movement." (149)
In 1927 the British Government passed the Trade Disputes and Trade Union Act. This act made all sympathetic strikes illegal, ensured the trade union members had to voluntarily 'contract in' to pay the political levy to the Labour Party, forbade Civil Service unions to affiliate to the TUC, and made mass picketing illegal. As A. J. P. Taylor has pointed out: "The attack on Labour party finance came ill from the Conservatives who depended on secret donations from rich men." (150)
One of the results of this legislation was that trade union membership fell below the 5,000,000 mark for the first time since 1926. However, despite its victory over the trade union movement, the public turned against the Conservative Party. Over the next three years the Labour Party won all the thirteen by-elections that took place. According to Martin Pugh, the author of Speak for Britain: A New History of the Labour Party (2010) the General Strike had "made a major impact on the general public by detracting from Baldwin's attempts to be seen as even-handed and by undermining the Conservatives in industrial constituences." (151)
However, Ramsay MacDonald was not the best person to take advantage of the situation. He was accused of losing his radical drive. Beatrice Webb wrote: "MacDonald is not working at his job; he is not thinking about it; he is not associating with those whom he has and would have to guide and from whom he could get enlightenment. His thoughts and his emotions are concentrated on his agreeable relations with the men and women - especially the women of the enemy's camp... he is becoming impatient with the troublesomeness of the working class." (152)
By 1928 MacDonald was 62 years old. He wrote in his diary: "How tired I am. My brain is fagged, work is difficult, and there is a darkness on the face of the land. I am ashamed of some speeches I have made, but what can I do? I have no time to prepare anything. It looks as though it will be harder to make my necessary income this year. I wonder how this problem of an income for political Labour leaders with no, or small, independent means is to be solved. No one seems to understand it. To be the paid servant of the State is objectionable; to begin making an income on Friday afternoon and going hard at it till Sunday night, taking meetings in the interval, is too wearing for human flesh and blood. On the other hand, to live on £400 a year is impossible. If it killed one in a clean, efficient business-like way why should one object, but it cripples and tortures first by lowering the quality of work done and then by pushing one into long months of slowly ebbing vitality and mental paralysis." (153)
Some members of the Labour Party thought that they needed to promise dramatic reform in the next election. Richard Tawney sent a letter to the leaders of the party: "If the Labour Election Programme is to be of any use it must have something concrete and definite about unemployment... What is required is a definite statement that (a) Labour Government will initiate productive work on a larger scale, and will raise a loan for the purpose. (b) That it will maintain from national funds all men not absorbed in such work." MacDonald refused to be persuaded by Tawney's ideas and rejected the idea that unemployment could be cured by public works. (154)
The Independent Labour Party (ILP) argued for a policy that became known as "Socialism in Our Time". The main aspect of this policy was what became known as the "Living Wage". The ILP argued that the provision of a minimum living income for every citizen should be the first and immediate objective. It called for the "legal enforcement of a national minimum wage adequate to meet all needs in all public services and by all employers working on public contracts, supplemented by machinery for the legal enforcement of rising minima on industry as a whole, as well as by expanded social services financed out of taxation on the bigger incomes, and by a nationally financed system of Family Allowances." Although this resolution was passed at the 1927 Labour Party Conference by 1,253,000 to 866,000, MacDonald described the measure as "flashy futilities". (155)
A bill was introduced in March 1928 to give women the vote on the same terms as men. There was little opposition in Parliament to the bill and it became law on 2nd July 1928. As a result, all women over the age of 21 could now vote in elections. Many of the women who had fought for this right were now dead including Elizabeth Garrett Anderson, Barbara Bodichon, Emily Davies, Elizabeth Wolstenholme-Elmy, Constance Lytton and Emmeline Pankhurst. Millicent Fawcett, the leader of the NUWSS during the campaign for the vote, was still alive and had the pleasure of attending Parliament to see the vote take place. That night she wrote in her diary that it was almost exactly 61 years ago since she heard John Stuart Mill introduce his suffrage amendment to the Reform Bill on May 20th, 1867." (156)
In 1928 Britain had over a million people out of work. Stanley Baldwin was urged to take measures that would protect the depressed iron and steel industry. Baldwin ruled this out owing to the pledge against protection which had been made at the 1924 election. Agriculture was in an even worse condition, and here again the government could offer little assistance without reopening the dangerous tariff issue. (157)
On 27th March 1928, David Lloyd George made a speech where he declared: "Let us be up and doing, using our idle resources to increase our wealth. With men and plant unemployed, it is ridiculous to say that we cannot afford new developments. It is precisely with these plants and these men that we shall afford them. When every man and every factory is busy, then will be the time to say that we can afford nothing further." (158) The following month Keynes said, "We have the savings, the men and the material. The things are worth doing. It is the very pathology of thought to declare that we cannot afford them." (159)
In January 1929, 1,433,000 people in Britain were out of work. Stanley Baldwin was urged to take measures that would protect the depressed iron and steel industry. Baldwin ruled this out owing to the pledge against protection which had been made at the 1924 election. Agriculture was in an even worse condition, and here again the government could offer little assistance without reopening the dangerous tariff issue. Baldwin was considered to be a popular prime minister and he fully expected to win the general election that was to take place on 30th May. (160)
In its manifesto the Conservative Party blamed the General Strike for the country's economic problems. "Trade suffered a severe set-back owing to the General Strike, and the industrial troubles of 1926. In the last two years it has made a remarkable recovery. In the insured industries, other than the coal mining industry, there are now 800,000 more people employed and 125,000 fewer unemployed than when we assumed office... This recovery has been achieved by the combined efforts of our people assisted by the Government's policy of helping industry to help itself. The establishment of stable conditions has given industry confidence and opportunity." (161)
The Labour Party attacked the record of Baldwin's government: "By its inaction during four critical years it has multiplied our difficulties and increased our dangers. Unemployment is more acute than when Labour left office.... The Government's further record is that it has helped its friends by remissions of taxation, whilst it has robbed the funds of the workers' National Health Insurance Societies, reduced Unemployment Benefits, and thrown thousands of workless men and women on to the Poor Law. The Tory Government has added £38,000,000 to indirect taxation, which is an increasing burden on the wage-earners, shop-keepers and lower middle classes." (162)
During the election campaign, David Lloyd George published a pamphlet, We Can Conquer Unemployment. Lloyd George pledged that if his party were returned to office, they would reduce levels of unemployment to normal within one year by utilising the stagnant labour force in vast schemes of national development. Lloyd George proposed a government scheme where 350,000 men were to be employed on road-building, 60,000 on housing, 60,000 on telephone development and 62,000 on electrical development. The cost would be £250 million, but the cumulative effect of all schemes would generate an annual saving of £30 million to the Unemployment Fund. (163)
Lloyd George was attacked by Tory politicians as they feared the proposals would appeal to the public. Neville Chamberlain, the Conservative MP for Ladywood argued that it cost £250 a year to find work for one man and only £60 to keep him in idleness. The government published a White Paper that "would reduce unemployment without bankrupting the nation". Baldwin suggested that "he (Lloyd George) has spent his whole life in platering together the true and the false and therefore manufacturing the plausible". William Joynson-Hicks, the Home Secretary, said he could not "understand how a man of Lloyd George's ability could put such a proposal before the people of this country". (164)
John Maynard Keynes and Hubert Henderson, who had helped Lloyd George to write the pamphlet, replied with another pamphlet, Can Lloyd George Do It? They concluded that it was possible for a government to successively introduce these methods to reduce unemployment. They then went on to satirise Baldwin's approach to the subject: "You must not do anything for that will only mean that you cannot do something else... We will not promise more than we can perform. We therefore promise nothing." (165)
A massive campaign in the Tory press against the proposal of increased public spending was very successful. In the 1929 General Election the Conservatives won 8,656,000 votes (38%), the Labour Party 8,309,000 (37%) and the Liberals 5,309,000 (23%). However, the bias of the system worked in Labour's favour, and in the House of Commons the party won 287 seats, the Conservatives 261 and the Liberals 59.
A. J. P. Taylor has argued that the idea of increasing public spending would be good for the economy, was difficult to grasp. "It seemed common sense that a reduction in taxes made the taxpayer richer... Again it was accepted doctrine that British exports lagged because costs of production were too high; and high taxation was blamed for this about as much as high wages." (166). Keynes later commented: "The difficulty lies, not in the new ideas, but in escaping from the old ones, which ramify, for those brought up as most of us have been, into every corner of our minds." (167)
David Lloyd George admitted that his campaign had been unsuccessful but claimed he held the balance of power: "It would be silly to pretend that we have realised our expectations. It looks for the moment as if we still hold the balance." However, both Baldwin and MacDonald refused to form a coalition government with Lloyd George. Baldwin resigned and once again MacDonald agreed to form a minority government. (168)
MacDonald's appointments included Philip Snowden (Chancellor of the Exchequor), Arthur Henderson (Foreign Secretary), Charles Trevelyan (Education), Jimmy Thomas (Lord Privy Seal), John R. Clynes (Home Secretary), Arthur Greenwood (Health), Sidney Webb (Secretary of State for the Colonies), Noel Buxton (Agriculture and Fisheries), William Adamson (Secretary for Scotland), John Sankey (Lord Chancellor), George Lansbury (First Commissioner of Works), Herbert Morrison (Transport), Hastings Lees-Smith (Postmaster-General), William Graham (President of the Board of Trade), Tom Shaw (Secretary of State for War), Earl De La Warr (Under-Secretary of State for War), Emanuel Shinwell (Financial Secretary to the War Office), Frederick Pethick-Lawrence (Financial Secretary to the Treasury), Hugh Dalton (Under-Secretary of State for Foreign Affairs), Lord Thompson (Secretary of State for Air), Hastings Lees-Smith (Postmaster General), Arthur Ponsonby (Under-Secretary of State for Dominion Affairs), Susan Lawrence (Parliamentary Secretary to the Ministry of Health), William Wedgwood Benn (Secretary of State for India), Albert Alexander (First Lord of the Admiralty), Margaret Bondfield (Minister of Labour), Frederick Roberts (Minister of Pensions) and Oswald Mosley (Chancellor of the Duchy of Lancaster). (169)
MacDonald refused to ask John Wheatley to join the government. In the 1924 government he had been seen as the most successful of all MacDonald's ministers: Philip Snowden later recalled: "During the time we had been in Opposition (1925-29), Wheatley had dissociated himself from his former Cabinet colleagues, and had gone to the back benches into the company of the Clydesiders. In the country, too, he had made speeches attacking his late colleagues. MacDonald was strongly opposed to offering him a post in the new Government. Wheatley had deserted us and insulted us, and MacDonald thought the country would be shocked if he were included in the Cabinet, and it would be taken as evidence of rebel influence."
However, Arthur Henderson, disagreed with MacDonald. So did Snowden, who argued: "Arthur Henderson took the view, and I was inclined to agree with him, that it might be better to have him inside than outside. I took this view from my experience of him as a Minister. he was a man who, when free from the responsibility of office, would make extreme speeches; but as a Minister I had always found him to be reasonable and practical." (170)
Beatrice Webb, the wife of the Secretary of State for the Colonies, made a study, of the cabinet. She assigned six to the old governing class, five to the lower middle class and six to the working class. She concluded that the "brains", including her husband, belonged to the lower middle class. The "predominant element (the Labour members of parliament) was Proletarian". (171)
What everybody agreed was that the MacDonald government was "composed overwhelmingly of the Right section of the movement" that had been opposed to the radical methods to deal with unemployment that had been proposed by David Lloyd George. (172) The new parliament met on 25th June. A week later the minority government presented its programme for the session. In domestic affairs the new government had very modest objectives. This included setting-up inquiries into the cotton and steel industries and dealing with the problems created by the 1927 Trade Disputes and Trade Union Act. (173)
In January 1930 unemployment in Britain reached 1,533,000. By March, the figure was 1,731,000. Oswald Mosley proposed a programme that he believed would help deal with the growing problem of unemployment in Britain. According to David Marquand: "It made three main assertions - that the machinery of government should be drastically overhauled, that unemployment could be radically reduced by a public-works programme on the lines advocated by Keynes and the Liberal Party, and that long-term economic reconstruction required a mobilisation of national resources on a larger scale than has yet been contemplated. The existing administrative structure, Mosley argued, was hopelessly inadequate. What was needed was a new department, under the direct control of the prime minister, consisting of an executive committee of ministers and a secretariat of civil servants, assisted by a permanent staff of economists and an advisory council of outside experts." (174)
The Chancellor of the Exchequer, Philip Snowden, was a strong believer in laissez-faire economics and disliked the proposals. (175) MacDonald had doubts about Snowden's "hard dogmatism exposed in words and tones as hard as the ideas" but he also dismissed "all the humbug of curing unemployment by Exchequer grants." (176) MacDonald passed the Mosley Memorandum to a committee consisting of Snowden, Tom Shaw, Arthur Greenwood and Margaret Bondfield. The committee reported back on 1st May. Mosley's administrative proposals, the committee claimed "cut at the root of the individual responsibilities of Ministers, the special responsibility of the Chancellor of the Exchequer in the sphere of finance, and the collective responsibility of the Cabinet to Parliament". The Snowden Report went onto argue that state action to reduce unemployment was highly dangerous. To go further than current government policy "would be to plunge the country into ruin". (177)
MacDonald recorded in his diary what happened when Oswald Mosley heard the news about his proposals being rejected. "Mosley came to see me... had to see me urgently: informed me he was to resign. I reasoned with him and got him to hold his decision over till we had further conversations. Went down to Cabinet Room late for meeting. Soon in difficulties. Mosley would get away from practical work into speculative experiments. Very bad impression. Thomas light, inconsistent but pushful and resourceful; others overwhelmed and Mosley on the verge of being offensively vain in himself." (178)
Mosley was not trusted by most of his fellow MPs. He came from an aristocratic background and first entered the House of Commons as a representative of the Conservative Party. One Labour Party MP said Mosley had a habit of speaking to his colleagues "as though he were a feudal landlord abusing tenants who are in arrears with their rent". (179) John Bew described Mosley as "handsome... lithe and black and shiny... he looked like a panther but behaved like a hyena". (180)
At a meeting of Labour MPs took place on 21st May, Oswald Mosley outlined his proposals. This included the provision of old-age pensions at sixty, the raising of the school-leaving age and an expansion in the road programme. He gained support from George Lansbury and Tom Johnson, but Arthur Henderson, speaking on behalf of MacDonald, appealed to Mosley to withdraw his motion so that his proposals could be discussed in detail at later meetings. Mosley insisted on putting his motion to the vote and was beaten by 210 to 29. (181)
Mosley now resigned from the government and was replaced by Clement Attlee. It has been claimed that MacDonald was so fed up with Mosley that he looked around him and choose the "most uninteresting, unimaginative but most reliable among his backbenchers to replace the fallen angel". Winston Churchill said he was "a modest little man, with plenty to be modest about". Mosley was more generous as he accepted that he had "a clear, incisive and honest mind within the limits of his range". However, he added, in agreeing to take his job, Attlee "must be reckoned as content to join a government visibly breaking the pledges on which he was elected." (182)
In a debate in the House of Commons on 28th May 1930, MacDonald argued that the rise in unemployment was caused by factors outside the government's control. The following month unemployment in Britain was 1,946,000 and by the end of the year it reached a staggering 2,725,000. MacDonald responded to the crisis by asking John Maynard Keynes to become a chairman of the Economic Advisory Council to "advise His Majesty's Government in economic matters". Members of the committee included J. A. Hobson, George Douglas Cole, Walter Citrine, Hubert Henderson, Hugh Macmillan, Walter Layton, William Weir and Andrew Rae Duncan. However, Keynes was disappointed by MacDonald's reaction to his advice: "Politicians rarely look to economists to tell them what to do: mainly to give them arguments for doing things they want to do, or for not doing things they don't want to do." (183)
Cole later recalled: "Philip Snowden held a strong position in the Party as its one recognised financial expert... MacDonald nor most of the other members of the Cabinet had any understanding of finance, or even thought they had... The Economic Advisory Council, of which I was a member, discussed the situation again and again; and some of us, including Keynes, tried to get MacDonald to understand the sheer necessity of adopting some definite policy for stopping the rot. Snowden was inflexible; and MacDonald could not make up his mind, with the consequence that Great Britain drifted steadily towards a disaster." (184)
MacDonald did give approval for several public-works projects. By June 1930 the projects were valued at £44 million. Vernon Hartshorn, who had been put in charge of these projects, estimated that the total number employed directly and indirectly as a result of this investment, would be about 150,000. The prime minister admitted in his diary on 24th June that this was not enough: "Unemployment is baffling us for the moment. Up 110,000 in a fortnight. Nothing can dam the flow at the moment." (185)
John Maynard Keynes published A Treatise on Money on 24th October 1930. It was the product of a long intellectual struggle to escape from the ideas in which he had been reared, later dubbed "classical economics"; for example, the Ricardian view that supply creates its own demand. "The focus of the book was on money and prices rather than on output and employment: it contained a full study of the operation of the monetary system, national and international. Fluctuations in prices were no longer explained in terms of changes in the stock of money as in the quantity theory, but in terms of the pressure of demand on the available supply of resources; and the pressure of demand was represented as varying with the magnitude of any divergence between the volume of investment and the availability of savings to finance it." (186)
The traditional view was that unemployment would force down wages and eventually people would be forced to sell their services for less and "getting priced into a job". Keynes rejected the view that this "equilibrating mechanism" always worked in this way and sometimes wages are not always "responsive to unemployment". In fact, since the slowdown in the economy began in 1924 wages had not declined. In one lecture he pointed out that wage rates were fixed by "social and historical forces", not by the "marginal productivity of labour". (187)
Keynes made this point in more detail in more detail in a BBC radio interview: "The existence of the dole undoubtedly diminishes the pressure on the individual man to accept a rate of wages or a kind of employment which is not just what he wants or what he is used to. In the old days the pressure on the unemployed was to get back somehow or other into employment, and if that was so to-day surely it would have more effect on the prevailing rate of wages... I cannot help feeling that we must partly attribute to the dole the extraordinary fact.... that, in, spite of the fall in prices, and the fall in the cost of living, and the heavy unemployment, wages have practically not fallen at all since 1924." (188)
Nicholas Kaldor has pointed out that Keynes criticised the employers for reducing wages and the Bank of England for "imposing high interest rates in an attempt to limit overseas lending to the amount that the level of net exports". By examining "exports, the trade balance, the flow of overseas lending, the nature of the adjustment mechanism in foreign trade, the instruments employed by the Bank of England" he was able to show the system was generating "a low employment trap". (189)
Keynes went on to argue that by 1930 wages had not fallen since 1916. Jacques Rueff, a conservative French economist, and supporter of the free-market, argued that the problem was that British workers were receiving too much unemployment pay: "In actual fact the wages level is a result of collective contracts, but these contracts would never have been observed by the workmen if they had not been sure of receiving an indemnity which differed little from their wages. It is the dole, therefore, that has made trade union discipline possible... Therefore we may assume that the dole is the underlying cause of the unemployment which has been so cruelly inflicted on England since 1920." (190)
Hugh Macmillan, a Conservative Party member of the Economic Advisory Council agreed and argued that social security benefits had prevented "economic laws" from working. Keynes replied: "I do not think they are sins against economic law. I do not think it is any more economic law that wages should go down easily than that they should not. It is a question of facts. Economic law does not lay down the facts, it tells you what the consequences are." He insisted unemployment benefits were not the cause of unemployment. "I think we are forced by the use of the wrong weapon to have a hospital because it has resulted in there being so many wounded." (191)
Ramsay MacDonald and Philip Snowden had several meetings with the Economic Advisory Council. Keynes described these sessions as visits to the "monkey house". Keynes, who joined forces with George Douglas Cole and Walter Citrine in favour of "a programme of productive and useful home development" the businessmen wanted to reduce costs, including taxes. Keynes also argued for controls on the export of capital. Hugh Dalton explained that MacDonald and Snowden would not agree to an enquiry into monetary policy or the state in relation to unemployment policy. Keynes responded bitterly at one meeting where he described himself as "the only socialist present". (192)
Hubert Henderson, who had co-written Can Lloyd George Do It?, also now became one of Keynes opponents. He told Keynes with the slump gathering force, the budgetary cost of public works schemes was bound to shoot up, as the projects financed became progressively less remunerative. Henderson feared that "with an increasing hole in the Budget, and increasing apprehension, until you were faced with either abandoning the whole policy or facing a real panic - flight from the pound and all the rest". (193)
John Maynard Keynes wrote several articles for The Nation on the economic crisis. On 13th December he praised the manifesto published by Oswald Mosley and signed by seventeen Labour Party MPs as "offering a starting point for thought and action". The following week he asked: "Is the man in the street now awakening from a pleasant dream to face the darkness of facts? Or dropping off into a nightmare that will pass away?" He then answered his own question: "This is not a dream. This is a nightmare. For the resources of nature and men's devices are just as fertile and productive as they ever were." (194)
Philip Snowden wrote in his notebook on 14th August that "the trade of the world has come near to collapse and nothing we can do will stop the increase in unemployment." He was growing increasingly concerned about the impact of the increase in public-spending. At a cabinet meeting in January 1931, he estimated that the budget deficit for 1930-31 would be £40 million. Snowden argued that it might be necessary to cut unemployment benefit. Margaret Bondfield looked into this suggestion and claimed that the government could save £6 million a year if they cut benefit rates by 2s. a week and to restrict the benefit rights of married women, seasonal workers and short-time workers. (195)
Unemployment continued to rise and the national fund was now in deficit. Austen Morgan, has argued that when Ramsay MacDonald refused to become master of events, they began to take control of the Labour government: "With the unemployed the principal sufferers of the world recession, he allowed middle-class opinion to target unemployment benefit as a problem... With Snowden at the Treasury, it was only a matter of time before the economic issue was being defined as an unbalanced budget." (196)
The first issue of the New Statesman and Nation appeared on 28th February 1931. It styled itself as an independent organ of the left, without special affiliation to a political party. The editor was Kingsley Martin who employed John Maynard Keynes to write about economics. Philip Snowden rejected Keynes ideas and this was followed by the resignation of Charles Trevelyan, the Minister of Education. "For some time I have realised that I am very much out of sympathy with the general method of Government policy. In the present disastrous condition of trade it seems to me that the crisis requires big Socialist measures. We ought to be demonstrating to the country the alternatives to economy and protection. Our value as a Government today should be to make people realise that Socialism is that alternative." (197)
Trevelyan told a meeting of the Parliamentary Labour Party that the main reason he had resigned: "I have for some time been painfully aware that I am utterly dissatisfied with the main strategy of the leaders of the party. But I thought it my duty to hold on as long as I had a definite job in trying to pass the Education Bill. I never expected a complete breakthrough to Socialism in this Parliament. But I did expect it to prepare the way by a Government which in spirit and vigour made such a contrast with the Tories and Liberals that we should be sure of conclusive victory next time."
He attacked the government for refusing to introduce socialist measures to deal with the economic crisis. He was also a supporter of John Maynard Keynes: "Now we are plunged into an exampled trade depression and suffering the appalling record of unemployment. It is a crisis almost as terrible as war. The people are in just the mood to accept a new and bold attempt to deal with radical evils. But all we have got is a declaration of economy from the Chancellor of the Exchequer. We apparently have opted, almost without discussion, the policy of economy. It implies a faith, a faith that reduction of expenditure is the way to salvation. No comrades. It is not good enough for a Socialist party to meet this crisis with economy. The very root of our faith is the prosperity comes from the high spending power of the people, and that public expenditure on the social services is always remunerative." (198) (199 missing)
In February 1931, on the advice of Philip Snowden, MacDonald asked George May, the Secretary of the Prudential Assurance Company, to form a committee to look into Britain's economic problems. Other members of the committee included Arthur Pugh (trade unionist), Charles Latham (trade unionist), Patrick Ashley Cooper (Governor of the Hudson's Bay Company), Mark Webster Jenkinson (Vickers Armstrong Shipbuilders), William Plender (President of the Institute of Chartered Accountants) and Thomas Royden (Thomas Royden & Sons Shipping Company). (200)
A. J. P. Taylor has pointed out that four of the May Committee were leading capitalists, whereas only two represented the labour movement: "Snowden calculated that a fearsome report from this committee would terrify Labour into accepting economy, and the Conservatives into accepting increased taxation. Meanwhile he produced a stop-gap budget in April, intending to produce a second, more severe budget in the autumn." Snowden made speeches in favour of "national unity" hoping that he would get help from the other political parties to push through harsh measures. (201)
Snowden came increasing under attack from England's leading economists. John Maynard Keynes criticised Snowden's belief in free-trade and urged the introduction of an import tax in order that Britain might resume the vacant financial leadership of the world, which no one else had the experience or the public spirit to occupy. Keynes believed this measure would create a budget surplus. (202) Others questioned the wisdom of devoting £60m to paying off the national debt. (203)
On 14th July, the Economic Advisory Council published its report on the state of the economy. Chaired by Hugh Macmillan, committee members included John Maynard Keynes, J. A. Hobson, George Douglas Cole, Walter Citrine, Hubert Henderson, Walter Layton, William Weir and Andrew Rae Duncan. The report drew attention to Britain's balance of payments. "The export of manufactured goods had not paid for the import of food and raw materials for over a hundred years but this had been made up by so-called 'invisible' earnings, such as banking, shipping and the interest on foreign income. These had declined with the recession. Crude estimates a new economic indicator - suggested that Britain was about enter into a balance of payments deficit... By way of solution, they proposed a revenue tariff." (204)
In July, 1931, the George May Committee produced (the two trade unionists refused to sign the document) its report that presented a picture of Great Britain on the verge of financial disaster. It proposed cutting £96,000,000 off the national expenditure. Of this total £66,500,000 was to be saved by cutting unemployment benefits by 20 per cent and imposing a means test on applicants for transitional benefit. Another £13,000,000 was to be saved by cutting teachers' salaries and grants in aid of them, another £3,500,000 by cutting service and police pay, another £8,000,000 by reducing public works expenditure for the maintenance of employment. "Apart from the direct effects of these proposed cuts, they would of course have given the signal for a general campaign to reduce wages; and this was doubtless a part of the Committee's intention." (205)
The five rich men on the committee recommended, not surprisingly, that only £24 million of this deficit should be met by increased taxation. As David W. Howell has pointed out: "A committee majority of actuaries, accountants, and bankers produced a report urging drastic economies; Latham and Pugh wrote a minority report that largely reflected the thinking of the TUC and its research department. Although they accepted the majority's contentious estimate of the budget deficit as £120 million and endorsed some economies, they considered the underlying economic difficulties not to be the result of excessive public expenditure, but of post-war deflation, the return to the gold standard, and the fall in world prices. An equitable solution should include taxation of holders of fixed-interest securities who had benefited from the fall in prices." (206)
William Ashworth, the author of An Economic History of England 1870-1939 (1960) has argued: "The report presented an overdrawn picture of the existing financial position; its diagnosis of the causes underlying it was inaccurate; and many of its proposals (including the biggest of them) were not only harsh but were likely to make the economic situation worse, not better." (207) Keynes reacted with great anger as it was the complete opposite of what he had been telling the government to do and called the May Report "the most foolish document I ever had the misfortune to read". (208)
The May Report had been intended to be used as a weapon to use against those Labour MPs calling for increased public expenditure. What it did in fact was to create abroad a belief in the insolvency of Britain and in the insecurity of the British currency, and thus to start a run on sterling, vast amounts of which were held by foreigners who had exchanged their own currencies for it in the belief that it was "as good as gold". This foreign-owned sterling was now exchanged into gold or dollars and soon began to threaten the stability of the pound. (209)
The Labour government officially rejected the report because MacDonald and Snowden could not persuade their Cabinet colleagues to accept May's recommendations. MacDonald and Snowden now formed a small committee, made up of themselves and Arthur Henderson, Jimmy Thomas and William Graham, three people they thought they could persuade to accept public spending cuts. Their report was published on 31st July, the last day of parliament sitting. It was a bland document that made no statement on May's recommendations. (210)
On 5th August, John Maynard Keynes wrote to MacDonald, arguing that the committee's recommendations clearly represented "an effort to make the existing deflation effective by bringing incomes down to the level of prices" and if adopted in isolation, they would result in "a most gross perversion of social justice". Keynes suggested that the best way to deal with the crisis was to leave the gold standard and devalue sterling. (211)
Philip Snowden presented his recommendations to the Cabinet on 20th August. It included the plan to raise approximately £90 million from increased taxation and to cut expenditure by £99 million. £67 million was to come from unemployment insurance, £12 million from education and the rest from the armed services, roads and a variety of smaller programmes. Most members of the Cabinet rejected the idea of the proposed cut in unemployment benefit and the meeting ended without any decisions being made. Clement Attlee, who was a supporter of Keynes, condemned Snowden for his "misplaced fidelity to laissez-faire economics". (212)
Frederick Pethick-Lawrence and Susan Lawrence both decided to resign from the government if the cuts to the unemployment benefit went ahead: Pethick-Lawrence wrote: "Susan Lawrence came to see me. As Parliamentary Secretary to the Ministry of Health, she was concerned with the proposed cuts in unemployment relief, which she regarded as dreadful. We discussed the whole situation and agreed that, if the Cabinet decided to accept the cuts in their entirety, we would both resign from the Government." (213)
Arthur Henderson argued that rather do what the bankers wanted, Labour should had over responsibility to the Conservatives and Liberals and leave office as a united party. The following day MacDonald and Snowden had a private meeting with Neville Chamberlain, Samuel Hoare, Herbert Samuel and Donald MacLean to discuss the plans to cut government expenditure. Chamberlain argued against the increase in taxation and called for further cuts in unemployment benefit. MacDonald also had meetings with trade union leaders, including Walter Citrine and Ernest Bevin. They made it clear they would resist any attempts to put "new burdens on the unemployed". Sidney Webb later told his wife Beatrice Webb that the trade union leaders were "pigs" as they "won't agree to any cuts of unemployment insurance benefits or salaries or wages". (214)
At another meeting on 23rd August, 1931, nine members (Arthur Henderson, George Lansbury, John R. Clynes, William Graham, Albert Alexander, Arthur Greenwood, Tom Johnson, William Adamson and Christopher Addison) of the Cabinet stated that they would resign rather than accept the unemployment cuts. A. J. P. Taylor has argued: "The other eleven were presumably ready to go along with MacDonald. Six of these had a middle-class or upper-class background; of the minority only one (Addison)... Clearly the government could not go on. Nine members were too many to lose." (215)
That night MacDonald went to see George V about the economic crisis. He warned the King that several Cabinet ministers were likely to resign if he tried to cut unemployment benefit. MacDonald wrote in his diary: "King most friendly and expressed thanks and confidence. I then reported situation and at end I told him that after tonight I might be of no further use, and should resign with the whole Cabinet.... He said that he believed I was the only person who could carry the country through." (216)
MacDonald told his son, Malcolm MacDonald, about what happened at the meeting: "The King has implored J.R.M. to form a National Government. Baldwin and Samuel are both willing to serve under him. This Government would last about five weeks, to tide over the crisis. It would be the end, in his own opinion, of J.R.M.'s political career. (Though personally I think he would come back after two or three years, though never again to the Premiership. This is an awful decision for the P.M. to make. To break so with the Labour Party would be painful in the extreme. Yet J.R.M. knows what the country needs and wants in this crisis, and it is a question whether it is not his duty to form a Government representative of all three parties to tide over a few weeks, till the danger of financial crash is past - and damn the consequences to himself after that." (217)
After another Cabinet meeting where no agreement about how to deal with the economic crisis could be achieved, Ramsay MacDonald went to Buckingham Palace to resign. Sir Clive Wigram, the King's private secretary, later recalled that George V "impressed upon the Prime Minister that he was the only man to lead the country through the crisis and hoped that he would reconsider the situation." At a meeting with Stanley Baldwin, Neville Chamberlain and Herbert Samuel, MacDonald told them that if he joined a National Government it "meant his death warrant". According to Chamberlain he said "he would be a ridiculous figure unable to command support and would bring odium on us as well as himself." (218)
On 24th August 1931 MacDonald returned to the palace and told the King that he had the Cabinet's resignation in his pocket. The King replied that he hoped that MacDonald "would help in the formation of a National Government." He added that by "remaining at his post, his position and reputation would be much more enhanced than if he surrendered the Government of the country at such a crisis." Eventually, he agreed to form a National Government.
On 24th August 1931 King George V had a meeting with the leaders of the Conservative and Liberal parties. Herbert Samuel later recorded that he told the king that MacDonald should be maintained in office "in view of the fact that the necessary economies would prove most unpalatable to the working class". He added that MacDonald was "the ruling class's ideal candidate for imposing a balanced budget at the expense of the working class." (219)
Later that day MacDonald returned to the palace and had another meeting with the King. MacDonald told the King that he had the Cabinet's resignation in his pocket. The King replied that he hoped that MacDonald "would help in the formation of a National Government." He added that by "remaining at his post, his position and reputation would be much more enhanced than if he surrendered the Government of the country at such a crisis." Eventually, he agreed to continue to serve as Prime Minister. George V congratulated all three men "for ensuring that the country would not be left governless." (220)
Ramsay MacDonald was only able to persuade three other members of the Labour Party to serve in the National Government: Philip Snowden (Chancellor of the Exchequer) Jimmy Thomas (Colonial Secretary) and John Sankey (Lord Chancellor). The Conservatives had four places and the Liberals two: Stanley Baldwin (Lord President), Samuel Hoare (Secretary for India), Neville Chamberlain (Minister of Health), Herbert Samuel (Home Secretary), Lord Reading (Foreign Secretary) and Philip Cunliffe-Lister (President of the Board of Trade).
MacDonald's former cabinet colleagues were furious about what he had done. Clement Attlee asked why the workers and the unemployed were to bear the brunt again and not those who sat on profits and grew rich on investments? He complained that MacDonald was a man who had "shed every tag of political convictions he ever had". His so-called National Government was a "shop-soiled pack of cards shuffled and reshuffled". This was "the greatest betrayal in the political history of this country". (221)
Some members of the Labour Party were pleased by the formation of the National Government. Morgan Philips Price commented: "I found Members delighted that Ramsay Macdonald, Philip Snowden and J. H. Thomas had severed themselves from us by their action. We had got rid of the Right Wing without any effort on our part. No one trusted Mr Thomas and Philip Snowden was recognized to be a nineteenth-century Liberal with no longer any place amongst us. State action to remedy the economic crisis was anathema to him. As for Ramsay Macdonald, he was obviously losing his grip on affairs. He had no background of knowledge of economic and financial questions and was hopelessly at sea in a crisis like this. But many, if not most, of the Labour M.P.s thought that at an election we should win hands down." (222)
The Labour Party was appalled by what they considered to be MacDonald's act of treachery. Arthur Henderson commented that MacDonald had never looked into the faces of those who had made it possible for him to be Prime Minister. His close friend, Mary Hamilton, wrote on 28th August: "But greatly as I admire your courage, and ready as I am to believe your gesture may have saved us all, I could not, as I thought the whole situation out on my long journey home, find it possible to support this Government or believe in its policy. It is a very hard decision to make; and this afternoon's party meeting does not make it agreeable to act on - but, there it is. I felt I must write this line to express the deep regret I feel about this, temporary severance between you and the party." (223)
MacDonald replied: "Whether you believe it or not, I have saved you, whatever the cost may be to me, but you are all quietly going on drafting manifestoes, talking about opposing cuts in unemployment pay and so on, because I faced the facts a week ago and damned the consequences... If I had agreed to stay in, defied the bankers and a perfect torrent of credit that had been leaving the country day by day, you would all have been overwhelmed and the day you met Parliament you would have been swept out of existence... Still I have always said that the rank and file have not always the same duty as the leaders, and I am willing to apply that now. I dare say you know, however, that for some time I have been very disturbed by the drift in the mind of the Party. I am afraid I am not a machine-made politician, and never will be, and it is far better for me to drop out before it will be impossible for me to make a decent living whilst out of public life." (224)
On 8th September 1931, the National Government's programme of £70 million economy programme was debated in the House of Commons. This included a £13 million cut in unemployment benefit. All those paid by the state, from cabinet ministers and judges down to the armed services and the unemployed, were cut 10 per cent. Teachers, however, were treated as a special case, lost 15 per cent. Tom Johnson, who wound up the debate for the Labour Party, declared that these policies were "not of a National Government but of a Wall Street Government". In the end the Government won by 309 votes to 249. (225)
John Maynard Keynes spoke out against the morality of cutting benefits and public sector pay. He claimed that the plans to reduce the spending on "housing, roads, telephone expansion" was "simply insane". Keynes went on to say the government had been ignoring his advice: "During the last 12 years I have had very little influence, if any, on policy. But in the role of Cassandra, I have had considerable success as a prophet. I declare to you, and I will stake on it any reputation I have, that we have been making in the last few weeks as dreadful errors of policy as deluded statesmen have ever been guilty of." (226)
The cuts in public expenditure did not satisfy the markets. The withdrawals of gold and foreign exchange continued. John Maynard Keynes published an article in the Evening Standard on 10th September, urging import controls and the leaving of the Gold Standard. (227) Two days later he argued in the New Statesman that the government policy "can only delay, it cannot prevent, a recurrence of another crisis similar to that through which we have just passed." (228)
A mutiny of naval ratings at Invergordon on 16th September, led to another run on the pound. That day the Bank of England lost £5 million in defending the currency. This was followed by losing over 10 million on 17th and over 16 million on the 18th. The governor of the Bank of England told the government that it had lost most of its original gold and foreign exchange. On the 20th September, the Cabinet agreed to leave the Gold Standard, something that Keynes had been telling the government to do for several years. (229)
The pound sterling was allowed to float in the international markets and was to fall by more than a quarter. Therefore, devaluation, which the Labour government had destroyed itself in its resistance to this policy, came four weeks after the formation on the National government. The advice of the Bank of England, which had been taken as absolute gospel, was proved to be worthless. Sidney Webb, the former Secretary of State for the Colonies in MacDonald's government, commented: "Nobody told us we could do this." (230)
Ramsay MacDonald still feared for the future, he wrote to a friend that "although we cannot say it in public, the unsettlement regarding sterling and the uncertainty regarding the position of the Government may, at any moment, bring a new crisis, the results of which may well be starvation for great sections of our people, ruin to everybody except a lot of dastardly profiteers and speculators, and the end of our influence in the world." (231)
On 26th September, the Labour Party National Executive decided to expel all members of the National Government including Ramsay MacDonald, Philip Snowden, Jimmy Thomas and John Sankey. As David Marquand has pointed out: "In the circumstances, its decision was understandable, perhaps inevitable. The Labour movement had been built on the trade-union ethic of loyalty to majority decisions. MacDonald had defied that ethic; to many Labour activists, he was now a kind of political blackleg, who deserved to be treated accordingly." (232)
The 1931 General Election was held on 27th October, 1931. MacDonald led an anti-Labour alliance made up of Conservatives and National Liberals. It was a disaster for the Labour Party with several leading Labour figures, including Arthur Henderson, John R. Clynes, Arthur Greenwood, Charles Trevelyan, Herbert Morrison, Emanuel Shinwell, Frederick Pethick-Lawrence, Hastings Lees-Smith, Hugh Dalton, Susan Lawrence, William Wedgwood Benn, Tom Shaw and Margaret Bondfield losing their seats.
The Government parties polled 14,500,000 votes to Labour's 6,600,000. In the new House of Commons, the Labour Party had only 52 members and the Lloyd George Liberals only 4. George Lansbury, William Adamson, Clement Attlee and Stafford Cripps were the only leading Labour figures to win their seats. The Labour Party polled 30.5% of the vote reflecting the loss of two million votes, a huge withdrawal of support. The only significant concentration of Labour victories occurred in South Wales where eleven seats were retained, many by large majorities. (233)
MacDonald, now had 556 pro-National Government MPs and had no difficulty pursuing the policies suggested by Sir George May. The new Chancellor of the Exchequer was Neville Chamberlain. MacDonald kept Snowden, Thomas and Sankey in his government but the Conservatives dominated the cabinet with eleven members. In September 1932, Snowden, Samuel and Sinclair resigned over the issue of tariffs on imports. MacDonald wrote in his diary: "I have had doubts as to whether I should stay, but only owing to my own personal feelings. It is a lonely job, but of what I ought to do I never doubted." (234)
Chamberlain gained extra revenues from tariffs but still had difficulty balancing the budget. This problem became worse when he reduced the contribution of direct taxation. To balance this he cut police pay by ten per cent and military expenditure was at its lowest since the war. Chamberlain refused to increase public spending and unemployment continued to rise and reached 23% in August, 1932. MacDonald wrote in his diary that he did not know what to do: "It is not the usual depression. It is really the breakdown of a system." (235)
|Unemployment in the United Kingdom: 1920-1939|
MacDonald was now a prisoner of the Conservative Party. He opposed the administration of the Means Test to the unemployed but was powerless to object. This represented almost a return to the poor law and when it was enacted it gave rise to considerable working-class opposition. He wrote in his diary that "no vision of general situation and only concern to keep government out of practically everything... deserted by Labour and Liberal parties, the National Government inevitably tends to fundamental Toryism." (236)
MacDonald was now 67 years old and he now began to feel his age. He wrote in his diary: "Trying to get something clear into my head for the House of Commons tomorrow. Cannot be done. Like man flying in mist: can fly all right but cannot see the course. Tomorrow there will be a vague speech impossible to follow." The following day he recorded: "Thoroughly bad speech. Could not get my way at all. The Creator might have devised more humane means for punishing me for over-drive and reckless use of body." (237)
Stanley Baldwin forced MacDonald to give Tory donors honours. He was especially upset by the case of Julian Cahn, who had made his fortune from hire purchase schemes. He wrote in his diary that "Cahn was one of those honours hunters whom I detested." Cahn had used his money to cover up a scandal that involved the Conservative Party: "Baldwin involves me in a scandal of honour by forcing me to give an honour because a man has paid £30,000 to get Tory headquarters and some Tories living and dead out of a mess." (238)
John C. Davidson, the Chancellor of the Duchy of Lancaster in MacDonald's government, commented: "MacDonald had a very well-stocked mind, but he had a very weak character... He didn't know how to be loyal - and I don't mean loyal to the people above him or probably equal to him - but he didn't know how to be loyal to his lesser friends; that's why his party couldn't stand him... He was a very treacherous man; he couldn't resist putting his knife into the back of the man in front of him. He was jealous, very feminine... A man like that is bound to have intrigues going o9n all the time, trying to replace him." (239)
In January 1932, Ramsay MacDonald was diagnosed with glaucoma. His health had been poor for several years and had been suffering from depression and insomnia since being expelled from the Labour Party. His speeches in the House of Commons became very difficult to understand. At a meeting in Geneva he momentarily lost consciousness while speaking. In a diary entry in January, 1933, he admitted that he was unable to do his job properly because he had "crossed the frontiers of age". (240)
However, he refused to consider resignation, believing he was indispensable. "In any objective sense, this was less and less the political case, but MacDonald's indispensability was totally subjective. It was how he validated his very existence. There were signs of paranoia during a parliamentary speech in 1933... Though he wished to avoid public humiliation, he made no serious effort to remove himself from the scene." (241)
In his later years he spent a great deal of time with Edith Vane-Tempest-Stewart, Marchioness of Londonderry. This caused a great deal of controversy as her husband, Charles Vane-Tempest-Stewart, 7th Marquess of Londonderry, was a leading member of the Conservative Party as well as being a major owner of coal mines in County Durham. MacDonald even appointed Londonderry as his Secretary of State for Air. Beatrice Webb considered the relationship to be totally immoral and his friendship "with the Londonderrys almost amounts to a public scandal". (242)
MacDonald became infatuated with Edith and writing many gushing letters to "my dearest friend of all," signing himself "your attendant ghillie". MacDonald told Edith he had overheard one Labour MP saying of him in the Commons lobby, "A few months ago he sang The Red Flag, but now he whistles The Londonderry Air." Stanley Baldwin wrote to a family member saying that 90 per cent of people regarded her friendship with MacDonald as "an act of political expediency" to help Londonderry's career. According to David McKittrick: "Most think that Edith and Ramsay did not actually become lovers, although the fact that she had a tattoo of a snake on her left leg, beginning at her ankle and wending its way intriguingly upwards, caused many to assume she was a fast woman". (243)
MacDonald continued to think of himself as a socialist. He described Tory politicians who were keeping him in power, as "an odd lot of colonels and sycophants repulsively vulgar." (244) He admitted that "my heart is elsewhere... but I am a socialist." (245) MacDonald was now aware, that along with Jimmy Thomas, he was under the control of the Conservative Party: "There are two of us in the very curious position of being amongst the leaders of a Party to which we do not belong and made responsible for a policy which we cannot control." (246)
In a letter to a friend MacDonald argued: "I never left my Socialism... I have never believed in revolution, except in very backward countries like Russia... I am only longing for the time when a combination to keep the country from ruin is no longer necessary, so that some plain speaking and principled Socialist propaganda can be launched." (247) However, soon afterwards he wrote in his diary: "How long can I remain at the head of a Government whose appeal to the country is anti-Socialism." (248)
On 7th June 1935, MacDonald went to see George V to tell him he was resigning as head of the National Government. The King said: "I wonder how you have stood it - especially the loss of your friends and their beastly behaviour. You have been the Prime Minister I have liked best; you have so many qualities, you have kept up the dignity of the office without using it to give you dignity." (249)
Henry Channon, the Conservative MP for Southend, commented in his diary: "I am glad Ramsay (MacDonald) has gone: I have always disliked his shifty face, and his inability to give a direct answer. What a career, a life-long Socialist, then for 4 years a Conservative Prime Minister, and now the defender of Londonderry House. An incredible volte-face. He ends up distrusted by Conservatives and hated by Socialists." (250)
In the 1935 General Election MacDonald was challenged in Seaham by Emanuel Shinwell, a popular figure in the Labour Party. Shinwell won easily with 38,380 votes to MacDonald's 17,882. The following year he was elected at a by-election to represent the Scottish Universities. He admitted it was such a safe-seat that during the campaign he did "not have to open his mouth". He now joined Stanley Baldwin's Conservative Cabinet as Lord President. (251)
James Ramsay MacDonald died of heart-failure on a cruise in the Atlantic on 5th November, 1937.
If practical Socialism means an autocracy or the Government of a Cabal I for one will have nothing to do with it. Did I take my ideas of the movement from the organ which you proudly yet falsely call the only vigorous weekly organ of the proletariat in the English language I would have that erroneous impression. To read that paper one would think the SDF's hand was against all other Socialist societies in England and that its duty was to heap slander of all sorts upon them ... We have over and over again had to read arguments in favour of Socialism that never went deeper than calling an opponent an "outrageous old hypocrite", "a bloodsucker", "ignorant", and many other epithets as delicious as the fumes of a Billingsgate market. Indeed, I have often been amazed at the expressiveness of the English language as shown in Justice. Well, that could in a certain measure have been put up with, but when this last dishonour has fallen upon us tine are obliged to speak and to act. It has been plainly shown in the history of the Federation that the great virtues it recognises are unscrupulousness, unfairness and slander. Be it so! I hope there may be many who can now see to what they have been trusting, and how they have been used, many who love the grand principles of Socialism more than the distorted doctrines of the Federation and who have the courage and manliness to act accordingly.
Political change is not desirable for its own sake, but rather for its effect on human well-being. But human well-being is not a matter of machinery or condition merely. We know, indeed, that it cannot be served by a system of wage slavery any more than it can be served by a feudal system; but even where the economic hindrances are overcome the ideal humanity may be as far away as ever... The individual is truly complete only in a perfect society, but to make society perfect requires the sympathetic and conscious efforts of the individual... The Fellowship therefore aims at a reform of the ideals of individuals.
A party of turbulent spirits which had been got together... in a semi-intoxicated state took up a position in the front seats and throughout the proceedings were noisily demonstrative, shouting choruses, using coarse language and making themselves very objectionable... The chairman's rising was the signal for loud hooting and some cheering. He announced the object of the meeting, and after a short speech, he proceeded to read the address amidst an almost indescribable din rendering it almost impossible to hear his voice beyond a yard or two... Mr. MacDonald next rose to address the meeting and was received in the same manner as the other speakers, but with true Scotch sturdiness he stuck to his guns, and in a speech of over an hour's duration, during which he was subjected to continual interruptions, he explained the relationship of the Labour party to the Liberal party and the programme on which he should fight the next Parliamentary election... In conclusion, Mr. MacDonald said that he had kept them rather long but he had done so mainly for the purpose of teaching certain interests in Dover a lesson, and if the same policy were adopted at every meeting he should do exactly as he had done that night.
When the MacDonalds arrived back in England in late December, the election campaign, which did not formally begin until January 1910, was, for all practical purposes, under way. In Leicester, the result was scarcely in doubt. As in 1906, MacDonald faced only one Liberal candidate; as in 1906, he was comfortably elected, only a few hundred votes behind the Liberal. But the rest of the country spoke with a more uncertain voice. When the House of Commons assembled in February 1910, the Liberals had 275 seats only two more than the Unionists. The Irish had 80; the Labour Party, its strength augmented by the miners' members, had 40. If the Irish abstained, the Labour Party might hold the balance. If it combined with the Irish and dissident Radical back-benchers, the Government might be severely shaken, perhaps even overthrown. On paper, Labour's position was stronger than ever before. In practice, it was to be a source of confusion, dissension and bitterness.
The confusion was due largely to the new problems created by the election results: the dissension and bitterness were exacerbated by the old problem of finding an acceptable chairman. Hardie had stayed in the chair for only two years. Henderson followed Hardie's precedent, and after two years as chairman he, in turn, retired. Thus the party's first task after the general election was to choose his succcssor. Even in 1908, MacDonald's name had been canvassed. By now, with the debate on the "right to work" Bill to his credit, his standing in the party was higher. Unlike Hardie, he was acceptable to the non-socialist trade unions; unlike, Henderson, be was a socialist, and a member of the I.L.P. There is little doubt that he believed himself, and was widely believed, to be the best candidate. Yet be was reluctant to throw his hat into the ring. The British Labour movement had traditionally been reluctant to combine symbolic authority with real power. Its "chairmen" and "presidents" were figureheads: power rested with "secretaries", theoretically responsible to committees. The L.R.C., and later the Labour Party, followed this tradition. The chairman presided over the National Executive: it was MacDonald, the secretary, who controlled the machine. Under Hardie and Henderson, the parliamentary party had followed a similar pattern. Thus the temporary chairmanship of the parliamentary party would be a poor exchange for the permanent secretaryship of the party outside, while it would be difficult to persuade, the party to allow both offices to be held at once or to make the parliamentary chairmanship permanent.
The only way (the Labour Party) could be made into a party and that is for the leadership to fall into the hands of a strong man who can lead. In the Party the strong men are limited as far as I can see to those who have already led and to yourself. Clynes I do not know sufficiently to speak about but he seems very good natured and too cautious. There remains only yourself... If you will not accept it then it is "God help the Party". Except Henderson you have no leader. Hardie could hardly be called a leader. He was merely an individual, largely unapproachable, preferring always to plough a lonely furrow, and always wishing to do things off his own bat. This in a democratic party was impossible. It probably split up the party at its most critical moment, the moment of its birth. If you cannot pull the party round, no one can. I consider that the attempt is a duty which you cannot refuse to undertake however distasteful it may be to you. I shall be exceedingly disappointed unless you accept.
It must be created from the same experiences, motives and sentiments, from which the family itself has been built up. In a much more literal sense than the expression is generally supposed to mean, the family is the foundation of the State. In short, it is not merely to do justice to women... that Socialists should favour women's suffrage. It is because women's experience is different from men's that women should be enfranchised.
I have no objection to revolution, if it is necessary but I have the very strongest objection to childishness masquerading as revolution, and all that one can say of these window-breaking expeditions is that they are simply silly and provocative. I wish the working women of the country who really care for the vote ... would come to London and tell these pettifogging middle-class damsels who are going out with little hammers in their muffs that if they do not go home they will get their heads broken.
On the 4th May the Chancellor of the Exchequer introduced a scheme of Industrial Insurance so wide in its scope and so bold in its conception that even to this day we do not feel competent to pronounce on its general effect. Its foundation, however, is quite simple - Insurance. To this, objection has been taken on the ground that great masses of people live under the poverty line and ought not to be asked to contribute to any Insurance scheme, and ... appeals have been made to the gallery and we have been told that the grand result of the proposal is to make the wage-earners pay towards their own sickness and invalidity the enormous sum of £10,000,000 a year... We shall content ourselves with two comments... The first is that the German Socialist Trade Unions, after having opposed insurance, are now its doughtiest advocates ... The second observation we make is that without some system of premium payment, the whole scheme would degenerate into a national charity of the most vicious kind, which would adversely affect wages and would not help the Socialist spirit.
I am gathering courage to tell you how over the fire one night we two wives searched our hearts together & fearlessly said to one another that love like ours had no room for one jealous throb. Mary Middleton had spoken to us unfalteringly of her hope that Jim would "love & live" again in all fullness and I said to Margaret that I knew Bruce's need of the love & sympathy of a true woman so well that were I to go from him my last words would be seek and soon another woman who would mother both him and the bairns for me. And Margaret put her check against mine -a very unusual demonstration - you know - and said, I think it was - "And so would I" - But anyhow I never doubted but we were wholly in sympathy. The feeling that I have to tell you this - almost as if she herself were insisting on it - has been with me for weeks past and I have not dared... But I am too sure of what she would have wished... not to have courage to speak-out now. I was 12 when my mother died and until my father married again when I was nearly 16 I had no home happiness at all. His grief and loneliness put out the sunshine for us children. And the second wife was tenderly good to us. And Margaret - what of her motherhood? It is her will that you live - live to carry on the noblest Socialism in the world today - to live gloriously down every mean aspersion of personal ambition and to accomplish the creation of a strong sane Collectivist Party in Britain capable of government in every sense of the word... She believed in your future and she knew your need of sympathy and help. She told me much of your mother. You know both of us had special reason to love and honour our husbands' mothers and learn from their sorrows and struggles a fiercer morality than any ordinary world holds. We both believed in real marriage: in men and women working shoulder to shoulder - you yourself record that. And here I will stop - proudly holding out both hands to you because I know that she who is gone loved and trusted me and showed me glimpses of her innermost soul.
At the time of my mother's death... my father's grief was absolutely horrifying to see. Her illness and her death had a terrible effect on him of grief; he was distracted; he was in tears a lot of the time when he spoke to us, and, as I say, it was almost frightening to a youngster like myself... This continued right down the years and over and over again not only during the next years but the next decades one would catch sudden glimpses of his eternal devotion to my mother. For example, on the anniversary, the first anniversary of her death - at the very hour when she died, he asked for all us children to come up to the room where he had been working; and again he was in a state of terrible grief. I may be exaggerating this but if I remember correctly be had his watch out... on his desk or in his hand and he sat there and he said when the actual moment came of her death, twelve months beforehand, that Mummy had now died and he spoke to us about her, of course in a wonderful way, but with this terrible tear-stained agony of grief... And always on the anniversary in one way or another he indicated to us, even when he was appallingly busy, in after years, that this was the day of the tragedy.
I noticed that Ramsay MacDonald in speaking of the appeal we should send out for capital used the word "Democratic" rather than "Labour" or "Socialist" as describing the character of the paper. I rebulked him flatly and said we would have no "democratic" paper but a Socialist and Labour one - boldly proclaimed. Why does MacDonald always seem to try and shirk the word Socialism except when he is writing critical books about the subject.
Ramsay MacDonald fascinated me. His head was a thing of beauty. Black hair waved and rolled over a fine brow, one curl almost touching his straight, strong eyebrows, from under which his eyes glowed. His voice was rugged, but soft, and, as he spoke, there came into it a throb. It was the natural instrument of an orator. Standing upright, he was a splendid figure of a man, and his appearance of height and strength was increased by his habit of rising on his toes and throwing back his head. He was the first man of culture I had met.
We may be rightly proud of the tolerance we display towards even the most extreme licence of speech in ordinary times... Mr. MacDonald' s case is a very different one. In time of actual war... Mr. MacDonald has sought to besmirch the reputation of his country by openly charging with disgraceful duplicity the Ministers who are its chosen representatives, and he has helped the enemy State ... Such action oversteps the bounds of even the most excessive toleration, and cannot be properly or safely disregarded by the British Government or the British people.
For months past - ever since the man who calls himself James Ramsay MacDonald, but whose real name is James McDonald Ramsay, has stood aloof from the almost unanimous response of the nation to the call of the King - we have persistently labelled him as a traitor and a coward; and we have called upon Leicester to rid itself of the stigma of having such a "representative" in Parliament. But, despite all provocation, we have so far confined ourselves to criticising and exposing his words and deeds in the capacity of a public man - of a paid servant of the State. Even when we were recently described by him as having spent most of our time "on the threshold of the gaol", we simply retorted that if he wished to push us through the door of the machinery of the criminal prosecution for libel was available to him. For, whatever our knowledge concerning his antecedents, we felt that even in the case of a traitor, there was a recognised line beyond which journalistic revelation should not travel. So we have remained silent with regard to certain facts which have been in our possession for a long time. First of all, we knew that this man was living under an adopted name - and that he was registered as James MacDonald Ramsay - and that, therefore, he had obtained admission to the House of Commons in false colours, and was probably liable to heavy penalties to have his election declared void. But to have disclosed this state of things would have imposed upon us a very painful and unsavoury duty. We should have been compelled to produce the man's birth certificate. And that would have revealed what today we are justified in revealing -for the reason we will state in a moment. It would have revealed "James Ramsay Macdonald", M.P. for Leicester, late "leader" of the Labour Party; late member of a Royal Commission, under the seal of His Majesty; the leading light of the Union of Democratic Control - libeller and slanderer of his country - it would have revealed him as the illegitimate son of a Scotch servant girl!
On the day when the paper with the attack was published, I was travelling from Lossiemouth to London in the company as far as Edinburgh with the Dowager Countess De La Warr, Lady Margaret Sackville and their maid. Breaking the journey at Aberdeen, I saw the Contents Bill of the paper announcing some amazing revelations about myself and when I rejoined the ladies at the station, I saw the maid had John Bull in her hand. Sitting in the train, I took it from her and read the disgusting article. From Aberdeen to Edinburgh, I spent hours of the most terrible mental pain. Letters of sympathy began to pour in upon me. The first time I had ever seen my registration certificate was when I opened the paper at Aberdeen. Never before did I know that I had been registered under the name of Ramsay, and cannot understand it now. From my earliest years my name has been entered upon lists, like the school register, etc. as MacDonald. My mother must have made a simple blunder or the registrar must have made a clerical error. In any event, the affair is most mysterious.
For your villainy and treason you ought to be shot and I would gladly do my country service by shooting you. I hate you and your vile opinions - as much as Bottomley does. But the assault he made on you last week was the meanest, rottenest lowdown dog's dirty action that ever disgraced journalism.
I am in receipt of your letter informing me that the Moray Golf Club has decided to become a political association with the Golf Course attached, and that it has torn up its rules in order that some of its members may give rein to their political prejudice and spite. Unfortunately, for some years, the visit of any prominent Liberal or Radical to the Moray Golf Club has been resented by a certain section which has not concealed its offensiveness either in the Club House or on the Course. Though I am, therefore, not sorry that the character of a number of members of the Moray Golf Club has been advertised to the world, I cannot help regretting that the Club, of which I was one of the earliest members, should be held up to public ridicule and contempt.
To dismiss MacDonald as a traitor to Labour is nonsense. His contribution in the early years was of incalculable value. His qualities as a protagonist of Socialism were of a rare standard. There has probably never been an orator with such natural magnetism combined with impeccable technique in speaking in the party's history. Before the First World War his reputation in international Labour circles brooked no comparison. Keir Hardie, idolized by the theorists in the movement, did not have the appeal to European and American Socialists that MacDonald had. There is no doubt that his international prestige equalled that of such men as Jaures and Adler. Among his people in Scotland he could exert almost mesmeric influence.
No one has ever completely explained the magnetism of MacDonald as a young man. He was the most handsome man I have ever known, and his face and bearing can best be described by the conventional term "princely." Partly this was due to the spiritual qualities which are so often found in the real Northern Scottish strain, with its admixture of Celtic and Norse blood. Some of it probably came from the paternal ancestry which gave him aristocratic characteristics and marked him as a leader of men. Lesser men might despise this suggestion of heredity; the people who loved him in those early days recognized it as an inborn quality. It also put him in Parliament. Leicester was intrigued about this Labour candidate who was the sole opponent of the Tory in 1906. If he had been an uncouth firebrand it is unlikely that he would have found much favour. The immense Liberal vote was his from the start. The Liberals and sentimentalists were utterly charmed by this handsome idealist whose musical voice wove gently round their spell-bound hearts. He won that election by emotionalism rather than intellect - as others before and since have won elections.
There has been no crime committed by statesmen of this character without those statesman appealing to the nations' honour. We fought the Crimean War because of our honour. We rushed to South Africa because of out honour. The Right Hon. Gentleman (Sir Edward Grey) is appealing to us today because of our honour. What is the use of talking about coming to the aid of Belgium, when, as a matter of fact, you are engaging in a whole European War which is now going to leave the map of Europe in the position it is in now?
After a year of barren effort, the Conservative Government has admitted its inability to cope with the problem of Unemployment, and is seeking to cover up its failure by putting the nation to the trouble and expense of an election on the Tariff issue.
TARIFFS NO REMEDY
The Labour Party challenges the Tariff policy and the whole conception of economic relations underlying it. Tariffs are not a remedy for Unemployment. They are an impediment to the free interchange of goods and services upon which civilised society rests. They foster a spirit of profiteering, materialism and selfishness, poison the life of nations, lead to corruption in politics, promote trusts and monopolies, and impoverish the people. They perpetuate inequalities in the distribution of the world's wealth won by the labour of hands and brain. These inequalities the Labour Party means to remove.
WORK OR MAINTENANCE
Unemployment is a recurrent feature of the existing economic system, common to every industrialised country, irrespective of whether it has Protection or Free Trade. The Labour Party alone has a positive remedy for it. We denounce as wholly inadequate and belated the programme of winter work produced by the Government, which offers the prospect of employment for only a fraction of the unemployed in a few industries; and in particular provides no relief for women and young persons.
LABOUR'S UNEMPLOYMENT PROGRAMME
The Labour Party has urged the immediate adoption of national schemes of productive work, with adequate maintenance for those who cannot obtain employment to earn a livelihood for themselves and their families. The flow of young workers from the schools must be regulated to relieve the pressure on the labour market, and full educational training, with maintenance, must be provided for the young people who are now exposed to the perils and temptations of the streets.
The Labour Programme of National Work includes the establishment of a National System of Electrical Power Supply, the development of Transport by road, rail and canal, and the improvement of national resources by Land Drainage, Reclamation, Afforestation, Town Planning, and Housing Schemes. These not only provide a remedy for the present distress, but are also investments for the future.
HELP FOR AGRICULTURE
Agriculture, as the largest and most essential of the nation's industries, calls for special measures to restore its prosperity and to give the land workers a living wage. The Labour Policy is one that will develop Agriculture and raise the standard of rural life by establishing machinery for regulating wages with an assured minimum, providing Credit and State insurance facilities for Farmers and Smallholders, promoting and assisting Co-operative Methods in Production and Distribution, so as to help stabilise prices, and make the fullest use of the results of research.
The Labour Party proposes to restore to the people their lost rights in the Land, including Minerals, and to that end will work for re-equipping the Land Valuation Department, securing to the community the economic rent of land, and facilitating the acquisition of land for public use.
PEACE AMONG THE NATIONS
Labour's vision of an ordered world embraces the nations now torn with enmity and strife. It stands, therefore, for a policy of International Co-operation through a strengthened and enlarged League of Nations; the settlement of disputes by conciliation and judicial arbitration; the immediate calling by the British Government of an International Conference (including Germany on terms of equality) to deal with the Revision of the Versailles Treaty, especially Reparations and Debts; and the resumption of free economic and diplomatic relations with Russia. This will pave the way for Disarmament, the only security for the nations.
RELIEF FOR THE TAXPAYER
Labour condemns the failure of the Government to take steps to reduce the deadweight War Debt. No effective reform of the National Finances can be attempted until the steady drain of a million pounds a day in interest is stopped. Treasury experts, in evidence before a Select Committee of the House of Commons, expressed their view that a Tax on War Fortunes could be levied, and have therefore admitted both the principle and its practicability. A Labour Chancellor of the Exchequer, in consultation with Treasury experts, would at once work out a scheme to impose a non-recurring, graduated War Debt Redemption Levy on all individual fortunes in excess of £5,000, to be devoted solely to the reduction of the Debt.
The saving thus effected, with reduction of expenditure on armaments, other sane economies, and the increased revenue derived from Taxation of Land Values, would make it possible to reduce the burden of Income Tax, abolish not only the Food Duties, but also the Entertainments Tax and the Corporation Profits Tax, as well as provide money for necessary Social Services.
THE COMMONWEALTH OF CO-OPERATIVE SERVICE
The Labour Party is working for the creation of a Commonwealth of Co-operative Service. It believes that so far only a beginning has been made in the scientific organisation of industry. It will apply in a practical spirit the principle of Public Ownership and Control to the Mines, the Railway Service and the Electrical Power Stations, and the development of Municipal Services. It will make work safe for the worker by stricter Inspection of Workplaces, and more effective measures against Accidents and Industrial Diseases. It will provide fuller Compensation for the Workers and improve the Standard of Hours.
THE AGED, THE WIDOWS, THE CHILDREN
Labour Policy is directed to the creation of a humane and civilised society. When Labour rules it will take care that little children shall not needlessly die; it will give to every child equality of opportunity in Education; it will make generous provision for the aged people, the widowed mothers, the sick and disabled citizens.
It will abolish the slums, promptly build an adequate supply of decent homes and resist decontrol till the shortage is satisfied. It will place the Drink Traffic under popular control.
EX-SERVICE MEN'S PENSIONS
In accordance with its past actions inside and outside Parliament, the Labour Party will do its utmost to see that the Ex-Service men and their dependants have fair play.
Labour stands for equality between men and women: equal political and legal rights, equal rights and privileges in parenthood, equal pay for equal work.
LABOUR'S PRACTICAL IDEALISM
The Labour Party submits to the men and women of the country its full programme. It urges them to refuse to make this General Election a wretched partisan squabble about mean and huckstering policies. It appeals to all citizens to take a generous and courageous stand for right and justice, to believe in the possibility of building up a sane and ordered wants, to oppose the squalid materialism that dominates the world to-day, and to hold out their hands in friendship and good-will to the struggling people everywhere who want only freedom, security and a happier life.
The first Labour Government took on the job for the administrative experience. They were dependent on the Liberals for a majority in Parliament and they aimed at winning over Liberal votes to Labour in the country. Some modifications of policies was expected. But what was not expected was that when Labour Ministers achieved office they should turn into quite different persons. They even changed in appearance. The significant politics of MacDonald's first term as Prime Minister were that he cut his hair, trimmed his moustache, assumed a tail-coat and was even seen in a tall shiny hat, symbol for a generation past of the hated capitalist. The change in Ramsay's dress had in reality a deep symbolic significance. Continuity was to be observed. Sleep soundly in your beds, O Middle Classes. The harbingers of change, the party of revolution, might have defeated the aristos, but the angle of approach to the future would remain unchanged.
I asked the Prime Minister about the continued circulation of your paper. His view, after reading it was that little of the news contained in it was likely to be unfamiliar to members of the Government or, indeed, to anyone who reads the Workers' Weekly and similar papers, so that in its present scope, he doubts whether it would provide very edifying or interesting reading to members of the Cabinet.
He thought, however, that it might be made at once attractive and indeed entertaining if its survey were extended to cover not only communistic activities but also other political activities of an extreme tendency. For instance a little knowledge in regard to the Fascist movement in this country and its main apostles... or possibly sonic information as to the source of the Morning Post funds might give an exhilarating flavour to the document and by enlarging its scope convert it into a complete and finished work of art.
Perhaps you would consider the continued circulation of the document in the light of this proposition?"
These braids and uniforms are but part of an official pageantry and as my conscience is not on my back, a gold coat means nothing to me but a form of dress to be worn or rejected as a hat would be in relation to the rest of one's clothes. Nor do I care a fig for the argument that it is part of a pageantry of class, or royalty or flunkeyism. If royalty had given the Labour Government the cold shoulder, we should have returned the call. It has not. It has been considerate, cordially correct, human friendly. The King has never seen me as a Minister without making me feel that he was also seeing me as a friend. I record a remark I made to one of the Left incorruptibles who asked why I had been at the Palace: "Because its allurements are so great that I cannot trust you to go". The stay at Windsor - 26, 27 April - was a revelation in spirit. The kindly homeliness was that of a cottage and sat well in gilt halls. It was the natural blending of the two that was such a welcome experience. "Sycophancy" growls the incorruptibles: "Not at all. The dignity and authority of human qualities."
On the 21st the draft - the trial draft - was sent to me at Aberavon... I did not receive it until the 23rd. On the morning of the 24th I looked at the draft. I altered it, and sent it back in an altered form, expecting it to come back to me again with proofs of authenticity, but that night it was published.
I make no complaints... The Foreign Office and every official in it know my views about propaganda ... On account of my known determination to stand firm by agreements and to treat them as Holy Writ when my signature has been attached to them, they assumed that they were carrying out my wishes in taking immediate steps to publish the whole affair. They honestly believed that the document was authentic, and upon that belief they acted.
If they acted too precipitately, what is the accusation against us? Why don't these newspapers say we are in too great haste? Ah, that won't catch votes against you... Therefore, they have to put up the story that we shilly-shally... Only nine days have elapsed from the first registering of the letter and the publication of the dispatch last Friday.
But that is not the whole story... It came to my knowledge on Saturday... that a certain London morning newspaper... had a copy of this Zinoviev letter and was going to spring it upon us...
How did it come to have a copy of that letter? I am also informed that the Conservative Headquarters had been spreading abroad for some days that... a mine was going to be sprung under our feet, and that the name of Zinoviev was to be associated with mine. Another Guy Fawkes - a new Gunpowder Plot...
The letter might have originated anywhere. The staff of the Foreign Office up to the end of the week thought it was authentic... I have not seen the evidence yet. All I say is this, that it is a most suspicious circumstance that a certain newspaper and the headquarters of the Conservative Association seem to have had copies of it at the same time as the Foreign Office, and if that is true how can I avoid the suspicion - I will not say the conclusion - that the whole thing is a political plot?
The story of I suspect to be a forgery is as follows: Amongst the papers I dealt with before leaving my Manchester host's house oil the morning of the 16th was the copy of a letter purporting to have been sent by Zinoviev to the British Communists. I did not treat it as a proved document but as I was on the outlook for such documents and meant to deal with them firmly, I asked that care should be taken to ascertain if it was genuine, and that in the meantime a draft of a dispatch might be made to Rakovsky. I said that the dispatch would have to carry conviction and that it should be drafted with a view to being published. I was in the storm of an election and it never crossed my mind that this letter had any special part to play in the fight. Diplomatically, it was being handled with energy and precision, circulated to the Service Departments concerned and sent to Scotland Yard. The trial draft waited for me at Aberavon as I had gone to Bassetlaw to help Malcolm, Bristol etc. I found it on my return to the hotel on the 23rd, substantially rewrote it, was not satisfied with it, but being pressed to go to meetings then waiting me, I decided to send it up for copying and to make sure it would come back, did not initial it. This reached London on the 24th.
In my absence, the anti-Russian mentality of Sir Eyre Crowe was uncontrolled. He was apparently hot. He had no intention of being disloyal, indeed quite the opposite, but his own mind destroyed his discretion and blinded him to the obvious care he should have exercised. I favoured publication; he decided that I meant at once and before Rakovsky replied. I asked for care in establishing authenticity; he was satisfied and that was enough. Still, nothing untoward would have happened had not the Daily Mail and other agencies including Conservative leaders had the letter and were preparing a political bomb from it. When Sir Eyre Crowe and Mr. Gregory were actually considering the moment when the dispatch should be published, they were informed that the Daily Mail was to publish next morning and without further consideration they decided to send off the dispatch at once and give it out for publication that night.
Wonderfully serious and spiritually united Conference sat for two days in Memorial Hall... Miners' plea that they were defending general standard of life of workers has united T.U.'s with them, and as the real problem of breakdown of mining industry has been dealt with in propaganda minds and by stunt phrases, we are up against the hard face of impossibility as miners cannot budge from "not a shilling and not a minute" formula. The Government has woefully mismanaged the whole business... But the T.Us have been equally blameworthy: 1. Miners' impossible formula. 2. Allowing themselves to fall into general strike psychology. General Strike declared and at the meeting of T.U. General Council yesterday evident no forethought. No definite idea of what they are to consider as satisfactory to enable them to finish and go back to work. Position wonderfully like 1914. Strike cannot settle purely economic problem of bankruptcy of industry. Were it to be "won" industry remains bankrupt. Employers in the various trades may not remain passive, but may raise own trade matters. Will strike continue to help section after section? At T.U. General Council Meetings men like Bevin, Thomas etc. saw this and were plainly trying to avoid it. Question raised: How far could they pledge miners to accept a readjustment of wages. But alas, miners' executive gone home and Cook who alone is in town declined responsibility of answering for them. Rightly! It really looks tonight as though there was to be a General Strike to save Mr. Cook's face. Important man! The election of this fool as miners' secretary looks as though it would be the most calamitous thing that ever happened to the T.U. movement.
MacDonald is not working at his job; he is not thinking about it; he is not associating with those whom he has and would have to guide and from whom he could get enlightenment. His thoughts and his emotions are concentrated on his agreeable relations with the men and women - especially the women of the enemy's camp... he is becoming impatient with the troublesomeness of the working class.
How tired I am. My brain is fagged, work is difficult, and there is a darkness on the face of the land. I am ashamed of some speeches I have made, but what can I do? I have no time to prepare anything. It looks as though it will be harder to make my necessary income this year. I wonder how this problem of an income for political Labour leaders with no, or small, independent means is to be solved. No one seems to understand it. To be the paid servant of the State is objectionable; to begin making an income on Friday afternoon and going hard at it till Sunday night, taking meetings in the interval, is too wearing for human flesh and blood. On the other hand, to live on £400 a year is impossible. If it killed one in a clean, efficient business-like way why should one object, but it cripples and tortures first by lowering the quality of work done and then by pushing one into long months of slowly ebbing vitality and mental paralysis.
For some time I have realised that I am very much out of sympathy with the general method of Government policy. In the present disastrous condition of trade it seems to me that the crisis requires big Socialist measures. We ought to be demonstrating to the country the alternatives to economy and protection. Our value as a Government today should be to make people realise that Socialism is that alternative.
But the first session was a bitter disappointment. Now we are plunged into an exampled trade depression and suffering the appalling record of unemployment. It is a crisis almost as terrible as war. The people are in just the mood to accept a new and bold attempt to deal with radical evils. But all we have got is a declaration of economy from the Chancellor of the Exchequer. We apparently have opted, almost without discussion, the policy of economy. It implies a faith, a faith that reduction of expenditure is the way to salvation. No comrades. It is not good enough for a Socialist party to meet this crisis with economy. The very root of our faith is the prosperity comes from the high spending power of the people, and that public expenditure on the social services is always remunerative.
Though I differ profoundly with the present leadership I have not the slightest sympathy with the action of men like Mosley. The Labour Party is going to be the power of the future however long it takes to evolve leaders who know how to act. But it is as in an army. The leaders for the time must settle the strategy. The officers who command the battalions can retire, but they must not rebel. I have taken the one step of protest open to me. I resign my position as an officer and become a private soldier.
On January 23rd, Mosley sent MacDonald a copy of a long memorandum on the economic situation, on which he had been at work for well over a month, and which has gone down to history as the "Mosley Memorandum". It made three main assertions - that the machinery of government should be drastically overhauled, that unemployment could be radically reduced by a public-works programme on the lines advocated by Keynes and the Liberal Party, and that long -term economic reconstruction required "a mobilisation of national resources on a larger scale than has yet been contemplated". The existing administrative structure, Mosley argued, was hopelessly inadequate. What was needed was a new department, under the direct control of the prime minister, consisting of an executive committee of ministers and a secretariat of civil servants, assisted by a permanent staff of economists and an advisory council of outside experts. The problems of substance, he went on, had to be looked at under two quite separate headings, which had so far been muddled up. First, there was the long-term problem of economic reconstruction, which could be solved only by systematic Government planning, designed to create new industries as well as to revitalize old ones. Second, there was the immediate problem of unemployment. This could be solved by making road-building a national responsibility, by raising a loan of £200 million and spending it on roads and other public works over the next three years, by raising the school-leaving age and by introducing earlier retirement pensions. Whatever their faults, Mosley concluded flamboyantly, his proposals "at least represent a coherent and comprehensive conception of national policy... It is for those who object to show either that present policy is effective for its purpose, or to present a reasoned alternative which offers a greater prospect of success.
Mosley came to see me... had to see me urgently: informed me he was to resign. I reasoned with him and got him to hold his decision over till we had further conversations. Went down to Cabinet Room late for meeting. Soon in difficulties. Mosley would get away from practical work into speculative experiments. Very bad impression. Thomas light, inconsistent but pushful and resourceful; others overwhelmed and Mosley on the verge of being offensively vain in himself.
Saw King today at 10.30 a.m. Great crowd and cordial reception. King most friendly and expressed thanks and confidence. I then reported situation and at end I told him that after tonight I might be of no further use, and should resign with the whole Cabinet. He asked if I would advise him to send for Henderson. I said "No", which he said relieved him. I advised him in the meanwhile to send for the leaders of the other two parties and have them report the position from their points of view. He said he would and would advise them strongly to support me. I explained my hopeless Party position if there were any number of resignations. He said that he believed I was the only person who could carry the country through. I said that did I share his belief I should not contemplate what I do, but that I did not share it. He expressed horror at an election. I said there would be no election till the crisis was well over and that so far as I could see, and on the assumption of resignations, no man could avoid it then. He again expressed thanks and sorrow... Henderson and others (Alexander, Lees Smith, Johnston etc.) met after Cabinet yesterday and decided to resign on 10% cut. They will be in good tactical position as Opposition if the crisis is avoided. Am preparing a statement too if I resign to give to the press at once. I commit political suicide to save the crisis. If there is no other way I shall do it as cheerfully as an ancient Jap. Indeed, this morning of sunny weather, my spirits have returned and my heavy weariness has gone.... How few people understand the unattractiveness of this place and this office to me. And, curiously enough, were it not so I could not have done what I have.
The Cabinet meeting last night lasted until after midnight. The P.M. got a majority in the Cabinet to agree with his proposals, but Henderson, Graham and Alexander led a strong opposition. Despite the P.M.'s majority a decision to go ahead with his plan would have involved seven or eight resignations, so that it was obviously impossible for the Government to carry on. Resignation of the Cabinet was inevitable.
The King has implored the J.R.M. to form a National Government. Baldwin and Samuel are both willing to serve under him. This Government would last about five weeks, to tide over the crisis. It would be the end, in his own opinion, of J.R.M.'s political career. (Though personally I think he would come back after two or three years, though never again to the Premiership. This is an awful decision for the P.M. to make. To break so with the Labour Party would be painful in the extreme. Yet J.R.M. knows what the country needs and wants in this crisis, and it is a question whether it is not his duty to form a Government representative of all three parties to tide over a few weeks, till the danger of financial crash is past - and damn the consequences to himself after that.
On the Prime Minister's instructions I went to see Mr. Henderson at the Foreign Office this morning. I told him that the P.M was contemplating a Resignation Honours List; and would Mr. Henderson press him to give effect to the suggestions which had been made before, that Mr. Henderson should be given a Peerage? Mr Henderson said that the situation had now changed. A hard fight lay before the Labour Party, the more so as some of their erstwhile leaders had parted from them for the time being. He himself had served with the Party for over 40 years: for over 20 years he had been their Secretary: it was due to the Party that he occupied in public life the position which he did. At such a vital time in the fortunes of the Party it would need all the assistance it could get: responsible guidance within it would also be more needed than ever and his going to the House of Lords might impair the help & guidance which he could give them by remaining as he was. Also, Mrs. Henderson was away, and he would want to ask her: how soon did the P.M. want a reply? (I said tomorrow would do.) ... In a general conversation in which I said that we stood at the parting of the ways, Mr Henderson said that we must not take this too seriously. At the time of the war when Mr MacDonald left the Party he (Henderson) had kept it together and it was ready to receive Mr MacDonald back again. He was parting with the P.M. now in no spirit of anger or resentment; and as regards myself as I said goodbye, he observed "I could never quarrel with anyone whose wife came from Newcastle".
I only got home this morning from Austria: had I arrived sooner I should have tried to ring up or call. This is an agonising situation to a great many of us: it is so to me. But greatly as I admire your courage, and ready as I am to believe your gesture may have saved us all, I could not, as I thought the whole situation out on my long journey home, find it possible to support this Government or believe in its policy. It is a very hard decision to make; and this afternoon's party meeting does not make it agreeable to act on - but, there it is. I felt I must write this line to express the deep regret I feel about this, temporary severance between you and the party.
Whether you believe it or not, I have saved you, whatever the cost may be to me, but you are all quietly going on drafting manifestoes, talking about opposing cuts in unemployment pay and so on, because I faced the facts a week ago and damned the consequences... If I had agreed to stay in, defied the bankers and a perfect torrent of credit that had been leaving the country day by day, you would all have been overwhelmed and the day you met Parliament you would have been swept out of existence... Still I have always said that the rank and file have not always the same duty as the leaders, and I am willing to apply that now. I dare say you know, however, that for some time I have been very disturbed by the drift in the mind of the Party. I am afraid I am not a machine-made politician, and never will be, and it is far better for me to drop out before it will be impossible for me to make a decent living whilst out of public life.... Do not lose touch, especially with Malcolm. He has been as brave as a lion, and you have no idea how he regards you.
In the old days I had looked up to MacDonald as a great leader. He had a fine presence and great oratorical power. The unpopular line which he took during the First World War seemed to mark him as a man of character. Despite his mishandling of the Red Letter episode, I had not appreciated his defects until he took office a second time. I then realised his reluctance to take positive action and noted with dismay his increasing vanity and snobbery, while his habit of telling me, a junior Minister, the poor opinion he had of all his Cabinet colleagues made an unpleasant impression. I had not, however, expected that he would perpetrate the greatest betrayal in the political history of this country. I had realised that Snowden had become a docile disciple of orthodox finance, but I had not thought him capable of such virulent hatred of those who had served him loyally. The shock to the Party was very great, especially to the loyal workers of the rank-and-file who had made great sacrifices for these men.
Many members of the Government, of whom I was one, were seriously disturbed at the lack of constructive policy displayed by the leaders of the Government. We were also conscious of a growing estrangement between MacDonald and the rest of the Party. He was increasingly mixing only with people who did not share the Labour outlook. This opposition, however, did not crystallise, because the one man who could have taken MacDonald's place, Arthur Henderson, was too loyal to lend himself to any action against his leader. Instead of deciding on a policy and standing or falling by it, MacDonald and Snowden persuaded the Cabinet to agree to the appointment of an Economy Committee, under the chairmanship of Sir George May of the Prudential Insurance Company, with a majority of opponents of Labour on it. The result might have been anticipated. The proposals were directed to cutting the social services and particularly unemployment benefit. Their remedy for an economic crisis, one of the chief features of which was excess of commodities over effective demand, was to cut down the purchasing power of the masses. The majority of the Government refused to accept the cuts and it was on this issue that the Government broke up. Instead of resigning, MacDonald accepted a commission from the King to form a so-called 'National' Government.
Susan Lawrence came to see me. As Parliamentary Secretary to the Ministry of Health, was concerned with the proposed cuts in unemployment relief, which she regarded as dreadful. We discussed the whole situation and agreed that, if the Cabinet decided to accept the cuts in their entirety, we would both resign from the Government.
At last I got my summons from the Prime Minster, and went to Downing Street. We went in and were sat round a table. MacDonald proceeded to address us. He gave a short account of the crisis, told us that the Cabinet had broken up and that he was forming a National Government with Conservative and Liberal colleagues. He closed the meeting abruptly, saying he had important business to transact. As we filed past to say good-bye, he detained me for a moment, and said he thought I might be willing to stay with the new Government; but I declined the suggestion.
Early in the summer vacation (August 21st) the Labour Government resigned and each Labour M.P. received a letter from the Prime Minister informing him that he had felt constrained to form a National Government and had secured the support of Mr Baldwin, the leader of the Opposition. Some Conservative Members would be taken into the Government. Mr Snowden and Mr J. H. Thomas had agreed to continue in their offices and it was hoped that the Parliamentary Labour Party would agree with what had been done. At the same time a message arrived summoning all Labour M.P.s to attend a meeting of the Parliamentary Party in London. Incredibly, I was playing cricket when it arrived. I rushed up to London at once. I found Members delighted that Ramsay Macdonald, Philip Snowden and J. H. Thomas had severed themselves from us by their action. We had got rid of the Right Wing without any effort on our part. No one trusted Mr Thomas and Philip Snowden was recognized to be a nineteenth-century Liberal with no longer any place amongst us. State action to remedy the economic crisis was anathema to him. As for Ramsay Macdonald, he was obviously losing his grip on affairs. He had no background of knowledge of economic and financial questions and was hopelessly at sea in a crisis like this. But many, if not most, of the Labour M.P.s thought that at an election we should win hands down. I was not so optimistic and wrote in a memorandum which I published in a local paper in my constituency at the time. "The country is thoroughly frightened and our Party has not proved that it has an alternative policy or the courage to put one through if it had one."
It is unfortunate that the Labour Party has in the main produced leaders who have been poorly endowed with that generosity of mind and regard for their colleagues which enables them to live closely with them. Keir Hardie, Arthur Henderson and George Lansbury were exceptions. The usual excuse is shyness, but that is not always valid.
Ramsay MacDonald, by the time he became prime minister, was already showing evidence of that remote and defensive attitude to those around him which in the end left him with virtually no friends in the real sense of the word. He had, as a matter of fact, a considerable number of M.P.s at his disposal who had years of hard experience in the House when they had had to wage a well-nigh hopeless battle as members of a party without political force or indeed much of the country behind them.
I am glad Ramsay (MacDonald) has gone: I have always disliked his shifty face, and his inability to give a direct answer. What a career, a life-long Socialist, then for 4 years a Conservative Prime Minister, and now the defender of Londonderry House. An incredible volte-face. He ends up distrusted by Conservatives and hated by Socialists.
Theirs was a great romance but one doomed to fail: the handsome, illegitimate ploughman's son and the earl's daughter, the beautiful Catholic socialite poet and Britain's first Labour Prime Minister, a low-Church Scot.
For the first time today, The Daily Telegraph reveals the love letters that James Ramsay MacDonald, the pre-war political giant who three times led the country, sent to Lady Margaret Sackville, youngest child of the 7th Earl de la Warr, during a 15-year relationship that was an absolute secret to all but a few of their closest friends.
The letters, of which there are about 150, show that MacDonald proposed at least three times to Lady Margaret, who was 15 years his junior. She turned him down each time. But he continued to shower her with intimate letters, writing poems and limericks and imagining a secret world in which they would be able to live without public comment.
The first of the letters, newly discovered at the National Archives in Kew, was written in 1913, a year after MacDonald met Lady Margaret, a famous beauty.
His biographer, David Marquand, the former President of Mansfield College, Oxford, said: "These letters are quite extraordinary and show a side of MacDonald that we have never really seen before."
Ramsay MacDonald, born in Lossiemouth in 1866, had just lost his wife, also called Margaret, to blood poisoning in 1911.
Lady Margaret Sackville, a poet who mixed with writers such as W B Yeats and Wilfred Scawen Blunt, was a friend of Lady Ottoline Morrell, a leading member of the Bloomsbury Set, and it is possible the lovers met through her.
Lady Ottoline, in her memoirs, had described MacDonald and Lady Margaret as "good friends", but the tone and hidden language of the letters shows that theirs was a full-fledged love affair.
MacDonald refers to sex in a repeated euphemism in his letters. Occasionally, he describes his marriage proposals as a "pilgrimage".
In a letter dated September 1915, just after he had proposed for a second time, MacDonald wrote: "Our love is wholehearted and cannot be changed and it is the most natural thing in the world that we should enter its holiest place."
But he then went on to indicate why Lady Margaret, who died unmarried in 1963, had refused to be his wife: "Nothing but the most formal barriers keep us from marrying and being with each other in a full common life and being all the better and happier in consequence.
"But, as you say, there are friends who, if they knew, would not understand or sympathise and of course they might come to know.
"You know, my dearie, how much I should grieve if your love for me brought you into conflict with anyone."
As well as worries about what her aristocratic family and friends might think, there was also the question of religion. Brought up in the Presbyterian church, MacDonald later joined the even lower Free Church of Scotland: Lady Margaret was Roman Catholic. David Marquand speculated that this was what the Labour pioneer meant by "the most formal barriers".
But another letter almost certainly written in the following year suggests that the idea of marriage had been reconsidered.
In it, he imagines that a friend has written to the local newspaper in his Midlands constituency, announcing the banns: "Sir, the honour of Leicester is to be enormously enhanced. Your [MP] — a poor misguided creature at present — is about to ally his fortunes to a famous house celebrated for its age, the beauty of its women, and the Conservatism of its men."
On occasions he was writing to Lady Margaret twice a day, sometimes arranging to meet, sometimes discussing the politics of the anti-war movement they both belonged to and which made them despised in the patriotic Britain of the Great War. But most of the letters are simple expressions of love for a woman with whom he spent too little time.
One undated letter reads: "Dearest beloved, it is such a beautiful morning that you ought to be here and we should be walking in the garden.
"And if we were walking in the garden, what more should we do where the bushes hid us?"
Another letter contains two limericks, one of which refers to the beautiful aristocrat's fondness for taking the waters and the strange health offerings of the Spa Hotel in "Strath", or Strathpeffer, in the Highlands of Ross-shire:
"A Lady went up to the Strath
For radium drinks and a bath
Her sweetheart turned up
And she flung down her cup
And kissed him to death in her wrath."
The collection of letters, which were kept in the home of Lady Margaret's bank manager in Cheltenham after her death in 1963 before being handed to the Historic Manuscript Collection, is incomplete. But those that still exist clearly show how the relationship waxed and waned, with the letters charting Lady Margaret's occasional desire to keep MacDonald at a more discreet length.
Immediately after the war, when he suffered for his pacifism with a heavy defeat in the 1918 election, MacDonald was in the wilderness and spent some time in Vienna, where he was rumoured to have had an entanglement with a well-known courtesan.
But he seems to have renewed his relationship with Lady Margaret sufficiently that, in 1924, during his first, nine-month stint as Prime Minister, MacDonald invited her to stay the night with him at Chequers, the premier's official residence in Buckinghamshire.
Later, after the affair petered out, MacDonald fell in love with Lady Londonderry, the wife of one of the ministers in his National Government, but nothing in his life ever again touched the depths of his feelings for "my own dearie".
It was a passion they could not make public, a love doomed to be declared in scribbled letters or stolen moments when they walked together. Ramsay MacDonald was the ambitious, illegitimate son of a farm labourer who became the first Labour prime minister. Lady Margaret Sackville was the youngest child of the seventh Earl de la Warr, a poet and a society beauty who became his lover.
They were separated not only by class but by religion. Born in Lossiemouth, Morayshire, MacDonald was raised in the Presbyterian church and, as an adult, joined the Free Church of Scotland. Born in Mayfair, London, and nearly 15 years his junior, Lady Margaret was Roman Catholic. But they met shortly before the first world war and found a shared commitment to pacifism and love of poetry.
For 15 years they were bound together in an intense relationship expressed in hundreds of ardent love letters written in black ink by MacDonald, which were kept by Lady Margaret but only rediscovered in the National Archives at Kew this week. They reveal a love that burned fiercely but could never be sealed in marriage.
MacDonald was nursing a broken heart when they first met. His wife, also called Margaret, had died from blood poisoning in 1911, the year that MacDonald became leader of the Labour party. It is possible that MacDonald, a widower with six children, was introduced to Lady Margaret by Lady Ottoline Morrell, a leading member of the Bloomsbury set who politely described the pair as "good friends" in her memoirs.
By the time of the first surviving letter, dated 1913, MacDonald, then 46, was already addressing Lady Margaret as "my dear heart". Two years later, the full horror of the war was unfolding and MacDonald had already experienced the first setback of his turbulent political career, forced to resign as party leader for his opposition to British involvement in the conflict.
As he swept from pacifist meeting to political rally, he diligently wrote to Lady Margaret, "my own dearest" and "my dear one". At times he would post two letters a day. MacDonald was known in parliament for his occasionally woolly rhetoric, but in private he was more direct, seldom shying from speaking of physical desire but couching it in a fantasy world of "the forest".
"My dear one," he wrote in June 1915. "That was a very loving letter I had from you yesterday. I feel its kisses. It brought you with it and I slept with my head on your breast last night after we have been in the very thickest places of the jungle together." Similar entries and letters continued throughout the summer. "Do you dream that I come to you?" he wrote. "Do I come to you when you are not dreaming? Do I kiss you and lie on your breast? Give me all the news about yourself and your heart and tell me all about your love."
A glamorous figure with a fondness for fur-lined jackets, Lady Margaret returned his passion with letters of her own. MacDonald was meticulous in conveying details of hotels where he was staying so that she could write. One day in 1915, he thanked her for some flowers. They were, he wrote, "fragile like kisses". On other occasions, it seems she gave toys to his children.
As MacDonald piloted his way through a political career that would see him become the prime minister of three governments, he had less fortune in persuading his lover to abandon propriety and marry him. From his letters it appears he asked for her hand in marriage three times and was rebuffed on all occasions. "It was so refreshing to see you again and so hard to part with you," he wrote in the spring of 1915. "I am sure it is right that we should not marry but what heartaches you give me! You are my own loved one and I want you always."
They shared their own secret world. MacDonald created playful fantasies that spoke of how he missed her. A keen photographer who kept numerous albums, he wrote of the photographs of her hanging on his walls. "Your photographs are misbehaving again very badly," he said in July 1915. "One in gorgeous evening dress in a hoity-toity way says: 'You cannot take me into the jungle, poor dear, because my dress would get crushed, so I wink at you maliciously and challenge you to embrace me.' Another says: 'Poor dear, you cannot speak to my heart because you cannot unloosen my brooch.'"
Lady Margaret was a protegee of the poet Wilfrid Scawen Blunt and known for her anti-war poems. Unintimidated despite never having gone to university, MacDonald would quote Burns in his letters or offer jaunty doggerel of his own. When Lady Margaret stayed at the Spa Hotel in Strathpeffer in the Highlands, he gave her "kisses, warm and invigorating as mud baths, fresh as the morning, and as full of love as your own heart", and a limerick:
"A Lady went up to the Strath
For radium drinks and a bath
Her sweetheart turned up
And she flung down her cup
And kissed him to death in her wrath."
Amid the playfulness, MacDonald was acutely aware of what the public, and the media, would say - whether it was the resentment of the recently enfranchised working class for his affair with an anti-war aristocrat, or the disapproval of the ruling class. He tried to make light of it, despatching one missive consisting of imaginary extracts from the London Mail and John Bull (which that year suggested MacDonald had deceived the public by trying to conceal his illegitimacy by using a false name).
"We congratulate Mr Ramsay MacDonald. The companion with whom he walked in Surrey last week would have done honour to kings and added grace to counts," he wrote. Then he poked fun at Margaret's self-consciousness at their stepping out in public and refusing to walk on his side of the path. "When we next meet them we hope to notice an improvement in this matter," he joked in the mock London Mail editorial.
Over time, MacDonald became more sensitive to the moments when his declarations were not returned with the same fervour. At times, he was plaintive: "The post has come [ ... ] Not a line, not a kiss, not a whiff of fragrance." Or questioning: "Why your silence? Have you eaten chocolates until you ache?" He could also be playful. Instead of "my own dear", he would begin letters, "my dear provocation" and "my dear deserter" and wrote: "Not a line! Not a kiss! Not a smile! Not a compensating frown!"
In the political wilderness after the war, MacDonald travelled to Vienna, when it was rumoured he became romantically involved with a similarly aristocratic Austrian socialite. But he continued to send love letters to Lady Margaret, speaking of "something ethereal like kisses" in 1923. When he first became prime minister in 1924 he wrote to her on 10 Downing Street embossed notepaper with the envelope - again kept by Lady Margaret - stamped "the prime minister". Making arrangements for her to stay at Chequers, the prime minister's official residence in Buckinghamshire, he wrote: "So I shall expect to see you on Saturday to stay that night" and, instead of the customary "ever, R", signed off with five kisses.
A decade on from the height of their passion, he was still moved to an elaborate metaphor in a 1925 letter, comparing a posted kiss to something as exotic and - in those days - difficult to transport as "an imported mango" from "a thousand miles away". However, he concluded, "there is nothing better to be had. So here is one carefully selected."
Later that year he wrote, again playfully, that she owed him a letter. "Perhaps you are dead; perhaps you are playing chess; perhaps you have fallen in love; but whatever has happened to you, I had better be wary and not intrude without sending in my card."
Why did their love wither away? Was it because they felt they could never marry without scandal and, perhaps, the sacrifice of MacDonald's political career? David Marquand, the former president of Mansfield College, Oxford, and MacDonald's biographer, has said he thought "the formal barriers" that the politician wrote were keeping them "from marriage ... and being all the better and happier in consequence" were the question of religion.
By the time of the final surviving letter, in 1929, the hectic meetings and conferences of a politician's life appeared to be getting in the way. "My dear, I have been trying hard to get a moment to write but for days engagements have fitted into the hours like pieces of a Chinese puzzle. What a life!"
For her part, Lady Margaret stayed true to her strong feelings for the iconic Labour leader who she knew as a passionate, playful lover. For nearly three decades after his death, and until her own in 1963, Lady Margaret kept his letters secret - and safe.
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