1) Labour failed to modernise its policies to a move affluent Britain and the party was constantly divided 2) The parliamentary party was split between the Left and Right: left-wing Bevan’s wanted an expansion of the public sector & hostile to Gaitskell, who did not 3) Gaitskell became leader after Wilson and agreed on a social democracy rather than a socialist one, but failed to remove Clause IV in 1961 Labour weakness enabled the Conservatives to avoid the electoral consequences of their mistakes, partially 1) Suez 1956
2) Resignation of Eden
The Labour party was dominating in votes up to 1950, however that year the difference between Labour and Conservative parties was very neglectful. There are several factors that might have contributed to Labours loss of power in 1951. The Labour government was associated with the period of austerity when people had to overcome rationing and devaluation. Additionally, many key members of the Cabinet were exhausted or unwell. Moreover, they were split internally and the event with Gaitskell that led to Bevan’s resignation in 1951, undermined the cohesion of the government. In comparison to them, the conservative party seemed to be more convincing at that period. The reign of Conservatives began in 1951 and lasted for 13 years, when Winston Churchill ran his campaign for election, and eventually, won.
Here were several reasons that guaranteed his success: he agreed to maintain the post-war consensus that kept full employment under Keynesian policy and allowed to enlarge the system of social services. Moreover, Churchill’s second election victory was partially due to the gratitude of British public for being a good wartime leader. Another point is that, Conservatives reorganised the system of internal work and its campaign that was oriented toward gaining of additional votes. Also, they brought young and bright members into the government that made them stand out against old Labour government. The policy proposed by Churchill’s government was Keynesian and it guaranteed full employment due to the increased financing of projects by government and decreased taxation that led to increase of import.
Additionally, growing industry, build of housing and development of welfare services guaranteed growing employment and high consumer demand; women found it easy to find a job that gave families at least 2 incomes. One of the important factors was that Conservatives finalised the austerity: rationing and licensing came to an end. However, there were some difficulties, too. Development of industry and services required more people, which resulted in immigration of low-cost workforce from colonies of GB. Consequently, up to 1962 the number of immigrants from India and African countries was about 200 000, that led to Commonwealth Immigration Act. Moreover, depressed areas continued to have the level of unemployment above average that suggested costly measures to create intensives for workers, such as low interest loans, tax breaks and housing for key workers. But those measures could not guarantee safe functioning during difficult periods, for instance, firms closed as soon as recessions started. Winston Churchill was a prime-minister during 1951- 1955, even though he was very old and due to health issues was no longer dynamic. And this period is considered to be successful despite the fact that recovery of British economy was moving at a slow pace than one of Europe or USA.
In 1955 the parliament was under direction of Anthony Eden, who worked close to Churchill and coordinated the work of government during his absence. He inherited good economic and political conditions, and it was hard to imagine that in 2 years he would resign in disgrace because of foreign affair matter, the very field area of government where his talent was praised for. His fiasco was caused by the Suez Canal seizure made by Gamal Abdel Nasser that was a strategically important point controlled by Britain since 1875. An attempt to intervene in Egypt with military force in secrete coalition with France and Israel was not supported by US government and would cause heavy pressure and withdrawal of its financial help from British economy. That event was humiliating failure of British foreign policy; and the secret collusion with France and Israel created a bad image for Eden. Harold Macmillan was a prime- minister from 1957 to 1964 and he followed the strategies of his fellow members. He implemented the Butler’s theory to operate a mixed economy and the policy of Keynesianism.
The aims of these policies were to avoid extreme inflation and deflation by a series of government adjustments. If inflation rose too quickly, the government introduced measures to slow it down. These measures included, raising interest rates to prevent borrowing and increasing import controls to limit purchases from abroad, with the intent of reducing the trade gap. Alternatively, if demand was low, the Chancellor of the Exchequer at the time would introduce ‘a giveaway’ budget whereby taxes and interest rates were lowered. The Conservatives maintained these economic policies from 1957 right up until 1964. The ‘give away’ budgets were criticised however, as they were said to be attempts to ‘buy votes’. Macmillan also introduced the policy of stop-go, which resulted in stagflation due to Britain’s lack of economic strategy. That indicated the failure of governments to develop policies that encouraged a constantly performing economy.
The policy of stop-go was about intervening of government when consumption rose too quickly. Despite any criticisms, Macmillan (also named as Supermac) created an image of full confidence in this policy and that reflected in increase of his popularity and general public approval. As the result, quality of life improved and people were able to buy luxuries. Macmillan had many qualities that gained him respect: he was decisive, portrayed his confidence through media and delivered on promises. He pulled out of the Suez affair as he knew Britain was not going the way Eden wanted to see. He promised to build 300,000 houses per year: in 1953 the number of new houses achieved 327,000 and in 1954 – 354,000. Finally, Macmillan got rid of the British Empire which saved enormous amounts of money. Though Britain was criticised for doing this, as they were said to be abandoning their empire, ultimately it was the right thing to do as too many extreme promises were made and Macmillan knew these could not be kept without risking the welfare of Britain themselves.
Also, the empire wanted freedom and therefore it was impossible for Britain to ‘abandon’ them; they were just providing their colonies with the freedom they craved. In 1964 the last prime-minister to hold office while being the member of House of Lords. After becoming a lord he was criticized by Labour Party as an aristocrat, who cannot understand the needs and problems of ordinary families; and he had an image of rather stiffly person by contrast with the Labour leader, Harold Wilson. In conclusion, one might say that the period of 1951-64 was a great success for British economy when it came revived and more industrialized after the 2nd World War. It gave a start for new vision and policy that improved the face of the country with time.