Anyone see the speech by Ed Balls to the Labour Conference? It strikes me that if anyone wants to delve into history to lecture us about historical precedents and the "lessons of history", they should at least get their historical facts right.
Mr Balls claimed:
And the previous Prime Minister to say ‘there is no alternative,' was a Labour Prime Minister, Ramsay MacDonald, in 1931, two years after the 1929 Wall Street crash - the second biggest financial crisis of the last hundred years.
There is no alternative, MacDonald said, but to cut spending and unemployment benefits to get the deficit down and keep the financial markets happy.
But this party said No – and so did Lloyd George and the Liberals.
And MacDonald had to form a Coalition with the Conservatives to make his cuts.
And what happened?
The Great Depression of the 1930s, mass unemployment and – yes – the deficit got worse.
Conference
You either learn the lessons of history or you repeat the mistakes of history – and that’s what they are doing.
Just think if Clement Attlee in 1945 – when after the war when our national debt was over twice its current level – had said that the first priority was to get the deficit down…there would have been no NHS, no new homes for heroes and no welfare state.
But we don’t need to go back to the history books to see the warning signs over George Osborne’s economic policy - we only need to look across the Irish Sea.
So let's take a look at the History of the World According to Ed Balls.
"There is no alternative, MacDonald said, but to cut spending and unemployment benefits to get the deficit down and keep the financial markets happy." - The question has to be asked, why did the Labour Cabinet in 1931 consider and agree to massive cuts? The Labour Government in 1931 was ready to make cuts to close the deficit. They fell apart because a small majority of Cabinet members could not go the full distance - they agreed to 90% of the cuts but baulked at the proposal to cut unemployment benefits. Balls was simply wrong to suggest Labour opposed cuts in 1931 (just as Labour are historically wrong to say they did not bring in cuts before they left office in 2010.)
Balls went on to claim, "But this [Labour] party said No [to forming a Coalition] – and so did Lloyd George and the Liberals." Utterly wrong. The Liberals formed a Coalition with the Conservatives. That's why it became a National Government and it is what gave the administration a majority in the Commons before the 1931 general election. It is true to say that Lloyd George stayed in opposition. He was joined by only 4 other Liberal MPs, one of whom was his daughter Megan, and another was his son Gwilym. The other 2 were close allies of Lloyd George. The rest of the MPs, nearly 60 in total, supported the National Government.
And to imply that Ramsay MacDonald was alone in the Labour Party in entering the National Government is simply historical rubbish. Philip Snowden, the Labour Chancellor, continued in his post in the National Government. Admittedly, the number of MPs who backed the National Government was small - 11 in total. But that is 10 more than MacDonald by himself.
Balls then claimed, "And what happened? The Great Depression of the 1930s, mass unemployment and – yes – the deficit got worse." This is an interesting interpretation of history. Unemployment did continue to rise but not as a result of the formation of the National Government. The depression started in 1929 and unemployment had already risen dramatically before the National Government was formed. Typically, Balls overlooked this. No doubt in years to come he will be claiming that unemployment did not happen until the Coalition was formed in May 2010.
Finally, Balls claimed, "Just think if Clement Attlee in 1945 – when after the war when our national debt was over twice its current level – had said that the first priority was to get the deficit down…there would have been no NHS, no new homes for heroes and no welfare state." This is becoming part of the stock of Labour's claims against the Coalition - 1940s history has been rewritten to suggest that Britain had massive debts but could afford to spend vast sums of money to create the welfare state and the NHS. The implication is that you can keep on spending without taking any austerity measures.
This is of course total rubbish. Labour introduced austerity measures which make what we are about to face pale into insignificance. The postwar years of the late 1940 are not known as the Austerity Britain for nothing. This was a period in which Labour introduced even more controls than were place in the war years to cut consumption, reduce the public sector deficit and get British industry exporting to earn desperately needed foreign currency (especially dollars). Rationing to cut domestic demand was even extended to foods that had escaped rationing during the war, for example, bread.
It is rather worrying to think that Ed Balls was in charge of the country's education system up to May 2010. Let's hope he never had any input into the history elements of the National Curriculum. He potentially could have turned the country into a nation of history dunces.
If anyone is interested, I wrote the biography of a National Liberal Cabinet Minister, Walter Runciman, for my PhD thesis. Hence my interest in the history of the 1930s. And I am currently doing research on British food rationing in the 1940s. I hope to have that completed next year.
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