Economic and Social Issues following the First World War

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Economic Effects of the War

  • 745,000 Britons killed in war, Spanish Flu killed 150,000 more, 1.6 mil wounded and 3.5 mil recieving some form of war pension
  • Many markets lost to the US
  • Many debtors, particularly the newly Bolshevik Russia, failed to pay up, so the UK could not pay the US back
  • Over-investment in iron and steel, shipbuilding, coal and textiles, all industries that weren't needed as much post-war
  • Short term boom caused spiralling inflation-interest rates were then raised, causing a depression
  • Dec. 1920, unemployment went from 300,000 to 700,000. Rose to 2 mil. by June 1921
  • End of 1921-Chancellor called for cuts of £175 mil. out of £1,136 mil.. Departments could only agree on £75 mil.
  • Committee headed by Eric Geddes ('Geddes Axe') set up to find the remaining £100 mil. but only managed £64 mil.
  • 1922 budget saw a 12% per cent cut in gov't. spending. Cuts later became the norm of dealing with depression in the inter-war period
  • Farmers were big victims of the cuts as it undrmined the 1920 Agriculture Act that guaranteed minimum prices, leading to massive subsidies as depression hit.
  • Gov't. went back on its commitments and alienated 40-50 MPs of agricultural constituencies


  • Ministry of Reconstruction in 1917-headed by Christoper Addison
  • Developed plans for housing, extension of unemployment insurance and abolition of the poor law
  • Appointed Minister of Health following the 1918 election
  • His dismissal in 1921 signalled the end of reconstruction
  • Reconstruction was…


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