Macmillan government 1957-63

The Macmillan Government 1957 – 63

Why did Macmillan and not Butler succeed Eden?

·         Butler failed to succeed Eden, largely due to his reluctance to get involved in the infighting necessary to become leader.

·         Macmillan was far more skilled in gaining support than Butler, who seemed less interested in having the top job

·         Macmillan had also done a fine job as Minister of Housing and was respected for his work at the treasury

·         He appeared to be one of the traditional Tory members and was known as a fine huntsman;popular figure in the party

·         much sharper political animal, who had come out of the Suez crisis relatively unscathed

·         He became leader after being appointed by an inner circle of like minded people from a similar social circle.

The Economy

·         recovery was taking place, but slower than had been hoped.

·         Britain’s economy seemed sluggish compared to western countried

·         Society was still class ridden and there was little entrepreneurial spirit

·         The work force was highly unionised.

·         There was an obvious divide between workers and bosses

·         avoid the extremes of inflation and deflation by meeting problems as they came along and to avoid confrontation with the unions whilst keeping high levels of employment.

·         Rises in interest rates and tax rises were used to stop threats of inflation, and similarly they would be lowered if economic growth began to slow.

·         This policy was criticised as being of too short term, with no long term view for steady growth being formed.

·         The budgets were perceived as being used for political purposes; i.e. to bribe the public before an election, as was very much the case with the 1959 budget which introduced tax cuts at a time of rising inflation.

·         ‘stop – go’ economics.

·         Between 1951 and 1964, Italy’s economy grew at 5.6%, Germany at 5.1%, France at 4.3%, yet Britain only achieved 2.3%.

·         This can partly be explained by the fact that Britain had a much higher level of defence spending than either of the other countries. By 1964, Britain was spending 10% of its GDP (or £1.7 billion) on defence.

There were three main criticisms of Macmillan’s economic policies;

1)     There was no coherent economic policy.

2)     Budget’s were being used to bribe the population at election time, not to put in place a financial strategy.

3)     There was a failure to invest in research and development, or to improve employer – worker relations. By the mid 1960s Britain’s rate of economic growth was low.

‘Never had it so good’ speech

·         The warning that Macmillan was trying to give was lost as the press and public took the message they wanted to hear – that Britain was prosperous.

·         A large part of the government’s economic policy…