During the inter-war period Britain's economy was not performing well.
As the First World War had cost Britain millions of pounds, not to
mention millions of lives, the potential debt was crippling. Yet did
this hinder Britain's economic growth so that it could not return to
its pre-war level? You could argue that Britain's economy was.
However, masked behind a series of setbacks outside the government's
control, the statistics told a story of decline.
1918 saw the defeat of the Kaiser's Germany and the Austro-Hungarian
Empire. However, it also saw Britain facing bills of millions of
pounds. The reparations awarded to Britain payable by Germanyhelped
ease the pressure on British accountants but restoring the economy to
its pre-war state looked impossible. Adding to the government's misery
was the dilemma of what to do with the returning soldiers, with mass
unemployment already, and women less than willing to give up their
jobs. The government needed to find them jobs to get the country
moving otherwise their benefits would be a drain on an already fragile
After winning his first election in 1918, David Lloyd George did not
need to do much to endear himself to the voting public, yet he
embarked on a series of social reforms which would eventually lay the
foundations for the welfare state. This included his 'homes fit for
heroes' pledge, which would ensure comfortable housing for the
returning war heroes and their families. Following the famous
economist Keynes' guidelines of deficit spending, Lloyd George
implemented his ideas in hope of kick-starting the econ...
... middle of paper ...
...den the working class gap. The new Welfare
State meant that more and more people were able to seek employment.
Rising employment meant that a higher percentage of the work force was
being employed, but as the work force was always expanding the actual
figures for employment remained roughly the same.
With the after-effects of the First World War still affecting the
economy it was always going to be hard to maintain a sustained period
of growth. The first four years after the war looked promising with
the post war boom, but that was short lived. Increased overseas
competition and two decades of mass unemployment meant that while some
growth did occur, the effects of WWI were deep rooted. It would take a
lot more for this period to be considered a period of total growth,
and shake off the legacy of the First World War.
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