Great Depression in The United Kingdom - Consequences of The Great Depression

Consequences of The Great Depression

Following the end of the Second World War, the majority of the British people, and particularly the working class and returning servicemen and women, did not want a return to pre-war Conservative economic policies, which they blamed for the hardship of the 1930s, and there was a mood for widespread social change. At the 1945 general election, to the surprise of many observers, Winston Churchill was defeated by the Labour Party headed by Clement Attlee.

The Labour government built up from pre-war foundations what was to become a comprehensive 'cradle-to-grave' welfare state, and established a tax funded National Health Service, which gave treatment according to need rather than ability to pay as the previous tax funded system had been. The Labour government also enacted Keynesian economic policies, to create artificial economic demand leading to full employment. These policies became known as the "post-war consensus", and were accepted by all major political parties at different times.

There were noted disagreements about the involvement of the state with the steel industry. With one government, it was state owned, to then be sold off with the following conservative administration only to be then re-nationalised by the following labour government. For the most part, the post-war consensus lasted until the late 1970s. Throughout the 1970s, it was becoming clear from all sides that radical change was needed as a result of such economic crises as the 1973 oil shock, high inflation, industrial unrest and sterling devaluation, but 1970s governments lacked in totality the political will and leadership, the House of Commons majority, and the intellectual basis from which to change the system until the Conservatives led by Margaret Thatcher won the 1979 general election.