Ramsay MacDonald and the Rise of Labour

by Professor Kenneth O. Morgan. University of Wales, Aberystwyth

new perspective Volume 1. Number 3. March 1996

Summary: MacDonald’s decisions as Prime Minister in 1931 during the Great Depression ruined his reputation and masked his earlier achievements. From his unpromising beginnings in Scotland his ability and opportunities made him a founding father of Labour’s fortunes and its first Prime Minister in 1924. His contribution included, in particular, parliamentary skills, organisational flair and his work as a socialist thinker with an international reputation.

Socialist with a Ruined Reputation

JAMES RAMSAY MACDONALD, Labour’s first prime minister, has suffered a cataclysmic slump in his reputation. Most of this stems from the tumultuous events of August 1931. In that month, amidst a massive run on the pound, MacDonald broke with his Labour Cabinet colleagues and linked up, quite unexpectedly, with the Conservatives and Liberals to form a so-called ‘National Government’. As a result, Labour suffered its worst-ever electoral defeat. Since then, the British left has always seen in him the embodiment of treachery. The very events of 1931 have been tainted with conspiracy in which MacDonald, the King and American bankers are variously supposed to have taken part. In the 1970s, Labour’s prime ministers Wilson and Callaghan were anxious at all costs to avoid being seen as ‘another Ramsay MacDonald’. Along with treachery went class betrayal, with MacDonald’s curious friendship with Lady Londonderry and his notorious remark in 1931 ‘Tonight, every duchess in London will want to kiss me’. He fared little better amongst his new-found Conservative allies. To them, the ageing premier was old Ramshackle, or, in Churchill’s term, ‘the boneless wonder’. It is not surprising that posterity has tended to recall him as one of Britain’s worst prime ministers.

A Founding Father of the Labour Party

That was not at all how things seemed for most of MacDonald’s lifetime. Indeed, until 1929, he had been regarded as one of the most dynamic and magnetic of British political leaders, a model for democratic socialists throughout the world. In particular, MacDonald’s posthumous reputation has obscured totally his part in the emergence of the political Labour movement in this country, down to his first period in 10 Downing Street in 1924. In fact, along with Keir Hardie, the matchless evangelist and crusader, and Arthur Henderson, architect of the ‘movement’ and organiser of its links with the trade unionists, MacDonald can reasonably be considered one of the Labour party’s three major founding fathers. He began in the most disadvantaged of circumstances. He was born in 1866, the illegitimate son of a poor Scottish girl in Lossiemouth on the Moray coast. He made his way to London as an impoverished science student and, significantly, made an early political appearance as secretary of the Scottish Home Rule Association. But he also became active in a variety of socialist organisations at that time, the Marxist Social Democrats, the gradualist Fabian Society, and eventually the Independent Labour Party formed in January 1893 under the leadership of that other proud Scot, James Keir Hardie. MacDonald stood for Parliament for Dover in 1892 and for Southampton in 1895; each time, he was heavily defeated. But he was now rising steadily within ILP ranks. Marriage to Margaret Gladstone (no relation to the Liberal prime minister) helped secure his finances. In 1900 MacDonald became secretary of the newly-formed Labour Representation Committee, launched at the Memorial Hall, London, in February 1900 as a working alliance between the trade unions and the socialist societies such as the ILP and the Fabians. His career as a political figure of national, and perhaps international, stature, had begun. In the years between the founding of the LRC in 1900 and the outbreak of the First World War in 1914, MacDonald exercised a growing and visible influence over the growth of the young Labour party (as the LRC called itself from 1906 onwards). In both its theory and practice, he played a central role. In four main respects MacDonald’s position was especially important, and each must be examined in turn.

An Astute Policy of Moderation and Independence

First, he was an organiser and strategist. More than any other man in Labour’s ranks, he was responsible for the ‘Progressive Alliance’ between Labour and the Liberals, which brought such immense political and social changes in the Asquith-Lloyd George era between 1905 and 1914. MacDonald played a highly significant role as secretary of the LRC in its early years. Not only did he attend minutely to matters of local party organisation, notoriously difficult for a working-class movement lacking the financial resources of the established Conservative and Liberal parties. He was also the negotiator who conducted - almost certainly without the knowledge of Henderson and other leading Labour figures - the famous ‘entente’, or secret pact, with Herbert Gladstone, the Liberal Chief Whip. Under the terms of this agreement, Labour had a clear run in about 50 seats at the next election without Liberal opposition. Of the 29 Labour MPs elected in January 1906 almost all benefited from this arrangement. Indeed, without this ‘entente’ with the Liberals, it is difficult to see how the Labour party could have got off the ground at all.

MacDonald himself was one of the 29 elected, as Labour member for Leicester, a two-member constituency. He continued his role as strategist thereafter. He was anxious to see that Labour worked closely with the Liberals on such issues as Lloyd George’s ‘People’s Budget’ of 1909, the National Insurance Bill of 1911, and Irish Home Rule. When he eventually became leader (or ‘chairman’) of the Labour party in 1911-14 he played a vital role in ensuring that Labour retained its alliance with the Liberals in Parliament and yet also kept its independence so that in time it, too, could hope to prosper on its own. In 1914 he turned down Lloyd George’s suggestion that Labour entered the government on a coalition basis. As a result, Labour managed to steer between both the Scylla of ‘Lib-Lab’ policies indistinguishable from Liberalism, and the Charybdis of extra-parliamentary agitation which would have ruined Labour’s hard-won reputation for moderation and constitutionalism. He kept his party clear of both trade-union sectionalism and neo-revolutionary ‘direct action’. As a result of his wise guidance, Labour, even with less than 40 seats, was in 1914 poised to become a major force in the politics of Britain.

Labour’s Leading Parliamentarian

Secondly, MacDonald was a major parliamentarian. Here he had the advantage of Keir Hardie, who was always happier in nationwide agitation rather than in the pedestrian detail of House of Commons politics. Arthur Henderson, another major figure, was more of a trade unionist than a parliamentarian. MacDonald, however, with his handsome appearance, his compelling oratory (delivered in an attractive Highlands accent) and his air of reasonableness, soon showed himself to be an effective Commons man. By the time he became party chairman in 1911 he had established himself as an impressive figure in Parliament, the first that Labour had ever produced. At a time when many in the trade union world complained that the gradualism and caution of the Parliamentary party (most of whom were not obviously socialists) had little to offer the workers in their class struggle with the forces of capitalism, MacDonald’s reputation and example kept the Labour movement on an even course.

The Thinker with an International Reputation

Third, MacDonald was internationally known as Labour’s political theorist. He was described as ‘the greatest intellectual asset of the movement’, fit to sit beside great socialist theoreticians such as Karl Kautsky of the German Social Democrats and Jean Jaur‚s of the French Socialists. It is particularly ironic that MacDonald later in life became derided as a romantic waffler, whose sole prescription for the advance of socialism was ‘on and on and on, up and up and up’. In the years before 1914 particularly, he gave British socialism a doctrinal substance it had lacked previously. His books now seem heavy and dated, with their Darwinian jargon and dreamy Utopianism. Titles like Socialism and Society, Socialism and Government and The Socialist Movement hardly stir the blood and, indeed, there is a good deal of recycling. At the time, they carried much weight. The emphasis was on an organic, evolutionary collectivism - not for nothing had MacDonald been trained as a scientist whose first work had been on ‘The Geology of Bristol’. Like Darwin in the biological sciences, he spelt out the evolutionary road to socialism. It was gradualist and also creative, since the state would respond to the complexity of modern society by taking on an ever-growing range of functions in central government - and also in local government which was important to MacDonald as former member of the London County Council. His evolutionary socialism would take over, but transcend, all that was best in the older Liberalism. Above all, it would avoid the horrors and violence of class war. It helped to give MacDonald’s fledgling Labour party the soundest of theoretical foundations.

And, finally, MacDonald became a major international figure, as did Hardie. At that period, the British Labour movement felt itself to be part of a world citizenry and an international workers’ crusade. MacDonald played his part by involving himself heavily in the Second Socialist International, and also by speaking at such notable demonstrations as the Anglo-German socialist protest against the naval arms race between Britain and Germany. He became a well-known socialist figure world-wide, rubbing shoulders with Bebel, Jaurés, Adler and even the obscure Lenin in the internationalist socialist world. There was also an imperial aspect. MacDonald took a close interest in colonial and imperial matters at a time when Labour in Britain tended to blame everything on the exploitation inherent in the imperialist system, and leave it at that. He wrote on Labour the Empire in 1906, following a tour with his wife in Canada, Australia and New Zealand. He also visited India in 1909 and published a volume, The Awakening of India in 1910. His approach to the problems of the sub-continent was gradualist and cautious, but he also began a long process of identifying Labour with the cause of Indian self-government, which ended with the transfer of power under the Attlee government in 1947.

The 1914-18 War and MacDonald’s Prospects

The great breakthrough in MacDonald’s career came with the outbreak of war in August 1914. At first this seemed most unlikely. Along with other Liberal and Labour figures in the Union of Democratic Control in 1914, MacDonald opposed Britain’s entry into the First World War. He called instead for peace through negotiation and maintained links with his comrades in the German Social Democrats, some of whom were also anti-war. But it was a posture that cost MacDonald dearly in the pro-war hysteria of the time. He became a pariah figure, ostracised and reviled, little less than a traitor. He immediately lost his chairmanship of the Labour party in favour of Henderson; he was expelled from many public bodies; he received white feathers (a sign of cowardice) through the post and was physically threatened. He became nothing less than a public enemy. In 1918 he was heavily defeated in his seat at Leicester constituency by a ‘patriotic’ ex-socialist. He recalled bitterly the newly-enfranchised women voters of Leicester, ‘bloodthirsty, cursing their hate’. The depressive MacDonald felt quite alone, since his beloved wife, Margaret, had died some time before the war broke out.

And yet, in fact, it was the war that gave him his opportunity. As the initial wartime hysteria gave way to helpless horror as the casualties mounted up on the western front, anti-war protesters like MacDonald gained a new credibility. Indeed, by 1918 his political prospects were transformed, in a way masked by the ‘hang the Kaiser’ emotion which governed the post-war general election. The split in Liberal ranks whenLloyd George succeeded Asquith as prime minister in December 1916 meant that the old Liberal party, Labour’s main rivals on the left, were fatally undermined. The Russian revolution of 1917, while eventually giving way to the one-party rule of Lenin and the Bolsheviks, gave a powerful new ideological stimulant to British workers angry at the sacrifices and shortages of wartime, at a time when capitalist profiteers were becoming millionaires. In 1918, too, Labour became a truly national party for the first time, with a unified nationwide constituency structure and also its own doctrinal stance, committing the party to a form of socialism. The growing power of the trade unions gave the party a firm mass working-class base. And there was also the prospect of a new voting strength, with the 1918 Representation of the People Act raising the electorate from 8 million to 21 million, including many poorer working-class males and (for the first time) women over 30. The future seemed much brighter for the Labour party now, its 57 seats masking its strong poll of 2.2m votes. MacDonald was its most likely beneficiary.

Liberal Disarray Furthers Labour’s Fortunes

In the period 1918-22, MacDonald emerged rapidly as Labour’s outstanding leader. His reputation as an anti-war protester, was now a glowing asset as the domestic and foreign policies of the Lloyd George coalition unravelled amidst unemployment and international tension. MacDonald was ideally placed to appeal to embittered trade unionists furious at the government’s betrayal of pledges to build ‘a land fit for heroes’, to middle-class intellectuals disgusted by the injustice and stupidities of the Versailles and other peace treaties and the wider public to whom he seemed a ‘brave new world’ figure, full of hope for a better society. Although defeated in another unpleasant by-election in Woolwich in early 1921, when the victor was a war hero who had won the VC at Cambrai, MacDonald found a safe seat at last in Aberavon, the coal and steel constituency in south Wales. Labour, with 142 seats (and 4.2m votes) was now manifestly second to the Conservatives, with the Liberals trailing in third place.

MacDonald was then elected chairman of the Parliamentary party (in fact the term leader, was now used for the first time) over the Lancastrian J.R. Clynes. Despite later claims that MacDonald was a closet right-winger, it is notable that he was still prominent in the socialist Independent Labour Party. In the leadership election he gained the votes of Labour’s far left, the ‘Clydesiders’ in Scotland and people like Emanuel Shinwell. He now set about making Labour a parliamentary force that would mobilise the disillusion of post-war, and ensure that the Liberals would be permanently supplanted as the challengers to the Tories. A powerful ideological force was the Union of Democratic Control, whose journalists, writers and progressive politicians became important in condemning the peace settlement for its punitive treatment of Germany. When another general election was called unexpectedly by the Conservative prime minister, Stanley Baldwin, in December 1923, the Conservatives’ seats fell to 259, while Labour’s rose to 191, and the Liberals held 159. Since the Conservatives had committed themselves to protectionist tariffs, the free trade Liberals could no longer back them. Shortly afterwards, Labour was voted into office. In January, Ramsay MacDonald, bastard son of a poor Scottish seamstress, the wartime pariah and scapegoat, kissed hands with King George V as Labour’s first prime minister.

Labour in Office

Labour’s experience of office, other than in 1945 - 51, has not usually been happy. Their first administration under MacDonald was no exception. There were endless difficulties in forming a government at all. He had to enlist former Liberals like Haldane to fill up posts in the Lords. He quarrelled disastrously with Arthur Henderson who seemed destined for a time not even to appear in the Labour government at all. MacDonald also had difficulties with his Chancellor of the Exchequer, Philip Snowden, another prima donna like himself, while in Parliament the Clydeside left was a constant problem. MacDonald’s decision to take on the Foreign Office as well as the premiership was certainly a mistake, partly because of the physical wear and tear which resulted. On the other hand, there were policy successes, in foreign affairs where the French withdrew their troops fromthe Ruhr, a new agreement was reached moderating Germany’s reparations payments under the Dawes Plan, and diplomatic relations were started with Soviet Russia. MacDonald could claim, with reason, that the Union of Democratic Control scenario had been partially implemented and that under Labour a more harmonious world, with Germany and Russia admitted into the comity of nations, was in the making. At home, there were useful reforms like John Wheatley’s Housing Act, and the government as a whole gave an air of modest competence.

In the end, it fell from office in an almost humiliating way. It was a minority government dependent on the shaky support of Lloyd George and the Liberals. This support was withdrawn over the Campbell case when the government failed to prosecute J.R. Campbell, editor of a left-wing newspaper, for calling on the army not to use force against fellow workers on strike. The government’s handling of the case was messy in the extreme, and MacDonald’s own erratic way of handling matters added to the confusion. The government was defeated on a confidence vote. In the following election, MacDonald and Labour were ludicrously tarred with the brush of the so-called ‘Red Letter’, when a Soviet leader, Zinoviev, was supposed to have called on British Communists for support. The letter was probably a forgery, but it enabled right-wing politicians to claim that British Labour and Russian Bolsheviks were making common cause. It was, indeed, an unhappy election and MacDonald was duly defeated. Yet the results also showed that the real losers were the Liberals who lost over a hundred seats and slumped to 40. Labour retained 151, and its popular vote actually rose from 4.4m to 5.4m. MacDonald’s own reputation had been more than sustained by his few months in office. In 1929 he was to return to office with Labour (on 289 seats and with 8.3m votes, the largest party in Parliament.

MacDonald the Creative Force in the Rise of Labour

Despite everything, MacDonald’s role down to the 1924 election was crucial to the rise of Labour in Britain. He was a difficult, vain, secretive man, whose relations with colleagues were frequently tense. Yet he also attracted massive loyalty and had a kind of Celtic magic that few other politicians could match. All in all, he is entitled to be regarded as Labour’s main creative force in its transition from being a party of protest to a party of power. By the mid-1920s, he had built up the strongest democratic socialist Labour Party in the world. He had emerged as a dominant figure to whom comrades in Germany, Italy or the United States looked at with admiration and with awe. He had supplanted Lloyd George as the spokesman for the British left, and had provided the voice of conscience and idealism appropriate for a war-weary public. When the later recriminations and criticisms are weighed in the balance, it is this earlier, attractive Macdonald who needs also to be remembered.

Words and concepts to note

astute: shrewd; subtle; wise; well judged.

Fabian: one who believes in the gradual implementation of socialism by peaceful methods, after the group of that name.

Marxist: one who believes in the use of revolution for the achievement of socialism, after the thought of Karl Marx.

pedestrian: unexceptional; ordinary.

prima donna: (Italian) Literally, first lady; used to refer to someone who thinks they are specially important.

punitive: punishing.

socialism: the public ownership of the means of production and distribution (the opposite to privatisation).

Questions to consider

w Apart from MacDonald, who are the other main contributors to the transformation of Labour from the party of protest to the party of power?

w What were the main influences which changed Labour from the party of protest into the party of power?

w How important was the Lib-Lab entente in the rise in Labour’s fortunes?

w Can it be argued that Labour were wrong to accept office in 1924?

w How far can it be claimed that Lloyd George did more than any man to raise the fortunes of Labour?


Further Reading: David Marquand, Ramsay MacDonald, London, 1977; Ross McKibbin, The Evolution of the Labour Party, 1910-1924, Oxford, 1974; Austen Morgan, Ramsay MacDonald, Manchester, 1987; Kenneth O. Morgan, Keir Hardie: Radical and Socialist, London, 1974; Kenneth O. Morgan, Labour People, Leaders and Lieutenants, Hardie to Kinnock, Oxford, 1987; Frank Bealey and Henry Pelling, Labour and Politics, 1900-1906, London, 1958.

Ramsay MacDonald and the Rise of Labour by Kenneth Morgan. © new perspective 1996

Kenneth O. Morgan, former Vice-Chancellor of the University of Wales, Aberystwyth, was from 1966 to 1989 Fellow and Praelector, The Queen’s College, Oxford. His 21 books include Lloyd George, (ed) The Oxford Illustrated History of Britain, and Labour in Power, 1945-1951. Currently he is writing the official life of Lord Callaghan.

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