How the Labour Party began
The Labour Party was created in 1900: a new party for a new century. Its formation was the result of many years of hard effort by working people, trade unionists and socialists, united by the goal of changing the British Parliament to represent the interests of everybody. Ignored by the Tories and disillusioned with the Liberals, a coalition of different interests came together to push for change at a Conference on Labour Representation in London's Memorial Hall in February 1900.
For many years the new organisation struggled to take root in the British political system. The conference of February 1900 had not even created a proper 'party.' Instead the new body was called the Labour Representation Committee and it had no members, only organisations affiliated to it. In the elections of that year, the new group made little ground. Indeed Labour's leaders worked closely with the 1906-14 Liberal Governments, and relied on their majority to agree measures to help Labour, such as the Trade Disputes Act of 1906, and the payment of MPs in 1911.
But while Labour in Parliament was "hanging from the coat-tails" of the Liberals, Labour in the country was growing apace. The number of constituency parties affiliated rose from 73 in 1906 to 179 by 1914 and before the outbreak of war prevented the expected election, Labour was prepared to field a record number of candidates. When the Liberal Party split in 1916, the Labour Party was well placed to make a challenge for power.
First government, 1924
The first real taste of political office came only a year later. Stanley Baldwin's Conservatives had fought the election on a single issue: protectionism. The Tories lost almost 90 seats, down from 345 to 258. Baldwin had failed to obtain the mandate he sought and declined to form a government, so despite winning 67 fewer seats than the Tories, Ramsay MacDonald was asked by the King to form a government.
The first Labour government had modest objectives and held office for only a few months, but its achievements should not be underestimated. Even without a proper majority in the House of Commons, legislation was still passed on housing, education, unemployment and social insurance. Yet, dependent on Liberal support to remain in power, the government fell as a result of a political row about the actions of Attorney-General Sir Patrick Hastings. In the subsequent election, the Daily Mail published the infamous Zinoviev letter, a forgery which alleged there were links between Russian communists and the British Labour Party. With an atmosphere of fervent anti-communism, Labour lost 40 seats and the Tories were returned to power.
Second government, 1929
Five years later, following the election in May 1929, Labour was back in office, albeit still as a minority administration. MacDonald was again Prime Minister, with iron-founder and trade unionist Arthur Henderson as Foreign Secretary and Margaret Bondfield as Minister of Labour, the first-ever woman cabinet minister of any party. The government was dominated by the world economic crisis, precipitated by the October 1929 Wall Street crash. MacDonald's government put in place a number of measures to try and resolve the problem of rising unemployment.
However, these had little effect and in 1931 unemployment caused a crisis within the cabinet. Politically unable to either cut benefits or increase taxes to deal with the financial problem caused by high unemployment, the government was split and fell. Yet MacDonald did not tender his resignation to the King, but instead offered to form a National Government with Liberals and Conservatives. From being one of its founding fathers, Ramsay MacDonald had turned his back on the party and was seen to have betrayed Labour. He was expelled in September 1931; but in the following election, MacDonald's coalition won a large majority. The Labour Party was reduced to 52 seats. It was the party's nadir.
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