Conference of Paris

PARIS, CONFERENCE OF and VERSAILLES, TREATY OF) which held its first session on Jan. 18, 1919, left to his colleagues the troubles which very soon began to arise. No one, indeed, paid much atten tion at the moment to the fact that Sinn Fein had not only secured 73 of the 77 Irish seats, with candidates pledged not to come to Westminster, but had also on Jan. 2 2 opened a "Republican Parliament" in Ireland. There were troubles nearer at hand. Miners' grievances broke out again in a strike, only composed for a time by the appointment of a royal commission in February with orders to issue an interim report as quickly as possible. During that month there was an epidemic of strikes. Worse still, all plans for gradual demobilization were being ruined. Since long before the end of the war the Government, foreseeing the diffi culties of returning five millions of men to civil life, had been elaborating plans of demobilization, which included not merely methodical return by classification based as far as possible on the probabilities of the labour market, but also plans for giving to the men held back facilities for education and vocational training, which might compensate them for the delay in their return. But the men in the armies cared about nothing but getting home again, and felt that they had earned the right to return; and this pressure came at a time when industry was suddenly shorn of the fictitious demand for production, and was disturbed by the strikes. There were serious troubles in demobilization camps, some known to the public, since they occurred in England, some not known so widely, since they occurred in France. In the end, demobilization had to be carried out wholesale, and problems of unemployment left to take their chance.

The interest of politicians was centred rather on the Peace Conference at Paris, where a good many hopes were vanishing, than in the progress of home affairs. The public mind was still too much accustomed to the vast demands of war expenditure to pay much attention to the budget ; it showed that the National Debt stood at nearly £7,500,000,000, with some £1,500,000,000 of floating debt. The setting up of a Ministry of Transport, and the changing of the Local Government Board into the Ministry of Health suggested that some lessons of organization had been learned (see GOVERNMENT DEPARTMENTS), and a housing bill was intended to redeem some of the election promises of better condi tions for millions who had served in various ways in the war. A "profiteering" bill, setting up local tribunals to deal with cases of exorbitant prices, was little but a sop to popular outcry. In an autumn session a further stage of experiment in the government of India was entered upon by the act giving effect to the proposals of the Montagu-Chelmsf ord report; the Enabling Act setting up the Church assemblies was passed; and the first woman member, Lady Astor, took her seat. But the public generally had not much concern for such doings. It was settling back, as best it could, into business and industry, the difficulties being for the moment partly masked by the war gratuities ; and it was finding matter for concern in Ireland, where an Irish Republican army was drilling, and where, throughout the autumn, there was a series of murders and murderous attacks by Sinn Fein adherents.

Guerrilla War in Ireland.

Nobody saw the terrible pace at which this was to grow into a situation of almost blind despair. Little else mattered in 1920. The Government were trying to meet the situation in the old way, with a mixture of coercion of disorder and concession to the demand in the shape of a new Home Rule bill, introduced on Feb. 25, setting up two Irish parliaments, one for Ulster and one for the rest of Ireland, with a single "Council of Ireland" to bring about harmonious action. This met to some extent the Ulster difficulty, though the proposal for a single council was mistrusted. It did nothing to meet the Sinn Feiners, who not only refused to accept any partition of Ireland but demanded nothing less than an independent Irish republic. The Government were able to reinforce largely the Irish con stabulary with men who had served in the war, and being unable to find civilian jobs were glad to return to active service; they went to Ireland without any of the constabulary traditions, and soon acquired a grim notoriety as the "Black and Tans." Ambush ings, kidnappings, raids, marked by merciless killing on either side, with violent street-fighting occasionally in Dublin and Belfast (see IRELAND: History) seemed to be working up to a bloody climax of English and Irish relations.

With this appalling kind of war on its hands in Ireland, with the rumours of war in Russia, where assistance was still being given to anti-Bolshevik armies, with the incident at Amritsar in the spring, where a threatening Indian crowd had been fired upon in a confined space, with many casualties, the Coalition Govern ment had little on the other hand to satisfy it at home. The country was, indeed, saved from what threatened to be a serious situation in the early summer, when the Trade Union Congress showed an inclination to act in sympathy with the strike of railwaymen in Ireland against handling military traffic, and to forbid the handling of any traffic in England until the transport of men and munitions to Ireland and to Russia was stopped. But it was not saved from a strike of miners in the autumn, as the Government failed to act upon the nationalization clauses of the coal commission's report (clauses, however, which had only been passed on the casting vote of the chairman, Mr. Justice Sankey). Nor was it saved from such an alarming state of unemployment in the winter that parliament had to make hurried grants to enable municipal bodies to undertake schemes of work to absorb labour.

The unveiling of the Cenotaph in Whitehall and the burial of the Unknown Soldier in the Abbey, on Nov. I z, 192o, came at a time when the country was most depressingly aware of what war could do to the whole productive system of a nation.

Decontrol and Its Troubles.

The Irish problem remained for another six months one of bloodshed and anger, with a great deal of fighting in Dublin in March, but the crisis in England began to matter more. The rapid destruction of any real meaning in "money" in Germany and Austria, and the signs that similar currency disasters might conceivably spread to Belgium, Italy and even France, began to have their effect on the British mind. The enormous expansion of revenue was seen as concealing the seeds of these very disasters; it really meant a vast creation of currency. The result was a demand for drastic economy, and the limitation of State action, with its corollary of paid servants, in every di rection. "Decontrol" of railways, mines, food and drink, prices and agriculture took place, the last-named involving abandonment of the minimum wage for agricultural labourers. The Coalition Government was giving up every means of that organization of the country for a better national life which had been its appeal to the electorate in Dec. 1919. Large undertakings surviving from the later days of the war, like the huge depot at Slough, were hastily wound up; and in August a committee for economizing in the public service—the "axe" committee—was set up under the chairmanship of Sir Eric Geddes. Decontrol of the railways was, indeed, accompanied by some small remnant of the war's lessons of organization, in an amalgamation of systems which left only four great railway companies. Decontrol of mines, another indication that the old piece-meal struggle was to be left to go on, led to another strike in April and to the calling-out of the reserves, and armed defence of the mines. At the end of June Lloyd George was able to announce a settlement, but he had bought it by a subsidy of ten millions to allow maintenance of wages.

The Decline of the Coalition.

In the latter half of the year Irish affairs took a turn for the better. Negotiations had been opened in May, but many difficulties had to be met (see IRELAND: History) and it was not until the early days of December that terms of peace were arranged. No small part of the difficulty had been due to an uncompromising attitude on the part of the "die hard" Unionists in parliament, who maintained their opposition throughout the debates on the ratification of the Irish Treaty. By the beginning of 1922 their opposition had developed into a serious rift in the Coalition. Disagreement arose in Jan. 1922 between Lloyd George and Sir G. Younger (Viscount Younger), the Union ist chief whip, as to the best date for an election, the former again being for precipitation ; and the rise of a discussion as to the dis tribution of political honours, alleged to have filled an electioneer ing war-chest which was under Lloyd George's control, hastened the desire to draw the Unionist Party clear. The year 1922 becomes, therefore, a tale of the decline of the Coalition. There were other influences at work, besides Unionist disaffection. In flated revenue figures were coming down, and budgets, instead of being balanced at 1,40o or 1,200 millions, were down to 90o mil lions or so, with the consequences of a shrinkage of currency and a fall in prices ; the index-figure of the cost of living had dropped from the highest peak of 176 to 92. The fiscal severity, however, meant not only drastic cutting down of the public service, but the abandonment of any really generous assistance for housing and lit tle prospect of much more subsidy for work for the unemployed. Reparations from Germany had never meant quite as much to the British people as to the French; but as it became more and more apparent that they would have to shoulder the whole burden of their war debt, and could look for little or no relief of taxation, it did the Coalition no good to have made promises which now, they had to explain, had always been futile. The failure of the Genoa Conference (q.v.) to "settle Europe" was followed by a period of real tension between Great Britain and France over the operations in Asia Minor which ended in the complete rout of the Greeks by the Turks. A Coalition which could give no fruits of peace at home, and seemed actually to risk peace abroad, had reached the end of its tether. Moreover, there had been growing a strong feeling that the power, and especially the electioneering power, behind the Coalition was speculative capitalism. This was what gave sharpness to the charges about the sale of party honours. It has been remarked that the general public never understood the true economic reasons for the rise of prices, but attributed it mainly to profiteering. Similarly they did not now understand the economic reasons for cutting down budget figures, or for light ening the excess profits duty while leaving other duties unaltered. Again, it merely looked as if the "profiteer" were able to secure terms for "big business" at the cost of schemes for housing and relief of unemployment. The war with Bolshevik Russia could be regarded as an expensive affair undertaken for the financiers whose loans had been repudiated. The troubles in Asia Minor were openly put down to the scramble of oil interests for territory to exploit. The Genoa Conference was thought to have failed—even, by now, the Peace Conference at Versailles was felt to have declined from great ideals—because high finance alone had national and international politics in hand. And a pledge-bound Coalition House of Commons, lacking the normal party strife in which truth may sometimes emerge, was accused of being the ideal instrument for influences that preferred to be unobserved.

The Return to Party Politics.

Lloyd George resigned on Oct. 19. There followed a curious period of political history. The King sent for Bonar Law, who in March 1922 had resigned his post in the Coalition Ministry on the ground of ill-health. Austen Chamberlain had, since then, led the party and the House of Com mons; but the Coalition in which he served having resigned, Bonar Law was the only possible leader to send for. The position was, in a sense, regulated by his election as their leader on Oct. 23 by a Unionist Party meeting of Lords and Commons. This, however, implied that the party was determined to return to normal political conditions whether the strong group of its chiefs in the late Coali tion Ministry liked it or no. In fact, they nearly all held aloof. The sound instinct of the Unionist move was clear from the elec tion results. Although, owing to triangular contests increasing largely in number from the existence of two Liberal groups and a rapid increase of strength in the Labour Party, those results were a somewhat distorted representation of the voting, the Unionists returned 347 strong, confronted by 159 Labour members, 59 Coali tion Liberals and 6o Independent Liberals. So in the least demo cratic of parties a rank-and-file movement met with success.

The Ruhr and Reparations.

The new Government had almost immediately to deal with a grave turn in our relations with France. To the French, as has been remarked, with their terribly devastated regions, reparations from Germany had always been a much more urgent subject than to the British; and they were moved by no argument of economists on the subject. On the ground that some form of coercion must be applied to Germany, France proposed to occupy the Ruhr (q.v.) district of mines and metal-works, and expected the active co-operation of Great Brit ain, which the Government, wholly mistrusting alike the wisdom and the use of such a step, could not offer. Conferences in Paris in December and January ended simply in leaving France a free hand, as amicably as might be in face of French anger at this "betrayal" of the alliance. Stanley Baldwin, the new chancellor of the Exchequer, was in America early in the year to negotiate the funding of Great Britain's debt to the United States. It stood now at 978 millions, and was funded with the interest fixed at 3% for the first ten years and 3 1% for another 52 years, with a sink ing fund of 1%. Baldwin's first budget, actually with a surplus of ioo millions, expenditure being now down to just over Boo mil lions, enabled him to make the first slight reduction in the income tax ; and good sense approved of his application of the surplus to debt reduction rather than to any considerable lightening of taxa tion. The Unionist Government applied itself mainly to the fur ther securing of our finances in a Europe of uneasy currencies; the French franc was showing signs of a bad fall. Unemployment dis played itself in the "hunger march" from the north in January; and grievances of ex-service men in particular roused a stormy debate in the Commons in April. In the following month the Government had some bad days over the question of men deported to Ireland; an act of indemnity had to be passed to save the home secretary from his breach of the Habeas Corpus Act.

Otherwise the session passed mainly in debates on finances, rep arations and the Ruhr occupation. The most hopeful event of the session was, perhaps, the announcement that a new conference on reparations was in prospect, in which America would co-operate. This latter fact was full of promise ; if America, with her financial power, was consenting to abandon her aloof attitude, much might be achieved; but, besides this, the phrase implying that the con ference might even amount to an "overhauling of the Versailles Treaty" especially suggested hopefulness, for only a new basis of understanding could bring France and Britain together again. Lord Curzon had some meetings with Krassin, a Soviet representa tive, with a view to better establishment of trade relations with Russia ; but it was a precarious question ; a very little while before these meetings the British Government had been protesting against the carrying on by the Soviets of political propaganda under cover of the trading agreement.

The Protectionist Election.

The whole session indicated that the Government, while making provision for relief works, were mainly listening to the economists, and trying, by ending the uncertainties of reparations and in other ways, to re-establish busy markets as the only real remedy for unemployment. There was the more surprise when, during the autumn, Baldwin (he had become prime minister in May, on the resignation of Bonar Law, whose ill health had become so serious that he died in the following Octo ber) suddenly announced that Protection was the way to fight unemployment. The suddenness must not be exaggerated. Bald win had been prominent of late years in welcoming and extending wherever possible the import duties on manufactured goods which had from time to time been imposed under the financial strain of the war. The process had begun with some duties resulting from the Allied economic conference in 1916 ; and others had been imposed since. That these steps had not been unobserved is shown by the fact that Bonar Law, to avoid awkward cleavages in the late election, had had to promise not to introduce any gen eral protection during the existence of that parliament. In one sense, therefore, there was nothing very surprising in Baldwin's announcement ; but the hint soon after from his chancellor of the Exchequer that the Government would have to seek release from Bonar Law's pledge revealed a completeness of protectionist pur pose which certainly had a sudden appearance. A very large sec tion of the Unionist Party felt it to be little short of wanton to risk throwing away, after a single year, an excellent majority, espe cially when a certain amount of tariff reform by instalments had been proved to be possible. Nor were they less disgruntled when it began to be plain that leaders were not at one ; Baldwin, fresh from an Imperial Conference (see BRITISH EMPIRE) was insisting mainly upon imperial preference without taxation of staple food stuffs; and Chamberlain was objecting to any limitation of pro tectionist policy. But for all the party discontent, Baldwin took his way, and dissolved parliament on Nov. 16. He relied, to a great extent, on divisions in the Liberal Party. He relied, too, on the fact that the Labour Party was entering the campaign with a capital levy in its programme, which would alarm the country. Yet in the end such calculations did not save the Unionists from the loss of their majority. They returned only 258 in number, against 191 Labour members and 158 Liberals.

The First Labour Government.

Again political history en tered upon a curious period. Here were three parties, no one of them in a majority. At the very moment when cabinet responsi bility was beginning to recover from the drugged years of the pledged Coalition, a new problem in cabinet government presented itself. But all this mattered much less than the other new experi ence for Great Britain—the first Labour Government. In face of the Liberal weakness at the last two elections Labour had for four years claimed to be the official Opposition ; and they were still out numbering the Liberals: There was some hope that the Liberals might not be inclined now to help Labour to power; unless they did, Baldwin could carry on. But Asquith dashed such hopes when the new parliament met in Jan. 1924; he announced that he and his supporters would vote for the Labour amendment to the Address. The Government was defeated, Baldwin resigned, and on Jan. 22 the King sent for Ramsay Macdonald. Nine months of office disposed quite sufficiently of doubts whether "Labour could govern." Its ministers not only did well in public, but also earned the good will of the departmental staffs. They had some advan tages not of their own making ; the revenue returns gave Philip Snowden (chancellor of the Exchequer) a surplus of 43 millions; the Reparations Conference produced in April the "Dawes Plan," (see REPARATIONS AND THE DAWES PLAN), which in every way opened up the better prospects that had been hoped for. And on quite another plane, the Wembley Exhibition distracted a public which had of late had only too much seriousness. The Govern ment set itself to work within the sober limits which its position as a minority government imposed ; it had no great assurance of Lib eral support. The budget, on an expenditure of 790 millions, made no "socialist" proposals. An unemployment insurance bill was also far from initiating strong measures ; and the housing bill, if it revived vigorously a policy of subsidies which had lately been more and more drastically curtailed, at least made no very excessive demands. But it never became law. The Government was always on sufferance, and the announcement of its Russian policy brought the sufferance to an end. Ramsay Macdonald, who had courage ously, if not altogether wisely, taken the Foreign Office as well as the premiership, had immediately opened negotiations with Russia in a new spirit. In July the results were announced in the form of a treaty, in which, besides the arrangements for trading facili ties, there appeared a limited recognition by the Soviets of the debts of the tsarist regime, but in return for this a British loan to the Soviets was to be arranged. While there was much to be said for access to the Russian market, there was still too much distrust of the Soviets to permit of such a treaty. Their propaganda was feared; their promises were not believed. The matter remained in suspense during the summer recess ; it reappeared at once in the autumn session. But another question had also arisen by then— the dropping of the prosecution of a Communist journalist, accused of tampering with military discipline. In the end it was on this issue that it was decided to defeat the Government. It fell early in October and Macdonald dissolved parliament.

The Zinoviev Letter.

In any case it is probable that the Unionists would have secured a safe working majority, but in the end they secured a majority beyond all calculations. A few days before polling day there was published in a newspaper the notori ous "Zinoviev" letter—a document alleged to have been attached to a Soviet communication to the Foreign Office, inciting disorder in Great Britain in the interests of international Communism. The bombshell did its work; middle-class voters were thoroughly scared into belief in an imminent "Red" peril. The Unionists returned 413 strong, against 151 Labour members and 4o Liberals. Liberals, in fact, suffered more from the Zinoviev letter than Labour ; their less stalwart adherents either resented the fact that a Liberal vote had put Labour into power, or felt that a three party balance must not occur again. Labour, on the other hand, had rallied strongly to the denunciation of the letter as an elec tioneering trick. Analysis of the voting showed that the Labour poll had actually gone up by a million, while the Liberal vote had declined by a million and a quarter. The production of the letter raised two hotly disputed guestions—that of its authenticity and that of the method of its publication. Ramsay Macdonald's own utterances were somewhat bewildered. Immediate enquiry by his successor at the Foreign Office, convinced Austen Chamberlain of the authenticity. Information not available at the time, but at Baldwin's disposal in March 1928, when the subject was raised again in connection with an investigation touching the conduct of certain individuals in the Foreign Office, proved that copies of the letter had been sent elsewhere than to the Foreign Office, and that its publication had not been due to improper communication of an official document. But it affected more than the election; Cham berlain at once put an end to the Russian treaty negotiations. 1925: The Coal Crisis.—Great Britain at the beginning of 1925 offered no very cheering spectacle to a new Government. In many directions there seemed to be no lack of money. If there was some tendency among the older county families to give up great expensive mansions there seemed to be plenty of other peo ple to take them. Moreover, an enormous increase in the less expensive types of motor-car, a move out to more and more pleas ant country suburbs, the maintenance of undiminished numbers at public schools and universities in the face of increased costs, showed that the professional and middle-classes also could corn mand money. Lower still in the scale of expenditure, crowded charabancs in holiday time, a tendency everywhere to expect some kind of summer change, abounding prosperity of cinemas and the pullulation all over the poorest parts of towns of "wireless" aerials, showed a command of money among the mass of industrial work ers. And yet unemployment was still showing figures well over a million ; business men and manufacturers were gloomy ; the labour world restless and aggressive. The Government certainly set out to combine fiscal purity with direct social ameliorations. The budget was notable for the return to the gold standard—a very strong assertion that continued budget balancing, even if a heavy burden to the taxpayer, had at any rate conclusively saved our currency and credit. With the budget came the promise of a con siderable extension of the benefit of pensions, the old age pension to be granted at the age of 65 instead of 70 and widows of insured men to be pensioned without waiting for old age. The granting of the insurance pay to the unemployed was, however, stiffened up somewhat by insistence on a minimum number of contributory payments to qualify for receipt of the pay. Discussion of the Geneva Protocol—an attempt at an all-round international guaran tee of security which the British Government felt to be likely to commit the country to far too vague and perilous responsibilities —occupied much time ; and the pensions bill, when it appeared in May, was debated at great length, as being another "burden on industry." But throughout the year the real concern lay outside parlia ment. There were clear signs of a very serious national crisis approaching. The immediate danger-point was, as for so long past, the coal-mines. There was another wages dispute in the summer, the owners giving notice of a reduction ; and the Government's appointment of a court of enquiry was met on the miners' side by refusal to consider possible reduction as a subject of enquiry at all. But behind this far greater shadows were looming. A. J. Cook, a leader of the miners, had early in the year been talking of a wide alliance of all labour to back their claims ; and this only put into words an uneasy sense that labour and capital were mass ing opposite one another as never before. How deep the alarm was, and at the same time how perilously responsible people were making up their minds to a fight, was shown in Nov. 1925, when the Government announced a scheme of an organization to deal with essential services in time of emergency. Commissioners, with the necessary staff, were to operate in ten districts into which the country was to be divided, to maintain, with volunteer aid obtained through "recruiting centres," transport, postal services and the supply of food; and coal. The truth was that the mining troubles showed no signs of a likely solution. Another coal commission had been appointed in September, under the chairmanship of Herbert Samuel; and quiet was being preserved for a time by the continu ance of a subsidy for keeping up wages. But the subsidy would end in April at latest ; it was far too costly to renew after that ; and yet no one hoped much from the commission's report. The issue between miners and mine-owners was too fundamental. On the one hand mine-owners could prove that, with a loss of markets during the World War which threatened to be permanent, and with the rising costs of working and transport, the industry was not paying its way. The miners' reply was that the real trouble was the wastefulness of piece-meal ownership, the struggle of small, poor mines and the selfishness of big rich ones; and their demand was for nationalization, or, pending that, such a pooling of mines as would, by throwing the returns of rich mines into the common stock, enable the poorer ones to keep up the wage-level. On that issue there was not the faintest hope of agreement.

1926: The General Strike.

Little else mattered in 1926. The narrative can go straight to the presentation of the commission's report on March 1o. It recognized that the parlous condition of the market necessitated some new arrangements between the two sides, calling especially for some sacrifice on the men's part in longer hours of work on a smaller wage minimum. But it recom mended that wage agreements should be national, and suggested large reorganization of the industry ; and contemplated some degree of State ownership in certain circumstances. The Govern ment immediately professed a readiness to act on the report, even against some of its convictions, if the two parties concerned would agree. They could not. The mine-owners posted late in April their new wage offers, which the miners described, and acted upon, as lock-out notices, and on April 3o the stoppage began. On May i the Government proclaimed a state of emergency, thus bringing its scheme of November into operation. The instant reply from Labour was the ordering of a general strike to begin at midnight on May 3. Last-minute efforts were made, and Labour leaders were in consultation with ministers when the negotiations were abruptly broken by the latter because a strike had broken out in a newspaper office ; compositors had refused to set up a certain lead ing article on the situation. The ministerial view was that this was treachery to the whole basis of the negotiations ; the Labour view was that a small and really isolated incident had been seized upon and magnified because now that war had been declared there were too many on the side of capital who were ready to fight it to a finish. So the strike began. (See GENERAL STRIKE.) For a day or two there was intense anxiety ; newspapers could not be published, and no one knew how near the country might be to armed conflict. Then the tension slightly relaxed : an official organ called The British Gazette was published daily, and one or two newspapers managed, to issue themselves in much diminished shape. Not that their contents tended to a peaceful state of mind ; the relaxation of tension was mainly due to the good spirit shown in spite of these publications. The response to recruiting for the maintenance of the four essential services was rapid; and as, on the whole, youth brought to its strange tasks the enjoyment of novelty and a good temper, there was far less friction than might have been expected. Amateur railway work and amateur driving of trams and buses was attended by more hilarity than ill-feeling, though there were occasional ugly incidents. The enlistment for the work of special constables was the most dangerous part of the scheme ; youth was not in its place there. The Government's refusal to support in any way an appeal to the nation by its reli gious leaders on May 6 had an uncompromising look; the muster ing of large food convoys in the London parks was accompanied by some conflict ; and it was obvious that tempers which could stand a short strain might break under a long one. Fortunately it was not long. On May 8 the prime minister broadcasted a concilia tory message; negotiations were opened, and on May 12 the gen eral strike was called off. It had not been whole-hearted, and it was showing signs of crumbling. But the original dispute in the mines remained as it was, and the stoppage of work dragged on for months. With a budget that again, after the better years, was showing a deficit, due to the mining subsidy, and with business generally bad, even the strong old industries like cotton and steel being in distress, there would, but for the feeling that Labour had "put itself out of court," have been a more healthy pressure upon both sides. As it was, the mine-owners held out for their whole position ; and the miners, resentful of the collapse of the general strike and therefore little inclined to heed criticism or advice from the rest of the labour world, stuck to their own extremists. Yet collapse came upon them too. By September a drift back to work had begun, slowly at first, but increasing week by week, in spite of the leaders' efforts, until by late in November half the men at least had gone back. Surrender came on Dec. 1, when the stoppage was declared at an end.

1927.

There remained the aftermath of the general strike and the only question was how serious it would be. Financially, it was bound to be grave ; the chancellor of the Exchequer put the total loss at S9 millions, and he had to budget for an actual deficit of 36 millions. He had now to help him the chances offered by the Safe guarding of Industries Act, which had been passed in Dec. 1926, and the betting tax which, imposed by the previous budget, had only become operative in November; this tax was soon to meet with unexpected complications in the sudden craze for greyhound racing. Nothing could be done to lighten the burden of taxation.

Politically, too, the aftermath looked grave. The Government introduced a Trades Disputes bill, making a general strike illegal, and intimidation and threats illegal, with such definition as was possible of the meaning of the words; and, further, altering the basis of the trade union levy. The Osborne judgment in 1909 had laid it down that a trade union had no right to spend money in financing the Labour Party, and as a result a compulsory political levy on members was impossible. The Liberal Government in 1913 had passed an act the effect of which was to allow a levy, but to permit members of the union to "contract out" of it. This prin ciple was now to be reversed, and no levy was to be made except upon members who "contracted in." Regarding the whole bill as the triumphant outcome of the past year, the Labour Party opposed it tooth and nail, and the debates were prolonged, but it passed into law before the summer recess. Happily a year which began with the open hostilities of the Trade Disputes bill ended in the acceptance by the general council of the trade unions of an invitation to send accredited representatives to discuss, with representatives of groups of employers, the vital aspects of a mod ern industrial community. An unemployment insurance bill, and a bill to foster the production of British cinematograph films were also passed. In this year also broadcasting in Great Britain passed under Government control.

Foreign affairs occupied a good deal of the session. A defence force had to be sent to protect British residents in the disturbances which had become more widespread and threatening in China. The trade agreement with Russia was broke9 off, after a raid upon a London office-building which revealed evidence of political activi ties, again under cover of the trading agreement. There was con siderable discussion, too, of matters arising out of the League of Nations. Naval expenditure had been coming heavily upon budgets which, in every other direction, were being cut down ; and the fact aggravated the failure of the Disarmament Conference in the summer at Geneva. It appeared to have broken down largely from imperfect diplomatic preparation beforehand between Great Britain and the United States. However, the great impression made by Sir Austen Chamberlain's speech at Geneva, on the pro posal to revive the Security Protocol—an impression of truth and sincere plain-speaking—maintained the vitality of interest in the League. (See DISARMAMENT.) An incident of the very end of the year—the rejection by the House of Commons of a proposed new prayer book, presented to it by the convocations and Church assemblies under the Enabling Act of 19i 9—was chiefly remark able for the quite unexpected public interest aroused in matters of doctrine and religion.

1928.

But it was an interest which showed that religious con troversy must still turn on very deep-seated historical prejudices. A second attempt, in which some endeavour had been made to compromise with opposition (mainly in modification of the pro posals for reservation of the consecrated elements in Holy Com munion), met with a similar fate in May 1928; and as the compromise proposals had alienated some of the support of the proposed new book, the attempt to adjust the forms of 1662 to the practices of modern times ended in a failure, mainly regretted, perhaps, by the ordinary individual as a disappointment to the aged archbishop of Canterbury, who had hoped thus to crown 25 years' direction of the Church of England which had, especially of late years, brought him a steadily increasing reputation for statesmanship. His resignation was shortly afterwards announced.

The session showed no failure of vitality in the Government, for its main piece of work was a budget of first-rate importance. The finance of English local government, a piecemeal growth out of petty parochial circumstances, was for the first time envisaged nationally in the light of modern industrial and social develop ments; and proposals were made in the budget which, by trans ferring in the course of two years, much of the responsibility for local government finance to the Treasury, would, it was hoped, remove from industry the burdens of an old "rating" system which had become inequitable in its operation.

The problem of the coal-mining areas passed into a new phase of sober common-sense. It was becoming obvious that, from loss of markets and from the inability to work some of the mines on , a proper economic basis, the mine-fields could no longer support their old population. The Government, therefore, set up an indus trial transference board to find employment in other industries, with some provision for vocational training if necessary, for men who could be absorbed elsewhere; the most striking early success of the Board was in arranging with the Canadian authorities for the employment as harvesters of more than 8,000 men, many of whom, it was hoped, might find permanent work in the Dominion.

During the summer there was a steadily growing interest in a draft treaty, originated by F. B. Kellogg, President Coolidge's secretary of State, aimed at the renunciation of war as a normal feature of international relations. It was eventually signed in Paris on Aug. 27 by several great Powers, including Germany, the adhesion of the other Powers at a later date being hoped for. While it could no more than any other international document make war really impossible, it was nevertheless felt to mark a real advance as the most specific and deliberate declaration that war was no longer to be considered by civilized nations as a recog nized implement of their ends. (R. H. GE.) An Anglo-French compromise on the limitation of naval arma ments, announced on July 31, was prematurely revealed in the Press, and at once subjected to severe criticisms—especially from the Government of the United States, which in a note of Sept. 29 refused to accept its terms. At home the autumn municipal elec tions showed a marked advance for the Socialist Party. Parliament was mainly concerned with the progress of the Local Government Bill. The year closed in an atmosphere of anxiety, caused by the seriously increased distress in the mining areas, and the prolonged illness of the King, necessitating the return of the Prince of Wales from East Africa and the appointment of six counsellors of State to act for the King in the transaction of the necessary business of State. By the beginning of 1929 His Majesty had begun to show signs of recovery, to the relief of the whole nation, and was able to open the London Naval Conference in January, 193o, and to resume court functions. (X.) The Conservatives, when they went to the country again in 1929, had counted confidently on a sufficient majority to carry them through another Parliament, and it was a shock to them to find their numbers in the new House reduced to 26o against 287 Labour and S9 Liberals. The Liberals decided that the constitu tional course was to give Labour, as the largest party in the House of Commons, an opportunity of forming a Government, and Ram say MacDonald accordingly became Prime Minister for the sec ond time.

The legislation of the next two years was scanty. A Coal Mines Bill reducing hours from eight to seven and a half and instituting the system of quotas for export fought its way to the Statute Book after some critical divisions. An Education Bill raising the school age to fifteen and giving parents a grant of 5/– a week for every boy remaining at school was rejected by the Lords, and, though it might have become law under the Parliament Act, was dropped by the succeeding Government on the ground that the state of the National Finances forbade it. The Minister of Agriculture, Dr. Addison, succeeded in passing a Marketing Boards scheme, and a useful but modest measure for housing in rural districts; and the Government set up the Indian Round Table Conference which met in London, and broke the ground for the coming reform scheme. The Imperial Conference met again in 193o, and once more renewed arguments on Tariffs and Prefer ence, but found the Labour Government as unwilling as its prede cessors to depart from the established Free Trade policy. The chief work of the Conference was to prepare the ground for the "Statute of Westminster," which was enacted shortly after the next General Election (1931).

The "Statute of Westminster" laid down that "Dominions are autonomous Communities within the British Empire, equal in status, in no way subordinate to one another in their domestic or external affairs though united by a common allegiance to the Crown, and freely associated as members of the British common wealth of Nations." The definition raises many difficult legal and constitutional questions, e.g., the functions of the Crown, the possibility of one or more of the autonomous Communities re maining neutral, while others are at war and so forth, but it is hoped that mutual forbearance and constant consultation be tween the different units will prevent their arising in any acute form.

Foreign Affairs.

In foreign affairs the Labour Government was generally voted to have done well. Mr. Snowden won great applause by his plain-speaking to France at the Hague Conference of 1929 about the British share of German Reparations under the Young plan, but whatever he gained was wiped out in 1932 when the Lausanne Conference made an end of Reparations, so far as Europe was concerned. In 193o the Naval Disarmament Confer ence settled the outstanding question of Cruisers between Great Britain and the United States, and paved the way for a settlement between France and Italy. In all these matters Mr. Henderson, the Foreign Secretary, steered a wise and tactful course.

National Finances.

The great American slump of 1929 had seriously affected international trade and caused a sharp rise in the number of unemployed, which now mounted to 2,000,000 and over. The Government was greatly opposed to diminishing the scale of relief, but with these numbers the unemployment scheme was rapidly piling up debt. In his first budget (April 1930) Mr. Snowden found himself faced with a prospective deficit of 47 millions, and though he turned the corner by increasing the beer tax and adding 31 millions to income-tax, super-tax and death duties, he was in still worse plight the following year (1931) when he could only obtain a nominal balance by appropriating 20 millions left over from the dollar-exchange account and borrow ing heavily to meet the charge for unemployment. In the last weeks of June 1931 Miss Bondfield, the Minister for Labour, told the House of Commons that the deficit in the Unemployment In surance Fund was at the rate of f i,000,000 a week and likely to rise. The borrowing on this account was already £ 12 5,000,000.

By this time a Royal Commission appointed in the previous October had issued a report declaring it to be imperative to in crease the contributions and reduce the benefits of the Insurance system and pointing to numerous anomalies and abuses in admin istration. The Government introduced a Bill dealing with these anomalies but was unable to adopt the other recommendations of the Commission in view of the strong opposition of its supporters. At this point an independent Committee under the Chairmanship of Sir George May, which had been appointed to inquire into the state of the national finances, issued a very alarming report. It said that at the present rate of expenditure the deficit in the next Budget would be £ 12 5,000,000, apart from the usual provision for debt reduction. This and the analysis of the situation accom panying it came like a thunder-clap at home and abroad. Europe was already in the throes of the crisis caused by the collapse of the great Austrian bank, the Credit Anstalt, and foreigners who had regarded British credit as unassailable took alarm and began withdrawing their money from London, with the result that the Bank of England had to seek assistance from the Bank of France and the Federal Reserve Bank of the United States.

The Cabinet then appointed an Economy Committee to deal with the situation. But this Committee only revealed the deep differences between its members, many of whom held the bankers responsible for the trouble and wished to seize the opportunity of bringing them under public control. While the Committee de bated, the situation was going from bad to worse, and on August 24, the Prime Minister, having made up his mind that it was too dangerous for further delay, tendered his resignation, and the next day was commissioned by the King to form a Coalition National Government.

The National Government.

Mr. MacDonald carried with him only three of his Labour colleagues, Mr. Snowden, the Chan cellor of the Exchequer, Lord Sankey, the Lord Chancellor, and Mr. J. H. Thomas, the Secretary for the Dominions and Colonies; but both the other parties came into the small Cabinet which he now proceeded to form, Mr. Baldwin, Mr. Neville Chamberlain, Sir P. Cunliffe Lister, and Sir Samuel Hoare representing the Conservatives, and Lord Reading, Lord Crewe, and Sir Herbert Samuel, the Liberals.

The formation of the new Government steadied the situation abroad, and for the time being the withdrawals from London were abated. On September 8, the new Government met Parliament and obtained a vote of confidence by a majority of 6o. Two days later Mr. Snowden introduced a new Budget laying drastic new taxation, and accompanied it by a memorandum, showing the "cuts" and economies affecting the social services and the entire public service, including army and navy, which the Government proposed. These were well received by the great majority but there was a certain amount of unrest in different parts of the country. When the reductions in naval pay were announced to the Atlantic fleet then assembled at Invergordon, the lower ratings expressed their objections in a manner which caused the Admiralty to cancel the manoeuvres arranged for the autumn and order the ships back to port. This outbreak was largely due to a misunder standing, and discipline was restored on the Commanding officer explaining what was proposed and promising to make representa tions to the authorities about certain hard cases.

Departure from Gold.

But added to the stories of unrest, exaggerated reports of a "mutiny" in the British fleet caused great mischief in foreign countries, and on September 20, the Bank of England warned the Prime Minister that withdrawals were again setting in on a serious scale; and on the following day the Chan cellor of the Exchequer found himself compelled to obtain the sanction of Parliament for the suspension of payment in gold. The Government had told the country that to maintain the gold standard was a high national interest and one of the chief objects of its drastic dealing with finance, and it had now to argue that the departure from gold was a blessing in disguise. That in fact turned out to be the truth. The overvaluation of the pound when the country returned to the gold standard in 1925 had been a serious handicap to foreign trade, and its devaluation to a gold standard of about 16/– to one £, which followed the departure from gold, gave an instant fillip to foreign trade, while the inter nal value of the pound remained unaffected.

Though the Government had been united about the immediate steps to deal with the emergency, it was very far from being agreed upon the permanent economic policy of the country. The Conservative members pressed for the institution of a tariff as a next step and urged the Prime Minister to dissolve Parliament, in the confident expectation that their party would be returned in sufficient numbers to ensure the adoption of this policy in a new Parliament. A few Liberals, headed by Sir John Simon, announced their conversion to tariffs, on the ground that the "balance of trade" required it; but the great majority of them stood firmly to Free Trade. The Conservatives nevertheless had their way and Parliament was dissolved at the beginning of October. In regard to tariffs the Prime Minister asked for a "mandate" to do any thing he thought necessary in the national interest.

Liberals had to be content with this and though officially the Government denied that a vote for them was necessarily a vote for a tariff, Conservatives left no doubt that if they dominated the new Parliament they would institute a Protectionist policy. The great majority of the electors were clear only that they did not wish a return to Labour, and the Government was returned by the enormous majority of 502, the Labour Opposition being re duced to 52. Mr. MacDonald now reconstituted his Cabinet, bringing it up to the normal number of 20, of whom r r were Conservatives, 4 National Labour, and 5 Liberals of different shades.

Protective Duties.

Pressure was immediately applied by the Conservatives to induce the Government to institute tariffs. Min isters replied with the "Abnormal Importations Act" which en abled the Board of Trade to impose duties up to So per cent on articles said to be dumped, and the Free Traders in the Cabinet accepted this as an emergency measure to redress the "adverse balance of trade." But the pressure continued and when Parlia ment reassembled in 1932 the Prime Minister announced that the Government proposed to lay a general ad valorem of Io per cent duty on all imports and additional duties to be determined by an Advisory Committee on articles said to be non-essential.

Two of the Liberal members of the Cabinet, Mr. Runciman and Sir John Simon, accepted this on its merits, but the three other Liberals (Sir Herbert Samuel, Sir Donald Maclean and Sir Archi bald Sinclair) strongly dissented, as did Mr. Snowden (now be come Lord Snowden and Lord Privy Seal) . These four, however, remained in the Cabinet on an "agreement to differ" which left them free to speak and vote against the proposals of their col leagues. Sir Donald Maclean died in June and in the following September Sir Herbert Samuel, Sir Archibald Sinclair and Lord Snowden decided that the definite adoption of Protection and Preference as the settled policy of the Government at the Ottawa Conference had made their position impossible and resigned their offices.

The chief legislative achievement of this Parliament was the passing of the great and complicated measure instituting self government in the Provincial Councils and Central Assembly of a Federated India. Much of the time of Parliament was occupied with the schemes of the Minister of Agriculture for controlling the output and prices of commodities like bacon, milk, hops, potatoes, etc., and regulating foreign imports by "quotas." Sub sidies played a large part in the Minister's schemes, and they mounted up to a point which presented an anxious problem to the Chancellor of the Exchequer.

Foreign policy during these years was dominated by the rise of Herr Hitler and rearmament of Germany, and from the spring of onwards by Signor Mussolini's insistence on marching into Abyssinia in defiance of the League of Nations. In June 1935 Sir Samuel Hoare succeeded Sir John Simon as Foreign Secretary, and Mr. Anthony Eden was given Cabinet rank as Minister for the League of Nations. A little later Mr. Ramsay MacDonald yielded the Prime Ministership to Mr. Baldwin, but remained in the Government as Lord President of the Council. In October the Parliament which had now lasted four years was dissolved, and Mr. Baldwin appealed to the country largely on a programme of rearmament, which was said to be urgently necessary in the situation now developing in Europe, especially the situation in the Mediterranean caused by Signor Mussolini's Abyssinian adven ture. This was an embarrassing issue for the opposition, which found itself deeply divided between its dislike of war and arma ments and its criticism of the Government for being unwilling to risk a war with Italy. Shortly before the election its leader, Mr. Lansbury, resigned on the ground that even for the sake of the League of Nations he could not support a warlike policy.

The election held on November 14 gave the Government a majority of 247, a figure which, though considerably below that of the year of crisis 1931, was in excess of the most sanguine esti mate of its supporters. The Conservatives came back 387 strong, the National Liberals 33, and National Labour 8. Labour with 154 seats was far below its strength in 1929, and Independent Liberals were reduced to 20.

The new year opened sadly, for after a short illness, King George V., whose Silver Jubilee (May 6) had been the great ceremonial event of the year 1935, died at Sandringham, January 20, 1936. Mourning was universal through the Empire.

In the meantime the too hasty acceptance by Sir Samuel Hoare of a scheme proposed by M. Laval, the French Prime Min ister, for the settlement of the Abyssinian question, had involved the Government in serious trouble. News of this scheme raised a storm in England which regarded it as a betrayal of the League and a dismemberment of Abyssinia for the benefit of the aggres sor. The Government thereupon withdrew its support, and Sir Samuel Hoare resigned and was succeeded as foreign secretary by Mr. Anthony Eden. "Sanctions" were continued, but the Govern ments could not agree on the one embargo—that on oil—which might have been effective, and Signor Mussolini rushed his cam paign to a conclusion with the aid of tanks and poison-gas. During the month of May, the Emperor Haile Selassie fled to Europe, and the Italians occupied his capital, Addis Ababa. Since the Nations supporting the League were not prepared to go to war to turn them out, nothing remained for the League but to acknowledge defeat and withdraw its sanctions. Sir Samuel Hoare returned to the Government and became First Lord of the Admiralty.

Germany, meanwhile, had taken advantage of the occasion to move troops into the demilitarized area of the Rhineland, thereby causing a crisis which ran parallel with the Abyssinian war and required all the skill of the British government to prevent its be coming dangerous. In an exchange of views between the British and German Governments the ground was laid out for a Five Power Conference, to which after some hesitation Germany and Italy accepted invitations. Up to the end of the year 1936 agree ment on the preliminaries of this Conference had not been reached.

In July the outbreak of Civil war in Spain threatened a new and dangerous complication between the democratic Powers, which sympathized with the Spanish government, and Germany and Italy, which sympathized with the military-monarchists clerical insurgents. M. Blum, the French Socialist prime minister, proposed that all the Powers should declare their neutrality as between the government and the rebels and undertake not to supply either with munitions. This was accepted with some quali fications by all the Powers, and a committee which sat in London was appointed to see that it was carried out.

Two other events belong to the spring and summer of 1936. First, the conclusion, as the result of a Conference of the Powers, of a Convention settling the question of the Straits—Dardanelles and Bosphorus—restoring to the Turks control over the Straits, and laying down rules for the passage of warships. Second, the conclusion of a treaty with Egypt which brought to an amicable settlement questions which had been outstanding for the sixteen years since the Milner Mission visited the country and recom mended the method now adopted. Great Britain, having recog nized Egypt as a Sovereign independent country, now entered into a treaty with her whereby the two countries undertook to co-operate with one another in Egypt's defence against foreign aggression, and for the security of the communications of the British Empire in Egypt. Under the arrangements now con cluded, the British force in Egypt ceased to be an army of occu pation and became instead an army for the guarding of those com munications, stationed for the most part, as such an army should be, in the Suez Canal zone and not in Cairo. This, relieved the Egyptians from the sense of being overawed by a foreign army in their own capital, but they acknowledged the need of co operation between the British and Egyptian armies in case of emergency, and accepted the services of a British military mis sion for training the Egyptian army in unity with the British force. Facilities were also provided for a more powerful air force which would be mainly British, and new roads and railways were projected for the transport of a mechanized army. The Sudan question, which had been the main obstacle to previous attempts at settlement, was now settled on the basis of the Con dominium of 1899, the Governor-General being appointed by the King of Egypt, but on "the recommendation of the British Gov ernment." At the same time that Government agreed to the return of Egyptian troops to the Sudan, and to the removal of restrictions on Egyptian immigration into the country "except for reasons of public order and health." There remained the ques tion of the "Capitulations," the abolition of which was greatly desired by the Egyptians but required the consent of other Gov ernments. The British Government promised to "collaborate actively with the Egyptian Government" in the attempt to pro cure their abolition, and it was hoped that a Conference would be convened at an early date to consider the matter. An Egyp tian Delegation headed by the Prime Minister, Nahas Pasha, and including distinguished politicians of all parties came to London for the signing of the Treaty (Aug. 19) and were warmly wel comed and received much hospitality. Subsequently the Treaty was ratified by an all but unanimous vote in the Egyptian Par liament, and unanimously approved in both Houses of the British Parliament after a debate in which all parties warmly congratu lated the Government and the Foreign Secretary on having brought a difficult question to a happy issue.

Rearmament and foreign policy were the main preoccupations of the Government when Parliament reassembled on Nov. 3. In a speech on Nov. 5 Mr. Eden, the Foreign Secretary, told the House of Commons that the "three main elements" in British policy were "the strengthening of the authority of the League of Nations, the negotiation of a European settlement, and the re equipment of our own nation." In the same speech he said that British relations with France and Belgium were never better; that Britain desired friendship with Germany, but such friendship "must neither be exclusive nor directed against anyone else" ; and that the British Government "welcomed Signor Mussolini's assur ance that Italy did not mean to threaten or interrupt the Medi terranean route; neither did we." Later Mr. Eden added the "in tegrity of Spain" and the defence of Egypt and `Iraq as British interests. In subsequent debates speakers expressed hope that the tripartite agreement between France, Britain and the United States for the stabilization of the exchanges when the French Government devalued the franc would provide the basis for a new economic Conference which would include the question of trade barriers and restrictions. Liberal members doubted whether the new policy of tariffs and preference for the British Empire had not added another to the possible causes of war.

The question of rearmament was debated in connection with the Report of the Royal Commission on the private manufacture of arms, issued in October, which, while rejecting nationalization of the industry, had proposed the establishment of a Ministry of Supply, the conscription of all industry in time of war, and other drastic measures for controlling the trade in arms. The Govern ment rejected the proposal for a Ministry of Supply, but prom ised consideration for the other proposals. Mr. Baldwin caused much surprise by a speech (Nov. i 2) in which he made the frank confession that though he had been aware of the need for re armament, he had concealed his knowledge and postponed action lest a premature revelation of the facts should have found the electorate unwilling to give a mandate for the necessary pro gramme of rearmament.

Disturbances in the East end of London caused by Fascist pro cessions, and Communist counter-demonstrations and attacks by Fascist speakers on Jews led to the introduction and passing of a Bill to prohibit "the wearing of uniforms in connection with political objects and the maintenance by private persons of asso ciations of a military or similar character." The principal objects of this measure were generally approved, but the clauses con ferring additional powers on the Police of regulating processions and keeping order at public meetings were closely scrutinized and amendments proposed in certain respects. Another important administrative measure was a Bill transferring to the Ministry of Transport all the trunk roads of the country except those in control of the County of London and County boroughs. This promised to be an important step towards the unifying and co ordinating of the road-system.

During the same sittings of Parliament the Government was much criticized for its supposed lukewarmness in regard to the "special areas" where unemployment remained concentrated in spite of the improvement in other parts of the country. Just be fore resigning his office, Mr. Malcolm Stewart, the Commis sioner for these areas, issued a third Report, in which he plainly indicated that a much more active policy would need to be pur sued, and a larger expenditure incurred, if the number of the unemployed was to be seriously reduced. While disclaiming the idea that he knew of any "spectacular plan" which would solve this "obstinate and baffling" problem, Mr. Neville Chamberlain promised fresh legislation in the New Year after the Government had had time to consider Mr. Stewart's report. In the meantime a scheme of land settlement for men over fifty with young families was put into operation, in the hope that it would bring substantial relief and provide a new interest in life for the limited number who were past the age at which they could expect to be re employed.

All through the autumn and winter the Spanish Civil war was a continuous cause of anxiety. The Non-Intervention Committee which sat in London had only a limited success. In spite of its efforts, aeroplanes, tanks and munitions of all kinds were sup plied to both sides from all parts of Europe, and many thousands of volunteers joined the two armies. While the Governments dis claimed official responsibility for these proceedings, many of them were suspected of aiding and abetting them, and it was openly said that Germany and Italy could not afford to see the insurgents defeated, or Russia to allow' the Government to be overborne. The result was that a struggle which would probably have worn itself out, by sheer exhaustion, if Spaniards alone had been en gaged in it, was being protracted, with every accompaniment of horror and misery, by volunteers from other countries, some of them ardent partisans, others mercenaries attracted by the high rates of pay. In the meantime voices were heard calling upon the Governments of Europe to line themselves up on one side or the other in the conflict between Fascism and Communism, at the risk of plunging Europe into an "ideological" war, which in most countries would have added the horrors of civil war to those of ordinary war.

The British Government stood firm against these ideas, and persisted in the effort inaugurated by the French Government to prevent munitions or supplies reaching either party. Holding to their view that the only kind of intervention that could be contemplated was intervention to mitigate the horrors of this warfare and eventually to mediate between the parties, the Brit ish and French Governments proposed to the other Governments at the beginning of December that they should take more ener getic steps to prevent munitions and volunteers going to Spain, and on this basis propose mediation to the warring parties. After some delay most of the other Powers accepted this proposal "in principle," but some of them with qualifications and reservations which suggested that they would not be zealous in promoting it. All that could be said at the end of the year 1936 was that British and French action had kept a dangerous situation within bounds.

King Edward VIII.

In November and December all other events were overshadowed by the question of the King's mar riage, which led to his abdication and departure from the coun try on December II. All through the autumn the press of the United States had been alive with gossip and rumour about his friendship with Mrs. Simpson, a lady of American origin, who had married an Englishman, after divorcing her American hus band. In October Mrs. Simpson obtained at Ipswich a decree nisi against her husband. Mr. Baldwin felt bound to ascertain what the King's intentions were, and raised the question in an interview with him on Oct. 20, and again more explicitly on Nov. 16 when the King told him, "I am going to marry Mrs. Simpson, and I am prepared to go." Up to the end of November the British people were less well informed about the intentions of the King than an immense number in other countries, and were almost completely' taken by surprise when the disclosure came. That was precipitated by an address to a Diocesan Conference on Dec. i by the Bishop of Bradford, who expressed a hope that the King might show greater awareness of the sacred obli gations of his calling, without apparently being aware that his words would be interpreted as applying to these particular cir cumstances. They were, nevertheless, so interpreted by the provincial press which on Dec. 2 with remarkable unanimity made them a text for warning and remonstrance addressed to the King. On the following day the greater part of the London press fol lowed in the same strain, using language about the Sovereign which had not been heard in England for generations.

In the meantime Mr. Baldwin had seen the King again (Nov. 25) and the King had proposed a compromise whereby he should be permitted to make what was loosely called a "morganatic" marriage with Mrs. Simpson, i.e. a marriage which would make her his legal wife but would not give her the position of Queen or royal rank, or confer upon their children, if any, the rights of succession to the throne. It needed only a brief consideration to show the difficulties of this proposal. As Mr. Baldwin explained to the House of Commons "no such thing as what is called a `morganatic' marriage is known in our law." The King may marry whom he chooses, and his wife ipso facto becomes Queen. What the King desired would, therefore, have needed a special Act of Parliament enabling him to marry Mrs. Simpson without making her Queen, and that act would have had to be passed not only by the British Parliament at Westminster but by all five of the Dominion Parliaments, since under the Statute of Westminster, which since the year 1931 had been the law of the Commonwealth, "any alteration in the law touching the succession to the throne or the royal style and titles" requires the assent of them all. At the King's special request Mr. Baldwin submitted this proposal to the British Cabinet and to the Govern ments of the Dominions, but after a week's consideration he told the House of Commons(Dec. 4)what he had already told the King, that the Government was not prepared to introduce such legisla tion into the British Parliament, and that the Dominions would not assent to it.

The mere discussion of this scheme had shown that agreement on it was out of the question in either Great Britain or the Dominions. Quite apart from any opinions they might themselves hold, all the Governments were agreed that it would be in the highest degree inadvisable to propose as a subject for public de bate in five Parliaments the passing of special legislation to enable the King to contract this particular marriage in the cir cumstances as they were now known. The subject, it was clear, would raise political, dynastic, religious and moral questions on which strong and heated opinions would find expression. Instead of being the symbol of unity and the harmonizer of its diverse ele ments, the monarchy would become a centre of discord in the Empire and Commonwealth, if this debate went forward. But if this special legislation was impossible, and the ordinary marriage which would have made Mrs. Simpson Queen was ruled out, as it had been from the beginning, it followed that no means were avail able by which the King could marry Mrs. Simpson and remain on the throne. That position was reached on Dec. 5, and from this point onwards his choice was either to abandon the marriage or to abdicate.

In his statement to the House of Commons on Dec. io, Mr. Baldwin gave a full account of the efforts he made and the argu ments he used to prevail on the King to make the sacrifice and remain on the throne. By this time Mrs. Simpson had left Eng land and was staying with friends in Cannes, from which she sent a message on Dec. 7 saying that "she was willing to withdraw forthwith from a situation which was now unhappy and unten able." Upon this certain newspapers announced that the "crisis was over," and that the King would accept the lady's withdrawal.

They were mistaken. Neither Mr. Baldwin's arguments nor the intervention of his royal relatives availed to move him from the intention he had declared on Nov. 16 to marry Mrs. Simpson and, if necessary, "to go." In the House of Commons Mr. Winston Churchill pleaded for delay and appeared to think that if the decision could be postponed, abdication might still be avoided. But the delay was paralyzing the Government at a critical moment in foreign affairs, and threatening dangerous political consequences in all parts of the Empire ; and opinion was unanimous that it should be ended. On Dec. io an instrument of voluntary abdication, signed by the King, was read in the House of Commons by the Speaker.

When the crisis began there was a minority in the House of Commons and in the press which favoured the idea of a "mor ganatic" marriage, and was apparently prepared to support the King against the Government, if the Government opposed it. But reflection had shown the danger of this idea, and the King himself was greatly opposed to being backed against his Govern ment by a party of "King's friends." On Dec. io when Mr. Baldwin had finished his grave and moving statement of the facts, the House was all but unanimous that he had handled a difficult and dangerous situation with patient kindness and dis cretion, and that there was no alternative to accepting the King's decision to abdicate. Legislation securing the succession to his brother and next heir, the Duke of York, was passed at one sit ting in both Houses the next day. On the same evening the King broadcast a touching farewell, in which he appealed for "under standing" of his reluctance to undertake the burden of the su preme position without the support of a wife or the happiness of home life. The same night he motored to Portsmouth and boarded a destroyer which took him to Boulogne, whence he travelled to Vienna, and became for the time being the guest of Baron Eugen Rothschild at Castle Enzesfeld, some forty miles south of that city. On the following day (Dec. 12) the Duke of York was proclaimed King under the title of George VI. His wife, a daughter of the Earl of Strathmore, a lady of much charm, greatly liked and respected, became Queen Elizabeth. The succes sion was secure to their children, the Princess Elizabeth and the Princess Margaret Rose.

The general judgment was that the British Empire and Com monwealth had come well out of what might have been a danger ous crisis, and that its institutions had shown uncommon strength and stability in the test. All the parties in its Parlia ments had acted with forbearance and restraint; all had instinc tively felt the need of unity and decision. In particular the gloomy prediction that the Statute of Westminster would leave the Commonwealth without centre or focus had been signally falsified. All the Dominions worked together at the call of the British Government and came to a unanimous conclusion in the shortest time. There were some speculations as to what might have happened if King Edward had married the lady as soon as she was free, and informed his Government afterwards, but the record is conclusive that he never contemplated anything of the kind, and considered only how he might go with the least loss of dignity and the least damage to the interests of the country when he realized the difficulties of making the marriage on which he had set his heart, and remaining on the throne.

The year 1937 was marked by a general recovery of prosperity at home, overshadowed by clouds of anxiety as to the possible outcome of events in Europe and the Far East. At home the early months of the year were occupied with preparations for the coronation of King George VI. and Queen Elizabeth ; and when the ceremony was performed in Westminster Abbey on May 12, it was followed by radio listeners all over the world. Shortly afterwards Mr. Baldwin resigned the premiership and was succeeded by Mr. Neville Chamberlain. The trend of events abroad led to an acceleration of rearmament, the cost of which was in 1937 estimated at £1,500,000,000 spread over five years.

By the beginning of 1937 it had become clear that the Italian Abyssinian crisis had profoundly altered the balance of power in Europe. The idea of a combination of Powers strong enough to enforce their will by sanctions without war had definitely failed. With Italy's secession from the League and her adhesion to the new group—subsequently called the "Axis"—of which Germany and Japan were the other principal partners, the great Powers were again divided into two camps; and in the absence of any definite sign from Russia, it was by no means certain that the Powers— mainly France and Great Britain—which still adhered to the League were the stronger. Germany had been feverishly rearming; Britain and France had fallen dangerously behind in the race for rearmament, especially in the air. But even more important, the secession of Italy from the League had removed the chief obstacle to the annexation of Austria by Germany, which, after purging his party of critics and objectors, Hitler accomplished in a char acteristically violent way on March i i, 1938. This opened the door to an attack on Czechoslovakia by a combination of diplo matic and military threats which kept Europe in a state of crisis for the next six months. In the first stage Hitler confined himself to a demand of autonomy for the Sudeten Germans who were in corporated in the Czech republic and the abandonment by the re public of its alliance with Russia. At the same time he expressed his desire for good relations with the British Government which responded by sending Lord Runciman to Prague at the beginning of August in an effort to mediate between the Sudeten Germans and the Czechs. His mission failed, and by the beginning of Sep tember it was evident that Hitler would be content with nothing less than the annexation of the Sudeten territory to the Reich, if even he would stop short at that. On September 14 he seemed to be on the point of invading Czechoslovakia even at the risk of a European war. Mr. Chamberlain then decided to fly to Munich (September 15) and visit Hitler at Berchtesgaden in a last effort to deter him. He returned the following day and, after consulta tion with the French premier and foreign secretary who came to London on the i8th, agreed with them that the Czechs must agree to the secession of the Sudeten provinces and the setting up of cantons in other districts. This they did "under irresistible pres sure from Britain and France," and on September 23, Mr. Cham berlain flew again to visit Hitler who this time "came half-way to meet him" at Godesberg on the Rhine. But this effort also seemed likely to fail owing to Hitler's insistence that the Czechs must by October i declare their intention to withdraw their troops from the Sudeten area. Otherwise he would march in.

Mr. Chamberlain was in the act of reporting this with its sinis ter implication to the House of Commons (September 28) when there came an invitation from Hitler to meet him, M. Daladier, and Signor Mussolini at Munich the following day. When this was announced members of all parties rose in their places and cheered, and the public in the gallery were permitted to join in. On the morning of the 29th Mr. Chamberlain made his third flight to Germany and on the following day came back bringing with him an agreement which was accepted under pressure by the Czechs and for the time being removed the fear of war. Signor Mussolini and Mr. Roosevelt were said to have played a consid erable part in the reaching of this settlement and at the time it was almost universally approved abroad and in Britain. On his return to London, Mr. Chamberlain received a tremendous ovation and, accompanied by his wife, appeared beside the King and Queen on the balcony of Buckingham Palace.

He brought back with him a joint declaration by himself and Hitler that they regarded the agreement thus reached as "sym bolic of the desire of our two peoples never to go to war with one another again" and that "they were determined to continue their efforts to assure peace in Europe." A shadow very quickly fell over this scene. Within the next few weeks the Czechs were complaining bitterly that the International Commission appointed to settle the details was acting under German pressure and un fairly to their interests. At the same time Poland and Hungary were demanding concessions at their expense. As the weeks went on it be game more and more doubtful whether Germany and Italy would May their part in the four-Power guarantee of the new Czech state, and if they did not it was clear that the other Pow ers would not be able to enforce it by any peaceful means. By this time criticism was becoming vocal. Mr. Duff Cooper, the First Lord of the Admiralty, had given the cue to it by resigning on the ground that he disagreed with the Government policy, and Mr. Chamberlain was now bitterly attacked by the Labour Party and by the Liberals for having "betrayed and abandoned" Czechoslo vakia. Very few of these critics said that they would have gone to war in its behalf ; most were persuaded that it would have been saved by a more resolute stand against Hitler. In the meantime, a new and savage outburst of anti-Jewish fanaticism further heated the atmosphere and greatly embittered British opinion against Germany.

Mr. Chamberlain was undoubtedly too optimistic about what had been accomplished at Munich, and he would have saved him self from much of this attack, if he had been content to say that he had made the best of a bad job which ought to have been handled years earlier in an atmosphere of peace. In the light of subsequent events it is extremely doubtful whether any "standing up to" Hitler would have prevented him from going to war or whether Russia could, as the critics contended, have been relied upon to come to the rescue of Czechoslovakia. But the respite gained at Munich was of undoubted advantage to both France and Great Britain. France was able to recover from her political and economic depression, Britain to take a long step forward in mak ing good the arrears in armaments and other necessary defensive equipment. It is reasonable to suppose that these considerations had weighed with Mr. Chamberlain, but, for obvious reasons, they could not be proclaimed in the debate with his critics.

In spite of Abyssinia Mr. Chamberlain had kept in touch with Italy, and on April 16, 1938, the British and Italian Governments signed a far-reaching agreement regulating their interests in the Mediterranean and Red seas and in Egypt, the Sudan, and North East Africa. Two conditions were to be fulfilled before this treaty came into force: first, that Great Britain should recognize the Italian position in Ethiopia, next that the questions arising out of the Spanish civil war should be settled. The second of these conditions proved extremely difficult. All through the year 1938 dangerous quarrels between the great powers about the Spanish war continued and the peace was only saved liy the legal fiction of "non-intervention." The nationals of four or five nations and at least three of the Governments did in effect intervene, but the Non-intervention Committee laboured heroically under Lord Plymouth's chairmanship, to avert official collisions. What at one moment threatened to be an indiscriminate submarine warfare in the Mediterranean was averted by the Nyon Conference of Sept. and the more dangerous incidents were from that time con fined to Spanish waters. The Government was much criticised for the "realism" which led it to stand aloof from the Spanish struggle and to condone the Italian offence against the League of Nations. Undoubtedly it was greatly influenced by the impor tance to the defence of the British Empire of a friendly or benevolently neutral Italy in the event of war and this part of its policy seemed to be justified in the following year.

The Italian agreement led to the resignation of Mr. Eden. He was succeeded in the foreign secretaryship by Viscount Halifax, the former Viceroy of India. The unrest continued through the autumn and winter; feverish preparations for war went forward in all countries and imposed a severe strain on their nerves and their pockets. The murder in Paris of a German diplomat by a young Jew gave the pretext for a violent renewal of anti-Jewish persecution, which horrified opinion outside Germany and still further aggravated the refugee problem.

In the winter of 1938-9 it looked as if Italy was preparing to pick a quarrel with France. In a violent and seemingly inspired press-campaign, Italian newspapers and demonstrators in the streets raised shouts of "Tunis, Corsica and Nice" and used ex tremely insulting language to the French, who met the situation with quiet sardonic humour. This campaign had the unintended effect of rousing the French from their economic and political depression and setting them on the road to a complete recovery. Signor Mussolini had given no official sanction to this agitation, which dropped as quickly as it had arisen. He had, however, a coup of his own in preparation, and in April 1939 he added to the European confusion by a sudden descent on Albania which, after driving out King Zog, he occupied with Italian troops.

Germany, however, remained the storm-centre, and on March 15 Hitler showed the worthlessness of the pledges he had given at Munich the previous year by marching into Prague and violently suppressing what remained of the Czech Republic. At Munich he had led the world to suppose that his ambitions were limited to bringing Germans within the Reich, whereas now he was annex ing a population of io,000,000 Czechs. In a speech at Birming ham (March 17) Mr. Chamberlain denounced this proceeding as "in complete disregard of the principles laid down by the German Government itself" and asked "Is this the end of an old adventure or is it the beginning of a new? Is this the last attack on a small State, or is it to be followed by others?" At the beginning of the year Germany had seemed to be on the best terms with Poland. In January, Ribbentrop, the German for eign secretary, had visited Warsaw and assured both the Poles and the German colony that the German-Polish agreement of 1934 "had put a final end to enmity between the two peoples." Within a week of the occupation of Prague (March 21) the Ger man Government presented a memorandum to the Polish Govern ment demanding that Danzig should "return as a free city into the framework of the Reich" and that Germany should receive a route and railway with extra-territorial status through "the Corridor." These two things were said to be "the very minimum which must be demanded from the point of view of German interests." This language was sufficient to warn the Poles and their friends in Eu rope how little they could trust to the agreement of 1934. The Poles replied that the Germans appeared to be demanding "uni lateral concessions" and that, though they were willing to discuss "objectively" and with the utmost goodwill any points raised by the German Government, peaceful intentions and peaceful meth ods would be necessary. if negotiations were to succeed.

Neither was forthcoming. Hitler reiterated that Danzig must and would become German, and in a violent press campaign charged the Poles with anti-German atrocities. In Danzig itself the Nazi party raised agitation to the boiling point. On March 31, Mr. Chamberlain 'assured Poland of British and French support "in the event of any action which clearly threatened Polish inde pendence," whereupon Hitler claimed to be released from the obligations of the Polish-German Treaty of 1934. During the next few weeks the British Ambassador in Berlin, Sir Nevile Hen derson, repeatedly warned the German Government that if Poland were attacked, Great Britain would come to her support; but Hit ler had apparently persuaded himself that the British people "would not fight for Danzig" and continued to refuse the settle ment by negotiation which, on the advice of the British and French Governments, the Poles continued to offer. There were a few days in July and August in which tension seemed to be re laxed, and on August 23 Sir Nevile Henderson flew to London at Hitler's request to "put his case" to the British Government. In the meantime Lord Halifax suggested various ways in which con tact between the German and Polish Governments might be re stored, but none was acceptable to the Germans. Hitler's "case," as it was presented in the final stormy interview (August 30-31) which the British Ambassador had with him and Ribbentrop, re quired the presence in Berlin within 24 hours of a Polish pleni potentiary who was to accept or reject a series of propositions which would then be presented to him. When asked what these propositions were, Ribbentrop read them in German "at top speed," and on being asked for a copy of them in writing said that it was now too late since the Polish representative had not arrived in the specified time. Lord Halifax made a final attempt to bring the Polish Government into touch with Germany, and on the evening of August 31 the Polish Ambassador called on Rib bentrop and informed him that his Government was ready to enter into discussions; but the Germans were now on the march and began the invasion of Poland at dawn on September 1. Sir Nevile Henderson was accordingly instructed to ask for his pass ports "unless the German Government suspended all aggressive action against Poland," and on September 2 Mr. Chamberlain in formed the House of Commons that unless a satisfactory answer was received by II A.M. the following day, "Great Britain would be in a state of war with Germany." The answer was a statement of the German case against Poland concluding with the suggestion that the British Government desired the destruction of the Ger man people. In spite of the invasion of Poland Signor Mussolini made a last effort to procure a European conference, but since this would have required a German withdrawal from Poland, this too proved abortive.

During a large part of 1939 the European complications had been attended with trouble in the Far East, where the Japanese blockade of Tientsin and generally hostile attitude to the British in Hongkong and the international settlements threatened danger ous consequences. In view of the situation nearer home the British Government was obliged to keep its resentment within bounds. The situation was automatically eased when Japan stood out of the war and moderated her anti-British policy accordingly.

On Aug. the world was taken by surprise by the announcement that Germany had concluded a pact of non-aggres sion with Soviet Russia. Since the beginning of May a British and French mission had been at Moscow endeavouring to negoti ate an agreement, and the British Government had been much criticised for its failure to make progress. At each step forward the Soviei. Government had made stipulations which were unac ceptable to either Poland or the Baltic States and had held up progress while alternative solutions were sought. It now appeared that it had all the time been engaged in secret negotiations with Germany on a basis which cut the ground from under the feet of France and Britain. For whereas the French and British were seeking Russian support in the event of a struggle with Germany for the defence of Polish independence, Germany offered Russia a large slice of Poland without having to fight for it, if she was willing to stand aside while Germany conquered the country.

Credibility was lent to the assumption that Stalin regarded a European conflict as Russia's opportunity and was ready for any policy which enabled him to exploit it. Hitler thought it worth while to obtain immunity from Russian attack at the cost of alienating Italy and Japan, his other partners in the Axis. This fundamentally altered the nature of the struggle in which the great powers were now to be engaged. Instead of finding them selves matched against a coalition of Germany, Italy and Japan with Spain probably on the same side, the Allies had now to meet a Germany released for the present from the fear of attack by Russia but deprived of the formidable support, especially at sea, of Italy and Japan. The results became visible in the first months of the war. Stalin exploited the situation to the utmost, taking measures against Estonia, Latvia, and Finland which seemed de signed to snatch the command of the Baltic from Germany, and occupying positions which enabled him to block German ap proaches to the Balkans. Before the end of the year doubts as to the wisdom of this policy appeared to be growing in Germany.

During these years domestic legislation was overshadowed by the international situation and the drain on the national purse in preparations for war. Sir John Simon, who was now Chancellor of the Exchequer, made what was generally approved as a just distribution between borrowing and taxing for this purpose. In he raised the standard rate of income-tax from 4s.9d. to 5s. in the I; in 1938 from 5s. to 5s.6d., and in his second War Budget of 1939 to 7s. in the I (7s.6d. for the following financial year). Death duties were correspondingly increased. Expenditure on armaments amounted to 17 50,000,00o a year in these years, of which one-third was found by taxation and two-thirds by loan.

Nothing could better have attested the resolution of the country in going to war than its composure in face of this drastic taxation.

A memorable event in 1939 was the visit of the King and Queen to Canada and the United States. This was not only a great per sonal triumph, but a contribution of high value to the spirit of unity and goodwill with which not only Canada but the whole Em pire and Commonwealth rallied to the common cause on the out break of war.

BIBLIOGRAPIIY.-D. C. Somervell, Reign of King George V; Sir J. Bibliograpiiy.-D. C. Somervell, Reign of King George V; Sir J. A. R. Marriott, Modern England; J. A. Spender, Short History of These Times; The King's Grace by John Buchan; The Annual Regis ter; Annual Summaries of The Times. (J. A. SP.)