Transcript Did Britain Really `Never Have it so Good`?

Did Britain Really ‘Never Have it so
Good’?
Lo – to assess whether the claim that Britain had
‘never had it so good’ was legitimate
Write definitions for these words:
- Dollar Gap
- Inflation
- Mixed economy
- Real wages
- Interest rates
- Deflation
Ext. Can you think of
positive or negative
effects of these events?
1. In 1951 there was a dollar gap because of the Korean war
America did not have much
money, so they could not buy
British goods with American
dollars. This meant that Britain
didn’t many dollars to buy imports
itself.
2. To make sure Britain didn’t run out
of dollars to buy the essential imports,
especially if things got worse and
America bought even less, Butler
restricted how many imports people
could buy and stopped them taking
much money out of the country
(restricted to £50).
So far economically...
3. Butler raised the bank rate so it was
more expensive for other banks to borrow
off the bank of England (the interest rates
were higher). This again meant Britain
could keep hold of its precious dollar
reserves. Britain was also struggling to
afford the Korean War.
4. In 1953 when the Korean War ended
Britain could afford more imports again
and America could buy more of Britain’s
exports again.
Was Britain better off in 1955 or
1951?
Is there a turning point?
6. In 1955 there was a boom and Britain
was buying too many imports – they were
worried they would run out of money
again. Butler should have raised taxes to
stop this. However, with an election
coming up he decided not to.
5. As things were looking so much better
for Britain and it had some more money,
Butler could cut income tax and purchase
tax.
v
Macmillan 1957
Did Britain Really ‘Never Have it so
Good’?
Lo – to assess whether the claim that Britain had ‘never had it so good’ was
legitimate
Britain had ‘never had it so good’
Britain did not actually ‘have it so good’
Cut and stick
your card sort
and then
answer the
question. Bare
in mind
Macmillan
stated it in
1957!
Macmillan 1957
Conservatives continued to follow a mixed economy and a loose form of
Keynesianism
The government were very worried about inflation (everyone wanting to buy
things and the prices of goods going up too quickly). To stop this they rose
interest rates to reduce borrowing, restricted imports to stop people spending
too much, and increased taxes to control spending. If it was looking like the
opposite would happen and demand would fall, following the principles of
Keynesianism, the Chancellor would lower taxes and interest rates so that
people would keep buying goods.