Mr Balfour's Poodle(20)

So far as the substance of the proposals was concerned, they were favoured with a greater weight of pejorative comment than has been the lot of any other Budget, either before or since. Arthur Balfour denounced it as ‘vindictive, inequitable, based on no principle, and injurious to the productive capacity of the country’. It ‘means the beginning of the end of all rights of property’, said Sir Edward Carson. ‘It is a monument of reckless and improvident finance,’ said Lord Lansdowne. ‘It is inquisitorial, tyrannical and Socialistic,’ said Lord Rosebery.

In these and many other ways the Budget was strongly denounced by all the opponents and by some of the erstwhile supporters of the Government. But the denunciation did not begin as soon as the Chancellor had announced his proposals. His four-and-a-half-hour speech had enabled him to elaborate them in some detail, and his peroration, in which he spoke of a ‘war Budget—for raising money to wage implacable warfare against poverty and squalidness’, gave a clear indication of what he was about. But the Opposition were at first more bemused than exasperated. It was then customary, as it is not now, to carry on a full-scale debate immediately after the Chancellor’s speech and to divide on certain of the Budget Resolutions at the end of the day. Austen Chamberlain therefore followed Lloyd George, and although, in his own words he ‘only skimmed the surface of (the) proposals’, he took over an hour to do so. But there was no hint in his speech of resistance â outrance. One of his main points was to suggest that the Liberal Party might now have a better understanding of the reasons why the previous Administration had not reduced expenditure. The Times, on the following day, apprehended that ‘the huge deficit … is to be raised almost exclusively at the cost of the wealthy and the fairly well-to-do’, but it accompanied this by the strange statement that it was an un-adventurous Budget in the sense that it broke no fresh taxation ground.

This was very much the lull before the storm. By May I, The Times was very worried, not so much by the detailed proposals of the Budget as by its political implications. ‘The Chancellor of the Exchequer,’ it noted somewhat turgidly, ‘discussed various matters not relevant to the matter in hand, deliberately with the intention of raising questions the discussion of which might lead to controversies likely, in his judgment, to be useful to his Party in the future.’ In the debate on the general principles of the Budget which arose out of the Tea Resolution on May 3, 4, and 5, Balfour was strangely mild in his condemnation,1 but this hesitancy had disappeared by the time of his Albert Hall speech to the Primrose League on May 7. Thereafter the campaign against the Budget rapidly gained momentum. City opinion quickly mobilised itself, and the leading financial houses sent a letter to the Prime Minister on May 15, which was phrased in familiar terms.

‘… while prepared to bear their full share of increased taxation, which they recognised as necessary, (they) expressed alarm at the increasing disproportion of the burden placed on a small class. They held that the increase of the death duties … and of the income tax coupled with the super-tax, would injure commerce and industry; that the prosperity of all classes had been greatly due to the indisputable safety for capital afforded by Great Britain, and that the taxes in question would discourage private enterprise and thrift, thus eventually diminishing employment and reducing wages.’l

A few weeks later the Budget Protest League was formed, under the presidency of Walter Long,1 and the union  ist Party committed itself at all points to the most resolute resistance to the Chancellor’s proposals.

In the Liberal camp the Budget was on the whole enthusiastically received. Some of the old Whigs were unhappy about the land taxes, and at a later stage thirty of them formed themselves into a deputation to the Prime Minister on these points. But they never carried their doubts to the extent of provoking a serious split in the party. On the majority of Liberal members the effect was quite the reverse. They approved of the detailed proposals, but even more strongly, as is always the case with a party from which support has been slipping away, did they approve of their leaders’ recovering the initiative. They hailed ‘the first democratic Budget’, and they felt that they might recover something of the spirit of the ‘glad, confident morning’ of 1906.

On some of the allies of the Government the effect was less encouraging. The Labour Party was well enough pleased,1 although its members had their reservations and found a number of occasions, starting with the vote on the Tea Resolution, for dividing against the Government. But the numerically more important Nationalist Party was far from content. Redmond2 spoke on Budget night and condemned the increased whisky tax and the excise duty on tobacco as unfair to Ireland; his party divided against them. A few days later he was seeing the issue in better perspective to the extent of describing the Budget as ‘admirable and courageous from the British point of view’, and saying that he would gladly see issue taken with the Lords on questions of social reform; but he remained adamant on his detailed criticisms, and neither on the second nor the third reading of the Finance Bill were the Nationalists able to support the Government.3 With the huge Liberal majority this was of no immediate parliamentary importance, but it was to become an issue of some significance in the next Parliament.